Global Ethics Forum: The Return of Marco Polo’s World, with Robert D. Kaplan

(bright music) – Our guest this
morning is the acclaimed political affairs journalist
and author Robert Kaplan. It is a pleasure to welcome
him back to this podium. He will be discussing his latest
book, which is a collection of essays written between
2001 and the present, entitled “The Return
of Marco Polo’s World: War, Strategy, and
American Interests in the Twenty-first Century.” – This is a collection of essays that deals with
basically two things, the state of the world
as it is on the ground beyond the media
headlines, and what America should do about it and
what the American role should be about it. In talking about the state
of the world, what I mean is, what are the processes that
are going on right under our noses and how the United
States is reacting to them. What I’m gonna confine
my talk to this morning, is essentially, will be
in the spirit of the lead, anchoring essay of
this collection, “The Return of
Marco Polo’s World.” I use Marco Polo’s journey as
a geographical framing device for Eurasia today, and
there’s a reason for that. Because if you look at the
route of Marco Polo’s journey, you see the pathways of
the Tang and Yuan dynasties of the medieval era in
China, which is the period when Marco Polo traveled
during the Yuan Dynasty. If you look at the pathways
and the routes and the plans for China’s Belt
and Road Initiative, you see the Yuan Dynasty. What China is doing
with Belt and Road is very much in keeping with
their own imperial tradition, and we’ll get into that because
it’s one of the main themes of this whole collection
is that while empire may be a dirty word
on college campuses, you cannot understand
the processes going on in the world today
without seriously and dispassionately
looking at empire. And I don’t mean the British,
French, and European ones, I mean the Indian,
Chinese, Persian, Seljuk, Ottoman empires. Let me get started. It’s not true that technology
has defeated geography. What’s happened is something
much more subtle and complex. It’s that technology
has shrunk geography and distilled geography so
that the world is more anxious, more claustrophobic,
more nervous, smaller
than ever before. Every place interacts with
each other as never before. The crises zones in the South
China Sea, the East China Sea, the Baltic Sea base in
Ukraine, the Black Sea, the Persian Gulf all have
an ability now to affect each other that never
existed before in history. We tend to think of
as a positive thing, it connects markets, creates
an enlightened global culture, et cetera, that’s true. But in a geopolitical sense, interconnectivity is
very destabilizing. For instance, I was
at Davos in January, and the markets were
at their top peak. This was before the disruptions of the later part of January. Yet nobody was happy there
because everybody sensed that our world is more
geopolitically fragile than it’s ever been. They just couldn’t explain why. What I am trying to do here in this lead essay
is explain why. Think of the world
on a taut string. If you pluck one part of it,
the whole network vibrates. That’s the world. Take the word Eurasia. As recently as 20 years
ago, Eurasia meant nothing. It was too big to mean anything, from Portugal to
Indonesia, too big, Portugal to Korea, too big. But what’s happened because
of the way technology has been shrinking geography,
we can now honestly talk about a cohering Eurasian
system of rivalry, trade, development, and conflict
that never existed before. So Eurasia as a word
has a meaning that
it never did before. To give you an example
of what I mean, let me take just two countries. Look at India and China. India and China are
two radically different world civilizations that were
separated by the high wall of the Himalayas and the
Palmyras and the Karakorums, that had mostly
very little to do with each other
throughout history. Yes, Buddhism spread
from India to China in middle antiquity, and
the Opium Wars united India and China in the
same zone of conflict in the mid-19th century. But those were
aberrations, generally. India and China
were very separate. Now look at today’s world. India has an intercontinental
ballistic missile system that targets cities in
China, China has fighter jets on the Tibetan Plateau
that can include the Indian subcontinent
or parts of it in their arc of operations,
you have Indian warships increasingly in the
South China Sea, and you have Chinese warships,
especially submarines, the most aggressive
kind of warship all over the Indian Ocean. You have China building,
or helping to build, or at least helping to
finance, state-of-the-art ports throughout the Indian
Ocean, to the east of India, to the west of India, in
Myanmar, Sri Lanka, Bangladesh, Gwadar in Pakistan,
Bagamoyo in Tanzania, and the Chinese are building
a 155-acre military base in Djibouti at the
mouth of the Red Sea. China is in the process
of building a commercial throughput seaborne
empire as though it were the early stages of the
British East India Company or the Dutch East India Company. That’s China. India and China are
now connected in a
very new geography of rivalry that never
existed before in history. So, rather than
defeat geography, technology has been building
new kinds of geographies. India and China are just one
example that you can play out around the world in terms
of how every crisis and zone is interacting with
every other one. Think of China moving
vertically south towards the Indian Ocean,
building or helping to develop these ports that I spoke of,
and think of India moving east and west along
the Indian Ocean, competing with China for oil
and natural gas fields in Iran and competing with China
in Myanmar for influence because Myanmar has a
long border with India. I remember some years ago,
about 10 years ago now, American diplomats
were very perplexed, and one of them said to me, “Why is India, a
democratic country, “giving military aid to Myanmar, “a brutally repressive
military dictatorship?” I said to them, “Have you spoken
to the Indians about this, “their national
security advisor? “Because of geography,
they don’t have the luxury “to stand on
moralistic ceremony. “They have to engage with
Myanmar, or else China will make “it a satellite, and America
is simply too far away.” This is where you
get India and China competing with each other. And where does China’s
imperial dream begin from? It begins in the
South China Sea. American diplomats can talk
hours on end to the Chinese and tell them, you should not
be doing what you’re doing in the South China Sea, and the
Chinese will listen politely and, rightly ignore
these Americans, because from the point of
view of China’s geography, China’s history, and China’s
goals, China is doing exactly what it needs to be doing
in the South China Sea. China is doing nothing different
in the South China Sea, and this was told to me by
Chinese military officers, than what the Americans did
in the greater Caribbean in the 19th and
early 20th centuries. The South China Sea
is China’s Caribbean, and the Chinese think of this
consciously in this term. If you think about it, America
moved into the Caribbean in a big way after
it consolidated the
dry land portion of temperate zone North America. The last battle in the Indian
Wars was fought in 1890. By 1895 American foreign policy was focused on the Caribbean. In other words,
conquer the dry land, then the big adjacent
sea next to it. Because the Caribbean
bordered not just Mexico and the Gulf Coast but
the northern fringe
of South America, where most people
actually lived, strategic control of the
Caribbean gave the United States effective strategic control
of the whole hemisphere. With control of the hemisphere,
it was able to affect the balance of power in
the other hemisphere, and that is what
the two World Wars and the Cold War were all about. It all began in the Caribbean. Now, for China in
the South China Sea, China gets several things
from the South China Sea, parity with the US
Navy, or even dominance over the US Navy; it
gives China greater access to the Pacific, it
softens up Taiwan, because Taiwan is the
northern cork in the bottle to the South China Sea; and it
allows China unimpeded access finally to the Indian
Ocean, which is the world’s global energy interstate,
because the oil and natural gas are in one end of the Indian
Ocean in the Arabian Peninsula, the Iranian Plateau, and the
customers are at the other end, the great middle-class
conurbations of Coastal China, South Korea, Japan,
Singapore, and elsewhere. China is at war with
the United States in the South China Sea. There’s only one problem,
the Americans don’t know it. That’s because the
Chinese conception of war is different than the
Western conception of war. The Western conception of
war is you shoot, you fight. The Chinese conception
of war is win without ever having to fight,
because if you have to fight, that indicates that you’ve made a strategic miscalculation
somewhere along the way. So what the Chinese are doing
is hundreds of micro-steps, take an island atoll here,
build a runway there, move an oil rig into
disputed waters there, after there’s complaints,
pull the oil rig out, but take another atoll
six months later. Just keep moving
like that, in a way that doesn’t generate page-one
news but which over time, 10 or 15 years, one
day we’ll all wake up to a different world
in the South China Sea. That, in fact, is what is
happening, because the Chinese are dead set against any
conflict with the US Navy because they know
they will lose. They may not lose in 15 years
at the rate they’re going, but they’ll lose now. It all starts with
the Caribbean. But then you have
to ask the question, why is China going to
sea in the first place in such a big way,
developing such a big navy in the South China Sea
and the East China Sea? China does not have very
much of a naval tradition. In the early 15th
century, it’s true, in the Ming Dynasty, under
treasure fleet Admiral Zheng He, the Chinese sailed as far
as the Horn of Africa. But that was an aberration. That was really not
part of their tradition, and they withdrew the treasure
fleets when they had trouble with the Mongols in
the north-central
part of their country. China never went to sea because it never
felt secure on land. China has the luxury now to
engage, to focus so heavily on the South and East China
seas and the Indian Ocean, precisely because they
are more secure on land than they’ve ever been, and they’re becoming more
secure and more secure on land. Why is that? That’s where we get
into One Belt, One Road, or Belt and Road Initiative. The Belt and Road Initiative
does several things that nobody reports
about in the newspapers. The first thing, it’s
a branding operation for what the Chinese
have already built in terms of asphalt roads,
railways, oil and gas pipelines across Central Asia to get
at the gas from Turkmenistan, the oil from Kazakhstan so
that China is less dependent on the Strait of Malacca,
which is narrow and vulnerable, for oil deliveries. So it’s a branding operation
for what has already been accomplished, essentially. The second thing it is, these
pathways across Central Asia link China with Iran. Iran, with a population of
80 million, highly educated, fronting not just one
hydrocarbon-rich region, the Persian Gulf, but
two, the Caspian Sea, is the organizing principle
of both the Middle East and Central Asia. China is investing
heavily in Iran. It’s building railways in Iran. It’s mining for
minerals in Iran. The Chinese-Iranian relationship
is becoming deeply organic, and China-plus-Iran
is an unbeatable
combination in Eurasia. The state that loses
out the most is Russia because China is beating
the pants off Russia in former Soviet, Russian
lingua franca-speaking Central Asia, and is
poised to infiltrate into the Russian Far East while Putin is
obsessed with the West. I never bought the argument
that Putin’s a great strategist or tactician at all. The other thing One
Belt, One Road is, it’s a way to deal with
China’s internal demons. One of the biggest
of those demons are the Muslim-Turkic Uyghur
minority in Western China. This is a minority
that is Muslim, that does not feel
itself part of Han China. The Chinese are very
worried about them. What China does, what One
Belt, One Road accomplishes is it deepens
China’s relationship with these other Turkic
Muslim states to the west of the Uyghurs so the
Uyghurs can never use them as a rear base in any future
imaginable insurgency. The second thing it does,
because the Uyghurs live in Western China,
One Belt, One Road is economically
developing Western China so the Uyghur standard
of living can rise and, as a result, they may
have less of an incentive to rebel in future
years and decades. So One Belt, One Road
does all of these things. Again, this is the
process that’s happening in front of our eyes. At the same time, we
have the Middle East. Let me talk a few minutes
about the Middle East. Why has the Middle
East been so tumultuous over the past quarter-century,
whatever time frame you want to use on it? It’s because of a basic
fact that goes unreported, that, for the first
time in modern history, the Middle East is in
a post-imperial phase. The Ottoman Turkish Empire,
which ruled from Algeria to Mesopotamia, is gone. When the Ottomans ruled, whether
you were a Jew or an Arab, a Sunni or a Shia,
you owed loyalty to the Turkish sultan
in Constantinople. That didn’t solve every
ethnic and group problem, but it certainly alleviated it. That’s gone. The British and French
imperial mandate systems, which provided order and
stability in the Levant, principally Syria and Iraq,
went away in the late 1940s. The American and Soviet Cold
War systems in the Middle East, which Oxford historian
John Darwin called imperial in all but name,
