Eunice Yoon on Xi Jinping's willingness to negotiate on trade

I think that the Chinese have shown that they are willing to negotiate, that they do eventually want to have some sort of meeting... The rhetoric from the Chinese perspective out of the White House is not actually that helpful because the way things are being set up is that President Trump is the kingmaker and that all these countries around the world are going over there and groveling and asking for deals.  From the Chinese perspective, this cannot happen because for President Xi Jinping it is so politically dangerous for him to be seen as crawling over to the United States asking for a deal.

~ Eunice Yoon, CNBC's Beijing Bureau Chief, "China’s Xi Jinping Sends Trump a Message as His Trade War Spirals," 3:30 mark, The Daily Beast, April 14, 2025

Xi Jinping: "There are no winners in a trade war"

There are no winners in a trade war, or a tariff war.  Our two countries [China and Vietnam] should resolutely safeguard the multilateral trading system, stable global industrial and supply chains, and open and cooperative international environment.  Trade war and tariff war will produce no winner, and protectionism will lead nowhere.

~ Xi Jinping, editorial jointly published in Chinese and Vietnamese official media, April 14, 2025

Phil Gramm and Larry Summers on the "hollowing out of American manufacturing"

The primary argument for the implementation of broad-based tariffs is that they will reverse the hollowing out of American manufacturing and reduce the trade deficit, which is causing a "hemorrhaging of America's lifeblood."  Contrary to the repeated claim, there has been no hollowing out of American manufacturing.  Industrial production in the U.S. is at an all-time high.  The U.S. is producing 2.5 times as much real industrial output as it did when we last ran a trade surplus in 1975.  We are producing that record output with the smallest percentage of the labor force since America became fully industrialized.  The percentage of the civilian nonfarm labor force employed in manufacturing peaked in World War II and has been in secular decline ever since.  This has been a great success for productivity and not a failure of trade, as today's full employment attests.

It is telling that the Trump tariffs implemented in mid-2018 and the Biden expansion of those tariffs didn't stop the secular decline in manufacturing employment as a percentage of total employment.  The decline in manufacturing employment is being driven by the same secular forces that caused employment in agriculture during the 20th century to fall from 40% to 2% of the labor force: a vast increase in labor productivity and a decline in manufactured products relative to services.  This is a worldwide phenomenon occurring in both developed and developing economies.

~ Phil Gramm and Larry Summers, "Gramm and Summers: A Letter on Tariffs From Economists to Trump," January 30, 2025

Dan Ferris on DOGE

DOGE will wind up hot having nearly as much teeth as people want it to, spending will stay high, the bombs will keep dropping and the debt will keep rising.

~ Dan Ferris, "Expect Corporate Bankruptcies and a Recession This Year," April 7, 2025

Janet Yellen on President Trump's tariffs

I’m afraid I could not give it a passing grade, I’m sorry.  This is the worst self-inflicted wound that I have ever seen an administration impose on a well-functioning economy.  So we had a very well-functioning economy, and President Trump has taken a wrecking ball to it.

~ Janet Yellen, CNN interview, April 11, 2025

Kevin Duffy on the trade war with China

Trade is win-win. This is Econ 101. If you understand that, you don't mess with trade. 

I don't understand all the anti-China sentiment in this country. What did they ever do besides ship us inexpensive goods in return for our government bonds which will end up worthless? They raised our standard of living and financed our deficits. We should be sending them thank you notes. The attack on China started a long time ago in the '90s. In fact, in 1996 a younger Nancy Pelosi warned about rising trade deficits with the Chinese. She sounded like Donald Trump. Feel free to fact check me on this.

The Chinese are smart and resilient. When they were targeted by Trump's first trade war in 2018, they adapted and de-risked from the US economy. That's why they're one of the few countries that is standing up to the bully. Bravo. I applaud them.

When Biden took office, many expected him to back away from Trump's trade war and anti-China rhetoric. Instead, he amped them both up.

Btw, US multinationals (Starbucks, Apple, Tesla, Shake Shack, etc.) do about $500 billion a year of business in China. That doesn't show up in the trade deficit. China's BYD is the biggest producer of EVs in the world, but it's locked out of the US market by 100% tariffs imposed by the Biden administration. But you don't hear that because it doesn't fit the narrative.

As a result of Trump's first trade war, trade with China has declined. So has the trade deficit. In fact, it's the lowest it's been since 2010. Doesn't fit the narrative.

This trade war risks blowing up the global economy and taking our 401Ks with it. Who is to blame? Both parties, but honestly, we're all to blame.

~ Kevin Duffy, Facebook post, April 10, 2025

Mark Skousen on President's 2018 steel tariff

Q: President Trump did say all of this will really lead back to the American dream being attainable again...  Do you see that happening?

A: No, absolutely not and in fact I think the president is delusional and I think he's making a major mistake.  Look, I'm a professional economist and one of the things I teach at Chapman University - and I've taught at Columbia and other big schools - is cost-benefit analysis.  Don't just look at the benefits that we're achieving through these tariffs, you have to look at the costs.  The rise in the cost to consumers: you're not going to see cheap clothing and toys and sports, and even automobiles are going to increase dramatically in price.  So what is the cost?

Well in 2018, President Trump imposed a 25% tariff on steel.  It created a thousand jobs in the United States, but it also lost 75,000 jobs.  Why?  Because steel is an import and that raises the cost and causes trouble.  You have to remember, the automobile industry has 30,000 different parts and do you know how much comes from outside the United States in imports?  40%!  So even U.S. cars are going to see a dramatic increase in price.

~ Mark Skousen, "Trump Unveils Sweeping Tariffs Plan," 2:15 mark, Newsmax, April 3, 2025

Scott Bessent: "Our trading partners have taken advantage of us"

This has been years in the making, this unsustainable system.  Our trading partners have taken advantage of us.  We can see this through the large [trade] surpluses.  We can see this through the large budget deficit.

[...]

After 20, 30, 40, 50 years of bad behavior, you can't just wipe the slate clean.

