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Feuding with Allies and Adversaries

President Donald Trump is in Singapore today, finishing his final preparations for tomorrow’s high-stakes summit with North Korea’s anti-American and nuclear-armed nutcase dictator. We’re holding out hope that it goes well, but the debacle Trump made of a routine meeting in Canada with six of our most stalwart allies over the weekend is not heartening.
Trump arrived late for the Group of Seven’s annual gathering, was tardy to or skipped altogether several of its planned meetings, and left early with trade wars and “Twitter” spats brewing against the other six nations and complaints that Russia’s anti-American and nuclear-armed nutcase dictator wasn’t invited. He was especially harsh about the host country’s pro-American and democratically elected Prime Minister Justin Trudeau, calling him “weak” and “dishonest” in in a series of “tweets,” and one of his advisors telling the Sunday morning shows that “there’s a special place in hell” for world leaders who dare invoke the wrath of Trump. He even rescinded America’s routine endorsement of the ritual “final communique “these things usually end with, and although Trump boasted that on a scale of zero to ten America’s relationships with it’s most stalwart allies was a solid ten, and blasted the “fake news” for saying otherwise, the world’s stock markets and most other objective observers around the globe will likely agree things did not go well.
America suddenly finds itself in a war of words and tariffs with Canada, of all places. Canada has an annoying tendency to punt on third downs during their football games and hold its news conferences in both English and French, and they can be awfully smug about their single-payer health insurance program, which we don’t want here, but that hardly seems reason to be feuding with its pro-American and democratically-elected Prime Minister at a time when Trump is lavishing praise on the anti-American dictators in North Korea and Russia. Except for that brief “fifty-four-forty or fight” contretemps way back in 1846 the Canadians have been polite and reasonable neighbors, and given that the size of the population and economy of the country is much smaller than America’s we don’t see them as an economic threat to the United States. Trump might well have some legitimate gripes about existing trade policies over soft lumber or dairy products, but those have always been worked out through existing world trade courts and other institutions without any personally insulting “tweets,” and given that Canada has been stalwart ally in nearly every actual war America has ever fought we can well understand why they resent Trump starting a trade war on the grounds of national security concerns.
Trudeau bluntly told the international press, in both English and that annoyingly redundant French, that although the Canadians pride themselves on being polite and reasonable they won’t be “pushed around,” and that he would go to to the trenches in any old trade war that Trump might want to start. The newly-and-dubiously elected populist leader of Italy agreed with Trump about letting Russia back in the former Group of Eight gathering, but he and the other five heads of states all agreed to retaliate against any tariffs Trump might impose. If this is a ten on a zero-to-ten scale of relations with our most stalwart allies, we shudder to think what a zero might look like.
Trump’s die-hard supporters will love it, of course. Over the weekend we talked with one who regards Germany’s previously pro-American and still democratically-elected Chancellor Angela Merkel as America’s most formidable adversary, and is glad that at long last we have a president who stands up to those snooty Europeans. On all the Sunday morning news shows Trump’s spokespeople were talking about Canada “knifing us in the back,” and explaining that it was a brilliant three-dimensional chess move meant to warn that nutcase North Korean dictator that if Trump is so hard on his most stalwart allies they should surely fear what awaits his adversaries. We can’t shake a lingering worry, though, that Trump is instead playing 52-card pick-up with the post-World-War-II order.
We also can’t shake an even scarier worry that this is all somehow personal for Trump, and has little to do with the more important geo-political and economic realities. Until he rode down that escalator in Trump Tower to launch his presidential campaign we never paid much attention to the failed casino-and-strip-club mogul and reality star, but since then we’ve watched him carefully enough to note that he takes things personally, and that he cares little for geo-political and economic reality. All of the other six heads of state in the Group of Seven, including that populist and dubiously-elected Italian, clearly regard Trump as a boorish and uneducated vulgarian intent on disrupting the post-World-War-II international order, and Trump surely knows that they make fun of of him when he’s not around, just like those swells on Manhattan’s social used to do when the vulgar usurper from Queens once showed up at their gatherings,
There’s also no shaking a worry that Trump’s peculiar antipathy to Trudeau is because the Canadian Prime Minister is objectively a more physically-fit and full-haired and handsome fellow than Trump, with bi-lingual skills and far better poll numbers in his homeland since his feud with Trump started, and that Trump can’t stand that. It’s especially worrisome when Trump segues from his Canadian debacle to that hight-stakes summit in Singapore about the Korean peninsula.
Kim Jong Un is several inches shorter than Trump, and even fatter, with just as ridiculous a hair-do, but we don’t expect he’ll be intimidated. He’s got nuclear weapons and inter-contintental ballistic missiles on his side, as well as an imbalance of power of conventional weaponry poised within range of South Korea’s essential-to-the-world-oder capital, and Trump’s trade wars with the more intimidating nuclear power of China haven’t yet yielded the expected negotiating advantage, even if they have enriched the Trump family’s various businesses. The fact that Trump is feuding with America’s most stalwart allies probably doesn’t worry him at all.
Still, we hold out hope.