essentially went away. The Soviet system
went away in 1991. The Russians have come back, but in much more limited fashion compared to what was Soviet
influence in Damascus, Baghdad, and many other places. In terms of American power,
American power for a long list of reasons that we could
spend all day talking about has dissipated over
the last 20 years. America is not what it
was in the Middle East, and it’s not only because of
the Iraq War or Afghanistan. It’s because the Middle East
is no longer run uniformly by stable autocratic systems
where there was only one phone number, one fax
machine, one president with one or two advisors
you had to deal with in order to deal with a crisis. Now you have to lobby dozens
of people in many places. It’s not impossible to do,
it’s just harder to do. It’s an irony that the
very weakening of autocracy has also weakened American
power in the region. So the Middle East is
left to its own devices. The result of that is the rise
and jockeying for position of regional hegemons Iran,
Turkey, Saudi Arabia, Israel, and, to a
lesser extent, Egypt. Iran really has an
advantage, because it has, of all these places, the
greatest imperial tradition. If you look at a map of
where Iran has influence from the Eastern
Mediterranean, Lebanon all the way through
Central Afghanistan where the Iranian rial is
the unofficial currency, you have a map, essentially, of most Persian-speaking
empires going back to antiquity. You look at the map of the
Achaemenids, the Sassanids, the Medes, the Parthians, you see exactly where
Iran is influential today. The ayatollahs are nothing
but the latest incarnation of Persian imperialism. This is a reason why the
Iranians are so brilliant at working with proxy
armies, proxy militias, because the real day-to-day
business of imperialism going deep back in
history is not conquest, it’s working with
local military factions in order to get your
own business done, to delegate through locals and
bring them into your system. The Marines, Army Special
Forces, Green Berets, that’s what they do
most of the time. They do it very well, but
they don’t do it as well as the Iranians have done it
with their militias in Syria, Iraq, and elsewhere. So there’s a particular
cultural genius to the way that the Iranians
operate in the Middle East. The Saudis promised victory
in Yemen in two months in 2015, they’re really
bogged down there. The Saudis promised the quick
knockout punch with Qatar over a year ago,
they never got it. Yes, a lot of it is
due to the impetuosity of the crown prince. But, again, Saudi
Arabia is a country with no imperial tradition,
no real history to draw upon in terms of projecting power, and especially military
power, in this way. So we have a process of China
and Iran overlying Eurasia, we have a post-imperial
world in the Middle East. So what about the United
States at the end of the day? All right, very quickly. The United States is a naval
power, that’s what it is, that’s who we are. Why do I say that? Because there’s a moral taboo
against using nuclear weapons, so the fact that we
have a nuclear arsenal
may be necessary, but it doesn’t help us
on a day-to-day basis. As far as land forces
go, and I’m talking about hard power here, in
terms of land forces, you move 15,000 or
20,000 US Army or Marines from one part of
the world to another or from the United States,
outside the United States, that’s front-page
news, it’s an editorial in “The New York Times,” it’s
arguments among columnists. But you move an aircraft
carrier strike group, which can incinerate
several big cities with the firepower it has
on it, which has thousands of sailors, you move that
aircraft carrier strike group from one part of the
world to another, and it’s public knowledge, there
is nothing secret about it. No news, nobody cares. Maybe a page-five story
somewhere for naval wonks. This is why the Navy is
such a powerful instrument, because you can
do things with it. You can signal, you
can move troops around, you can suddenly move
three carrier battle groups off the Korean Peninsula
whereas three weeks before you had only one, and it’s not
a sexy news story in any way. So we’re a naval power, and
naval power throughout history has generally been
organized around free trade and advancing some
form of civil society. Land powers tend to
be more conservative. Everyone says
America is like Rome. It’s more like Venice. We’re much more like imperial
Venice in that respect. That’s what we are,
that’s our brand. We’re a naval power which
supports free trade. With our warships we
keep the sea lines of communication open,
the choke points open, and access to hydrocarbons
for our allies open. It’s a benign influence,
and it goes with promoting, not forcibly imposing democracy, but supporting the gradual
expansion of civil society. But if you play around
with that American brand, you have nothing, essentially. You stop supporting free
trade in the general sense, you send out signals that
you’re not especially interested in advancing the march
of civil society, you lose everything in a way. You especially lose, and here
I’ll conclude, in Eurasia, because we are not in Eurasia. We can’t have a Belt and Road to compete with
China in Eurasia. What we offer Eurasia
is a vision of trade, of civil society,
of rule of law, and that’s a very
attractive vision, especially coming from a
country half a world away that has no territorial
ambitions on Eurasia. It makes it very attractive. But this is hard to do when
you voluntarily give up or seriously weaken
the American brand. I’ll end here, thank you. (audience applauding) (light music) – [Announcer] For
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China’s War on Pollution

This video is sponsored by Skillshare. The first 500 people to use the link in the
description get their first two months free. In 2008, China hosted its first ever Olympic
Games. Over 10,000 athletes, from 200 countries,
competed in 300 summer events. But for China, it was about much more than
athletics, In many ways, this was Beijing’s grand entrance
to the world. As the most-watched televised event in history,
at the time, it was the perfect opportunity to show off
a healthy, happy, prosperous China to an international audience, one that has long been confused about and
often deeply suspicious, of the Middle Kingdom. So, its government spared no expense. The city was given an extreme makeover. The kind you can afford when your economy
relies on pouring concrete on any surface you can find, and then pouring again because
why not?, more labor means more economic growth. 9 Billion dollars was spent improving public
transit, doubling the size of the subway. Ugly powerlines were buried underground, flowers
planted, and twenty new buildings constructed, like the iconic Bird’s Nest, Which held
the Opening Ceremony on August 8th, 2008, at exactly 8:08 PM, a lucky number in China. The 4-hour event cost 100 million dollars. 7,000 per. second. And flying overhead, you would’ve noticed
that, although it was raining elsewhere that night, the sky above the open-roofed stadium
was perfectly clear. Only minutes after the ceremony ended, the
clouds magically reappeared. The event was so important, and China so determined,
that it changed the weather, literally shooting chemicals at the sky with rocket launchers. And yet, even when its image mattered the
most, China still couldn’t control its pollution. The city was covered in its signature, dangerously
thick, grey smog. Air quality was so bad that some athletes
changed events. Others decided not to compete at all. But what looks like a hopeless environmental
disaster, China sees as an amazing economic opportunity. Its now on a quest to clear its air, clean
its energy, and grow its economy, not despite these things, but because of them. There are two ways to look at environmental
impact, depending on whose payroll you’re on. Per capita, China’s CO2 emissions, for example,
are nothing special, About the same as Poland or Mongolia. Nowhere near a rich country like the U.S.,
the United Arab Emirates, or especially, Qatar. Wow. But, in total, China makes up a quarter of
the world’s emissions. With a population of 1.3 billion, it’s problem
is that it’s just so. darn. big. As the world’s largest car market, China
has as many motor vehicles as the U.S. has people, Three hundred twenty-two million. So, not only does it have that fun LA traffic,
but also the kind of pollution that stops planes from landing, the kind of pollution where you can’t see
your fingers, the kind you can vacuum up, condense, and
make a brick out of. But unlike America, where the automobile means
freedom, and freedom, well that’s our thing, The right to commute in a 16 seat SUV by yourself
is probably written in the constitution, China can and does just say “No.” Cities like Beijing, Guangzhou, and Guiyang,
only issue a tiny number of new license plates a year, through a lottery. Although, ”tiny” is kind of an understatement. The chance of winning is approximately 1 in
783, or was, until Beijing lowered the quota from 90,000 to 40, and now your chances are
1 in 2,031. Locals joke they’re more likely to win the
actual lottery. One government official was arrested for accepting
bribes of 30,000 US Dollars for a single plate. Shanghai, on the other hand, auctions them
off to the highest bidder, with an average price of $14,022, nearly twice China’s per
capita GDP, and considerably more than most of the cars they’re attached to. So, good luck buying a car unless you have
very deep pockets, powerful friends, or amazing luck. Even so, there are limitations. In Beijing, the last number of your license
plate determines which days you can drive on. For example, right now, until April 7th, numbers
1 and 6 can’t drive on Monday, 2 and 7 can’t on Tuesday, 3 and 8 on Wednesday, and so on. All are allowed on the weekend. The numbers switch four times a year, and
rule breakers get three points on their license, 12 of which suspends your ability to drive. These restrictions have helped reduce pollution,
but only so much. The Air Quality Index, which measures pollution,
is usually in the range of 50-100 in cities like LA, San Diego, and most of southern China. In the North, it’s often three, four, even
five times that much. Now, it’s easy to see these numbers, think
that China focuses only on economic growth and conclude that its government really doesn’t
care that much about pollution. But that’s not entirely true. For one, healthcare is really expensive. Pollution kills an estimated 1.6 million people
in the country a year. It also has a significant impact on tourism. What makes this issue so unique is that it
can’t be hidden – smog is there for everyone to see, and not in some far, Western province,
but in the capital, where politicians live and work. So, even Chinese-owned state media reports
on the problem. And while it isn’t exactly known as the
protest capital of the world, it has seen a few. If that wasn’t incentive enough, enter electric
cars. Perhaps nowhere on earth is better suited
to lead the EV revolution. Millions of Chinese are entering the middle
class, looking to buy their first car, and have no stigma against electric vehicles. It’s great for local companies, it helps
grow the larger economy, and it’s good for everyone’s lungs. So it’s no surprise that China buys more
EVs than the rest of the world combined. In the U.S., there’s California and everywhere
else. The Golden State buys almost ten times more
EVs than second place New York. In Palo Alto, you turn your head when you
see a car that’s not a Tesla. China is to the world, what California is
to the U.S. It’s making EVs irresistible. Like police cars and ambulances, they’re
exempt from the last-number rule, and have a separate line to apply for a license plate. Many don’t even require a driver’s license
at all, with a top speed of around 40 miles an hour. Smart Cars cost 20-30,000 dollars. These cost about 1. The government has given Tesla permission
to build a factory outside Shanghai, Converted all Shenzhen busses to electric, and doubled its charging infrastructure in
the last year. Of course, cars are only part of the problem. China also burns an insane amount of coal,
one of the worst environmental offenders. Even India pales in comparison. But these numbers are somewhat misleading. There are three common types of coal plants
– subcritical, supercritical and ultra-supercritical. The first being low-temperature and less efficient,
the last being high-temperature and more efficient. Over time, China has been building fewer and
fewer subcritical plants, and more and more efficient ones. By 2020, it’s estimated that every Chinese
coal plant will be more efficient than every coal plant in America. China doesn’t have nearly as much natural
gas. So, instead, it’s largely moving straight
to renewable energy, which it now produces more of than any other country. Like electric cars, its government has an
economic incentive. Compared to fossil fuel, renewable energy
usually creates far more jobs. In fact, coal employs fewer Americans than
fast food chain Arby’s. Already, Beijing’s air pollution has fallen
by 35%. This, according to experts, could save 20
million residents over 3 years of their lives. And even when its weaker economy in 2018 made
car sales fall to a two-decade low, electric and hybrid cars continued to grow. At a time when the U.S. is removing EV tax
credits and environmental protections, it’s more important than ever that China take the
lead. Its electric car revolution is just getting
started. Its anyone’s guess how the economy will
change in the next 20 years, but it’s always safe to invest in your self! Why not learn about the stock market, so you
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David Goldman: Will China overtake the U.S. as the world’s leading superpower?