~ Scott Bessent, Treasury Secretary, "Treasury Sec. Bessent says ‘there doesn’t have to be a recession’: Full interview," NBC News "Meet the Press," 2:50 mark and 9:30 mark, April 6, 2025

Kevin Duffy on trade deficit accounting

There is no "trade deficit" any more than your family runs a chronic trade deficit with the local grocery store.  Trade is mutually beneficial.  You value the food more than the money, the grocery store values your money more than the food it gives up. 

Outside of barter, there are all kinds of money exchanges in an economy.  Employees run a money surplus with their employers.  Businesses run money deficits with their suppliers and employees.  There are also exchanges that have nothing to do with goods and services, such as a depositor putting money in the bank (depositor runs a deficit, bank runs a surplus) or the government borrowing money (government runs a surplus, lender runs a deficit). 

So anytime someone claims Americans are getting ripped off by foreigners, consider perhaps the most successful company in the history of capitalism, Apple.  Apple does A LOT of business in China (16% of total revenue).  They run deficits with Chinese suppliers and surpluses with Chinese consumers.  Everyone is happy. 

But then Apple does something unforgivable: it imports iPhones to the U.S. for sale to its customers!  Again, everyone is happy.  In fact, because everyone Apple touches through money exchanges is happy - suppliers, employees, customers - the company is wildly profitable.  And that makes investors happy.  How happy?  Until Trump's trade war, Apple was valued at $3.6 trillion, the most of any company in the world.  Today, that's down to $2.8 trillion.  This makes total sense that shareholders have seen $800 billion of their wealth evaporate in 2 months: Apple is in the crosshairs of a trade war which mainly targets China.

A "trade deficit" is an accounting fiction, a contradiction in terms.  When Apple imports an iPhone and sells it in the U.S., it's counted by the U.S. Bureau of Economic Analysis, but when Apple sells an iPhone in China, it's not.  Using worthless trade statistics as an excuse to diminish trade is dangerous folly.

~ Kevin Duffy, Facebook post, April 6, 2025

Keyu Jin compares the political systems of the U.S. and China

In the U.S., parties change but policies don't.  In China it's the opposite.

~ Professor Keyu Jin, "Prof. Keyu Jin: What Americans GOT WRONG About China's Economy," Rise of Asia, January 18, 2025

Peter Navarro on the trade deficit: "it's the sum of all cheating"

What the trade deficit does for any given country, it's the sum of all cheating.  It's the sum of all unfair trading practices.

~ Peter Navarro, senior counselor to the president for trade and manufacturing, CNN interview, April 3, 2025

Kush Desai: U.S. trade deficits are a "national emergency"

The only special interest guiding President Trump’s decisions is the interest of the American people.  The entire administration is aligned on addressing the national emergency that President Trump has rightfully identified is posed by our country running regular trade deficits.

~ White House spokesman Kush Desai, "Wall Street Gets Rude Shock as Bessent Plays Second Fiddle on Tariffs," Bloomberg, April 5, 2025

Stephen Miran: "In the long run, the tariff rate will make the United States more competitive"

The wrongs of excessive trade imbalances and the wrongs of excessive globalization didn't happen overnight and they also won't be fixed overnight...  In the long run, the tariff rate will make the United States more competitive, vis a vis our trading partners.

~ Stephen Miran, Fox News interview, April 4, 2025

Daniel McAdams on big government in America

America has massive problems, which can be summed up in two words — overwhelming government. Despite some impressive exposures from DOGE, our chief problem is being exacerbated.  Government spending is increasing, government debt is increasing, President Trump threatens new wars, and now we’re in the midst of a trade war.  The troops are not coming home, the 1,000 bases are not being closed, and the “foreign aid,” is not being eliminated.  In order to get rid of overwhelming government, all of these variables have to move in the opposite direction.

~ Daniel McAdams, "More Spending, More Debts, More War — And A Trade War?," LewRockwell.com, April 4, 2025

Max Rangeley and Daniel Hannan on the post-WWII trade order

In closing, we know what happened when the world moved away from Cobdenite [free trade] principles.  It happened at the beginning of the 20th century with cataclysmic consequences.  Indeed it was precisely as a reaction to the horrors of the two wars, the Holocaust and the Holodomor that delegations from the free nations met in Bretton Woods in 1944 and agreed to a progressive reduction in trade barriers, a policy which led to the creation of what is now the World Trade Organization and to seven decades of unprecedented democracy as well as unprecedented prosperity.  

That process is now going in reverse.  Trade is falling as a proportion of global GDP and we are seeing a revival of the doom loop between political instability and autarkic tendencies.  "The owl of Minerva," wrote Hegel, "spreads its wings only with the gathering of the dusk."  If ever there was a time to remind ourselves how fortunate we have been in the economic order we have enjoyed, that time is upon us.

~ Max Rangeley and Daniel Hannan, Free Trade in the Twenty-First Century," Preface

2025

Mark Thornton on protectionism

It's important that Austrians and friends of the Austrian School realize that protectionism is just a step forward to war.  It's a step forward to human impoverishment and it's a step towards human division, hate and devolution.  Protectionism is the health of the state.

~ Mark Thornton, "Free Trade in the Twenty-First Century," Minor Issues, 3:40 mark, March 29, 2025

Donald Trump on the impact of tariffs on foreign car prices

I couldn’t care less, because if the prices on foreign cars go up, they’re going to buy American cars.  I hope they raise their prices, because if they do, people are gonna buy American-made cars.  We have plenty.

~ President Donald Trump, interview, NBC News, March 30, 2025

(The new 25% tariffs on foreign-made cars and auto parts are set to take effect on April 3, a day after Trump is scheduled to announce reciprocal tariffs on imports from more of America’s trading partners.  While there were reports last week that the reciprocal tariffs would be targeted and less ornery, the Wall Street Journal reported Sunday that the Trump administration is considering stiff tariffs of up to 20% against almost all U.S. trading partners.)

Kishore Mahbubani on how China learned from the collapse of the Soviet Union

I think out of necessity they [the Chinese] have to have a strategy.  And they do have one.  So for example, they ask themselves the obvious question: "Why did the United States successfully defeat the Soviet Union?  Why?"  And I must say, the one country that has studied the collapse of the Soviet Union more carefully than any country in the world is China because China knows that the dream of the United States is to make China the second Soviet Union that collapses.

