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Will the Five Eyes stare down China’s economic coercion? So far their self interest looks to be winning out.

Published by Anonymous (not verified) on Mon, 19/04/2021 - 4:53am in

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China

For at least some products , Australia may not so much be “left alone on the playing field” as substituted off and only able to watch from the sidelines.

Trade figures suggest promises to “have Australia’s back” are yet to be matched by economic solidarity. Next month brings the inauspicious one-year anniversary of China ramping up a campaign of trade punishment against Australia. Wine, barley, beef, lobster and coal have all been targeted. And there’s no end in sight.

Weary Australian government ministers could be forgiven for taking solace in a series of supportive statements from the Biden administration, as well as by senior politicians and officials in other liberal democratic countries. Last month, Trade Minister Dan Tehan said, “I think all Australians should be reassured by the fact that the Americans have come out and said that they’ve got our back, and they won’t leave us alone on the playing field”.

Prime Minister Scott Morrison followed up by expressing appreciation for the “great support we’ve had from liberal democracies around the world, none less so than the United States”. The government has also taken to promoting the economic connections among the intelligence-sharing partnership of the so-called “Five Eyes” – Australia, Canada, New Zealand, the United Kingdom and the United States.

Australia is providing an important international community service. Plenty of capitals are keen to take lessons from Canberra’s experience about how to manage their own relations with Beijing and what a more powerful and nationalistic China might mean for their interests.

But in terms of “having Australia’s back”, what support, precisely, is being offered to Australia? To date at least, it’s not economic solidarity.

Of the $20 billion or so annual fall in Australian exports to China caused by trade disruptions, coal accounts for more than half. Using a rolling, quarterly window to smooth monthly volatility, statistics from China’s General Administration of Customs indicate that as of September 2020 Australia held a 42.2% share of China’s imported coal market.

At the same time as undertaking a clear-eyed reappraisal of the China relationship, Australia’s predicament won’t be eased by extending a doe-eyed gaze elsewhere.

The following month, Chinese utility companies and steel mills were given verbal instructions to avoid the Australian product. Australia’s share fell to zero in the three months to February 2021.

In contrast, the share of other Five Eyes countries rose from 2.7% to 6.1%.

The same data source shows China’s massive imported food and beverages market was worth $US123 billion in 2019. In April 2020, Australia held a 6.3% share. The next month, four Australian abattoirs had their certification to supply the Chinese market removed and this was followed by tariffs on barley and disruptions affecting lobsters and more. Australia’s share fell to 3.6% by February 2021.

Meanwhile, the share of other Five Eyes countries went from 25.5% to 39.5%.

To be sure, a good chunk of this jump stemmed from US sales of soybeans and corn, products which Australia does not sell to China in volume. But a report by University of Adelaide researchers in February found that the “Phase One” US-China trade deal struck in January 2020 had possible implications for two-thirds of China’s goods imports from Australia other than iron ore.

The US is aware of Australian fears about it cutting trade deals with China on the side. In June last year, then–trade minister Simon Birmingham said he was watching US-China trade flows “carefully and closely”.

This is also why comments last month from Kurt Campbell, Biden’s “Indo-Pacific Tsar”, contending that the “US is not prepared to improve relations in a bilateral and separate context at the same time that a close and dear ally is being subjected to a form of economic coercion” were so appreciated.

Yet Biden’s trade chief Katherine Tai has also insisted that China “needs to deliver” on the bilateral promises it made in the January 2020 agreement, including those to increase purchases of US agricultural products this year.

For at least some products then, Australia may not so much be “left alone on the playing field” as substituted off and only able to watch from the sidelines.

When China closed the door to Australian wine by imposing prohibitive tariffs in November, the Trump administration, including Secretary of State Mike Pompeo and other members of the Inter-Parliamentary Committee on China, with the bulk of its members from Five Eyes countries, took to social media, urging their compatriots to up their purchases and blunt the impact.

Alas, while the value of Australian alcoholic beverages exports – almost exclusively wine – to China fell by 98% between October 2020 and February 2021, sales to the US and other Five Eyes countries didn’t compensate. In fact, these also fell by 25%.

Over time this will likely grow as Australian winemakers put more resources into developing the US and UK markets. Perhaps Canada, too, after the Australian government successfully took action against Ottawa at the World Trade Organisation to prise open its market.

In contrast, sympathetic voices in Washington, London, Ottawa and Wellington and social media campaigns touting what the Barossa Valley and Margaret River vintages have to offer are unlikely to make much of a difference.

China’s trade belligerence has predictably prompted a reassessment of its reliability as a trade partner – in Canberra, amongst Australia’s business sector and in plenty of other countries watching on. For this, Beijing only has itself to blame.

And even support from Australia’s security allies, friends and partners that is, limited to rhetoric, are welcome. But at the same time as undertaking a clear-eyed reappraisal of the China relationship, Australia’s predicament won’t be eased by extending a doe-eyed gaze elsewhere. Practical support may eventually materialise. But until then, it needs to be recognised that it is local winemakers and lobster fishers who are picking up the tab.

This article has been republished from The Interpreter 15 April 2021. Click here to read the original article.

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Biden’s Industrial Policy

Published by Anonymous (not verified) on Mon, 19/04/2021 - 4:46am in

America is about to revive an idea that was left for dead decades ago. It’s called industrial...

Hong Kong’s housing crisis- an underlying factor in the 2019 riots.

Published by Anonymous (not verified) on Sun, 18/04/2021 - 4:49am in

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China, Politics

The Hong Kong Special Administrative Region (HKSAR) of the People’s Republic of China (PRC) has a serious housing problem.  There has been much discussion over the last several years about how this has amplified social discontent.  This conversation intensified during the major 2019 protests that became a lengthy anti-government and anti-Beijing rebellion.

Critical arguments have focussed prominently on the serious lack of housing accessibility due to very high purchase prices and the elevated profits of major, private housing developers.  The basic problem, as stated, is not unfounded, but the full picture on housing in Hong Kong is far more complex and interesting, while still deeply concerning.

As it happens, Hong Kong faced a more formidable housing crisis over 60 years ago, to which it responded with a remarkably successful solution.  I argue below that the essential outline of an answer to today’s housing crisis can be found within the exceptional remedies applied to that earlier housing emergency.  To understand why this is so, it is instructive to look, in some detail, at how Hong Kong’s housing regime came to be where it is today.

The Public Revenue System in Hong Kong

One can reasonably claim that Hong Kong is a remarkable tax policy museum.  For a First World jurisdiction, it has an unusually limited range of taxes – there is no prescribed, general Sales Tax, nor any formal Capital Gains Tax, for example.  Yet one can also argue that has been a centre of revenue policy innovation.  The innovation, above all, has pivoted on successfully accessing non-usual sources of public revenue (especially land-related revenues).  The result is that tax reform has been kept to a minimum.  Hong Kong thus retains a Revenue Regime (RR) which is (formally) low tax, clearly simple (with low compliance costs) and it has generated revenues sufficient to build excellent infrastructure, to provide often first rate government services, to enable Hong Kong to stay virtually debt free and to amass huge fiscal reserves. It is, as happens, also a system well-equipped to pay for and maintain a robust Rule of Law regime.

From its inception, British Hong Kong (BHK) was a Free Port, so Customs Duties were not available as a source of revenue.  Also from the outset, the British did not allow any sale of freehold land.  All land was made available as leasehold land (with strict conditions attached to each particular lease).  Landholders wishing to vary the building-usage allowed under a particular lease had, on each such occasion, to pay a premium to the Hong Kong government to secure the variation.  They still do.

This policy traces its roots to Britain’s bleak experience in losing the American Revolutionary War – and its American colonies – some 60 years earlier.  That war was significantly triggered by disputes over London-sourced taxation and price-setting.  The Colonial Office thereafter emphasized the importance of making new colonies – including Hong Kong – internally self-financing as far as possible.

In pursuit of this outcome, the practice of restricting the availability of land for development In Hong Kong evolved.  The notably hilly terrain added sense to this approach.  But this policy also helped drive the price of available land up towards the limits of what the market would accept and, thus, revenue receipts.  When one factored in the consistent strong, opium-based, growth in the economy over the first 50-plus years of British Hong Kong, the government found that its land-based revenue regime more than compensated for the shortfall in expected funding from the originally planned opium-based revenue stream

The colony’s fiscal foundations proved to be so sturdy that, within around 40 years of its founding, the Hong Kong Government had already amassed more than one year of total, normal, public expenditure in fiscal reserves.  A by-product of this policy was the retention of remarkably extensive areas of green-space surrounding Hong Kong’s far smaller, built-up area.

This land-related revenue regime was further strengthened as the total area comprising the Crown Colony increased significantly, initially in 1860 and then in 1898.  The expansion of Hong Kong increased the Hong Kong Government’s “land-bank” greatly.