Robert Reilly: David Goldman is not only an
economist with a lot of experience on Wall Street, he’s a music critic and a music
theoretician who has taught on that subject. Of course he’s best known not as David Goldman
but as Spengler through his years and years of extraordinary articles and columns in the
Asia Times, which I have followed [and] which I’m sure many of you did as wel always wondering
who could this man be who knows Islam so well, knows the Middle East so well, Turkey, who
knows of course the Asian War affect, the- who knows everything and so finally he’s
been exposed as indeed David Goldman who’s going to talk to us tonight on, “Will China
Overtake the US as the World’s Leading Superpower?” question mark. I just want to share with you
because it’s such a delicious quote and there are a number of you in the audience
tonight who have worked in the intelligence world, the quote about our speaker by the
former CIA National Intelligence Council vice chairman Herbert E Meyer. Quote, “Ask anyone
in the intelligence business to name the world’s most brilliant intelligence service and we’ll
all give the same answer: Spengler. David Goldman’s Spengler columns provide more
insight than the CIA, mi6, and the Mossad combined.” Please join me in welcoming David
Goldman. David Goldman: I’m humbled to be invited
to such a distinguished group in the presence ofso many people as work I’ve admired for
many years, including Bob Reilly’s. Bob’s work on music by the way is some of the most
interesting and important I’ve read. His book in 20th century music I think should
be the standard on the subject so I throw that in as a free advertisement. The good
the simple answer to the question, “will China try to overtake the United States as
leading world as a new superpower?” is yes unless we change the course. The hour is late
and it’s time to be alarmed. I’ll explain the point of my title, “Geeks in a new Roman
Empire in a moment. How you measure the Chinese economy… the Chinese economy is either 20
percent larger than ours or 20 percent smaller, what the world bank calls purchasing power
parity, that’s the actual cost to do business. So for example if you want to create a research
lab and develop a new hypervelocity missile inside of the costs of the engineering personnel
will be considerably less so the GDP of China that respect to be upgraded a bit if you calculate
it in ordinary U.S. dollar terms they’re still somewhat behind us but even so given
the growth rate of the Chinese economy sometime in the early 2020s it is very likely that
China over it will overtake us in nominal dollar terms and however we measure it it
will be roughly our size given that China is growing at six or seven percent a year
which is a doubling every ten or twelve years not very long from now the Chinese threat
that we have now will double we’re like hercules wrestling the giant and TAS the daughter
of gaia ‘the the earth goddess who every time he touches the ground doubles in strength.
Hercules finally had to strangle him in midair and the problems that we now face are going
to be much greater in the future and if we don’t address them we’ll be dealing with
a power that will in many ways swamp us I’ll try to explain what those ways are first I’d
like to say something about what China is China is a civilization that has been with
us for five thousand years does much more much older than us it has had periods of extreme
decline and chaos followed by periods of reconstruction but overall it’s certainly one of the world’s
few truly successful civilizations according to the linguists not quite a hundred and fifty
thousand languages have been spoken on planet earth since the dawn of man of those perhaps
five thousand is still spoken but if you eliminate the languages spoken by a few hundred people
in the New Guinea Highlands and the ones that are likely to survive another 100 years you
get into the hundreds so of this enormous pool of languages and cultures Chinese culture
has been one of the very few successes coming from a younger and also reasonably successful
culture which is the Jewish culture I look at the Chinese in all they should never be
underestimated what makes China China what is it how does it understand itself until
the Jesuits turned up in the 16th century matera Ricci and his colleagues China simply
understood itself as civilization China was a civilizing principle it was a means of unifying
different ethnicities on the basis of very different principle than Rome or Alexander
or the Holy Roman Empire or any entity in the West or its antecedents and I think that’s
best illustrated by what it’s like to be a Chinese child Chinese children but I was
very bumptious and sort of have a free happy-go-lucky kind of existence until they’re about six
at which point they’re given a pen and the pot of ink and a piece of paper and they’re
told now you’re going to learn the characters and for the next six or seven years they’ll
spend four hours a day learning the characters. China managed to combine roughly 70 major
language groups by having a unified written language and entirely diverse spoken languages
it’s not until very recently with the advent of telecommunications and the centralizing
influence the Mandarin dialect the old Beijing imperial court dialect that China has said
anything like the unifying culture in the sense that we understand culture know what
Chinese mother for thousands of years sang a lullaby to a child in Chinese Chinese was
what you wrote this duality lies at the heart of Chinese strength and Chinese fragility
China has never quite been unified it’s like a bag full of operas Lee charge magnets
held together by super glue. China’s trying to spend a hundred years until the Communist
revolution the so-called century of humiliation disunited dominated by warlords with civil
wars that may have cost up to a hundred million lives in the middle of the 19th century the
Taiping rebellion for example this is still a living memory there are people who remember
this in the 1930s and 1940s so China’s paranoia about a rebel province Taiwan breaking away
or a Tibet is deeply rooted in the fragility of Chinese history but at the same time the
process of acculturation of Chinese citizens is so intense and so deep requiring so much
effort and felt hood that the unifying characteristics have a kind of have a different kind of strength
which no supranational entity in the West has ever achieved important to remember that
China had by some estimates 30 percent literacy 2,000 years ago when literacy in the West
was a tiny fraction of that now China essentially grew from the tiny area to notify the Shang
Dynasty 3,500 years ago by making its neighbors an offer they couldn’t refuse. The offer
was you become Chinese which is you learn the characters you adopt Chinese dress, Chinese
customs, and you pay taxes to the Emperor who will be the arbiter of conflicts among
various ethnicities and so forth. That’s a option one. Option two is we kill you all
and it won’t well effectively fine a basically reached its current geographical boundaries
which were natural the Gobi Desert that million mountains and the oceans by the year 700 they
haven’t changed substantially since then nor are they likely to change this is not
Rome or Alexander or the British Empire or the Comintern which wants to conquer masses
of territory China wishes to project influence but it does not look it is not in thirteen
hundred years fourteen hundred years look for territorial expansion the differences
between China and the West are deeply set the most important thing we’ll notices in
China is that there are no subsidiary institutions to use the terminology from Catholic social
theory there’s no Football League no Church bingo game no Board of Education that is or
that’s organized outside the imperial struck which is run by the Communist Party which
tolerates no competition the fundamental unit in China’s society was never a subsidiary
organization like New England churches that elected their own clergy and didn’t like
Anglican bishops telling them what to do it’s nested dolls the fundamental unit was the
extended family form in which the head of the form was admitted for Emperor and many
forms formed a clan which had a head who was another slightly less miniature Emperor going
up to a provincial governor going up to the Emperor it was a structure that reproduced
itself down to the capillary level of society that in a deeply oversimplified summary is
what Confucianism is my friend Francesco see she came from a writer for ancient times points
out that the Chinese conception of law rights and obligations is radically different from
the West starting with the Romans and certainly ancient Israel elsewhere the state was an
entity to which one had obligations and from which one derived rights and privileges in
Rome he paid her taxes he served in the army you could demand certain things of the state
you had certain economic benefits as it is in you’d deserve protection and so forth
it was a very well defined quid pro quo engraved in common law shana you do what the emperor
feels like at the moment and you hope you get a reward there’s no sense of rights
and privileges. China is radically different than Japan. Japanese love their emperor. The
Chinese have never loved their emperor. The emperor is a necessary evil. Chinese will
tell you today we’ve always had a temper. Why should we change now? When we didn’t
have a strong Emperor we killed each other. Look at the century of humiliation so we don’t
like the common party we don’t like any of these people they’re tax collectors they’re
brutal and they’re arbitrary but without them we would all kill each other close this
part of it with an anecdote I I worked for several years for an investment banking boutique
in Hong Kong Chinese owned we took a number of tech companies public and got a good view
of some of the more interesting things happen in the Chinese economy at once and I wrote
a research report and included the name of young Chinese colleague otic he said why did
you do that I said well I’m trying to give your career a little help it’s what you
do he said no one in China does that I said really you said in China no one has any friends
at age six you look around yourself in primary school and try to figure out whom you’re
going to walk over to get ahead that is not a lack of altruism it’s the way the system
is gamed because in parallel to this arbitrary Imperial structure China said it for 3,000
years of form of meritocracy which has been on many occasions highly effective that’s
the Mandarin system you passed the Mandarin exams your family becomes rich so a vast number
of people spend their families will find one talented boy invest all the resources to try
to get him to pass the matter of exam so it can elevate the entire family China has no
header hitter had hereditary aristocracy unlike the west no Dukes counts princes and so forth.