— Bud Norman

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Trump vs. Everybody Else

President Donald Trump is in Canada today for a Group of Seven meeting, and it will surely be awkward. Not only is Trump is currently waging trade wars against the other six countries in attendance, he’s also feuding with them on issues ranging from the climate to Iran to the North Atlantic Treaty Organization, has irked all of them on such matters as terrorism and immigration, and in several cases has personally insulted the countries’ heads of state.
Recently Trump even blamed the host country for the War of 1812, even though Canada wasn’t yet a nation at that long ago point in history.
Trump won’t get the warm welcome from our democratic allies that he got from the authoritarian governments of China and Saudi Arabia, he’ll have to spend the night in a hotel he doesn’t own, the international press will be asking pesky questions, and to the extent he’ll be the center of attention it will be for all the wrong reasons. Economic advisor Larry Kudlow assures The Washington Post that “The president wants to go on the trip,” but we’re more inclined to believe the newspaper’s unnamed administration sources who say that he’s dreading it.
Canada and Great Britain and Germany and Italy and France and Japan have all made it clear that they’re allies in each of the feuds Trump is waging against them, and it’s unlikely that he’ll be able to charm or bully them into submission. What’s more likely is that Trump will double down on his defiance in some petulant way that provokes outraged headlines in each of the Group of Seven Countries. The hard-core fans will love it, as they share Trump’s belief that entire world is out to get them and must be confronted, but the more sensible members of his administration will probably be wincing.
Trump is reportedly annoyed that the G-7 summit is a distraction from his preparations from a planned upcoming summit with North Korea’s nutcase dictatorship, although he’s told reporters he doesn’t really need to prepare because it’s all about his “attitude,” as he expects it to be Nobel Peace Prize-winning and universally acclaimed hero there. We hope that turns out well, although our notion of “well” is anything short of a nuclear mushroom cloud, and we think that Trump would have better chances of that outcome if he arrived with at the summit with an American president’s usual standing as the acknowledged leader of the still-almighty diplomatic and economic and military and cultural power that is the Free World.
Instead Trump will be dealing with Kim Jong Un — formerly a fat and short “Little Rocket Man” according to Trump, but now an “honorable” and “excellent” leader — as just another world leader he’s trying to take advantage of. He’ll be asking Kim to agree to a nuclear disarmament deal even as his erstwhile allies are trying to salvage the disarmament deal they and America struck with Iran and Trump reneged on. He’ll have the advantage of imposing America’s economic power through sanctions, but he won’t have needed help from Japan and South Korea and China and the European powers and the rest of his trade war foes. Trump does have the bigger “nuclear button,” as he characteristically boasted about, but Kim has enough conventional military poised within artillery range from South Kore’s densely populated capital to largely negate that advantage. As for the Free World’s former cultural clout, Trump has already promised not to mention North Korea’s abysmal human rights and is promising the country prosperity instead.
We hold out hope it will turn out well, mostly because our former congressman and current Secretary of State Mike Pompeo will be keeping a watchful and frequently wincing eye on the proceedings, but at this point we don’t have much faith in Trump’s much bragged-about negotiating skills.