So how does China prevent a collapse?  First point, the Soviet Union didn't collapse because of external pressures; it collapsed because of internal weaknesses.  And so China realizes, "To make sure I survive, I must have a very strong dynamic economy and strong dynamic society."  [...]

So the Chinese know that the first priority is to make sure your economy is strong and your society is strong, which is why they're massively educating their people and growing their economy, so that they don't become a second Soviet Union.  

The second thing that the Chinese learned from the collapse of the Soviet Union was that the United States succeeded because it managed to get a lot of the neighbors of the Soviet Union to join the containment policy everywhere: Western Europe, Japan, South Korea, both ends of the Soviet Union.  So what did the Chinese do?  The Chinese launched a preemptive strike against a containment policy by making sure that its neighbors depended on the Chinese economy.

I'll give you a simple example.  Singapore is part of Southeast Asia and we are part of an organization called ASEAN and ASEAN started as a pro-American organization.  In fact, when ASEAN was created on August 8th, 1967, both the Soviet Union and China denounced the creation of ASEAN as a pro-American organization.  It's true, ASEAN was pro-American, pro-Western.  And what was stunning was that even though ASEAN was pro-American, pro-Western and we had longer dialogues with the United States, European Union, Australia, Japan, everybody, none of our Western friends proposed a free trade agreement to ASEAN.  The first country to propose a free trade agreement to ASEAN was China in 2001.

And the impact of that China-ASEAN agreement was phenomenal.  Because in the year 2000..., ASEAN's trade with the United States was $135 billion and our trade with China was only $40 billion.  So U.S. trade was more than 3 1/2 times what China's trade with ASEAN was.  But as a result of the free trade agreement, by 2022, even though ASEAN's trade with the United States has gone from $135 billion to $450-500 billion, an increase of over three times, China's trade with ASEAN went from $40 billion to $975 billion dollars, almost $1 trillion dollars, the world's largest trading relationship in 2022!  So there's no way ASEAN can join a containment policy against its largest trading partner, right?  It's crazy.

~ Professor Kishore Mahbubani, "Kishore Mahbubani REVEALS China's Strategy to Counter USA," Rise of China, 6:35 mark, March 25, 2025

(The Association of Southeast Asian Nations was established in 1967 by Singapore, Thailand, Malaysia, Indonesia and the Philippines.  It has since been joined by Brunei, Vietnam, Laos, Myanmar and Cambodia.)

WSJ on the 1963 chicken tax

Nothing is more American than the pickup truck. One big reason why: the “chicken tax.”

The U.S. has imposed a 25% tariff on imported trucks ever since President Lyndon Johnson hit back at European levies on American poultry in 1963, less than two weeks after the assassination of President John F. Kennedy.

As the Trump administration pursues a barrage of new tariffs, the longstanding tax on pickup trucks bears witness to the power of high duties to reshape global trade, competition and industry over decades, with effects far exceeding their original purpose.

Like today’s tensions, the dispute that became known as the “chicken war” was punctuated by worries about the trade deficit, accusations of protectionism and threats to cut Europe loose from America’s defense umbrella. 

~ Stephen Wilmot, "The 1960s ‘Chicken Tax’ Shows the Lasting Impact of Tariffs: Imported pickups have long incurred a 25% tariff, keeping production within North America but raising little revenue for Washington," The Wall Street Journal, March 19, 2025

In the 1980s, Subaru imported a small pickup that circumvented a 25% tariff on trucks because it had two backward-facing seats bolted to the open bed.

Stephen Miran: "I think that a lot of folks have got the effects of tariffs wrong"

I think that a lot of folks have got the effects of tariffs wrong...  The number one point is a general point about economics, which is that when you think about any economic policy, a tariff, a tax, anything else, the economists believe that the party that bears the burden or the benefit of that policy is the party that's more inflexible, because if you're flexible, you can change your behavior to avoid the costs...  

U.S. consumers are flexible.  We have options.  We can produce stuff at home, we have a variety of countries we can import stuff, we can substitute into home production, whereas countries that sell to the United States are inflexible.  They've only got the United States to sell to.  There's no alternative.  So they're the ones who will bear the burden of these tariffs, which means that there's going to be very limited pass through into downside economic risk or into higher prices.

~ Stephen Miran, "Trump's Economic Adviser Rejects Short-Term Pain From Tariffs," Bloomberg Podcasts, 0:30 mark, March 24, 2025

Our World in Data on comparative advantage

To see the difference between comparative and absolute advantage, consider a commercial aviation pilot and a baker.  Suppose the pilot is an excellent chef, and she can bake just as well, or even better than the baker.  In this case, the pilot has an absolute advantage in both tasks.  Yet the baker probably has a comparative advantage in baking, because the opportunity cost of baking is much higher for the pilot.

At the individual level, comparative advantage explains why you might want to delegate tasks to someone else, even if you can do those tasks better and faster than them.  This may sound counterintuitive, but it is not: If you are good at many things, it means that investing time in one task has a high opportunity cost, because you are not doing the other amazing things you could be doing with your time and resources.  So, at least from an efficiency point of view, you should specialize on what you are best at, and delegate the rest. 

The same logic applies to countries.  Broadly speaking, the principle of comparative advantage postulates that all nations can gain from trade if each specializes in producing what they are relatively more efficient at producing, and imports the rest: “do what you do best, import the rest.” 

~ "Trade and Globalization," Our World in Data, 2014

(Look under subtitle, "Theory: What is 'comparative advantage' and why does it matter to understand trade?.")

Ryan McMaken on the Boston Tea Party, mercantilism and the American Revolution

On the night of the Boston Tea Party in 1773, American insurrectionists donned disguises and destroyed a shipment of tea imported by the East India Company.  The protestors boarded privately owned ships in the harbor and threw the tea overboard.  Later that night, the activists discovered another tea shipment that had been unloaded at a warehouse.  Not content with having destroyed most of the company's import, they broke into the warehouse and destroyed that tea, too.  The total damages amounted to more than $1.5 million in today's dollars.