There are no aristocratic families but they tend to last two or three hundred years. They
keep turning over because talent from the base is allowed it’s a cold-hearted and
merciless meritocracy but it still works the one thing she Jinping cannot do is to get
one of his children into Peking University or Shema university you have to pass the exam
and get the right score of course there are people who hire professional exam passers
and with fake fingerprints to get to the security there’s a whole industry and cheated on
exams but the principle is nonetheless there that’s one of the great difficulties we
have in communication with Chinese if you meet any Chinese public official of any significant
rank you’re guaranteed that he or she has an IQ of over 150 it’s as if we had a government
entirely composed of National Merit Scholars not semi-finalists because out of the vast
population you select out the brightest by competitive exam systems and those are the
people who manage the government the difficulty the Chinese have is understanding that democracies
frequently advance stupid people you’re talking to people who since the age of 12
have never met a stupid person and they’re completely unable to believe that some of
the things we do are not conspiratorial subterfuges but simply incompetence and
dynasties have always fallen in China because they become soft and corrupt of it and then
get invaded or because they’re successful and the population expands faster than the
arable land China’s cursed with a very small portion of arable terrible territory so lack
of arable land has always produced peasant rebellions chronically the current dynasty
has had a very simple solution decimate the peasants and there won’t be a rebellion
that’s the reason for the one-child policy it’s a social control mechanism overpopulation
overthrew other dynasties okay we get rid of the population you’ve always been plenty
of side it’s one of the cruelest policies that any government in history has ever adopted
really ruthless but that’s the motivation second thing of course is since peasants tend
to be fractious as Mao Zedong observed famously in his report on Hunan in the 1930s eliminate
the peasantry moved them to the cities put them into a polygon block of urban residents
with people who come from other provinces can’t even talk to each other and of course
keep trying to prosperous maintain the mandate of heavy and make China impregnable so what
is fine is problem China’s problem is the same as that of every other country in the
world and I’d like to step back and mention a bit of wisdom from Robert Mundell the grandfather
of supply-side economics, 1999 Nobel Prize winner in economics who observed that chronic
current account deficits are the result of aging all capital markets are as young people
borrowing from old people old people need to retire young people need to raise families
start businesses old people of savings and they lend money to young people what happens
if you have a country with lots of old people who need to lend money to retire on but they
don’t have a lot of young people well you find another country which has young people
and you lend the money to them how do you get the money you sell the more Goods than
they sell to you that’s what national savings is it turns into a current account surplus
so there’s a relationship and a loose relationship between the percent of population over 65
and the current account balance as a percentage of GDP this is what Mandela predicts now of
course it’s a loose relationship and how far you are from the regression line is an
important data point so I’ve labeled the one the countries who have more of a current
account balance then their position and age would indicate it’s the ants and the ones
below it as the grasshoppers the ants are saving the grasshopper it’s a district because
I’m try that is way above the line we’re way below the line now since the whole world
the whole world doesn’t appear to be age if you look at the UN population tables it
appears static but that’s deceptive because most of the young people are in Africa or
South Asia and it’s very difficult to invest Western capital in a politically safe product
productive fashion in countries with low educational infrastructure poor political governance and
so forth so actually there’s a race on to control those markets which are investable
and that’s the decisive race in the world today Chinese have a rapidly aging population
the question for every population of the world is will you get rich before you get old in
the past I’ve drawn attention to the extraordinary fact that Iran will without any doubt be the
first country that gets very old without getting rich and all this is because of the extraordinary
fact that the Iranians running around today in their 30s 40s childbearing age come from
families with an average of seven children they’re having one and a half to two children
1.6 1.7 never in the history of the world has there been such a radical and sudden shock
to fertility behavior that means in 20 years from now there will be only one and a half
Iranians of working age to support every elderly Iranian so grandma’s going to be left to
starve in a garret and the society will break down Iran is the Walking Dead you can now
China is age not as fast as Iran but it’s aging as a result of the one-child policy
that’s been rescinded it’s our – child policy it’s yet to be seen whether it having
been muscled into a certain kind of fertility behavior that findings population will change
but China’s problem is they need to save massively in order to meet their their future
obligations to an age and generation Germans will tell you exactly the same thing so China
is proposing to take over Eurasia and make it a greater age greater a ragin co-prosperity
sphere or in their language one belt one road this is a trillion-dollar investment program
three years ago this looked like one more propaganda exercise by Chinese leadership
that couldn’t find its way to the sanitary facility it was launched with great fanfare
publicity nothing seemed to be happening but now a great deal is happening there are now
two rail lines going from China to Iran which cut the cost and time of shipment to Iran
in half there’s a fast train from Beijing to Istanbul it goes through a Caspian Sea
ferry to Baku and Arzo bajean then on to the blue sea and Georgia and then two cops in
eastern Turkey and then to Istanbul it also cuts the time in half we wonder looking at
Turkey why Turkey seems to be impervious to threats menaces bribes or whatever we try
to offer them to keep them in the Western alliance turkey now is profile itself as the
Western economic province of China and among other things you can see they’re behaving
on the matter of the weekers which was a sore point between Turkey Chinese for quite some
time the other thing that the Chinese are doing a Turkey which is a good segue into
another aspect of Chinese plans is transforming the Turkish broadband system mobile broadband
is having a transformational effect politically and economically that very few people anticipated
until very recently for my sins in the past I did some develop a economics I did some
work in place like Mexico Nicaragua Peru Russia after the fall of Communism the main thing
one notices about so-called developing countries is that most people sit around doing very
little most of the day you work this persistence plot you sit in a market stall swat flies
and wait for someone to come along and buy a liter of cooking oil you don’t pay taxes
you work off the books you scrape out a living 30 or 40 percent of economic life is the so-called
informal economy official labor participation rates are abysmal people are lost in a cycle
of poverty what mobile broadband has done is to reach into the capillaries of emerging
economies and locate the intrapreneurs the talent give them access to a world market
platform and increasingly give them access to microfinance and the entrepreneurial genius
who created this model in China where it’s most advances of course Jack Ma of Alibaba
now as big as Amazon Jack Ma is joined-at-the-hip bees the Siamese twin of Xi Jinping there
are two sides there’s a bright side and a dark side to what Big Data and mobile broadband
do you know the turn villages in China which are working for one person who figured out
how to make a product and sell it on the Alibaba platform and you’d have something called
ant finance and a number of other microfinance platforms which are making small loans to
businessman all over China something the banking system state banking system doesn’t do state
banking system is based a bucket full of cash with a shovel which is used when a state of
an enterprise comes by and this is transforming the capillary level of China the most important
thing that China has managed to do that no other so-called emerging economy has done
in the past while Korea has done it becoming it has emerged is to mobilize the human capital
of its citizens make the whole world available to them but because the Chinese have successfully
protected their intranet the Great Wall of China there’s a dark side to this as well
all the data that Alibaba and 10 cent and the other great internet organizations in
China collect is of course at the disposal of the Ministry of State Security the greatest
telecom communications equipment provider in the world is now Huawei founded by a former
officer in the Chinese Signal Corps a couple of years ago as an anecdote I wanted to get
a tour of Huawei headquarters and to do that I had to find some unsuspecting Latin American
ambassador to take the tour so I could tag along as the escort and we were shown the
Huawei exhibition hall which is a three-hour extravaganza it looks like two wings of the
Smithsonian we came to a wall at Norma’s wall and as several times the size of that
screen which the city of Guangdong map with lots of points of light they said very proudly
every one of those is every smartphone in the city and we can correlate the location
of the smartphone and its movement with online searches online shopping Facebook about Facebook
WeChat postings and so forth so they know where everybody is who they’re with and
what they’ve done and what they’ve said at a little times plus they’ve got cameras
everyone meters or so which do very effective faithful recognition so if you happen to be
holding someone else’s smartphone they’ll figure that out quickly enough which gives
the Chinese Communist Party without any doubt the cruelest dictatorship in modern history
to Tollett Aryan social control capabilities that the likes of a Hitler or Stalin could
not have dreamed of overthrowing this entity is not an easy proposition I don’t know
where we begin and I wouldn’t undertake the task we’re dealing with an entity which
is not going to be cowed politically we’re a few Op-eds about dissidents or human rights
are going to have much of an effect this is not Poland with a subsidiary Catholic Church
or Hungary it’s a very different entity it’s a society with no subsidiary hollowed
out except for the Catholic Church except except for the Communist Party I just spoke
for a second there is a Catholic Church in China it’s tiny it’s split into a Catholic
patriotic Association controlled by the state and a very small underground Catholic Church
you do have perhaps a hundred billion Chinese who consider themselves in one way or another
to be Christian and they’re tolerated as long as they meet in homes and form no visible
organizations so they tend to be very low-profile for that reason it’s extremely difficult
to gain an overall profile of what the content of Chinese religious life is you have any
people who identify as Christians who’ve never had a Bible and many who are deeply
learning and profound but we only have anecdotal evidence about that that might be over the
very long term of soft underbelly of Chinese culture but it’s something we can only speculate
about and in the horizon of any viable strategy I don’t believe will be a factor so this
chart shows the percentage of population owning a smartphone Turkey and China are right there
around 50 percent China has become a cashless society effectively no a few years ago the
Apple store in Hong Kong had the calf counting machines that drug dealers use and people
have come from the mainland with suitcases full of cash and they go down the cash counter
machine and walk out with a hundred iPads taken back to the mainland and sell them not
anymore Ali pay and other electronic payment systems have largely eliminated cash this
is the core of the anti-corruption campaign which is enormously successful because it’s
technology driven the government can track every transaction because they’re electronic
the most important appointment that came out of the Chinese Party Congress in the view
of our China editor days at times Jeff Tao was the elevation of yeah who was the reforms
are under under Xi Jinping the author of the famous dot now famous document called a proposal
for supply-side structural reforms in the Chinese economy what are these reforms law