— Bud Norman

The Avoidable and Inevitable Stock Market Swoon

Monday was another down day on Wall Street, and so far as we can tell there are several reasons for the recent stock market swoons. Part of it just the usual economics, but so far as we can tell the worst of it is some unusually stupid politics.
The seemingly biggest reason is that the Chinese have predictably imposed steep tariffs on many American products in retaliation for President Donald Trump’s unilaterally imposed tariffs on many Chinese products, and it seems a trade war has begun. At the same time, though, Trump is also waging war on some major American businesses, another heavy hitter has come under congressional scrutiny, and the usual economic disruptions are at play.
Trump has “tweeted” that “trade wars are good and easily won,” but the smart money on Wall Street and most sane observers elsewhere strenuously disagree. Trump has also retreated from some of his “tweeted” threats, which has always prompted stock markets rallies, but then he “tweets” another threat, such global economic powers as the European and Union and our neighbors to the north and sound issue retaliatory threats and the stock markets once again swoon. If the cycle continues until the rest of the world meekly accedes to Trump’s demand for American dominance of the global marketplace, we expect it will take a while.
In the meantime, one of the most dynamic sectors of the American economy is facing political problems, which are the worst kind of problems these days. Some of the biggest players in the high-tech industry that keeps coming up with all sorts of world-changing gizmos and gadgets and thingamajigs are now being “tweeted” about and summoned to congressional committees, which is not good for business, and the tech-heavy NASDAQ stock exchange has taken the worst hit lately in the recent downturn.
The on-line retailer Amazon.com has recently surpassed Wal-Mart as the world’s biggest store, and Trump has recently been “tweeting” that it’s a tax cheat which drives Main Street stores out of business and is bankrupting the United States Postal System. Much of that is entirely untrue and the rest quite debatable, but it’s been an undeniable drag on the drag on the company’s stock price, and given its enormous size there’s a big drag on the overall averages. For now there’s not much Trump can do about Amazon or its owner’s other notable property, The Washington Post, other “tweet” about it, what with those pesky constitutional prohibitions against bills of attainder and infringements of freedom of the press, but at least Trump is inflicting quantifiable financial pain on his even-richer nemesis.
The on-line social media giant Facebook has its own similar political problems, but for very different reasons. A web site that became extraordinarily profitable and powerful by allowing people to share videos of their cats and cell phone pictures of the taco they were about to eat and whatever else they had on their minds also wound up disseminating political propaganda from Russian-based “troll farms” through a firm tied to the Trump campaign during the last presidential election, and the resulting headlines have not been good for the company’s once red-hot stock price. All the propaganda was apparently pro-Trump, so Trump hasn’t “tweeted” anything about it, but the Democrats on those pesky congressional investigative committees have at least managed to inflict some quantifiable financial pain of their own. Facebook ended Monday down 16 percent from its recent high, and given its outsized influence that also accounted for much of that broader decline.
The computer chip-making giant Intel also took a huge on news that Apple Computers, another outsized company tech-sector and one of Intel’s biggest customers, is considering making its own computer chips. That’s the sort of business page news you’d expect on any day in the fast-moving and nerve-wrackingly dynamic high tech sector, though, and we’re the sort of red-in-tooth-and-claw capitalists and old-fashioned Republicans who are content to let the marketplace sort that out. As much as we love that old corner store that Mom and Pop once built out of brick and mortar, we equally hate bills of attainder and infringements on a free press, and we’ll let Amazon do whatever the state legislatures and the marketplace allows it do, and we’ll stay on Facebook just to keep apprised about which of our friends have recently divorced, so as to avoid any awkward comments.
Although we’re rapidly growing too old for such economic disruptions, we’ve long since learned to accept them as part of the ebb and flow toward something like progress. As rock-ribbed Republicans and red-in-tooth-and-claw capitalists we’ve long believed that all those sorry-assed consumers at the pay line could choose more wisely than the politicians, and we still resent those darned Democrats for presuming to make better picks of the winners and losers.
Nowadays, though, that seems to make us “Republicans in Name Only” or “cuckservatives” or “globalists,” as both parties have chosen their winners and losers. Steel and aluminum companies seem a good stock bet at the moment, but car makers and beer brewers and any other industries that use steel or aluminum look risky. If you have a stake in any of the several industries China is now slapping tariffs on, you might want to talk to your financial advisor about that. The Democrats can try to deprive all the social media-addled youth of Facebook, but we’d advise them that most of the political content from our friends is annoyingly liberal.
Oddly enough, yet another reason for the current nervousness on Wall Street is that the unemployment rate is currently low by historical standards and the overall economy seems to be doing well, so there’s the ever-present danger that the Federal Reserve Board will raise interest on loans past the virtually free-money rates that have sustained the whole enterprise since that last big crash. Such adjustments are another one of those disquieting disruptions we’ve learned to accept, but otherwise we’d prefer politics just stay out of it.