This was the work of the Sons of Liberty, a group which would become known for acts of resistance, arson, and violence against tax collectors and other agents of the crown.

But why destroy the tea of a private company if the group's target was the British state?  The answer, of course, is that the East India Company was essentially an adjunct of the regime and private in name only.  This was the era of mercantilism, when colonial governments used protectionism and monopoly powers to enrich the state and its supporters through supposedly private companies.  The Sons of Liberty understood the system well and targeted the "private" East India Company.

The success of the American Revolution struck a heavy blow against the mercantilist system.  But unfortunately, the wound was not mortal.  Many old mercantilist policies persisted under new labels and were promoted with new claims of helping "the people."  The regime of the new republic, too, used the tools of cartelization, monopoly, regulation, and taxation to support certain corporate friends at the expense of the ordinary people.

~ Ryan McMaken, "From the Editor," The Misesian, p. 5, January-February 2025

1973

Stanley Druckenmiller: "The economy looks very, very strong" (2025)

The economy's very interesting.  We're at a very low unemployment rate, 4% essentially, we've got 3% GDP growth and I've been doing this for 49 years and we're probably going from the most anti business administration to the opposite.  We do a lot talking to CEOs and companies on the ground and I'd say CEOs are somewhere between relieved and giddy.

We're a big believer in animal spirits.  Paul Ryan was on your show last week talking about a 32% increase in business confidence over the last 12 months.  I think that's probably a record in terms of chain.  So the economy looks very, very strong at least for the next six months, which is about as far out as one can see with any degree of confidence.

~ Stanley Druckenmiller, CNBC interview, March 23, 2025

Stephen Mack on how defense spending is off limits for DOGE

Is the DOGE initiative a delusion? 

The DOGE initiative promulgated by Elon Musk is being widely celebrated for all of the savings that it has realized.  Much of that savings is attributed to cancelled government contracts across the various federal agencies and departments.  A table of the savings can be found at the DOGE web site [see here].

An analysis of the savings shows that the Department of Defense (DOD) has been essentially untouched by DOGE.  As of 3/20/2025, of the 5,630 cancelled contracts on the list, only 25 (0.44%) are associated with DOD.  Of the notional $19 Billion in total savings, DOD contract cancellations only contribute $10 Million (0.053%) to the total. 

[...]

It must be noted the waste, fraud and abuse at DOD has been documented over many years with many acquisition boondoggles and profligate dysfunctional financial management.  The Pentagon has "failed" all recent audits.  But little has been done to correct the systemic dysfunction in the Pentagon.  DOGE appears to be strangely reluctant to address the pathological elephant in the fiscal living room.

It should also be noted that Elon Musk sees DOD as a target rich environment for his companies.  Is the DOGE interest in addressing the fiscal pathologies in the Pentagon inversely proportional to Elon Musk's interest in making a lot of money from the Pentagon?

~ Stephen Mack, LinkedIn post, March 21, 2025

Tom Bernhardt on AOC's comment that Elon Musk is "a billionaire con man"

I’ve seen this meme posted on X and Facebook by many active Dems.  It’s remarkable on several levels.

Long before Musk’s recent sojourn into politics, I considered him to be the most consequential person this century.  He changed payments with Paypal, propelled the electric car business from niche to mainstream in Tesla, radically reduced the cost of space lift with SpaceX, gave us low-latency global internet with Earthlink, advanced AI at OpenAI, Boring Company provides new tunneling tech, evolved Twitter to being a better free-speech platform with X, and Neuralink advanced brain-computer interface giving hope to victims of neurological damage.  He is a business polymath and tech visionary by any definition.

Contrary to AOC’s post, Musk is a brilliant engineer.  Several years ago, I recall listening to Musk on Lex Fridman’s podcast where he talked in depth about topics such as rocket engine design and autopilot AI for over four hours.  I was very impressed.  But it is his extreme ability to spot opportunity, hire top talent and fearlessly execute that sets him apart. 

Entrepreneurs significantly differ (on average) from the general population in several of the Big Five personality factors, notably being far lower in Agreeableness (going along with others) and Neuroticism (negative emotions such as anxiety) and higher in Openness (curiosity and attraction to the novel).  You see this in spades with Musk, Jobs and others (Gates, Ellison, etc.).  They are very difficult to work for, but the results speak for themselves. Geniuses such as Musk are also often quite eccentric. 

Musk was a hero of the left when he was a lifelong Dem.  Now he is the victim of metastasized TDS.  It’s not surprising that an ex-barista would say something this dumb.  What is surprising is that Dems are picking this up as some piece of important insight.  Until they emerge from this psychopathology, the electorate will shake their collective heads in disbelief and vote otherwise.

~ Tom Bernhardt, Facebook post, March 22, 2025

Alon Mizrahi on the Israel bubble

I have lived most of my life in Israel.  And what I see is how destructive this is, how cruel and inhumane and how destructive it is and it has no future.  Part of me is trying to tell my former country, because I can't call it my country anymore, "You have to stop because what you are doing, you are bringing a catastrophe upon yourself.  You have to stop it before this catastrophe."  But no one seems to want to listen.  The conformity is so strong that no one dares break rank with the politically-approved message: "You have to kill children, you have to..."  We are looking at, I don't know, a huge historical disaster as it's happening and as it's about to get worse.

Israel is different because it is a bubble.  It is isolated basically from the rest of humanity.  And it is being shielded from its neighbors, from... humanity basically by the support of the U.S.  The U.S. is there to make sure Israel never faces consequences for what it's doing.  So Israel can be as belligerent and brazen and lawless as it wants because the U.S. will make sure nothing ever happens to it.  Which is an illusion, because something is going to happen to it eventually.  That's life.  

There's no isolation.  No one is isolated for long.  It can work for a short period of time, but no one is truly isolated.  We are all connected.