The land-based revenue system remains a mainstay of the Hong Kong fiscal regime to this day.  These foundations were fundamental in allowing the colony to thrive without need to resort to any sort of direct income taxation for around 100 years – and when such taxes came they were kept low and simple.

A good way to get a feel for just how financially significant this system is, in operation, is to look at an example.  In 1995, the Hong Kong Government put a parcel of land (Lot 129) of around 180,000 square feet up for sale on Ap Lei Chau, which is an island located to the south of Hong Kong island.  Ap Lei Chau is connected by a causeway bridge to neighbouring Aberdeen on Hong Kong island.  The whole area is densely populated.  As is the case across much of Hong Kong, these high density urban areas are surrounded by wooded mountains and the sea.

Lot 129 is located along the Ap Lei Chau waterfront, across the road from numerous small-scale shipyards which service the local fishing fleet and the many pleasure junks and luxury yachts moored in the large Aberdeen Typhoon Shelter.  The government sold the Lot 129 lease – for industrial use – for just under US$30 million in 1995 to a secondary commercial-industrial developer.  By 2005, two primary residential property developers had acquired a significant interest in Lot 129 (by now valued at about US$74 million).  The two property developers needed to have the lease modified to allow a major, high-end residential development in several modern high-rise tower blocks to proceed.  The lease modification premium – paid to the government – to convert the lease from the original-sale industrial use to the high-end residential use was approximately US$504 million.  The Hong Kong Government thus derived US$534 million within around 10 years, virtually at two strokes of a pen, from the two Lot 129 transactions.

It is important to note that a key feature of this land-based revenue system is that the public land-revenues are mainly collected “up front”.  Leases in BHK typically had durations of 75, 99 or (less commonly) 999 years – with renewal rights.  Government Rent per annum (where lease-stipulated) was minimal: customarily 3% of a conservatively estimated annual, potential rent-value.  The drawbacks of relying on this “up front” payment system have been well argued by a number of commentators (for example, it crowds out smaller, less cash-rich developers and thus curbs competition).  For successive Hong Kong Governments this system has proved highly attractive, however.  For one thing, the transaction costs associated with collecting very large amounts of public revenue each year are kept remarkably low.

Since the establishment of the HKSAR within the PRC on July 1, 1997, almost all new government leases have been granted for 50 years.  The government has confirmed, however, that it has complete power to issue or renew leases beyond 2047.  The great majority of leases include a right to renew.

Hong Kong, thus, developed the use of land as a long-term, fundamental revenue source in a way no other First World jurisdiction has.  Elsewhere, primary urban land has largely been sold off into private hands.  Only in Hong Kong does government retain an indefinite, profit-sharing, core proprietorial interest in all land.  Henry George, the 19th century (American) Patron Saint of Land Taxation (one of whose followers, Lizzie Maggie, created the precursor to the game of Monopoly) never conceived of such a system.  But had George understood it in detail, it is likely he would have approved and may have adopted key aspects of what he saw into his own exceptional taxation framework.

Hong Kong’s first ever income tax was the War Revenue Ordinance passed by the Legislative Council  (LegCo) in 1940 enacted in response, above all, to the rapidly expanding invasion of China by Japan.  It created a system of schedules, establishing three separate taxes on different categories of income – a Property Tax with a flat rate, a Salaries Tax with progressive rates and a Profits Tax with a flat rate for corporations and progressive rates for unincorporated firms.  The Ordinance exempted all offshore income from taxation.

In drafting the Ordinance, the War Revenue Committee copied the schedular British Income Tax system introduced by Prime Minister Addington in 1803, despite the fact that the British system itself had been reformed in 1910 to base tax liability on a taxpayer’s total income.

The new, post-war, 1947 tax legislation passed by LegCo, the Inland Revenue Ordinance (IRO), retained the basic schedular structure and the restricted territorial ambit of the War Revenue Ordinance.  Since 1947, the IRO has been formally re-examined on three occasions, in 1954, 1968, and 1976, by Review Committees.  No major alterations have been made to the IRO, however.

 One decisive role of the PRC-enacted, mini-constitution of the HKSAR, the Basic Law, is to provide for the highest degree of fiscal separation between Hong Kong and the Mainland (Two Systems) within the PRC (One Country).  Particular effort has been put into drafting provisions in the Basic Law which are designed to install a constitutional, “fiscal firewall” between the two Tax Systems.

Article 106 of the Basic Law provides that Hong Kong is to have its own independent finances and prohibits the PRC from raising taxes in Hong Kong or sharing the HKSAR’s tax revenue.  Article 108 further provides that:

The Hong Kong Special Administrative Region shall practise an independent taxation system.  The Hong Kong Special Administrative Region shall, taking the low tax policy previously pursued in Hong Kong as reference, enact laws on its own concerning types of taxes, tax rates, tax reductions, allowances and exemptions, and other matters of taxation.

Housing in British Hong Kong

The critical role of adequate basic housing in maintaining colonial stability was made starkly clear to the BHK Government on the evening of Christmas Day, December 25, 1953, when a devastating fire swept through the Shek Kip Mei squatter area in Kowloon.  Some 53,000 immigrants from the Mainland, whom the BHK Government had no choice but to look after, were made homeless overnight.  The Governor, Sir Alexander Grantham launched what was to become one the most massive public housing projects in any large city, worldwide.  Grantham was able to commence this project because the BHK government could, both: supply the land on which to build; and fund the construction expenditure.  Initial temporary housing was erected within two months.  Between 1954 and 1964 the BHK Government built more than 140 multi-story “Resettlement Blocks” as they were known.  In 1971, the then new Governor, Sir Murray Maclehose, announced a still bigger public housing programme to house close to 2 million people in flats (small as they were) fitted with decent facilities.

The remarkable outcome has been the creation of Hong Kong’s vast stock of Public Rental Housing (PRH) – now over 800,000 flats – and the mass provision of subsidized Home Ownership Scheme (HOS) residences – now in excess of 400,000 flats.  All such flats are small with average living space per person at around 11 square metres.  Older PRH estates are often conveniently located and even new estates normally have good public transport access.

Rents average less than $US250 per month or 10-15% of disposable income.  As that income normally falls below the taxable threshold, resulting in zero liability for Salaries Tax, PRH residents typically have enjoyed disposable incomes of 85%-90% of gross income, after rent.  Thus, the large majority of low income Hong Kong residents are comparatively well housed, though in small flats.  A system exists, too, for passing on a PRH flat from one generation to the next, subject to a means test regime.  Almost 30% of Hong Kong residents live in PRH with about another 20% living in subsidized, privately owned housing.

But how was this housing revolution was funded when private market residential flats prices have long been, per square foot, among the highest in the world?  Because the BHK Government had retained the freehold title of virtually all land, the then readily available land used to build PRH and HOS flats came at zero nominal cost as the scheme was implemented.  And all that public revenue from (high value) land-related transactions greatly assisted in the creation of the ample fiscal reserves which readily funded building costs.

The completed flats have been let at low rent to stable, reliable tenants, on the whole, so that bad debt and excessive wear-and-tear problems are minimized.

The very worst off, amongst those living below the Poverty Line in Hong Kong were – and still are – the poor who lack access to PRH.  Stuck in low income jobs (if that fortunate) families of four or more can find themselves with no choice but to rent (an often non-legal) “subdivided unit” of 10 square metres or even less.  This is where the poverty gap in Hong Kong is intolerably evident.  Around 230,000 people are estimated to live in more than 100,000 such subdivided units.  The PRH waiting list for such people averages almost six years, according to one recent report.

An Antipodean Comparative Perspective

Some comparative context is useful to add perspective on these difficult housing problems facing Hong Kong.  New Zealand and Australia do not face the very constrained land-availability problems of Hong Kong.  Both are wealthy First World jurisdictions blessed with significant natural resources.  Yet according to recorded figures, homelessness is a significantly greater problem in both jurisdictions compared to Hong Kong.

The official Hong Kong homelessness rate was under 1,200 in 2018.  Academic studies, looking at street-sleepers, say that the real rate is at least 2,000.  In a population of 7.7 million this is equivalent to a rate of .015% to .026%.  (The poor in Hong Kong renting sub-divided units endure very harsh, cramped living conditions, of course – but they do have a fixed home to return to each evening.)

Homelessness estimates for New Zealand range from an official government figure of 4,000 to an academic study figure of 41,000 in a population of almost 4.8 million, equivalent to a rate ranging from .083% to .85%.  In Australia, homelessness was estimated, by the Australian Bureau of Statistics at over 115,000 in 2018, in a population of just on 25 million, which translates as rate of .46%.  It is true that different measuring methods may be being used but these figures are at least indicative.  Using the minimum comparative figure, New Zealand has a homelessness rate which is more than three times the higher estimate for the HKSAR.  Using the highest New Zealand and Hong Kong estimates, the New Zealand rate is over 32 times higher.  In Australia, the rate is almost 18 times higher.