— Bud Norman

An Uneasy Labor Day

Labor Day is supposed to provide a brief respite from the news, but lately there is no escape.
On Sunday the nutcase dictatorship running North Korea successfully tested a thermonuclear bomb five times more powerful than anything in its previous arsenal, which comes shortly after provocative tests of long-range missiles that could reach as far America’s west coast, and follows decades of verbal provocations that have lately been ramped up to an alarming level. This seems a particularly inopportune time to pick petty fights with our longstanding allies in the very sane democracy running South Korea, but that is exactly what President Donald Trump has chosen to do.
Trump “tweeted” shortly after North Korea’s nuclear test that South Korea’s ongoing efforts to reach a diplomatic solution to the crisis amounted to “appeasement,” adding that the North Koreans “only understand one thing,” with an exclamation mark added for emphasis, and he also reportedly instructed his aides to begin preparations for a unilateral withdrawal from a free trade agreement with South Korea. Neither stand seems to comport with the very complicated facts of the situation, and neither seem likely to do anyone any good.
South Korea’s efforts at diplomacy are easily understandable, given the devastation that the country would suffer even in a brief war involving only conventional weaponry, but Trump should be aware that they’ve also backed up their efforts with a strong military posture. The South Koreans are currently conducting bombing drills, practicing ballistic missile strikes on key North Korean targets, and defiantly continuing other large-scale military exercises with American forces. They’ve also reluctantly agreed to proceed with a American-made missile defense system that President Barack Obama negotiated, all the more reluctantly after Trump tried to make them pay billions of dollars for the equipment that is mostly intended to shoot down any missiles heading toward America’s west coast, and won’t offer any protection from the old-fashioned artillery barrages that could rain down on the more than 10 million people of Seoul who are just 30 miles away from the supposedly demilitarized border.
So far as we can tell South Korea hasn’t offered any concessions of land or other strategic advantages to maintain the tenuous peace, which is the definition of appeasement that has informed the past many centuries of diplomacy, and our guess is that after 54 years of coping more or less peacefully with their nutcase neighbors to the north they know them better than Trump ever could.
There are some strong arguments to be made against that free trade agreement with South Korea, which didn’t increase overall American exports to the country as promised and instead increased the trade deficit, and Americans can rightly complain that our very sane democratic allies have taken full advantage of some badly negotiated loopholes, but of course the facts are more complicated than that. There’s also a strong argument to be made that for all sorts of complicated reasons our exports to South Korea might have fallen even further without the agreement, that America’s trade deficits with other countries are no more troubling than your own swelling trade deficit with your local grocery store, and that in any case South Korea’s doubling of its financial investment in America’s economy since the agreement was made more than makes up for the difference.
All politics is local, too, and here in Kansas and other red states it’s widely noted that beef exports to South Korea have increased by an impressive 150 percent since the agreement. We suppose that the local aircraft plants have also been among the winners, and given how very good the world-class steaks are around here we’re sure that some epicurean South Koreans have also benefited.
Some future economic historian might definitively prove that both sides came out ahead, with South Korea relatively slightly better off from the deal, which is fine by us but is surely anathema to every fibre of Trump’s being. Trump might flip-flop on all sorts of other positions, but he has always maintained with a granite consistency that every negotiation comes down to a matter of winners and losers, and that no matter how far ahead you get if the other guy gets even further ahead you’re the loser. This view has always had a certain appeal to the “America First” types from pre-World War II up until now, and seems work well enough in the New York real estate biz, but it’s never been the way for the country’s preeminent economic, military, and cultural power to conduct business with the rest of the world.
Especially when you’re dealing with a complicated situation between a sane democratic ally and the nutcase dictatorship just to the north of them who might now be able to launch a missile with a thermonuclear bomb atop that could devastate one of the cities on America’s west coast. Trump is safely ensconced on the east coast, where he’s talking tough on both trade and thermonuclear war, and can be sure that no matter how devastating the war at least he and most of America came out the relative winner, but we’d prefer he take a broader view of the situation. That $20 billion or so trade deficit with the South Koreans is a mere rounding error in the context of a multi-trillion dollar economy, and nothing close to the hit that the stock markets the rest of the American economy would take if Seoul or Tokyo were flattened or an international trade war broke out, and there’s also a strong argument to be made for the lives of all those millions of people in Seoul and Tokyo and now America’s west coast, so now hardly seems the time for  petty spats with the South Koreans.
According to press reports all the military generals and Goldman-Sachs veterans that Trump has surrounded himself with have been urging that he speak more softly while still  wielding the big stick he inherited from all those previous hated presidents, as another populist Republican president with more bona fide tough guy credentials once advised, so we’ll hold out some hope they’ll prevail. During the campaign all of Trump’s reluctant supporters assured us that he’d hire such seasoned hands and heed their counsel, but he kept talking about how he knew more than the generals and that he was his own main security advisor and could make decisions without all the information that those squishy establishment types seemed to need, and we guess we’ll have to wait to see how that turns out.
In the meantime we plan to have some charbroiled Kansas beef and a couple of Colorado-brewed beers, watch some baseball, and otherwise celebrate America’s labor and take a day off from the rest of the news. We hope it turns out pleasantly for all you, as well.