~ Alon Mizrahi, "Roger Waters Just Endorsed THIS Anti-Zionist Jew—Israel FREAKS OUT!," Kim Iverson, 12:15 mark, March 21, 2025

Tesla Universe on how U.S. sanctions on Huawei unleashed a wave of innovation

The resilience of companies previously seen as vulnerable to sanctions has surprised many.  Huawei, once thought to be in decline after restrictions cut off its access to key technology made a dramatic comeback in 2023 by unveiling the Mate 60 Pro.  This smartphone, powered by an advanced, domestically produced 7 nanometer processor, caught industry experts off guard.  Many believe that China's ability to innovate had been stifled by sanctions, yet Huawei's success told a different story.  The company has also built next-generation networking equipment using entirely local components, reinforcing its ability to navigate external pressures.  Rather than acting as barriers, trade restrictions have fueled advancements by forcing Chinese firms to develop alternative technologies.

[...]

Texas Instruments, a major supplier of analog semiconductors reported a revenue shortfall of $2.3 billion due to reduced demand from Chinese buyers.

[...]

For years, these [U.S. semiconductor] firms generated up to 30% of their revenue from China.  With demand shrinking, new concerns have emerged over whether these policies [tariffs and sanctions] are backfiring.  China's share of global semiconductor production has surged.  In 2020, it accounted for around 15% of the world's total output.  By 2023, that figure climbed to nearly 30%.

[...]

China's influence extends beyond chip manufacturing.  Domestically-produced processors are now powering critical infrastructure, including data centers, telecommunications networks and artificial intelligence platforms.  Major companies are replacing imported components with locally-developed alternatives, reshaping the supply chain.  By 2023, over 60% of China's cloud computing industry was running on homegrown technology, demonstrating the shift away from foreign providers.

~ "China SHOCKING Tech Breakthrough: Did U.S. Sanctions Backfire?," Tesla Universe, March 17, 2025

Huawei Mate 60 Pro

Howard Lutnick on Tesla: "It's unbelievable that the stock is this cheap (2025)

I think if you want to learn something on this show tonight, buy Tesla.  It's unbelievable that this guy's stock is this cheap.  It'll never be this cheap again.  When people understand the things he's building, the robots he's building, the technology he's building, people are going to be dreaming of today and Jessie Waters and thinking, "Gosh, I should've bought Elon Musk's stock."  I mean, who wouldn't invest in Elon Musk?

~ Howard Lutnick, Commerce Secretary, Fox News appearance, March 19, 2025

Andrew Day on why conservatives should oppose the deportation of Khalil Mahmoud

The arrest and possible deportation of Mahmoud Khalil, a pro-Palestinian activist, has galvanized the left and drawn criticism from liberals and civil libertarians. Even some neoconservatives have condemned the White House’s aggressive action earlier this month. MAGA conservatives should also oppose it. 

At least one prominent MAGA-friendly voice, the author Ann Coulter, has already spoken out against deporting Khalil, who was born in Syria.  “There’s almost no one I don’t want to deport, but, unless they’ve committed a crime, isn’t this a violation of the first amendment?” Coulter wrote last week on X.

Khalil, a green card holder whose wife is a U.S. citizen (and eight months pregnant), does indeed enjoy rights under the First Amendment.  The Supreme Court ruled in 1945 that alien residents cannot be deported for political speech, including speech in support of groups seeking to overthrow the U.S. government.  Notably, the Court rejected the government’s argument that the targeted alien held an “affiliation” with a subversive organization, judging that the claim relied on too loose a definition of that term.  The case, Bridges v. Wixon, is highly relevant to the controversy surrounding Khalil.

The Trump administration, in rescinding Khalil’s green card, invoked a 1952 immigration law to justify the move.  That statute, the Immigration and Nationality Act, empowers the government to deport any lawful permanent resident whom the secretary of state deems a danger to U.S. foreign policy interests.  The White House has said that Khalil, through his protest activities at Columbia University, promoted antisemitism.  Additionally, the Department of Homeland Security said that Khalil “led activities aligned to Hamas,” a designated terror organization. 

These justifications are spurious.  The First Amendment does not carve out an exception for speech that Marco Rubio labels “antisemitic,” and in any case Jewish students at Columbia have vouched for Khalil’s character.  As for the vague assertion that Khalil is “aligned” with Hamas, the administration has not produced evidence that he was affiliated with the group in any meaningful sense.  If the arrest of Khalil is legal under the Immigration and Nationality Act, then the relevant provisions of that law are null and void under the Constitution, the supreme law of the land.

~ Andrew Day, "Mahmoud Khalil, Viewed From the Right: MAGA should oppose the arrest and deportation of the pro-Palestinian activist," The American Conservative, March 19, 2025

Andrew Day on how the Israel lobby undermines sovereignty

Right-wingers tend to conceive of politics not in terms of rights, but of power.  One political ideal that relates to power and that MAGA conservatives should cherish is sovereignty.  What Mearsheimer’s comment suggests, even if he wouldn’t put the point in this way, is that Israel and the Israel lobby presently undermine the sovereignty of the United States. 

Sovereignty refers to the exclusive authority of a state over the country it rules and the nation it defends.  It is the glue that holds a political grouping together and safeguards its survival and liberty.  A state, to truly possess sovereignty, must have the power to make decisions free from foreign influence.  One reason the actions against Khalil should give MAGA pause is that the administration seems to be acting on behalf of Israel, not the American people. 

Here’s the plain truth: Khalil was arrested not because he posed a threat to the United States, but because he protested against Israel.  Drop Site News reported that Khalil’s arrest “followed a two-day targeted online campaign against Khalil by pro-Israel groups and individuals” (emphasis added).  President Donald Trump has alleged that Khalil supports Hamas, an enemy of Israel. Khalil led protests against the Israeli war in Gaza.  Miriam Adelson, a top donor to Trump’s presidential campaigns, has pushed the president to take pro-Israel actions and is leading the charge against critics of Israel on college campuses. 

As if to make clear which nation’s interests are actually implicated in the Khalil episode, the White House’s X account has written “Shalom Mahmoud,” using the Hebrew word for “goodbye.” 

I had thought English was America’s official language now.

[...]