Some other comparative statistics related to the provision of PRH in New Zealand and Australia are worth noting.  Housing New Zealand has about 62,000 PRH units available for rent – a ratio of units to total population of 1.3%.  The ration in Australia is somewhat higher than that for New Zealand at 1.7%.  Just looking at PRH flats in Hong Kong (not including HOS flats) the comparative ratio is just on 11.4 % – almost nine times higher than in New Zealand and almost seven time higher than in Australia.  In both New Zealand and Australia, rents for PRH are typically about 25% (or more) of total income compared to 10-15% in Hong Kong.

Housing in the HKSAR

So why does the HKSAR face such a housing crisis today?

First, consider the demand-side of the explanation.  Basic claims for better access to decent accommodation have continued to rise.  Apart from close to a quarter of a million, penurious Hong Kong residents  living in tiny, sub-standard flats waiting to move to PRH, other demand-factors are applying pressure.  Under a long-sanctioned (by the British) migration programme, over 50,000 family-reunion Mainlanders per year (of typically modest means) are allowed to take up permanent residence in Hong Kong.  This typically has added over 1 million new residents to the Hong Kong population every 20 years.  Then there is the mass of younger HKSAR residents who, not unreasonably, very much aspire to move out of the family home and into a home of their own.

Next – and crucially – compared to several decades ago, the Hong Kong Government has now run up against major land shortage problems making it more difficult than ever to build badly needed additional PRH flats and HOS flats.  This land shortfall is not, however, a product of a dire shortage of physical land within the HKSAR.  It is far more a consequence of entrenched policies restricting land usage – and land creation.  Some of these policies are of very long-standing.

For political-historical (and hilly-geography) reasons, measurably less than 30% of the total HKSAR area (today) of some 1100 square kilometres is subject to high density development.  Over 70% is designated as “countryside” which includes low-rise accommodation, farmland and remarkably expansive “country parks”.  Moreover, for political-environmental reasons, land-reclamation, a consistent practice from 1842 and throughout the BHK era, has become increasingly difficult to implement.

The government has ambitious plans to increase the supply of housing by 450,000 public and private units (70% public and 30% private) over the coming years through until 2029 – using, inter alia, re-zoned farmland and low density areas and so called “brownfield” sites (without reclaiming areas in country parks).  This is, though, a project constrained by an abundance of contemporary, rights-influenced, legal and NIMBY (Not In My Back Yard) obstacles.

The government is, thus, also planning a massive reclamation to create around 1,700 hectares of new land (in essence, a new island) close to the eastern end of Lantau Island, not so far from Kowloon and Hong Kong Island.  Housing could be provided here for over one million people by 2035.

The Lantau Tomorrow proposal is, predictably, controversial, though many of the criticisms amount to making the perfect and enemy of the good.  Few places have had greater, successful experience with land reclamation than Hong Kong.  Only the government can “build”: new land.  With new land, the NIMBY problems are far less acute and by building its own new land, the bargaining power of the government will be enhanced as it deals with the leasehold-owners (often major developers) of farmland and related sites.  The cost is great and there are risks.  Completing the project may initially involve spending much of the fiscal reserve fund.  This would reduce the cash reserves but the land reclaimed would create a, potentially more valuable asset-reserve.  One conservative estimate suggests that the value of the land created should exceed the reclamation cost by 14% (US$145 billion vs US$128 billion).  It is planned that much of the created land would be sold (on a leasehold basis) to private developers creating a prominent cash replenishment of fiscal reserves.

This huge new reclamation also has significant potential to assist in ways no other proposals can, for example, by allowing the complete relocation (and redevelopment) of large, ageing PRH estates while retaining “neighbourhood” characteristics.

Another Comparative Perspective

Interestingly, Singapore is now providing some fresh evidence of the long-term (stability-maintaining) wisdom of the Hong Kong approach.  In notable respects the Singapore public housing system is superior to that in Hong Kong.  In particular, living space is unmistakably better and Singapore uses an “owner-occupier” model where almost all occupiers (over 80% of the population) live in flats which are owned under a 99 year lease.  However, these leases do not have any renewal rights.

The reason is that it is a long-standing policy of the Singapore Government that such leased-flats are to be handed back to the government after 99 years to allow for redistribution to future generations.  As certain leases now have less than 50 years to run, some owners are finding that their primary asset is beginning to depreciate in value and re-selling to other eligible buyers is made more difficult.

The Singapore Government is trying to explain that owning such a flat was never meant to be an indefinitely secure, appreciating investment and to convince owners that it is in the public interest that this is so.  This is not an easy task and it looks set to grow more difficult as time passes.

 Conclusion

I argued at the outset that seeing Hong Kong’s housing predicament primarily in terms of sky high purchases prices and maximum developer profits provides a notably incomplete portrait of the overall housing position in the HKSAR leading to an abbreviated misreading of the whole picture.

Frankly, Hong Kong has long lived with these price and profit realities.  They are very significantly a product of the land-related revenue system which has done such a remarkable job of boosting public revenues in HK since 1842, while supporting a low-rate, simple general taxation system.  Curbing the supply of land for private housing has not only boosted developer profits – it has also singularly enhanced public revenues.

However, this core element in Hong Kong’s unique revenue system created a major problem in that it was pricing even basic, decent housing far beyond the reach of the lower paid and, indeed, was making it unaffordable for a clear majority of residents.  This was a result of the system’s inherent tendency to push land prices higher combined with policies producing a shortage of available land for high density usage and the almost always steady growth in demand.

For more than six decades successive Hong Kong Governments have applied a distinctive solution which has involved creating one of the most extensive systems for providing public housing (or social housing as it is now often called) seen anywhere on this scale.  The government has used land over which it had so prudently retained ultimate ownership and ample saved funds, not least from the land-related revenue streams, to bring about this housing revolution.   It is, in many respects, an extraordinary public policy achievement.

The result, today, is that the government still directly provides PRH for around 2.5 million Hong Kong residents – and it continues to build (and rebuild) PRH on a very large scale.  Meanwhile, the HOS flats, which permit flat purchases by lower-income groups at discounted prices has been a primary and effective way of allowing access to home ownership to purchasers who would otherwise be shut out of the market.  These buyers do not have to pay the cost of the underlying land value on first purchase (effectively from the government) – this is collected at the time of certain resale transactions.  These flats house around 1.5 million residents.

The solution has, however, always left too many behind.  This was so during the BHK era.  And it remains the case today.  Intense levels of demand continue to exceed supply – and it is not hard to see why.  There are the pressing needs of the poorest Hong Kong residents living in over 100,000 tiny, sub-standard flats and paying, per square foot, extremely high rents.  Then there are the 50,000 family-reunion Mainlanders immigrants per year and the conspicuous number of younger HKSAR residents who face inordinate difficulty in securing a home of their own.

Since mid-2020, new measures have being applied by Beijing in the HKSAR to help rebuild stability following the exceptional political rioting in 2019.  These remedies are quite drastic, including a conspicuous reduction in the role of democratic elections.  But they are a direct and calibrated response to an extended, offshore supported insurrection in the HKSAR – followed by a further election-based, political destabilization project – both of which unfolded during the ongoing escalation of the US-led, confrontational, Sino-containment project.

A crucial aspect of rebuilding Hong Kong’s stability is the wholesale restructuring of the LegCo electoral system.  For more than a decade LegCo grew increasingly dysfunctional.  It became the base for a political struggle between the pro-democracy opposition and the HKSAR Government (and Beijing).  In due course, the determined, continuous nature of these opposition tactics, which were sometimes visibly extreme, effectively rendered Hong Kong’s legislature no longer fit for purpose.  These radical new reforms have addressed what had become a severe shortfall in the ability of the HKSAR to govern itself by recasting the primary foundations of LegCo.

Despite the depletion of Hong Kong’s very large fiscal reserves due to exceptional deficit-spending to cushion the severe economic impact of the COVID pandemic, ample reserves (including within the relevant housing authorities) remain to help drive the accelerated building of substantially more social housing (for rent and for sale).  Ernst & Young estimated, in January, 2021, that COVID spending has reduced the reserves by about 30% but remaining reserves still totalled over US$100 billion.  Moreover, once the Hong Kong economy begins growing, we can expect, as in the past, to see these reserves being steadily replenished.  Finally, this enhanced building project will generate substantial reliable revenues from sales and rents as each phase is completed.

The good news, overall, is that the environment for tackling the Hong Kong housing problem has distinctly improved.  Although the government still faces that very serious land supply problem, it is now possible to consider more freely, how to address this singular impediment.