in the case of Turkey Turkcell is now in a joint venture with one way to help the Finance
Ministry eliminate cash payments by 2023 broadband and physical transport or hard wiring turkey
into the Chinese economy that’s why the West has lost leverage and Turkey Iran with
its two rail lines going to China they’ve always believed in dependent on the Chinese
economy for many years that’s also a problematic consideration what kind of pressure would
sanctions effect on Iran given their dependence on China Russia has quadrupled or quick toppled
it’s oil exports to China over the last four or five years mainly the expense of Saudi
Arabia Russia will be bankrupt without the Chinese favoring oil imports from Russia Russia’s
incredibly important adjunct to China one of the things China doesn’t have a culture
hasn’t favored it is a foreign intelligence services speaker for a diplomatic service
in China if you meet somebody in the Diplomatic Service who’s lived abroad speaks four languages
at ease of Western culture you know for sure he’s the near to well brother-in-law of
some party official who didn’t think it was worth putting them up the fast-track of
the peoples of the race and arming of the regional party organizations it’s a dumping
ground for people who aren’t that important so the Ruffins with their great expertise
in Turkey in the Caucasus and Persia and so forth they’re excellent intelligence service
language capabilities are critical adjunct very fine now is trying to kind of go bankrupt
I’ve been reading articles about China’s debt and debt problem and so forth I think
many of the reports we’ve had have been a quick first cut and superficial I’m a
banker and the question bankers wanted it was what’s the collateral if there’s a
loan what’s behind it the debt to the laboratories of a company is less important than its underlying
carrying capacity so our team at age of x broke down the balance sheets of the 300 top
companies in the shinjin 300 index that’s the closest thing China has to an S&P 500
index and we discovered that two-thirds the total debt is attached to infrastructure companies
biggest is petrified the others are real companies and metal companies power development nuclear
power take out the fine and not putting me including the financials a couple of airports
this is theme this is China’s infrastructure which is includes now close to thirty thousand
kilometers of high-speed rail which is an enormous productivity booster now there’s
a lot of inefficiency obviously but it’s not the same thing as the great American bubble
of 1998 to 2008 where foreign money bought American mortgages American mortgages finest
house speculation by households how speculation was used to artificially boost consumption
so the problem we had was financial distress in the population itself this is debt backed
by infrastructure which has a productivity-enhancing effect why did this happen this way well one
of the oddities I don’t want to go through the details of this if I’ve got some data
I’d be glad just and send you if you talk to me afterwards but if you look at the debt
ratios in China versus almost any other country in the world you see this huge corporate debt
component very small government and household debt components compared to everyone else
China until very recently had effectively no taxes there’s no personal income tax
they had what’s called the corporate tax which is just a top-line tax recently they
adopted value-added tax being introduced that’s being corrected but in the meantime if you
wanted to build the infrastructure oh and they didn’t have a domestic bond market
to speak up so in the U.S. you issue bonds and you raise tax revenues down to tax revenues
you borrow money against tax revenues those mechanisms simply didn’t exist in shock
they’re now being built rapidly so to get the infrastructure built the Chinese government
simply told the state banks we’re printing money give that money to state companies so
it shows up as a ballooning of corporate debt that’s an inefficiency in the structure
the Chinese economy which is one of the many things that the Xi Jinping regime will address
in the course of the reforms but it’s not a financial crisis the hedge fund community
is littered with corpses of people who shorted China believing it was a crisis there’s
a before I get to the the Rd stuff famed just as a quick aside China lost a trillion dollars
worth of reserves 2015-2016 and the papers were full of reports saying there’s a massive
run out of Chinese assets Chinese are panicking China’s going to go backward what the papers
did not report but the Bank for International Settlements Economics staff documented a great
detail is that while the Chinese government was losing a trillion dollars of reserves
Chinese companies mostly state-owned companies were paying down a trillion dollars worth
of foreign debt it was simply an internal bookkeeping transaction and it was undertaken
because the Chinese had let their currency appreciate for years so it was the advantage
of corporation to borrow in dollars use the proceeds in RMB and then pay the dollars back
and a more favorable exchange rate in the future but the Chinese were the very fast
drives of the dollar 2015 Chinese had to turn that around so you had to turn around the
super tank of a balance sheet or replace the dollar debt with local currency gain and so
anyway a lot of very poor superficial analysis has been done on the Chinese economy but also
some really excellent work for example as I mentioned by the Bank for International
Settlements the data and the analysis are out there if you look for them unfortunately
the gullible and lazy reporters of the mainstream media who give us most of our daily feed don’t
bother to do their so China’s now has R&D at 2% of GDP what does that go into well I’ve
got the fastest supercomputers in the world they have a functioning quantum satellite
in other words a quantum a quantum link between satellite earth means that if there’s any
attempt to interfere with a signal for example to eavesdrop on it it immediately destroys
the signal itself liquidates Chinese scientists had a conversation over the satellite link
with the French counterpart massive investments in supercomputer also investments and things
like services to ship missiles which may or may not be able to take down an American carrier
we probably don’t want to find out diesel-electric submarines of the kinds of Germans that for
a long time that can lurk on the bottom and batteries and at this point are virtually
undetectable hypersonic missiles designed to defeat not only fat or Patriot or other
systems that we currently have but systems that we might develop in the future satellite
killer missiles and a range of things to make themselves and pregnant now one important
caveat about Chinese military spending is shown by the difference between how they equipped
a ground soldier and how they equip their space forces and missile forces the United
States spends last I checked something over a hundred thousand dollars maybe one hundred
ten hundred twenty thousand dollars to equip a single infantryman Chinese spend about fifteen
hundred dollars twelve hundred fifteen hundred dollars that’s basically a Kalashnikov rifle
pair of boots couple spare uniforms and that’s it Chinese have no grab attack aircraft nothing
like the warthog nothing like the Russian frog but simply not in the inventory Chinese
are not preparing for a land war the only land where they could conceivably fight might
be with India or Vietnam that really doesn’t fit into their objectives but they want to
absolutely dominate the South China Sea make Taiwan entirely dependent on and control everything
around them one of the companies that we took public at when I was at reorient group in
Hong Kong kwangji science run by a bunch of materials PhD is from Duke I walked into the
office of the chairman that he had his iPhone out and he said I want to show you something
they showed me a little map of the South China Sea with lots of triangles so that’s cool
what are those triangles so that is the location speed direction and condition of a motor of
every ship in the South China Sea so we can distinguish a fishing trawler from a destroyer
how do you do that it said balloons they have some very strong materials they develop so
they put a pie out to balloons all over the place with coaxial cables they can monitor
the South China Sea if God forbid we had a wall of China and we each take out of each
other satellites the US military is blind Chinese have a much more primitive but robust
technology covering their entire Coast so roughly six or seven percent of undergraduates
major in engineering in China it is 33% Chinese produce twice as many stem PhDs as we do now
and four times as many stem undergraduates now granted the saw the quality of the Chinese
educational system is spotted remember that the Cultural Revolution leveled the universities
they had to be rebuilt from scratch but in the view of many the better schools are as
good as ours then you have some crappy diploma mills at the bottom of the pile but I urge
you to go on the internet and simply look at the equivalent of New York regions test
for graduating high school seniors in China I know a little math and it made me sweat
I guarantee that if that were the standard test for Americans you know 1/10 of 1% competency
right now in America there’s a lot of warranty plenty of people doing R&D to try to find
a better breakfast cereal but federal R&D is a good proxy for hard science long-range
R&D and that was in the Reagan administration of blessed memory roughly you know close to
about 0.8 percent of GDP and it’s fallen by half to about 0.4 percent of GDP remember
in the 1980s we had corporate laboratories we had GE RCA IBM Bell Labs none of them exists
anymore they’ve all been shut down the National Labs are you know shadow of themselves we’ve
got plenty of people at universities doing things but we don’t have the kind of concentrated
industry science relationship which holds these things together and is related to do
this in productivity which I don’t want to go into the case where’s the money going
in the U.S. well there’s tons of money going into software this is a venture capital commitments
but nothing going into computers peripherals semiconductors telecom networking why don’t
we invest in capital intensive high-tech manufacturing because every venture capitalists out there
is scared witless of the agents who subsidize this stuff they’re afraid they’ve got
Christ so we invest it apps capital white stuff we’ve got a trillion dollar valuation
on an app to search for used cars we’ve got 120 different dating sites we are geeks
in a new roman empire now what do we do about we’re gonna have to do subsidies I’m a-free
marketer. I’m a supply-side I’m a free trader this is war war you do things differently
where you put the subsidies you put them in the hard science hard Rd let businesses take
the risk but the Defense Department may have to do direct investments in some industries
we start with inherent Dr. Henry Cassell and I proposals in the World Street Journal just
after the election start with the rule sense of defense goods have to be made in the U.S.
under secure conditions period that’s a gazillion percent tariff how do you like them
apples I don’t care about tariffs on steel or aluminum the Chinese want to get rid of
that stuff anyway Chinese would love us to be Brazil let agriculture energy of semi-finished
goods and of course politically a steel plant has more workers to give a speech in front
of then semiconductor fab plant does not quite a sexy so politically it may not fit the profile
quite as smoothly as some other things but if we don’t do this we’re going to lose
this one belt one road thing well lots of people hate the Chinese they’re horrible
they’re aggressive they’re nasty they in debt countries they bully them well what
if we could to get together with the Japanese who’ve got more foreign assets than the
Chinese and the Indians and compete with them the Chinese and sorry the Indians of Japanese
ordered of something already have something called the Asian growth car which is supposed
to be but it’s tiny if we got behind that in a three-way effort we could offer the Chinese
a serious competition and then stop Intel and other companies from getting access to
the Chinese market by giving away the store a lot of companies won’t like that because
it’s good for their stock price in the short run a lot of people are getting rich on the
decline of the West but there are some things more important than Intel stock price a lot
of people don’t like it but it’s got to come down to the top my conclusion ladies
and gentlemen thank you for your patience is that we have done this before we did it
in World War II we did it with a Kennedy moonshot we did it with Reagan and the military buildup
in the SDI we know how to do it a lot of the people who did it are still around it’s
not that we can’t do we just have to determine that we want to do it and get it done otherwise
we’re going to live in a world that none of us are going to be really pleased with.