The undue influence that pro-Israel groups exert over the U.S. government deserves close scrutiny and blunt criticism.  Israel’s Prime Minister Benjamin Netanyahu has long tried to drag the U.S. into war with Iran, which poses little threat to the American homeland.  The president seems on the verge of giving Bibi what he wants, though in Trump’s first term he griped that the Israeli leader was “willing to fight Iran to the last American soldier.”  In recent months, Israel’s supporters have sought to thwart foreign policy appointments perceived as inimical to Israel, and they may have succeeded last week.

The Trump administration simply cannot pursue an America-First policy agenda if its military and staffing decisions and the nation’s foundational rights are subject to Israeli veto.  Whatever MAGA conservatives think of Khalil or the views he espoused, they should oppose his deportation—for freedom, for sovereignty, and for America. 

~ Andrew Day, "Mahmoud Khalil, Viewed From the Right: MAGA should oppose the arrest and deportation of the pro-Palestinian activist," The American Conservative, March 19, 2025

2007

Marko Papic on NATO and Germany defense

Ultimately, the architects of NATO – almost exclusively American – were not stupid.  They created a geopolitical architecture that – in the words of NATO’s first General Secretary Lord Ismay – was meant to “keep Americans in, Russians out, and Germans down.”  This has been an extraordinarily beneficial arrangement for the US, giving Washington an important geographical anchor on the Eurasian continent while forcing Europe to be largely subservient to US national interests.  Europe was effectively left in a permanent state of geopolitical adolescence.  The war in Ukraine ultimately illustrates that reality.  By waking up Germans to this reality, President Trump has ensured that Berlin – and Europe by extension – is no longer satisfied with staying down.

~ Marko Papic, "Europe’s Crisopportunity: Trump, Putin, And The Geopolitical Gambit," BCA Research, March 2025

The Economist: "Donald Trump will upend 80 years of American foreign policy"

DONALD TRUMP’S critics have often accused him of buffoonery and isolationism.  Yet even before taking office on January 20th he has shown how much those words fall short of what his second term is likely to bring.  As the inauguration approaches, he has helped secure a ceasefire and hostage deal in Gaza.  Busting taboos, he has bid for control over Greenland, with its minerals and strategic position in the Arctic.  Mr Trump’s second term will not only be more disruptive than his first; it will also supplant a vision of foreign policy that has dominated America since the second world war. 

For decades American leaders have argued that their power comes with the responsibility to be the indispensable defender of a world made more stable and benign by democracy, settled borders and universal values.  Mr Trump will ditch the values and focus on amassing and exploiting power.  His approach will be tested and defined in three conflicts: the Middle East, Ukraine and America’s cold war with China.  Each shows how Mr Trump is impelled to break with recent decades: in his unorthodox methods, his accumulation and opportunistic use of influence, and his belief that power alone creates peace.

~ "Donald Trump will upend 80 years of American foreign policy: A superpower’s approach to the world is about to be turned on its head," The Economist, January 18, 2025

The Economist: "America’s bullied allies need to toughen up"

For decades America has stood by its friends and deterred its enemies.  That steadfastness is being thrown upside down, as Donald Trump strong-arms allies and seeks deals with adversaries.  After freezing all aid to Ukraine on March 3rd, his administration restored it when Ukraine agreed in principle to a 30-day truce.  It is unclear how hard the White House will press Vladimir Putin to accept this.  On the same day, Mr Trump briefly slammed even more tariffs on Canada.  Its new prime minister, Mark Carney, warned that a predatory America wants “our water, our land, our country.”  And don’t forget Asia.  The president has just raised doubts about the value to America of the US-Japan defence treaty, which Eisenhower signed in 1960.  Around the world, allies fear that America First means they come second, third or even last. 

Mr Trump and his supporters believe his frenetic actions enhance American power, breaking deadlocks and shaking up deadbeat or parasitic allies.  The proposed ceasefire in Ukraine is evidence that he can change countries’ behaviour.  But at what cost?  His trade war is panicking financial markets.  The 40-odd countries that have put their security in America’s hands since 1945 are suffering a crisis of confidence.  They dread Team Trump’s inconsistency and short-termism: a ceasefire in Gaza that is rather like the Ukrainian one may soon collapse.  At home, Mr Trump faces checks and balances.  Abroad, much less so.  Allies are asking whether they are certain that Mr Trump or a President J.D. Vance would fight alongside them if the worst happens.  Unfortunately, the answer is: not certain enough. 

~ "America’s bullied allies need to toughen up: To avoid being crushed, they need a better plan than flattery and concessions," The Economist, March 15, 2025

Tim Cook on Chinese manufacturing: "Vocational expertise is very, very deep here" (2018)

There's a confusion about China...  The popular conception is that companies come to China because of low labor costs.  I'm not sure what part of China they go to, but the truth is, China stopped being a low-labor-cost country many years ago.  The reason [for moving jobs to China] is because of the skill.  The quantity of skill in one location and the type of skill it is.  The products we [make] require really advanced tooling and the precision you have to have in tooling and working with the materials we do are state-of-the-art.  And the tooling skill is very deep here.  In the U.S., you could have a meeting of tooling engineers, and I'm not sure we could fill the room.  In China, you could fill multiple football fields.  Vocational expertise is very, very deep here.

~ Tim Cook, "Apple CEO Tim Cook explains why Apple chooses China for manufacturing," 2018

Socrates on marriage

By all means marry.  If you get a good wife, you'll become happy.  If you get a bad one, you'll become a philosopher.

~ Socrates, 422 BC

Dan Rasmussen: "Investing is a game of meta-analysis"

Investing is not a game of analysis, it's a game of meta-analysis.  It's not what you think, it's what you think relative to what everyone else thinks...  Instead of saying, "How positive do I feel about this stock or its prospects?," flip it and ask, "How positive does everyone else think about this?" and then look for the places where you're most likely to disagree.  And that is the place where the best investments are found.