Continuing, serious research on the Lantau Tomorrow proposal makes good policy sense as component in the long-term planning to address Hong Kong’s enduring housing needs.  As noted above, advancing that proposal will also put the government in a better bargaining positing as it negotiates a way through the pricing and legal complexities required to access privately held brownfield (etc) sites.

But there is one further option that should now be seriously considered.

Singapore has a population of around 5. 5 million living within an area of 719 square kilometres compared to 7.7 million living within 1100 square kilometres in Hong Kong.  A report by Ken Chu, a leading businessman, in the South China Morning Post in 2017, noted, acutely, that in Singapore around 14% of land is used for housing with around 10% set aside as parks and nature reserves while the comparable figures in Hong Kong are 7% of land devoted to housing and around 40% set aside as country parks and reserves.

Numbers of country parks in the HKSAR include areas of low-ecological value which abut significant housing estates.   Chu, who strongly favours increasing the supply of public sector, subsidized housing, makes a cogent case that Hong Kong should look very seriously at these areas, arguing that taking just 2.5% of such land could allow the construction of over 400,000 new residential units.

Building on this land is not straight-forward as it is typically hilly; there are significant civil engineering challenges.  But a number of large public housing estates were successfully built during the BHK era on awkwardly elevated sites.  This can be done.

As explained above, this remarkably high level of green space in Hong Kong is a clear if indirect product of the British policy of greatly restricting the land available for high density development.  Today, Hong Kong’s extensive country parks are a source of justifiable pride.  They are also “protected” by voluble often strident green-group lobbying.  It is a fair bet that these civil society guardians live in sound housing – they do not live in sub-divided units.

In truth, what was once a positive British legacy has also become, over time, an impediment to sound planning in the public interest.  The taboo on resolving this conflict of priorities in order to address the most basic social need – decent housing – needs to be lifted.

Massive spending on public housing (widely defined), enabled by Hong Kong’s super-solvency, has provided a crucial foundation for the dominant, long-term social-stability which has largely prevailed since the end of World War II.  That stability has been regularly tested by intense, sometimes deadly, political protesting.  After each such ordeal, Hong Kong has, typically, collectively righted itself.  Today it needs to do so, again, as it rebuilds after the immensely damaging upheaval in 2019.

Although the HKSAR will fairly soon have a radically transformed legislature, the reformed LegCo will take time to find its feet.  However, the path has been made clear to consider a full range of imaginative solutions to the fundamentally important housing crisis in the HKSAR.  It has become feasible to work constructively on securing a significant fix for this problem over the next 10 years.  This was not conceivable working within the previous LegCo structure.

Adding to the sense of urgency, Beijing, frustrated by all of the governance difficulties regularly thrown up since 1997, is insisting that Hong Kong has to put confrontational politics aside and apply itself constructively and energetically to fix what Beijing says matters.  Housing is one elemental item at the top of that “solutions-needed” list.

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History Debunked Refutes Critical Race Theory’s Rejection of Objective Fact

In this video from History Debunked, YouTuber and author Simon Webb attacks Critical Race Theory’s epistemology. Critical Race Theory is the theory of racial politics, devised by American Marxists, that Blacks are the victims of institutional racism. As the video states, Critical Race Theory has largely been confined to the US for the past 40 years, but is now being adopted in Britain. It was the McPherson report following the murder of Stephen Lawrence, which introduced the idea of institutional racism in Britain with its conclusion that the Met was institutional racist. Since then a number of other organisations have also been accused of institutional racism, including the NHS.

Epistemology is the branch of philosophy dealing with knowledge. There is a difference between subjective and objective knowledge. The statement that light moves at 186,000 miles per second is objectively true. It can be tested. But the statement that X hates someone is subjective, as it is difficult to prove objectively. In the West, knowledge is generally regarded as objective fact. But Critical Race Theory rejects objective fact in favour of ‘Standpoint Epistemology’. This is the view that the opinions and perceptions of minorities are what matter, and these should be accepted uncritically, as demanding objective proof or questioning them is a form of oppression. The video also states that the theory also promotes instead of facts the stories Black people tell amongst themselves. These stories, which may include myths, are to be regarded as incontrovertible truth, and should similarly not be subjected to criticism or testing.

The video illustrates this by citing the views of a young Black woman, Yomimi, in an article published by the Beeb, and the Oprah Winfrey interview with Meghan Markle. The Beeb article is about the higher percentage of graduate unemployment among Blacks. Yomimi is quoted as saying that she feels it is due to institutional racism, and that employers automatically reject applicants from Black and Asian candidates, whose names are difficult to pronounce. This was the subject of a previous video by History Debunked yesterday, in which he argued against this assertion. Official statistics show that Chinese and Indians are slightly better at obtaining jobs than Whites, but Chinese names are notoriously difficult for westerners to pronounce. However, the Chinese generally do better in education than Whites, while fewer Blacks than Whites obtain two or more ‘A’ levels. Black unemployment may therefore have more to do with poor Black academic performance than institutional racism amongst employers. But what is important about the article is that Yomimi is not asked to provide supporting facts for her arguments. It is just how she feels or sees the situation.

Similarly, Markle said little in her interview with Winfrey that could be objectively verified. Significantly, Winfrey thanked Markle for speaking her ‘truth’. This sounds strange to British ears, but it’s part of the same viewpoint that rejects objective truth in favour of feelings and perceptions.

I’ve no doubt that racism exists in this country, and the police force, especially the Met, has been notorious for the racism of some of its officers. Racism appears to be one explanation for the Met’s failure to prosecute Lawrence’s murderers, but they were also the sons of notorious London gangsters. An alternative explanation was that the cops were afraid of prosecuting them because of their fathers, or else were corrupt and on their payroll. Private Eye also stated a few years ago that an Asian and White lad were also separately the victims of racist murders, and the Met was similarly negligent about finding and prosecuting their killers but that there was no mention of this.

The rejection of objective fact, however, is a fundamental element of Postmodernism and its moral and cultural relativism. Instead, it sees every culture and viewpoint as equal. Way back in the 1990s I tried to do an MA on British Islam at my old College. As part of it, my supervisor sent me to several Cultural Studies seminars, which were thoroughly postmodern. These were on colonial or western views of extra-European cultures. The attitude really did seem to be that westerners really couldn’t understand or appreciate other cultures, who should thus be exempt from western criticism. Any attempt to do so was dangerously prejudiced and ‘othering’.

Unfortunately, parts of the women’s movement have also been contaminated by this irratrionalism. In their book Intellectual Impostures, Sokal and Bricmont, one an American left-wing mathematician and physicist, the other a Belgian philosopher, attack postmodern philosophy and particularly its appropriation of scientific concepts. These are used nonsensically to give an appearance of depth and profundity to arguments that are actually absurd and incoherent nonsense. In one chapter they attack a number of postmodern feminist writers, who refuse to use conventional logical argument because logic and objective are patriarchal concepts that mentally imprison women. I am not joking, and this is most definitely not a wind-up.

A friend of mine came across this attitude, also back in the 1990s, in the women’s committee of the local branch of the National Union of Students. He was told by someone who worked with it, that it was one of three autonomous committees, whose conclusions were automatically passed as NUS policy. The other committees were for Black and LGBTQ students. The women’s committee similarly rejected logic and objective fact. Instead their debates supposedly consisted of them largely talking about their experiences of sexual abuse before concluding with their recommendation on a particularly issue. Which was passed with no debate. This situation should have been unacceptable. I have every sympathy for anyone who has been sexually abused, but official decisions need to be based on logical argument and proper debate, not entirely subjective feelings and personal history unless these are directly relevant to the matter.

Sokal and Bricmont were highly critical of this feminist rejection of logic, not least because it was based on a very traditional view, that has been used to exclude women from authority. For centuries women were largely excluded from a number of professions and political power on the basis that they, unlike men, were emotional rather than reasonable and logical. The Nazis used the same argument to justify their removal of women from the workplace and politics. They also believed in Cultural Relativism, and what was appropriate for one race was unsuitable for others. This is shown in their denunciation of democracy as ‘Jewish’. Now cultural relativism and the rejection of objective fact in favour of feelings and perceptions is being promoted as empowering for Blacks and women.

Proper discussion of racism is entirely appropriate, especially given the continuing poverty and marginalisation of the Black community. But this has to be done through rational discussion and argument, backed up with facts and statistics. And this means a rejection of Postmodernism and Critical Race Theory’s theory of knowledge.

How China Is Offering an Alternative to the IMF

Published by Anonymous (not verified) on Fri, 16/04/2021 - 7:45pm in

China has been setting up currency swap lines with many countries. But is this an idea that is ahead of its time?

What Can Taiwan Do To Protect Itself From China?