Thank you very much for you. I have a lot of neighbors who are Chinese Americans and
they’re on WeChat here so two questions one is there any way that the Chinese government
can be America and to word about from lack of time I think North Korea is a case of the
Chinese wanted play arsonist and Fire Brigade at the same time they’ve encouraged the
Chinese they’ve encouraged the North Koreans and given them some covert help and then you
know President Trump will go to China and tell the Chinese we need your help to deal
with these nutcases Xi Jinping will say well we can help little cost you now that’s a
dangerous game to play because I say the Japanese decide to develop nuclear weapons I can tell
you the Chinese won’t like that they’re very afraid of the Japanese so it could backfire
on them it’s a delicate game but that is an example of the Chinese using well their
play play go you surround the opponent with your pieces you don’t do obvious dramatic
moves you play for the very long-term very patient very strategic whereas we are impatient
and tactical they’re playing go we’re playing Monopoly Brendan thank you for your
time honored but my real question is the Russian Far East and Chinese Leeson the far-east is
kind of a quasi-vassal state how do we get well Chinese look at everybody and think protein
source reference included but now the Russians simply don’t have a population to dominate
the Far East so the Chinese it’s not worth their fighting over it because long term it’ll
fall into Chinese hands the Chinese won’t fall over it because long term it will be
theirs just due to Russia’s population at riffin how do you get the Russians to understand
that well I think there are a lot of things we could do with the Ruffins that’s a whole
other presentation I think we’ve mishandled it I think you need a very big stick and a
very juicy carrot at the same time we won the Cold War in large part because Henry Kissinger
god bless him helped split and Nixon helped split China from Russia and get in the back
together again cannot possibly be in our interests but given in China’s the fact that China
dominates the raw materials demand side and Russia depends on raw materials there’s
very little we can do in the short term to change that dependency that Russia has on
China so although in principle I agree with you tactically that’s a much longer term
kind of consideration that’s just the way the cards are dealt then you should be writing
four times I’m delighted to meet you in person my pleasure – yeah two questions
one with China’s economic penetration in the de Central Asia as far as Iran and Turkey
what impact do you think this might have along the instability and chaos in the Middle East
well that’s one second the US has turned its back on the TPP how serious of blunder
do you think that is well I don’t think the TPP is going to help us at this point
I think it’s much more a matter of fighting economic war with the Chinese they’ve got
there greater co-prosperity sphere we want to set up competition so I think you should
just sort of move on and adopt a different policy as far as instability it’s very hard
to know it is possible that the Chinese will exercise a moderating influence on the irradiance
the Chinese want to get rich want it but powerful and they want everyone to behave and pay them
tribute they don’t want the meijer tribes to war with each other and they have a 3,000
4,000 year history of exterminating unruly barbarians so they would certainly encourage
the Iranians to cool it with the Israelis they like the Israelis they get you know they
get along they want is really technology they don’t want a war between Iran and Israel
for example on the other hand all of this may variable embolden an Iranian regime which
is increasingly desperate and strident and Chinese are very poor at managing relation
so they may have quite different effects very hard to know the worlds being transformed
so quickly that it’s very hard to make a blank judgment it’s a great question I wish
I could be are using their gene-splicing to be able to look at embryos and try to determine
which are smarter so parents can create a bunch of fertilized embryos and then decide
which to plant later in the womb and create the smartest kids in the world how effective
they will be I have no idea but this is not an urban legend. This is real. They are doing
it and that’s how they think as I said it’s a very cruel society. It’s an absolutely
ruthless meritocracy and which does not give any mercy to the hindmost parties consistently
well I think China wants Russia to be its cat’s paw in a number of strategic operations
it wants to make the Shanghai Cooperation Organization a successful competitor NATO
wants to harness all of Russian military technology to Chinese ends and China has some significant
gaps in their military profile which the Russians have historically filled for example Chinese
still can’t make a good jet engine their metallicky is behind the Russian so they use
Russian jet engines they only just got the s400 which is important because with a range
of several hundred kilometers it can control the skies over Taiwan from land bases on the
mainland that probably want the s500 so they won thrushes to do their bidding at effectively
be their vassal state at a hundred year horizon roughest population will have shrunk it’s
even though Russian fertility has actually recovered a good deal the pool of women of
childbearing age fell so quickly that a decline is inevitable and that means that it’ll
be the marginal areas like Siberia that lose the most population so it’ll fall into Chinese
hands the Chinese set up to fight for it they’re going to get it anyway you swear well circle
for me while while seeing paradox they all have the most strategic nation out there right
now but at the same time you correctly demonstrated that they don’t know how to before intelligence
they’re rubbish at the close why is that there’s a lack of capital empathy how can
they be uber strategic with the one belt one Road at the same time the further eight intelligence
and all Chinese culture has been to push inward to take peach to take the periphery and force
it inward and homogenize it with the with the single written language with the ideograms
because china had no interest in getting through the getting to the rest of all that reached
natural natural borders by about 700 with the Tang dynasty they really didn’t have
pressure to do so China’s economic basis has always been agriculture never been a colonial
power like the British the Emperor had an annual ceremony where he put his hand on the
plow which say the son of heaven himself is symbolically a plough it’s deeply embedded
in Chinese history when you spend your entire childhood I mean after the age of 11 or 12
if you know working four hours a day you can read 2,000 characters perhaps that right mm
maybe 1,500 to 2,000 and ames 11 means you can read a newspaper to get to 10,000 characters
which is high literate you do everything else the ability to learn languages phonetically
that we have in the West is something that has never been developed as part of Chinese
culture that Roman polyglot or Greek polyglot capacity was simply never part of the culture
the Chinese feel so drawn centripetal to their own culture that they simply don’t like
living anywhere else when they go to other countries they bring their own war teams their
own wheelbarrows their own cooks their own food that open next to the locals because
they feel out of sorts on the other hand Chinese who as individuals emigrate er some of those
adaptable people in the world from the Chinese diaspora has been remarkably adaptable both
culturally and economically so it is it is a it is a difficult contradiction to shyness Turkish relations were at a low
two or three years ago because the Chinese believed with some justification that the
Turks were supporting wigglers who were moving in large numbers Syria fighting in Syria getting
trained as terrorists a lot of them there was a route that went from China to Southeast
Asia at the Yunnan Province they go to Turkish consulates they present themselves as Chinese
Turks get Turkish passports Chinese officials locally the Turks had fifty thousand blank
passports and their consulates to serve us the weavers whether that’s true or not I
don’t know but I think the Chinese actually believed that they were very afraid of weaker
terrorism since then Erewhon has started behaving himself he cracked out of the weavers in Syria
and Turkey he’s not letting them travel back and forth without any fanfare there been
a very few reports in the media dothis air Dhawan has completely exceeded two Chinese
demands so air the ones national interest his desire to gain independence from the West
has trumped his ethnic solidarity with his weaker cousins when our people thank you very
much for that comment I deeply share your concern and if it weren’t
for the fact that we’ve lost our moral compass we wouldn’t be having these concerns at
all to begin with but I do I certainly want trying to do the prosperous and to be a piece
and to be secure I don’t think the United States should attempt to break Taiwan or from
China I think the one policy one China policy simply is a banner of realism I don’t like
it particularly but I think that’s the way the cards are dealt I don’t think we’re
going to get any worth to bet so I don’t want to mess with that I’m all for China
being secured at U.S. borders however it’s like steel in 1870 very European country they
don’t have high quality steel mills you can’t make cannon you’re dead militarily
if we lose our semiconductor industry our edge in semiconductors militarily we become
a second-rate power and that has all kinds of terrible consequences which are almost
impossible to predict apart from the fact will be a great deal poorer as well so I’m
all for China being prosperous but I’ve I deeply want America to have a technological
edge that’s tangible and keeps everyone afraid of us I very much believe if you want
peace you prepare for war relatively little reserves of energy great day little cold not
very much else 25 million cars that are produced there now running this is the imported fuel
well they’re turning coal into methanol well they do have a huge potential for fracking
probably as large as the United States Romney takes a lot of water in one hears stories
that water is our premium and processes just get a Ford there’s definitely true what
do you hear about any plans actual investment going into it’s not my field that’s a
gray it’s an excellent question I wish I knew more about it from what I’ve heard
you’d have to construct a pipeline from the sea to bring in seawater because the air
is where the shale deposits located or mountainous and extremely dry so there isn’t any water
source ready to have that would be an enormous expense and the Chinese have to weigh that
against for example building pipelines interruption well a natural gas which they’re doing and
creating the pipelines to through Pakistan to the Indian Ocean which would give him better
access to Iranian and and belayed and Iraqi crude without going without the vulnerability
of going through the Straits of Malacca so I think the Chinese tension is much more an
energy security replacing the existing routes and increasing their supply from Russia that
on fracking they also of course if announced that they’re going to eliminate the internal
combustion engine entirely in China but what 2030 I wouldn’t take that too seriously
but it is an important effort they’re building nuclear power plants as fast as they can several
a year that will not have a huge effect on their total energy output for several years
to come but at a 15 year horizon it will make a very big difference further alarming they
have a plan is beyond the one belt one road to build a grave it connects the entire world
including us is but which way do you pay the tolls thank you for that thank you good for
whom Xi Jinping is a very capable leader and his Chinese patriot is doing what he’s thinking
thinks is best for his country in ways that in many cases I found repugnant in the extreme
but I don’t propose to criticize and the Chinese are going to have to work out their
own problems I think Trump trap is being set for the United States which is will make a
fuss about aluminum tariffs and steel tariffs and dumping and various other things Chinese
will kick and scream and negotiate and finally they’ll give in and trumple of a great victory
we saved the American aluminum industry from Chinese dumping we saved steel Chinese officials
told me why does Trump want to save all the industries who want to get rid of China is
happy for us to be Brazil semi-finished goods and raw materials so I think that’s what
the habitus ocean is going to go and I think the first thing I would tell if I were trumpet
here’s what I would tell Xi Jinping for the last 30 years you and the Russians have
told us it would be unacceptable for us to develop and implement a space-based anti-missile
system because he’d consider that a tenable change in balance of power like to acknowledge
the presence here the distinguished political scientist Angela Kota Villa one of the world’s
experts on this may want to say something more about it I would say see we understand
your concerns but you loused up you let the North Koreans get out of control everybody
was relying on you and look what a mess you made of it that leaves us no choice so as
soon as I come back I’m going to announce the American people to the American people
a Manhattan Project to develop a space-based anti-missile system to make the United States
impregnable and if you don’t like it go jump on
the belief system to sustain is that in China I know she is working hard to promote the
per diem ideology and is thinking how vulnerable is it to a change such as that since it’s
been said for so many years that is the great question Bob and the riddle wrapped in an
enigma is the status of Chinese Christianity if ever a country were ripe for Christianity
that would be China look at the late Roman Empire with tribes migrating disappearing
losing their national identity losing confidence in their preworld gods well China’s a nation
of my currency 600 million people have moved from countryside to the city it’s spiritually
empty human beings do not do well in a spiritual vacuum but because the movement has been so
subtle and so located it’s been a house church movement not an organized movement
it’s extremely difficult to gather data on it there’s a recent book on Christianity
in China a good book but entirely Anto almost impossible to get real data on this so that
certainly could be a game-changer is not the right word for it that could be the transformational
change that would that would make China an entirely different place but I’ve got no
means to evaluate it I’ve been trying to learn about it for years and you only hear
anecdotes because with very good reason Chinese Christians are keeping their heads down.