~ Dan Rasmussen, "The Private-Equity Reckoning is Here," Stansberry Investor Hour, 50:35 mark, March 17, 2025

Shaun Rein on trade with China: "I'm hopeful that Trump is going to realize the pragmatism"

I also think that Trump is pragmatic and he's going to see U.S.-China trade eventually is good for the American population.  If you look at it, inflation is a major problem in the United States right now.  Partially it's because what I consider to be an irresponsibly loose monetary policy by the Fed in the last five years during the Covid era where we've added - almost doubled - almost $18 trillion to the American deficit.  Part of it is because of high energy prices from Russia because of the Russia-Ukraine war.  But a large part of it is tariffs.  It's no surprise that there's major inflation in the United States when there's tariffs on $350 billion of Chinese-made goods.

I'm hopeful that Trump is going to realize the pragmatism.  If you look at it, in the United States the average SUV costs $43,000.  The average sedan costs $38,000.  BYD, a Chinese NEV maker, just announced that their $9,000 model.  It's going to have full autonomous driving as good, if not better than Tesla.  Wouldn't it be great for the everyday American is they could buy a $9,000 car from BYD and that would help solve the massive inflation problem that's hitting the United States.

[...]

I'm hopeful that under Trump that an accommodation can be made, that a trade deal can be made.  I'm not sure it's going to happen in year one, I'm not sure it's going to happen in year two or even in year three, but Trump has a pathological need to say that he got a trade deal and he beat the Chinese.  And I think he's going to say that to the American population even if it's not really a defeat of China, but it's more of a win-win deal.

~ Shaun Rein, "Why China Brushes Off Trump's Tariffs," Thinkers Forum, 10:30 mark, March 1, 2025

BYD Seagull EV

Shaun Rein: "I'm cautiously optimistic over trade between the U.S. and China under Trump"

With Trump, it's quite clear that he's not an ideologue.  He's very transactional.  You see he's criticized Panama, Mexico and Canada and now he's starting to criticize EU.  He's slapping tariffs, slapping criticism, even on America's closest allies.  So that actually lowers the tension with China.  If Trump adds 10% or 60% tariffs in China, it doesn't seem like he's trying to destroy China he's just trying to extract what he considers to be the best trade deal for America and probably for himself.

With Trump, I think Chinese feel that there is an opening.  I'll give an example.  Trump has said, "I don't want NEV [new energy vehicle] automakers to export from China autos into the United States.  I want them to build factories in America, hire American workers and help grow the economy of the United States."  Frankly, that's fair, right?  That's what the Chinese did to GM.  That's what the Chinese did to Ford.  That's what the Chinese did to Volkswagen in the 1990s.  They said to foreign automakers, "If you want to have access to China's growing, swelling middle class, you need to set up joint venture and you need to set up factories in China."  So I think it's fair if Trump, and I think it's frankly fair if Europe, does the same thing to the BYDs, the NIOs and Xpengs of the world and says, "If you want access to America and you want access to Europe, you need to invest in factories in these countries."

The key is that Trump is offering a pathway to Chinese companies.  With Biden it was 100% tariff on Chinese NEVs and it was 100% ban on Chinese NEVs and software...  So Biden basically was banning Chinese NEVs, which is one of China's new productive forces and key pillars for economic growth from ever selling into the United States, while Trump is saying, "Build factories in America."  That gives a pathway.  It's the same thing with TikTok.  Biden wanted to ban TikTok completely, Trump is saying, "Maybe if TikTok sells a 50% stake to American investors, we'll give an avenue."  

I'm actually cautiously optimistic over trade between the U.S. and China under Trump because at least Trump is giving a pathway to Chinese companies to start to invest and grow internationally without fears of sanctions.

~ Shaun Rein, "Why China Brushes Off Trump's Tariffs," Thinkers Forum, 7:20 mark, March 1, 2025

Shaun Rein on how America's containment policies of China are backfiring

Containment policies don't work.  Now one of your previous guests, John Mearsheimer, has said he's 100% all-in on trying to contain China.  I think this is one of the most foolish, stupid policies that America could do.  One, as I've shown, Chinese companies have invested so much on innovation themselves, that they're now as good, if not better than the United States.  If America can build it, you can be sure that China eventually can, too.  It's either bigoted or stupid to say that Chinese can't catch up to Americans because China has the money, it has the government support and it has the STEM intellectual brains to try to catch up.  

Two, it hurts American companies like Intel, like Nvidia.  Nvidia has said that now their former client, Huawei, is now one of their biggest competitors.  So this was another mistake from the Mearsheimer school of thought of trying to contain China.  

And then third, more importantly, when you look at the bigger picture, I think a lot of countries in the Global South - I like to call them the Global Majority - they feel that the United States is bullying China and they're worried that they, too, could be bullied.  The United States went from being the liberators in the world, the good guys - they liberated the world from the Nazis, they liberated the world from a form of communism during the Soviet era that was not very productive economically - now they're really almost like triads or mafia, forcing other countries to follow whatever the United States wants.  And I think the Global Majority is angry at what the United States is doing.  I'll give an example: Malaysia has invested billions and billions of dollars because they want to be a base or locus for data centers.  But in his last week as president, Biden slapped export bans on high-end semiconductor chips to Malaysia.  And so Malaysia's plans over the last five years are gone...

So I think you're starting to see a deterioration of America's prestige, power and dominance in the world because people view them as bullying China and bullying other countries like Malaysia.  And that's why I start to see countries starting to move closer to China's orbit.

~ Shaun Rein, "Why China Brushes Off Trump's Tariffs," Thinkers Forum, March 1, 2025

Shaun Rein on how China responded to the Trump and Biden era sanctions and tariffs

I believe in open and fair competition between the United States and China when it comes to AI.  I think it's amazing that DeepSeek and Alibaba both were able to create language learning models that were as good, if not better, than OpenAI's ChatGPT.  What I'm kind of sad about in the United States you've seen a lot of tech bros, the view DeepSeek's release as a Sputnik moment.  But instead of saying, "Let's outcompete the Chinese fairly, let's invest more in R&D, let's have more good minds on it," they're pushing Trump to try to put even more sanctions and even more expert controls on China.  You see Eric Schmidt, the former CEO of Google, is saying, "We need to add even more export controls."  Alexander Wong, who's also the founder of a big AI company, has also said, "We need to slap more sanctions on China."