— Bud Norman

Viva Mexico, and Us, and Both of Us

Unsurprisingly enough, America’s diplomatic relationship with Mexico is currently rather contentious. A planned meeting between American President Donald Trump and Mexican President Pena Nieto has been called off, angry “tweets” have been exchanged, populist pressures are being brought to bear on both leaders, and it’s the sort of thing you hate to have going with a neighbor.
Relationships with neighbors can go sour from time to time no matter how hard one tries, and we have a few stories of our own you could empathize with, but for the most part we and the rest of America have been rather lucky. The United States of America only has two abutting neighbors, which is a good start, and compared to what Israel or Finland or Jerry Seinfeld had to put up with they’ve not been very troublesome. Except for the War of 1812 and all that fuss about “fifty-four forty or fight” back in 1818 Canada has been a good neighbor, even if they are rather snooty about their single payer health care system and have a strange tendency to punt on third downs, and even if we did delay that XL Pipeline all through the Obama years and our relatively low income tax system allows us to consistently beat up on their sports teams.
The relationship with Mexico has been more complicated, what with that Mexican-American War and the Marines marching into the Halls of Montezuma back in the 1840s, and the resulting re-drawing of the maps of both countries, and that other time in the early 20th century that the American military went into Mexican territory in hot pursuit of Pancho Villa’s marauding bands, not to mention their disputes with American oil companies and the many decades or argument about the large numbers of Mexicans seeking and finding employment in America and countless other quarrels. Despite it all there have been diplomatic protocols and trade agreements peso bailouts and other arrangements, and no outright wars between the two countries for the past 169 years, which is not bad by historical international standards.
In the current dispute we think that America can make a convincing case for itself. Whatever the still-disputed causes of that long-ago Mexican-American War we think the the re-drawing of the map it wrought turned out best for the people who found themselves on the north side of it, and we doubt that many of them of any ethnicity would want to revisit the matter, and in any case we think that America should resist such revanchism there just as it should in the Ukraine and the islands of the South China Seas. In the unlikely event that rebels intent on overthrowing the American are wreaking havoc in northern Mexico we wouldn’t mind the Mexicans the chasing them into American territory, and the nationalization of American-financed and American-made and duly negotiated oil industries still strikes us as outright theft, and the very significant influx of legal and illegal Mexican immigrants that has occurred since does include a certain number of rapists and other criminals and seems a decidedly mixed blessing for both countries, and the idea of enforcing borders seems altogether reasonable, and some of those trade deals probably could have turned out better for America.