Why China Ended its One-Child Policy

This video is sponsored by Dashlane. Conveniently store your passwords and get
10% off premium when you sign up with the link in the description. China is huge. The kind of huge that’s hard to wrap your
head around. Beginning in the 1950’s, its population
exploded, from an already respectable 500 million to almost three times that today. which makes it bigger than all of North America,
Australia, and Europe combined. Its consistent economic growth has made it
one of the world’s great powers, with enough military might to claim the strategically
important South China Sea, and enough influence to begin the most ambitious
infrastructure project in history. A $1 trillion dollar network of ports, pipelines,
and railroads across 65 countries. But none of this was inevitable. While China rapidly and forcefully industrialized,
it faced massive famine and housing shortages. Its economy needed time to develop, and the
world deeply feared overpopulation. China’s response was the famous One Child
Policy, which limited ethnic Chinese families to a single child, with a few exceptions. To enforce the law, women were forcefully
sterilized and fined for having too many children. The problem is: it worked. Or, something did. Historians doubt it prevented all 400 million
births claimed by the government, But China’s Total Fertility Rate, the average number of
children a woman will have in her lifetime, has fallen all the way to 1.6, well below the 2.1 needed to maintain its
size. There simply aren’t enough children, and
in a few short years, China will begin to shrink. The One Child Policy was repealed in 2015,
but it won’t make a significant difference, because it only ever sped-up the unavoidable:
As nations develop, they choose to have drastically fewer children. China’s problem isn’t unique, about half
the world lives in a country that is or soon will be in the same position, but it is uniquely
big, and the timing, uniquely bad. The story of China in the 21st century is
just as much about demographics as it is GDP, military power, the rule of Xi Jinping, all
of which will be seriously tested by the coming demographic crisis. To understand why it’s such a threat, and
whether something can be done, we need to look a little more closely. As individuals, humans are unpredictable. We don’t know what someone will do, or say,
or buy, because they don’t know. Impulse guides your decision to add guacamole
just as it does what college you attend. But, countries don’t care about individuals,
they care about groups. And the beauty of demography is that groups
are predictable. Very. Of course, nothing is certain, theories compete
and estimates vary, but it’s much easier to guess how many 18-years-olds we’ll have
in 30 years and in general, what they’ll be doing than, say, the next three decades
of foreign policy or culture. No country has yet figured out how to manufacture
18 year olds, not even China, and that means population today is a good peek at population
tomorrow. When this information is combined with geopolitics
or economics, it goes from mildly interesting to downright powerful. Here’s what we know about China: Each of these lines is one of its age groups,
with babies at the bottom, and elderly at the top. First, are consumers. From 18 to 45, we know people are spending
– they’re going to school, taking out loans, saving… not so much. and despite what this group says about millennials,
they’re very important, because consumer spending is one of the biggest contributors
to economic growth. Next, are the money makers. These people have paid off their debt, now
they’re saving for retirement. And even though they’re a smaller share
of the population, they generate most of its income. In the U.S., for example, they alone pay half
of all income tax. That makes them, a government’s best friend. Finally, at age 65, people are done working,
done saving, and, largely, done spending. What’s special about this group, is how
quickly and how dramatically it begins: In a single day, a retiree often goes from
contributing the highest taxes of their lifetime, to almost nothing, as they slowly collect
pensions and social security. For right now, let’s ignore the total number
of people. China could be bigger like this, or smaller
like this, What’s important is the balance between
these different groups, and that’s why this graphic is so useful. It’s called a Population Pyramid, because,
for most of history, it has been. A constant stream of babies at the bottom,
and a small number of deaths with each subsequent year. A good example is Niger, where the average
woman has 6.5 children. Mortality is very high, making the average
age only 15. But much of the world no longer looks like
a pyramid. In China, it’s turning upside down. As you can see, there are two big bulges in
its population, here and here. The first is currently in its peak spending
years. The second, right in the prime of its high-earning,
high-tax-contributing years. It’s no wonder China is seeing massive economic
growth. But that’s what makes a demographic crisis
such an ugly one: it happens verrryyyy slowly, and then, all at once. Remember, this huge groups of workers will
soon, and quite suddenly retire, as they start waiting for the checks to arrive. But the group responsible for writing those
checks, or at least, funding them, is getting smaller and smaller. The problem isn’t just financial, A single
child must now care for two parents and four grandparents. The United Nations expects China’s Dependency
Ratio, the number of non-working compared to working-age people, to increase at roughly
the same rate as Japan’s, whose population began shrinking in 2011, and now sells more
adult diapers than infant ones. By 2050, China may have more retirees than
all of Germany, Japan, France, and Britain. Worse, the One Child Policy, combined with
a cultural preference for males, has created a massive gender imbalance. As a result, it’s likely that by 2030, one-fourth
of Chinese men in their late 30’s will have never married. At a minimum, an abundance of forgotten young
men will cause some social anxiety. Or possibly, as some experts suggest, serious
conflict. It sounds a lot like the plot of a movie. Perhaps, “No Country for Young Men” Of course, China is aware of the problem,
But it’s fighting an inevitable demographic transition. In the beginning, For China, the early 20th
century, children are abundant. Because: you can only expect a few to survive,
you don’t have the education or tools for family planning, and because the best way
to grow tomatoes is to first grow children. Seriously. For any sleep-deprived parents watching, this
will be a shock, but giving birth was once the ultimate productivity hack. Before there were tractors, there were children. And then, people stop dying. It really only takes a few improvements to
healthcare for rapid reductions in mortality. And that’s how the world grew from 1.6 to
6.1 billion people in one century, That short window where fewer people are dying,
but everyone’s still having children. But it is just a window, after mortality drops,
fertility is right behind it. As industrialization brings rural workers
to find jobs in the city, Children become less a utility and more a liability – the
kind that screams, and cries, and generates student loan debt. As the saying goes: the best contraceptive
is economic development. The fact that countries like China, the U.S.,
Italy, and Germany, have this problem, is an otherwise good sign. Dangerously low fertility is actually a side-effect
of many good things: increased education, opportunities for women, and healthcare. It’s a no-kidding first-world problem. There are many ways to offset the damage,
you can increase productivity, taxes, immigration and/or fertility, But it’s hard to find a solution that doesn’t
come with its own set of problems. Many countries, for example, now offer incentives
for having children. One of the most generous is Sweden, where
couples have the right to 480 days of paid maternity leave PER child. The downside? Employers are more hesitant to hire young
women, who are far more likely to take those days off. And it doesn’t help that, even adjusted
for inflation, the cost of raising a child has risen for decades. Babies just can’t compete with dogs. China has already gone from issuing fines
for second children to issuing checks, but people just don’t seem to want them. This paper predicts the new two-child policy
will only increase China’s population from 1.4 to 1.45 billion in 2029. Because a person’s ideal family size is
largely determined by their own, two generations of Chinese now see one child as the norm. Plus, young people are pressured to work longer
and harder to keep up with the rising taxes needed to support the older population. None of this means China can’t come up with
a solution, In fact, it has a few things going for it: As people move to the city, they’ll become
bigger contributors to the economy, And today’s young workers are far better
educated than those they’re replacing – 11 years of schooling compared to just 6. There’s also the bigger trend towards an
automation-based economy which doesn’t rely on a such a large number of workers. But that too, has the potential for chaos. And even if it does manage to increase fertility,
remember that demographic changes are slow. Children born today won’t start contributing
for at least 18 years. Whatever the outcome, it’ll define China’s
role in the 21st century. The One-Child Policy will test China’s national
security… just as your One-Password Policy could threaten your security. I know, I know, it’s easy to use the same
password everywhere, But there’s just no need to choose between
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Freeland: McCallum doesn't speak for Canadian government

Canada's former ambassador to China John McCallum is facing criticism for waiting into the ongoing diplomatic dispute between Canada and China McCallum told the South China Morning Post that he advised his former contacts in China's Ministry of Foreign Affairs that any more punishments on Canadian exports could help the Conservatives win October's election a win he said would not be best for China's interests Foreign Affairs Minister Christian Phelan was asked about McCallum's comments earlier today let me be extremely clear that mr. McCallum does not speak in the name of the governments of Canada in January the Prime Minister asked for mr. McCallum's resignation and mr. McCallum subsequently resigned from his role as Canada's ambassador to China when it comes to China our priority very much my personal priority is the well-being of Michel Kovarik and Michel SPAWAR conservative leader Andrew Shearer issued a statement slamming McCallum and calling his comments an invitation of foreign interference in the Canadian election

Trudeau meets with G20 allies amid China-Canada tensions | Power & Politics

Prime Minister Trudeau is in Osaka Japan for the g20 gathering of world leaders while he does not have any meetings scheduled with China's President Xi Jingping the Prime Minister is hoping for movement in Canada's ongoing diplomatic dispute with China Canadians Michel Kover again Michael's father are still detained in prison in China accused of spying in recent months China has stopped importing some Canadian products like canola and earlier this week China halted imports of Canadian meat due to a shipment of pork with fake Canadian certificates so what is happening to try to resolve the dispute Jim Carr is the minister of international trade diversification he joins me now from Winnipeg Minister Khar welcome back to the program again thanks Heather it's not good to be on a very hot day with a bit here to an Ottawa I'm to say can we begin this conversation on China on the meat van and on the fake certificates what is the latest today on the investigation nothing has changed since you spoke to the Agriculture Ministry yesterday and we did a series of interviews there is an investigation in authentic certificates have been found and we're going to get to the bottom of it and we want to resolve this as fast as we can and we have been in constant contact with the industry with producers with our provincial counterparts with the CFIA which has been in daily contact with officials in China and we're working very aggressively to resolve it what is the level of cooperation with China I'm wondering whether they are investigating the origin of the meat whether they're looking to see who in China ordered the importation what is that level of cooperation yeah there's been quite a bit of cooperation and frequence as you know it's in everybody's interest to solve this quickly we have the finest product in the world the Chinese have demonstrated how much they like the product sales have been way up there has been a culling of the herd in China so they need our product so it's in everybody's interest to make sure that this is resolved quickly it's not unprecedented that there have been certificate problems it has happened before it's rare and we know what our interest is it's to assure the producers in Canada that we are telling our partners and everybody around the world that this is the finest product and that our safety system and inspection is the gold standard now we're gonna we're gonna work through it or we're gonna work through it as quickly as we can okay so I'm gonna come to the timing back to that in a second but what you're telling me not any closer today to determining the origin of the source here what are the possible sources Minister Khar well that would just be speculation and there'd be no point in that and it's not helpful because I could speculate and I'd be wrong and you'd come back to me in a week or in the month and you would say yeah your speculation was wrong so I don't think there's much advantage and what we're looking for here is a route to a speedy solution right if not the origin then how would you help us understand the process how would you even determine the origin of this would you look at for wearable DNA testing of this meat well the investigators will do that this is what they do arsenic or their well we have our law enforcement officials working with the CFIA they know the roots of investigation that are fruitful and they're working full-time on it right now why would Canada have been the target of fraud in this way I don't know I don't know for sure again you're asking me to speculate what do we know we know that we are sending abroad the finest work in the world we know that the Canada brand is an elite brand so I guess it might be in somebody's interests to use that branding and to use that reputation but we don't know and those are the reasons why we're aggressively investigating and you've indicated you want this to be resolved as quickly as possible how long do you anticipate the Chinese market will be closed to Canadian meat and what are the short-term fixes you're looking at in terms of ensuring that's a short as possible well we're looking to expand our export markets and as you probably know we just returned from South Korea and Japan with canola producers with the ministers of trade from Alberta and Saskatchewan with officials with canola growers because we know that because of the quality of our product that it is desirable internationally and part of the trade diversification strategy is to understand that it's in the strategic interests of Canada to really reduce our reliance on any one partner seventy-five percent of our exports go to the United States and make sense for us to diversify 40% of our canola goes to China the same reason supply and we've been working very aggressively I've been on the phone non-stop with counterparts and importers in Malaysia and Pakistan and Bangladesh in Mexico in France in Germany the United Arab Emirates to sell our products we have a relationship already with all of these nations and it makes sense to broaden and deepen them and particularly on the canola point have any of those efforts yielded anything definitive to this point yes they have and we came back from South Korea and from Japan with some memorandums of understanding with major retailers with Costco with latte and we know that through these distribution networks it will bear fruit and probably in the short term remember we already have a large percentage of these markets so the ambition is not only to get a larger