Published by Anonymous (not verified) on Fri, 16/04/2021 - 11:57am in

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China, Taiwan

Article by Mark Pontin

 

Lyle Goldstein, research professor and founding director of the China Maritime Studies Institute at the U.S. Naval War College, in a YouTube video, claims, in the words of commenter someofparts ‘One clear fact that emerges is that China will be taking Taiwan back. It’s a question of when not if … If they have to use force, professor Goldstein says Taiwan will be able to hold out about two weeks.’

One big factor Professor Goldstein is leaving out regarding Taiwan — for reasons to do with long-standing U.S. policy — is that no country that ever had a serious program to build nuclear fission weapons — A-bombs — ever failed to do so. South Africa developed them, for instance, though in 1989 de Klerk ensured they were dismantled before the handover to Mandela.

In fact, A-bombs such as were dropped on Hiroshima and Nagasaki are far simpler and easier to construct than most people realize. It’s a technology developed by people who listened to Benny Goodman on vacuum tube radios, after all. (For all that the scientists at Los Alamos represented, sadly, probably the greatest number of the most intelligent people gathered together for one project in history.)

H-bombs — fusion bombs aka staged thermonuclear weapons — which emerged with Ivy Mike in 1952 are a very different, more complex deal. In 2021, they’re what a nation-state seeking deterrence wants because—while Ivy Mike was the size of a very large locomotive engine, 20 feet high and weighing 140,000-plus lbs., with an additional 24,000 lbs. for its refrigeration equipment—they can be physically miniaturized to be put atop missiles and designed so the resulting explosion can be almost any size, shape, or radiation yield. Ted Thomas, the U.S.’s most talented bomb designer, even built a thermonuclear device so small he lit a cigarette with it.

To return to Taiwan: simple fission-style A-bombs do require bomber aircraft (which can be knocked down by missiles in 2021) to deliver them—although trucks or boats will do in a pinch. But Taiwan could still build such weapons as stationary “mini-doomsday” devices, so that if China invades the whole island goes up and large radioactive clouds sweep over the mainland. That would definitely be a deterrent.

The hardest part of building simple fission devices is accumulating enough enriched uranium and/or plutonium. Taiwan has six reactors so it has the nuclear material to enrich, to start with.

Enrichment is usually dependent on massive chains of centrifuges — which is why Iran currently is vulnerable to sabotage — but there’s a new high-tech alternative called laser isotope separation, or LIS, which can be carried out in a plant the size of a small warehouse or your local high-end auto dealer’s garage. Taiwan is in one sense the most technologically sophisticated country in the world, in that it has more microprocessor chip fabs than any other. Indeed, that’s another reason why mainland China shouldn’t invade in the next decade, till it’s built up its own fab plants: global technological civilization would stagger to a halt without the chips Taiwan supplies the rest of the world, including China.

In any case, if Taiwan wants to enrich radioactive material via LIS, it can probably manage “nuclear breakout” both covertly and quickly.

So the fact that Taiwan could relatively easily gain nuclear deterrence is one factor Professor Goldstein isn’t bringing up.

And that’s because Japan and a number of other nations could achieve nuclear breakout very quickly, too. During the Cold War, the U.S. deliberately extended its “nuclear umbrella” to allies to discourage them from having their own nuclear deterrent program. That way, proliferation was discouraged and U.S. hegemony was preserved, in that the U.S. nuclear umbrella also provided cover for U.S. conventional forces to go in and flatten whomever Washington deemed should be flattened. (As in Iraq.)

Professor Goldstein isn’t talking about all this because he’s invested in maintaining U.S. hegemony. Also, he’s at the U.S. Naval War College and a potential scenario where China invades Taiwan with conventional forces is good promotion for the idea of naval force projection, and the Navy always wants more ships. I bet he doesn’t bring up the uselessness of aircraft carrier groups in such a scenario, however. If so, he’s being disingenuous on two counts.

Ian – this is by Mark Pontin, not me. I lifted it from comments with his permission. We’ll be talking a bit more about Taiwan (and the Ukraine) in the future. Thanks to Mark for agreeing.

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NED-Funded Uyghur Separatist Network and CAIR Director Rally Around Cold War Propaganda

Published by Anonymous (not verified) on Fri, 16/04/2021 - 4:37am in

WASHINGTON — On March 30, demonstrators gathered outside the Chinese Embassy in Washington, calling on the U.S. Congress to pass the Uyghur Forced Labor Prevention and Human Rights Protection Acts.

This legislation would ban the import of products alleged to be made from forced labor in China. It also authorizes President Biden to sanction anyone believed to be responsible for labor trafficking.

Despite their tiny numbers, these protesters have a powerful force backing them: the U.S. government. Several of them are funded by the National Endowment for Democracy, an ostensible non-governmental organization that itself is funded by Congress. Over the last two decades, through the NED, the U.S. government has poured millions of dollars into a network of organizations advocating for a neo-Ottoman separatist state in China’s Xinjiang province, what they call East Turkestan.

Indeed, these Uyghur exiles pose as grassroots activists attempting to pressure the very same Congress that is funding their activities. Most prominent among them is Rushan Abbas.

 

Rushan Abbas’s resume

“The Chinese regime is waging war against humanity. Against the basic rights God has given to us and waging war against our ethnicity and religion,” Abbas told the crowd.

Her profile – now scrubbed from the internet – boasts of “extensive experience working with U.S. government agencies, including Homeland Security, Department of Defense, Department of State, Department of Justice, and various U.S. intelligence agencies.” Most famously, she worked as a translator for Uyghur detainees at the notorious Guantanamo Bay detention camp.

Abbas also worked at Radio Free Asia – what The New York Times described as a “Worldwide Propaganda Network Built by the C.I.A.” Today, she heads the Campaign For Uyghurs, an organization funded by the National Endowment for Democracy.

Also in attendance was Elfidar Iltebir, secretary of the Uyghur American Association. This is a subsidiary of the World Uyghur Congress, the main NED-funded organ of the separatist movement. The NED has granted millions of dollars to the World Uyghur Congress since its founding, and gave it the Democracy Award in 2019.

“As the world has witnessed in the last decade, Chinese communists, instead of respecting religious beliefs, and embracing democracy, [has] become more racist, fascist and tyrannical,” Iltebir said.

Days before the rally, Iltebir took part in a Uyghur caravan denouncing a “Stop Asian Hate” rally. Fellow caravan participants shouted obscenities at the protesters.

 

Unreliable narrators

The director of the Uyghur American Association is Kuzzat Altay. An investigation by Ajit Singh, published in The Grayzone, revealed that Altay and his brother Faruk have been trained by a former U.S. Army ranger as part of a Uyghur militia called Altay Defense.

Elfidar Iltebir’s sister is Elnigar Iltebir, who in 2019 was appointed to be the Trump administration’s director for China at the National Security Council.

I asked Abbas and Elfidar Iltebir about the allegations of a Uyghur genocide.

“More than three million Uyghurs are taken to concentration camps,” Abbas told me.

“So according to the State Department, two million — and the Pentagon, three million — Uyghurs. We believe it’s more than three million Uyghurs are in concentration camps in East Turkestan,” Iltebir said.

On Mike Pompeo’s last day heading Donald Trump’s state department, he published a report accusing China of genocide, claiming more than 1 million civilians are in concentration camps and likening them to the Nazi Holocaust.

Pompeo directly referenced Adrian Zenz, the evangelical Christian fundamentalist whose claims of forced sterilization and labor – the basis of the genocide label – have been discredited as the product of data abuse and outright fraud.

In May 2020, several months before Pompeo’s genocide claim, then-Assistant Secretary of Defense for Indo-Pacific Security Affairs Randall Schriver suggested the number was much higher, though he offered no evidence.

“The detention camps, given what we understand to be the magnitude of the detention, at least a million but likely closer to three million citizens,” Schriver told reporters.

I asked how many people have died in the alleged concentration camps.

“It’s hard to tell because the numbers China gives are never trustworthy. So according to the camp survivor Mihrigul Tursun, when she was in the camp for three months, nine out of 60 detainees were dead,” Iltebir told me.

Mihrigul Tursun is a Uyghur whose claims have been central to the genocide narrative and who has been featured in the CIA cutout National Endowment for Democracy’s promotional videos.

She was the central witness in a Congressional Executive Committee on China hearing chaired by the neoconservative Senator Marco Rubio (R-FL).

The very same Marco Rubio who, in 2016, denounced then-president Obama’s visit to a mosque, accusing him of dividing and pitting people against each other.

At the hearing, Tursun claimed to have had her head shaved, been tortured and nearly killed in an electric chair, and witnessed deaths of fellow inmates.

Harrowing testimony, to be sure. But is it factual? Well, it’s hard to say. However, the Chinese state media outlet CGTN caught Tursun lying to CNN about the death of her son.