We’re still hoping for an amicable resolution to the latest quarrels, but only with faint hope. Trump’s constantly repeated campaign promise to build a literal wall between the countries is now an executive action, threats of making Mexico pay for it through a 20 percent import tax and other measures have been expounded by his press secretary and “tweeted” on his almighty account and will soon be taken up by Congress, and after that imbroglio with the American judge of Mexican ancestry who was presiding over the Trump University lawsuit that Trump wound up settling for $25 million and the rest of the campaign rhetoric it’s hard to argue that Trump has a certain animosity toward Mexicans. Mexicans are no more amicable to Trump, judging by the red hot market for Trump pinatas and mass protests on both sides of the border, and although Nieto offered an ill-advised helping hand by inviting candidate to a presidential-looking Trump to a state visit back when things were still up for grabs he’s now forced by overwhelming public to take a more adversarial stance against his self-proclaimed adversary.
Our experience of dealing with neighbors has taught us to well consider their positions, and in the current matter we can well understand why they’re miffed about being asked to pay for a wall to separate them from us and all the implicit and explicit anti-Mexican rhetoric that has gone along with it. Perhaps it’s another of Trump’s brilliant negotiation ploys to start from such an antagonistic position, but all of Trump’s past negotiations were with other businessmen who weren’t accountable to millions of Mexicans who felt their pride had been impugned by such tactics, and even then he still occasionally wound up in bankruptcy. If the currently unpopular yet relatively sane Nieto does succumb to Trump’s art of the deal he’ll likely be replaced in an upcoming election by one of those Latin American socialist demagogues who wins election by fanning the flames of resentment against the damned Yanquis, just as Trump won in part by fanning the flames of resentment against Latin Americans, and the next round of negotiations will be even more contentious.
Even in the worst case scenario it probably won’t come to another outright war, given that Mexican national pride lags far further behind its military prowess than it did even back in the 1840s, and despite the havoc it would wreak on America the Mexicans would would be advised to avoid a trade war, given that the past century and a half of Mexican socialism hasn’t improved its economic standing relative to the Americans, even if Trump and his more nationalistic supporters think that a huge portion of the American middle class wealth has been redistributed down there, but by now it should obvious even in America what people will endure as a matter of national pride. A mutually beneficial situation with Mexico could be worked out, just as we’ve managed mostly successful relationships with the many Mexican and Mexican-Americans we daily encounter here in the heartland, such as that comely Mexican-American woman who sells the best-deal-in-town donuts at the nearby Juarez Bakery with a mellifluous “buenos dias” and the guys who make the Carne Asada at the Lopex drive-thru late at night and the Esteban Jordan y Rio Jordan conjunto that we sometimes play on the cassette player,  but we can’t see it ending well if either side insists on winning.

— Bud Norman