I think the reality is the Trump era, the Biden era, sanctions and tariffs have shot America in the foot.  If they hadn't launched such sanctions, China probably wouldn't have focused so much on indigenous innovation.

~ Shaun Rein, "Why China Brushes Off Trump's Tariffs," Thinkers Forum, March 1, 2025

WSJ editorial board on tariffs: "Mr. Trump can’t say he wasn’t warned"

This isn’t cause for panic, but it is for tariff caution.  Mr. Trump is promising to impose his 25% levies on Mexico and Canada this week, which will send auto and other North American supply chains into chaos.  China gets hit with another 10% border tax, with European cars up next, followed by reciprocal tariffs on most of the world. 

A tariff is a tax, and taxes impose costs that reduce economic activity.  They also add uncertainty about where and how businesses should invest, as CEOs try to figure out where the tariffs will strike, on which goods, and for how long.  Will there be exceptions? 

If growth continues to slow, Mr. Trump can’t say he wasn’t warned.

~ The editorial board, "Tariffs and the Slowing Economy," The Wall Street Journal, March 2, 2025

JD Vance: "If you want to be rewarded, build in America"

We started a great American comeback.  [We will] make it easier and more affordable to make things in the United States...  This is not always easy and it doesn't happen overnight...  I have to be honest with you.  The road ahead is long, but we are ready - in just seven weeks - starting to see early indications of the president's vision becoming our shared American reality.

[...]

If you want to be rewarded, build in America.  If you want to be penalized, build outside of America. [prompting chants of "USA! USA!"]  It's as simple as that.

[...]

If we do not protect our nation's manufacturers, we lose a fundamental part of who we are as a people.  Making things, building things, working with our hands is America's heritage.  When we lose the ability to make our own stuff, we abandon a way of life.

~ Vice President JD Vance, speech given to plastics manufacturing facility in Michigan, March 14, 2025

(Source: "Vance says U.S. manufacturing can rebound despite tariff jitters, falling markets," The Philadelphia Enquirer, March 15, 2025)

Salon on Mitt Romney's economic adviser, Kevin Hassett

One of Mitt Romney's economic advisers is Kevin Hassett, a longtime fellow at the conservative think tank the American Enterprise Institute. 

[...]

What's astonishing is why any aspirant to the White House would want to be associated with Kevin Hassett. Hassett's track record on economic forecasting is the gold standard for disastrous mediocrity. All by himself, he demolishes any claim Mitt Romney might have to economic acumen. 

~ Andrew Leonard, "Kevin Hassett, world's worst economist, works for Romney," Salon, August 7, 2012

Ray Dalio: trade wars lead to conflict

Sara Eisen: Is a trade war healthy? [...]  Where does the trade tensions and tariffs ratcheting it up fit, whether it's the external order of what do you think will ultimately happen as a result of all of this?

Ray Dalio: It's just an extension of the patterns of history.  So for example, if you looked at European countries in the '30s, like Germany in the '30s and taking economic policy, there was write down the debts, create tariff revenue because you can get a lot of money from tariff revenue, then build up your domestic [industry] - be nationalist, be protectionistic, be militaristic.  That is the way these things operate.

So I would say lessons from the past of what that looks like.  And the issue is really the confrontation of all of this, the fighting of all of this.  So tariffs are going to cause fighting between countries.  What kind of fighting?  Maybe military, I'm not necessarily talking military, but think about U.S., Canada, Mexico, China and all of those types of fighting.  There will be fighting and that will have consequences.  And I think that's the main thing to pay attention to.

Sara Eisen: Do you worry about what it will do to the global economy... as a result of all the trade barriers?

Ray Dalio: Of course.  I worry about the global economy and the global well being... but I also should emphasize that in history you can see that there are the major countries [involved in the conflict] and then there are the neutral countries.  And the neutral countries do extremely well during these periods of time.  They get people and capital that go to them, they are able to navigate in a certain way.  The making of great prosperity, it doesn't effect the whole world; there are beneficiaries of this, too.  Like Singapore, if it remains a neutral country - and that's a very difficult thing to do - and it operates this way, it becomes great opportunities.

~ Ray Dalio, "Ray Dalio and Salesforce’s Benioff on AI, trade wars and new world order," CNBC International Live, 18:40 mark, March 14, 2025

Ray Dalio on the U.S. debt problem

Ray Dalio: I think the first thing is the debt issue.  We have a very severe supply-demand problem so that they have to sell a quantity of debt that the world is not going to want to buy.  And that's a set of circumstances that is imminent.  That's of paramount importance.  The deficit must go from what will be projected now to be about 7.2% of GDP to 3% of GDP, otherwise there will be a supply-demand problem.  That's a big deal.  You are going to see shocking developments in terms of how that's going to be dealt with, things that may not have happened in our lifetimes, but things that have happened throughout history...

Sara Eisen: What do you mean, austerity?

Ray Dalio: There may be restructurings of debt.  There may be exerting pressures on countries who own the debt, to buy the debt, political pressures on countries.  There may be cutting the payments to some creditor countries for political reasons and so on.  So there may be monetizations of debt.  If you look at history and see the repeating of "What do countries do when they're in this situation?"  There are lessons from history that repeat.  It's correct

~ Ray Dalio, "Ray Dalio and Salesforce’s Benioff on AI, trade wars and new world order," CNBC International Live, 12:00 mark, March 14, 2025

Marc Benioff on the AI race

Sara Eisen: Does the U.S. have a leading edge in AI against China, Marc?

Marc Benioff: I think that both have different approaches right now...  I wouldn't say the U.S. has a significant leading edge.  You just saw one of the leading [generative AI] models, which was DeepSeek, emerge, but also now... Alibaba's as well and there's other models as well, and there's different approaches with chips.  So while there's U.S. chips that are very good and very competitive as we saw in the training of the DeepSeek model, there's different approaches with chips and... nobody has a monopoly on training chips or on inference chips.

~ Marc Benioff, "Ray Dalio and Salesforce’s Benioff on AI, trade wars and new world order," CNBC International Live, 21:15 mark, March 14, 2025