So the claim of Uyghurs being killed comes down to the testimony of one person whose own mother was revealed to be a liar. If Mihrigul Tursun is lying, it wouldn’t be the first time the U.S. government would have a sympathetic character give teary-eyed but false testimony in order to justify military aggression. That testimony, of course, turned out to be a lie cooked up by a member of congress and a PR firm.

Back at the rally, Rushan Abbas couldn’t cite any actual figures, but insisted Uyghurs are being killed en masse.

“We may not know that there’s going to be like tens of thousands of dead bodies somewhere or gas chambers, but everything that the Chinese government is doing in our homeland is exterminating the Uyghur people and killing the Uyghurs basically,” Abbas explained.

 

Crematoriums and credulity

Both Rushan Abbas and Elfidar Iltebir also claimed that China has constructed crematoriums next to concentration camps, evoking imagery of the Nazi Holocaust.

“Also China built crematoriums around the camps,” according to Iltebir.

“Crematoriums are built next to it, next to those concentration camps, for a culture that doesn’t practice cremation. Right there, that should give a warning signal.” Abbas alleged.

But unlike in the Nazi death camps, there’s no evidence of Chinese crematoriums. Instead, there are a handful of articles from the U.S. propaganda organ Radio Free Asia where Abbas used to work.

This Radio Free Asia article about crematoriums references claims to have aerial photos delivered by the Uyghur Transitional Justice Database, a Norway based organization that is also funded by the National Endowment For Democracy. Yet the supposed photos of the alleged crematoriums are not provided.

Instead, the article contains a blurry image of what it claims is an internment camp, provided by serial fabulist Adrian Zenz, and says “there might be a cremation site near the camps.”

uyghur internment camp

Source | Radio Free Asia

The Radio Free Asia article also references a previous article that alleges the regional government listed tenders for contractors to build nine quote “burial management centers” that include crematoria.

A native Mandarin speaker searched the website of the Xinjiang Production and Construction Corps and found nothing corroborating this claim.

The same report claims the existence of a job posting listed on the Xinjiang official government website seeking 50 security personnel to work in a crematorium.

There is no link to the job posting, a screenshot of any kind of evidence or of this job posting; and, again, research by a native Mandarin speaker came up empty.

It is, however, true that the Chinese government mandates cremation. Except, this only applies to the ethnic Han majority. Ethnic minorities including Uyghurs are exempt.

This 2003 document explains the policy, citing respect for customs of ethnic minorities, and instead allows them land for cemeteries.

“Ethnic minorities which traditionally practice inhumation are exempt from the government requirement of cremation, and are allotted special land for cemeteries,” the document says.

In fact, the cover photo of the first Radio Free Asia article shows a newly constructed and weatherproof Uyghur cemetery in Xinjiang. The traditional form of dirt burials had left them vulnerable to the elements, as this CGTN report explains.

Those Radio Free Asia articles were authored by Uyghur exile Gulchehra Hoja. In 2019, Hoja and Tursun were photographed proudly shaking hands with former CIA director and then-Secretary of State Mike Pompeo.

 

Just lobby, like the Uyghurs

At the rally, I asked Elfidar Iltebir what she thought about the U.S. government’s treatment of Muslims.

“Do you think Mike Pompeo and Antony Blinken are good allies to Muslims,” I asked?

“I believe so. I believe so,” Iltebir told me. “They do have strong beliefs which we see, you know? And they do stand up for human rights. And I believe they are indeed from the heart, care about humanity.”

Iltebir assured me that despite the U.S.-sponsored catastrophes in Muslim-majority countries like Yemen, Syria, and Palestine, the U.S. is actually taking care of their rights and they should simply lobby congressional lawmakers like the Uyghurs have.

“I am sure the U.S. did enough for their rights. Because I’m in the Uyghur diaspora I read more about those, so I may not have enough information to make a comment on that. But I would recommend those from Yemen and others to get together and do advocacy work and inform the Congress, inform the Senate, inform the government officials about what is going on. And if they know enough, I think they will take an action,” she assured. So what I suggest is for other Muslim countries to keep doing the advocacy work, lobbying.”

“Same with the Palestinians, for example,” I asked.

“Yes, and reach out for help. Reach out for other groups too,” she continued.

“Would you call what’s happening to the Palestinians a genocide,” I asked.

“Umm, as I said, because I don’t have enough information like I don’t read, I’m not up to date with what’s going on, I’m not the right person to make that comment,” Iltebir told me.

 

A very selective concern

When I asked Rushan Abbas why the U.S. is supposedly interested in the rights of Uyghurs while committing atrocities in Muslim-majority countries, she assured me that the U.S. is taking steps to ensure their rights.

“Why does the U.S. care about human rights for the Uyghur people but not about the Yemeni people, not about Palestinians,” I asked.

“I’m sure that they have, you know, other projects funding and supporting to end those atrocities as well,” Abbas told me.

Abbas then warned that China is seeking to imprison the entire world in concentration camps:

Look at the Uyghur today and imagine the future of the free, democratic world. Because that’s what Chinese government wants. If they win over the Uyghurs or win over the people like criticizing the Western countries or this and that, and they let us concentrate on something else and get away with what they are doing, then the darkness of what the Uyghurs are facing will be the future of the entire world.”

Finally, Abbas lashed out at Daniel Dumbrill, a Canadian vlogger based in China whom she accuses of making money from the Chinese government.

“They are very actively using the social media, using those famous YouTubers to spread disinformation and false narratives,” she claimed.

“Who are these people?” I asked.

“This is a guy, Daniel Dumbrill, he is supposed to be Canadian, living in Shenzhen, making money from the Chinese government. He has a brewing company,” she explained.

“He’s paid by the Chinese government?” I responded.

Well he has a company in Shenzhen supported by the Chinese regime because the Chinese regime is always advertising his brewing company in state-owned media… He accuses me of being paid by the US government or CIA but I’m not going to do what he is doing because I don’t have evidence.”

But Rushan Abbas has long been on the payroll of the U.S. government and continues to be funded by the National Endowment For Democracy, a fact she didn’t deny when I had brought it up earlier in our interview.

“What do you say to criticism about the funding that you’ve gotten and still get from the U.S. government,” I asked her.

“Because the U.S. cares about the human rights for the Uyghur people,” Abbas told me.

While Abbas acknowledges that she doesn’t have evidence that Daniel Dumbrill is paid by the Chinese government, she insisted on portraying him as its beneficiary.

“One thing you should think,” she said, “if he can use Youtube and Twitter and social media, which none of the other people who are living in China can use, if he has a brewing company being supported and advertised by the Chinese regime, what do you say?”

I contacted Daniel Dumbrill, who denied Abbas’s allegations that the Chinese government affords him special internet privileges and that Chinese media runs advertisements for his business, explaining:

I don’t think Rushan truly believes that millions of people accessing social media from China don’t know how to use a VPN and their only option is to do favors for the Chinese government. As for her other claim, I actually made a special note that if any media outlet came to interview me about my politics or vlogging, that they not mention my business. I didn’t want to conflate the two. Ironically it’s my critics that speak about my business more than I do. And this is a really good opportunity. Ask Rushan to provide any evidence to this claim and you’ll find, like many of her other claims, there’s just nothing there to back it up because it’s simply not true.”

Indeed, I asked Abbas for evidence but she declined to provide it, saying she is “not interested in anything he had to say.”

 

CAIR weighs in

Yet it wasn’t only Uyghur separatist figures linked to intelligence agencies at the rally. Nihad Awad, the executive director of the Council on American-Islamic Relations (CAIR), attended too.

“We ask the Biden administration to fulfill its promise to put human rights on the top of their agenda,” Awad told the small crowd.

While on one hand defending the civil rights of Muslim-Americans and refugees targeted by the U.S. government in the post 9/11 era, CAIR has also been a key proponent of destructive U.S. wars in the Middle East and North Africa.

In 2011, CAIR backed the Obama administration’s decision to launch a NATO regime-change war on Libya, which plunged the country into chaos and brought open-air slave markets back to the African continent. In 2015, CAIR supported the U.S. dirty war on Syria, calling for a no-fly zone – a euphemism for the U.S. to shoot down Syrian and Russian military aircraft.

CAIR has called on its membership to pressure Congress to pass the so-called Caesar Act, the most crippling sanctions on Syria to date. These sanctions have criminalized international aid, created severe energy shortages, and caused a devastating famine. According to Foreign Policy magazine, “it has brought starvation, darkness, plague, misery, robbery, kidnappings, and the destruction of a nation.”

Now, under the guise of humanitarianism, CAIR is throwing its weight behind the U.S.’s new cold war against China.

Dr. Talibi Shareef, the Imam and president of Washington’s historic Masjid Muhammad mosque, attended too.