percentage of the current market but to expand it and the way you expand it is by talking about the health quality and the nutritional value of our product the best in the world and I felt that it was a very successful mission and I believe that our partners did too because we're looking last year at 2.7 billion dollars of canola seed to China alone last year alone that's a lot to make up it is and we don't want to give up on the China market far from it and as you know we have been trying to engage at all levels particularly the scientific level because there has been an allegation of impurity in Canadian canola but we haven't seen the evidence we've had problems with the Chinese and canola before in 2016 before that in 2009 we were able to work through it but we need the engagement so we're working very hard for that engagement meanwhile there is a support system in place to advance loans to canola producers and we're working very aggressively to find other markets the g20 as you well know set to begin in Osaka is there any further clarification that you can share on whether the Prime Minister will in fact get that face-to-face meeting with President Xi no I can't give you an update on whether there will or will not be I do know that at these meetings there are opportunities for leaders to have informal conversations we'll see if that happens we know that there is certainly an agenda and we're very keen to engage Chinese leadership and diplomats at all levels because I believe and I'm sure most Canadians would believe that the way to resolve a problem is to talk through it and when we're able to do that I think we'll make progress well when you said informal conversations based on tradition at these kinds of gatherings leaders are organized alphabetically which means Prime Minister should be scientist be side-by-side with President Xi China so that because I've been at the g20 meetings where I've sat next to the Chinese and there might be an opportunity to have some kind of informal exchange we'll see Donald Trump has said that he will do what he can to advocate for Canada's positions including on the two detainees but I'm wondering as you're fully aware he is embroiled in his own trade issues with with China is it realistic to think that he really will get around to the Canadian problems and will try to bring his influence to bear well this is the closest alliance in the world I just talked about the seventy five percent of our export that Ghost the United States and me were linked by geography by history by language by tradition we are the closest allies in the world and allies help each other and I know that the conversations between the president and the Prime Minister have been very constructive on this issue and on others so I'm very hopeful that the Americans and the Canadians will be on the same side of a wide variety of issues as we usually are Minister Khar I very much appreciate your being on the program today thank you my pleasure thank you very much Jim Carr the minister of international trade diversification in Winnipeg today hi I'm Vashi Capello's host of power in politics see more of our show by subscribing to the CBC news channel or click the link for another video thanks for watching

Trudeau confident Trump raised detained Canadians with Chinese president | Power & Politics

I am confident that the Americans brought up the issue and President Trump brought up the issue of the detained Canadians in China we are very pleased that so many countries around the world our allies and friends and others have highlighted to China that the situation that these two Canadians find themselves in is is unacceptable today Prime Minister Justin Trudeau said he was confident u.s. President Donald Trump raised the issue of two detained Canadians with Chinese President Xi Jingping on Saturday American officials however have yet to confirm to CBC News that that is indeed the case the two Canadians Michael spammer and Michael khovrakh have now been in Chinese custody for more than 200 days so is Canada any closer to securing the release of Coburg and spammer and ending the ongoing dispute earlier I spoke with Colin Robertson a former Canadian diplomat who served in both the US and Hongkong he is now the vice president of the Canadian Global Affairs Institute I asked him about Trudeau's claim that he's quote confident that Trump brought up the detained Canadians in his meeting with the China's president at the g20 I would be better if the president if Prime Minister had said he was certain because with Donald Trump you're just never sure so I think as you said at the outset it would be let's wait confirmation and that then we will feel better that the President did indeed raise it with a Z Jinping which is important because that the president raises it with presidency it has effect we've had European leaders racist and the Chinese don't like that they would rather that this was simply dealt with in their own fashion so it important that the president did so but let's get confirmation that he did so after the Prime Minister held his news conference this afternoon we emailed the American Embassy here in Ottawa we also reached out to the White House we haven't heard anything back just yet but I've got my phone here so if we do get any sort of response from any American officials to confirm what the Prime Minister is confident about but to get back to the point of this Justin Trudeau said he too brought it up when he did cross paths with Xi Jingping at the g20 I'm there is there anything that are these conversations really going to be able to do anything to improve the relationship doing Ottawa in Beijing right now well right now it's it's our hostages so one mang for two Michaels in a way and I that that we have to sort that out and that's where the Americans have the the whip an because they're the ones who have requested the extradition in Bengal Wong Joe and we are proceeding with that because of the Prime Minister's declaration of respect for rule of law but this is really something that the Americans could be more helpful to us on and that's why it is important it would be very important that for the president to have raised that after all he got us into this fix and that fixes as you say cost to Canadians 200 days of their life in pretty grueling conditions and it's resulted in as we know embargo of our canola and harassment of other Canadian food products meat and pork and who knows what will be next because I think the Chinese will continue to ratchet up the pressure they don't understand that the rule of law means something in Canada they think if they put enough pressure on us that will buckle and that sort of leads to my next question that you know the Chinese have made it very clear there is one thing they want here they want huawei executive hmong wong jo to be released she of course was arrested in Canada at the request of the United States Canada has made it clear that it is not going to interfere in the judicial process here is how do these two countries how does Ottawa and how do Beijing how do they move past this is there any way to move past this yes I think that there was an opportunity to send Prime Minister former prime minister Krejci as a kind of special envoy I think somehow we've got to open up a dialogue with the Chinese because it would appear for now that the Chinese are not returning the calls of the Prime Minister you may have had a passing conversation with presidency but Premier Li isn't responding to his call nor is the Chinese Foreign Minister responding to the calls of foreign minister Freeland so somehow we got to get a dialogue going but the Chinese I think they think they can just stiff us for now so I think it's probably about time for us to start taking some pokes back because they've certainly been poking us and I think there are some things we could do there are a hundred thousands Chinese students studying in Canada they regard Canada is an extremely favorable place to to study I think we start saying okay if you're the son or daughter of a senior official we're gonna slow that application down or perhaps you're not going to move with it because remember people in 2004 September the president of Taiwan is going to be visiting the United States in a couple of weeks well well we've been debating a foreign investment protection agreement with Taiwan we have a potentially major KT investment going into Taiwan around clean energy maybe we say to the president of Taiwan why don't you stop by Canada the situation in Hong Kong I think we should we have probably the biggest diaspora of Hong Kong citizens because of the flow of migration over the years partly because people are very unhappy with what's going on in China we perhaps put the spotlight on what's going on in Hong Kong after all the Prime Minister has said that we are a champion of human rights it's what we're doing right now in Toronto around Ukraine and helping Ukraine move forward maybe we start taking a poke back differently the Chinese not a trade issue not trade because I don't think the trade will hurt Canadians but I think there are certain areas where we can poke back there may be Chinese officials who are behaving badly in Canada engaging in espionage well maybe we pick up a couple yeah are you not concerned though if the government did start to poke back whether it is you know slowing down on applications of children of Chinese officials or picking up you know diplomats who might be or officials who might be spying in Canada are you not concerned that that would only inflame tensions further and and cause even more retaliation from China well right now whatever we've been doing is not working and perhaps the United States has been helpful but as you say has been 200 days and there has been no progress rather we seem to be on the losing end of Chinese initiatives including as they say bargaining our foodstuffs and continuing to slap us a boat there's one other thing I want to bring up marrying I want to show you a tweet from marrying she is the minister of small business and Export Promotion she along with the government leader in the Senate Peter harder are in who he by the way I should mention has an extensive background in Canada China relations they're both in Beijing right now and I'm going to bring up this tweet and she's promoting Canadian businesses he says when in Beijing you drop by cows I scream a true Canadian small business that story from Prince Edward Island the needs the world needs more all of all great things Canada has to offer ice cream included and that's why I am dedicated to helping small medium enterprises startup scale up and access new markets however she's there and the tweet also has some photographs of her sitting down Peter harder having some ice cream and Beijing given the tensions that are hanging over everything in this relationship right now is it really appropriate for Canada to go there and try to deepen business ties when Canada is trying to get its to citizens released yes because we still have to do business remember the relationship is multifaceted and I think having Peter harder over there as you point out former Deputy Minister of Foreign Affairs he was head of the Canada China Business Council for many years before going to the Senate he has the kind of place that the Chinese will respect Maryanne given her heritage so I would not surprise me that there are conversations going on between Peter harder and administering with Chinese officials to sort of see if we can't find some way out so I think that's it is useful for us to continue to try to do business with China after all we still want to sell with our goods to China but at the same time I think they it would not surprise me to see Peter harder given that he was a skilled diplomat having discussions with Chinese counterparts because he would be viewed as kind of an old friend all right Colin Robertson thank you very much for your time today thank you last hour I spoke with the power panel about the Prime Minister saying he was confident the Donald Trump raised the issue of the detained Canadians in his meeting with the Chinese president here is what Tiffany Gooch Rachel Curran and Francois Zhu Ivan made of Trudeau's choice of words confidence is the best that you can have when you aren't in the room and you can't say for certain exactly what was said but you've been told by those around and throughout that it was intended to be done and that it was so I think that this is one of those those times when language is something that the PM doesn't need to be careful around to make sure that he's not necessarily put words in somebody else's mouth it is something that I think the white house needs to be able to answer to as well or those that were in the room and after the Prime Minister held his news conference today I sent an email to the u.s. embassy here in Ottawa as well as to the White House I haven't heard anything back my email just went up I know I'm checking just in case there is some sort of like direct confirmation that yes it happened Rachel when you heard the word confident did that stand out to you is that what do you make of that well I I read it as like it actually happened to be honest I thought he probably wouldn't use the word confidence unless he was actually confident because you don't want to use that kind of word if it's going to blow back on you if you're going to be not so confident in a day or two after making that statement so I think there is probably a lot of work going on behind the scenes I think there's probably a fairly decent chance that Trump did mention it in some context if if we're what we're hearing is accurate but you know how hard did he really press how much did he really lobby probably not much if he raised it at all it was probably a pretty pro forma interaction you know at best so I mean look there's not much progress that's being made clearly there's work going on behind the scenes but it's not enough and we're still stuck we're stuck exactly where we were you know six months ago so war needs to be done I think more can be done and more should be done France was when you when you hear that the Prime Minister saying okay he's confident and Trump brought it up you know when the Prime Minister went to Washington just before the g20 to get that public assurance to get that you know public statement to say yes Donald Trump would do anything to help Canada in this situation you know there was people were holding their breath and crossing their fingers that Donald Trump did follow through on that what does that say about the general Canada who the state of the canada-us relationship when Canada's closest ally when there's such uncertainty about whether Canada's closest ally will actually follow up on what it says it's gonna do well first of all we have to realize that it's been a bumpy road for the last year from shell of WA to to Osaka I mean there's a lot of things that happen in between so we went from being in the doghouse to maybe becoming again friends again so it's it's not as simple as that the problem is in my point of view is when you depend on somebody to do your job you live with the consequences and especially when you depend on something that was not that clear to me even if the President President Trump said he would raise the issue with President Jinping at the same time I had my doubts because it seemed kind of last second and and we know how Donald Trump has many ideas in one day so while he's saying this something can happen later that will trump excuse the expression the previous one so so that might be the problem contrary to my colleagues I don't believe in the word confident for me doesn't mean that is sure it's shutting down media saying I'm confident he did because I'll take the president to his word but right now the White House the Canadian government nobody can say with certainty that something happened on the issue it's very easy to say I do believe that it happened I don't have the details but I was assured that it happened and just I'm confident well I'm confident about a lot of things that will never happen in my life and and and that's that so that was my earlier conversation with the power panel Tiffany Gooch Rachel Curran and Francois Zhu oven hi I'm Vashi Capello's host of power in politics see more of our show by subscribing to the CBC news channel or click the link for another video thanks for watching