“We are asking that America, its government, its president, its leaders, put pressure on China to treat every one of their citizens as the creation of the Almighty God the Creator,” he said, “as has been identified, in the precious document that established this country: this Declaration of Independence.”

Imam Shareef told me that Congress passing this legislation targeting China would be a sign of the U.S. living up to the ideals expressed in its founding documents, and he seemed to suggest the U.S. should take military action.

“So if the U.S., for example, recognizes this Uyghur genocide, and advances legislation to challenge it, you think that will be a sign that the U.S. is advancing towards a more harmonious, racially tolerant atmosphere?” I asked.

“Absolutely it would be a sign. And it’s really the least they should be able to do. I served in the military for over thirty years. So I know they have different instruments of power,” he assured me.

 

Pompeo finishes with a full-split

But the Uyghur genocide narrative was the project of former CIA Director and Secretary of State Mike Pompeo, one of the most extreme Islamophobes in U.S. politics.

After the 2013 Boston Marathon bombing, Pompeo remarked that “silence has made these Islamic leaders across America potentially complicit in these acts.” Pompeo has accepted awards from the hate group ACT for America, whose founder Brigitte Gabriel said that an American Muslim  “cannot be a loyal citizen” and that Islam is the “real enemy.”

But for Imam Shareef, Pompeo’s last-day genocide designation wasn’t an attempt to irreversibly ramp up aggression with China, but a sign of genuine change of heart.

“Why do you think someone like Mike Pompeo, who is widely considered an Islamophobe, is so serious about this issue?” I asked.

“Well, I think some of that had to do with some sense of consciousness to speak the truth,” Imam Shareef told me, adding:

He was on his way out. He knew he was on his way out. Because we got to look at the whole time he was in in terms of how he addressed it. And this is a short period of time, and for him, I think in terms of consequences to him, were inconsequential for him to make that statement at that particular time even if it was going against the interests of the one that he was representing. That’s why I think he said it. But again, I do see him as one who represents that right extremist population. “

“So you think, just on this issue, kind of at the end he kinda came to his senses and said, ‘I’m gonna be in solidarity with these people?’” I asked.

“I do,” he affirmed. “I do.”

With little pushback, the Uyghur issue is the central component of a bipartisan push to weaken and divide China and is now at the top of Washington’s foreign policy agenda.

Feature photo | Graphic by Antonio Cabrera

Dan Cohen is the Washington DC correspondent for Behind The Headlines. He has produced widely distributed video reports and print dispatches from across Israel-Palestine. He tweets at @DanCohen3000.

The post NED-Funded Uyghur Separatist Network and CAIR Director Rally Around Cold War Propaganda appeared first on MintPress News.

Michael Hudson: America’s Neoliberal Financialization Policy vs. China’s Industrial Socialism

Further discussion of the American and Chinese economic models, focusing on financialization as a central distinction.

America’s Neoliberal Financialization Policy vs. China’s Industrial Socialism

Published by Anonymous (not verified) on Thu, 15/04/2021 - 11:41am in

Tags 

articles, China

Nearly half a millennium ago Niccolo Machiavelli’s The Prince described three options for how a conquering power might treat states that it defeated in war but that “have been accustomed to live under their own laws and in freedom: … the first is to ruin them, the next is to reside there in person, the third is to permit them to live under their own laws, drawing a tribute, and establishing within it an oligarchy which will keep it friendly to you.”[1]

Machiavelli preferred the first option, citing Rome’s destruction of Carthage. That is what the United States did to Iraq and Libya after 2001. But in today’s New Cold War the mode of destruction is largely economic, via trade and financial sanctions such as the United States has imposed on China, Russia, Iran, Venezuela and other designated adversaries. The idea is to deny them key inputs, above all in essential technology and information processing, raw materials, and access to bank and financial connections, such as U.S. threats to expel Russia from the SWIFT bank-clearing system.

The second option is to occupy rivals. This is done only partially by the troops in America’s 800 military bases abroad. But the usual, more efficient occupation is by U.S. corporate takeovers of their basic infrastructure, owning their most lucrative assets and remitting their revenue back to the imperial core.

President Trump said that he wanted to seize Iraq’s and Syria’s oil as reparations for the cost of destroying their society. His successor, Joe Biden, sought in 2021 to appoint Hillary Clinton’s loyalist Neera Tanden to head the government’s Office of Management and Budget (OMB). She had urged that America should make Libya turn over its vast oil reserves as reparations for the cost of destroying its society. “We have a giant deficit. They have a lot of oil. Most Americans would choose not to engage in the world because of that deficit. If we want to continue to engage in the world, gestures like having oil rich countries partially pay us back doesn’t seem crazy to me.”[2]

U.S. strategists have preferred Machiavelli’s third option: To leave the defeated adversary nominally independent but to rule via client oligarchies. President Jimmy Carter’s national-security advisor Zbigniew Brzezinski referred to them as “vassals,” in the classical medieval meaning of demanding loyalty to their American patrons, with a common interest in seeing the subject economy privatized, financialized, taxed and passed on to the United States for its patronage and support, based on a mutuality of interest against local democratic assertion of nationalistic self-reliance and keeping the economic surplus at home to promote domestic prosperity instead of being sent abroad.

That policy of privatization by a client oligarchy with its own source of wealth based on the U.S. orbit is what American neoliberal diplomacy accomplished in the former Soviet economies after 1991 to secure its Cold War victory over Soviet Communism. The way in which client oligarchies were created was a grabitization that utterly disrupted the economic interconnections integrating the economies. “To put it in a terminology that harkens back to the more brutal age of ancient empires,” Brzezinski explained, “the three grand imperatives of imperial geostrategy are to prevent collusion and maintain security dependence among the vassals, to keep tributaries pliant and protected and to keep the barbarians from coming together.”[3]

After reducing Germany and Japan to vassalage after defeating them in World War II, U.S. diplomacy quickly reduced the Britain and its imperial sterling area to vassalage by 1946, followed in due course by the rest of Western Europe and its former colonies. The next step was to isolate Russia and China, while keeping “the barbarians from coming together.” If they were to join up, warned Mr. Brzezinski, “the United States may have to determine how to cope with regional coalitions that seek to push America out of Eurasia, thereby threatening America’s status as a global power.”[4]

By 2016, Brzezinski saw Pax Americana unravelling from its failure to achieve these aims. He acknowledged that the United States “is no longer the globally imperial power.”[5] That is what has motivated its increasing antagonism toward China and Russia, along with Iran and Venezuela.

The problem was not Russia, whose Communist nomenklatura let their country be ruled by a Western-oriented kleptocracy, but China. The U.S.-China confrontation is not simply a national rivalry, but a conflict of economic and social systems. The reason why today’s world is being plunged into an economic and near-military Cold War 2.0 is to be found in the prospect of socialist control of what Western economies since classical antiquity have treated as privately owned rent-yielding assets: money and banking (along with the rules governing debt and foreclosure), land and natural resources, and infrastructure monopolies.

This contrast in whether money and credit, land and natural monopolies will be privatized and duly concentrated in the hands of a rentier oligarchy or used to promote general prosperity and growth has basically become one of finance capitalism and socialism. Yet in its broadest terms this conflict existed already 2500 years ago in the contrast between Near Eastern kingship and the Greek and Roman oligarchies. These oligarchies, ostensibly democratic in superficial political form and sanctimonious ideology, fought against the concept of kingship. The source of that opposition was that royal power – or that of domestic “tyrants” – might sponsor what Greek and Roman democratic reformers were advocating: cancellation of debts to save populations from being reduced to debt bondage and dependency (and ultimately to serfdom), and redistribution of lands to prevent its ownership from becoming polarized and concentrated in the hands of creditors and-landlords.

From today’s U.S. vantage point, that polarization is the basic dynamic of today’s U.S.-sponsored neoliberalism. China and Russia are existential threats to the global expansion of financialized rentier wealth. Today’s Cold War 2.0 aims to deter China and potentially other counties from socializing their financial systems, land and natural resources, and keeping infrastructure utilities public to prevent their being monopolized in private hands to siphon off economic rents at the expense of productive investment in economic growth.

The United States hoped that China might be as gullible as the Soviet Union and adopt neoliberal policy permitting its wealth to be privatized and turned into rent-extracting privileges, to be sold off to Americans. “What the free world expected when it welcomed China into the free trade body [the World Trade Organization] in 2001,” explained Clyde V. Prestowitz Jr, trade advisor in the Reagan administration, was that, “from the time of Deng Xiaoping’s adoption of some market methods in 1979 and especially after the collapse of the Soviet Union in 1992 … increased trade with and investment in China would inevitably lead to the marketization of its economy, the demise of its state-owned enterprises.”[6]

But instead of adopting market-based neoliberalism, Mr. Prestowitz complained, China’s government supported industrial investment and kept money and debt control in its own hands. This government control was “at odds with the liberal, rules-based global system” along the neoliberal lines that had been imposed on the former Soviet economies after 1991. “More fundamentally,” Prestowitz summed up:

[7]

China’s economy is incompatible with the main premises of the global economic system embodied today in the World Trade Organization, the International Monetary Fund, the World Bank, and a long list of other free trade agreements. These pacts assume economies that are primarily market based with the role of the state circumscribed and micro-economic decisions largely left to private interests operating under a rule of law. This system never anticipated an economy like China’s in which state-owned enterprises account for one-third of production; the fusion of the civilian economy with the strategic-military economy is a government necessity; five year economic plans guide investment to targeted sectors; an eternally dominant political party names the CEOs of a third or more of major corporations and has established party cells in every significant company; the value of the currency is managed, corporate and personal data are minutely collected by the government to be used for economic and political control; and international trade is subject to being weaponized at any moment for strategic ends.

This is jaw-dropping hypocrisy – as if the U.S. civilian economy is not fused with its own military-industrial complex, and does not manage its currency or weaponize its international trade as a means of achieving strategic ends. It is a case of the pot calling the kettle black, a fantasy depicting American industry as being independent of government. In fact, Prestowitz urged that “Biden should invoke the Defense Production Act to direct increased U.S.-based production of critical goods such as medicines, semiconductors, and solar panels.”

While U.S. trade strategists juxtapose American “democracy” and the Free World to Chinese autocracy, the major conflict between the United States and China has been the role of government support for industry. American industry grew strong in the 19th century by government support, just as China is now providing. That was the doctrine of industrial capitalism, after all. But as the U.S. economy has become financialized, it has de-industrialized. China has shown itself to be aware of the risks in financialization, and has taken measures to attempt to contain it. That has helped it achieve what used to be the U.S. ideal of providing low-priced basic infrastructure services.

Here is the U.S. policy dilemma: Its government is supporting industrial rivalry with China, but also supports financialization and privatization of the domestic economy – the very policy that it has used to control “vassal” countries and extract their economic surplus by rent-seeking.

Why U.S. finance capitalism treats China’s socialist economy as an existential treat

Financialized industrial capital wants a strong state to serve itself, but not to serve labor, consumers, the environment or long-term social progress at the cost of eroding profits and rents.

U.S. attempts to globalize this neoliberal policy are driving China to resist Western financialization. Its success provides other countries with an object lesson of why to avoid financialization and rent-seeking that adds to the economy’s overhead and hence its cost of living and doing business.

China also is providing an object lesson in how to protect its economy and that of its allies from foreign sanctions and related destabilization. Its most basic response has been to prevent an independent domestic or foreign-backed oligarchy from emerging. That has been one first and foremost by maintaining government control of finance and credit, property and land tenure policy in government hands with a long-term plan in mind.

Looking back over the course of history, this retention is how Bronze Age Near Eastern rulers prevented an oligarchy from emerging to threaten Near Eastern palatial economies. It is a tradition that persisted down through Byzantine times, taxing large aggregations of wealth to prevent a rivalry with the palace and its protection of a broad prosperity and distribution of self-support land.

China also is protecting its economy from U.S.-backed trade and financial sanctions and economic disruption by aiming at self-sufficiency in essentials. That involves technological independence and ability to provide enough food and energy resources to support an economy that can function in isolation from the unipolar U.S. bloc. It also involves decoupling from the U.S. dollar and from banking systems linked to it, and hence from the U.S. ability to impose financial sanctions. Associated with this aim is creation of a domestic computerized alternative to the SWIFT bank-clearing system.

The dollar still accounts for 80 percent of all global transactions, but less than half of today’s Sino-Russian trade, and the proportion is declining, especially as Russian firms avoid dollarized payments or accounts from being seized by U.S. sanctions.

These protective moves limit the U.S. threat to Machiavelli’s first option: destroy the world if it does not submit to U.S.-sponsored financialized rent extraction. But as Vladimir Putin has framed matters: “Who would want to live in a world without Russia?”

Footnotes

[1] Niccolo Machiavelli, The Prince (1532), Chapter 5: “Concerning the way to govern cities or principalities which lived under their own laws before they were annexed.”

[2] Neera Tanden, “Should Libya pay us back?” memo to Faiz Shakir, Peter Juul, Benjamin Armbruster and NSIP Core, October 21, 2011. Mr. Shakir, to his credit, wrote back: “If we think we can make money off an incursion, we’ll do it? That’s a serious policy/messaging/moral problem for our foreign policy I think.” As president of the Center for American Progress, Tanden backed a 2010 proposal to cut Social Security benefits, reflecting the long-term Obama-Clinton objective of fiscal austerity at home as well as abroad.

[3] Zbigniew Brzezinski, The Grand Chessboard: American Primacy and its Geostrategic Imperatives (New York: 1997), p. 40. See the discussion by Pepe Escobar, “For Leviathan, It’s So Cold in Alaska,” Unz.com, March 18, 2021.

[4] Brzezinski, ibid., p. 55.

[5] Brzezinski, “Towards a Global Realignment,” The American Interest (April 17, 2016) For a discussion see Mike Whitney, “The Broken Checkboard: Brzezinski Gives Up on Empire,” Counterpunch, August 25, 2016.

[6] Clyde Prestowitz, “Blow Up the Global Trading System, Washington Monthly, March 24, 2021..

[7] Clyde Prestowitz, ibid.,

Photo by Chris Brignola on Unsplash

The post America’s Neoliberal Financialization Policy vs. China’s Industrial Socialism first appeared on Michael Hudson.

Intelligence Sources Say Biggest Threat To U.S. Is Actually U.S. Policy

Published by Anonymous (not verified) on Wed, 14/04/2021 - 11:42pm in

A new “threat assessment” by the US intelligence cartel has named China the number one threat to the United States today, followed by Russia, Iran, and North Korea. This has of course led to blaring news headlines like “China poses the biggest threat to the U.S., a new intelligence report says” from The New York Times, instead of something a little less propagandistic like “Here’s who the CIA wants you to be afraid of in order to advance its geostrategic power agendas.”

The report makes a bunch of evidence-free assertions which serve no purpose other than to help manufacture consent for the movement of expensive weaponry around the globe at the facilitation of unscrupulous war propaganda firms like The New York Times. Not only that, but I can now report that this US intelligence threat assessment is squarely contradicted by my own intelligence source.

Far from being threatened in any meaningful way by Beijing, Moscow, Tehran or Pyongyang, my intelligence source tells me that the greatest threat facing the United States today is actually the policy and behavior of the US itself.

My source informs me that infinitely more threatening to Americans than China is their own government’s policy of maintaining more and more severe domestic austerity measures and relying on a racist, violent and increasingly militarized police force to bash its most impoverished populations into line instead of simply helping them. The fact that America’s primary system of care for those who fall through the cracks is its immense prison-industrial complex poses a far greater threat to America than Moscow, Iran or North Korea ever will.

“When prison has become your country’s social safety net and you’re incarcerating at a rate unseen anywhere else in the world, it is not the time for you to worry about Kim Jong Un,” the intelligence source tells me.

But this crushing poverty and authoritarianism is necessary when a nation is the hub of a globe-spanning empire and its rulers need to make sure the populace remains too poor, busy and propagandized to begin interfering in the mechanics of the war machine. If Americans began using the power of their numbers to force their political system to cease hemorrhaging money and resources into interminable occupations and ever more expensive acts of military expansionism so that people could be cared for at home, the empire would fall. And that would make the imperialists sad.

According to my source, the real threat to America today is the standing policy of overextending US military commitments in a futile effort to maintain unrivaled unipolar planetary hegemony on a world that is forever out of control while impoverishing and oppressing Americans at home, all to preserve a failed competition-based model of mass-scale human behavior that our species needs to evolve beyond anyway.

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Okay, my intelligence source is between my ears.

Anyone with a brain can see that there is no real threat to the United States from outside US borders. US unipolar domination might be under threat from an ever-changing world in which empires are always temporary. Imperialism’s days might be numbered. Capitalism may be on the way out. But the US itself is not being threatened on the world stage by any foreign actor.

The US government is the one threatening nations with obliteration if they do not obey its dictates, not the other way around. Nobody is threatening America.

Your own intelligence sources will, with some rigorous usage, tell you that the real threat to America comes from oligarchs, imperialists and war profiteers who see the US government and its historically unprecedented military force as a tool for expanding power and wealth no matter what the human cost might be.

We can trust our intelligence sources on that matter my friends. Our story is much better-sourced than any we’ll ever see in The New York Times.

_____________________

New book: Notes From The Edge Of The Narrative Matrix.

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