Trade war on hold


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President Donald Trump with China's President Xi Jinping during their bilateral meeting at the G20 Summit, Saturday, Dec. 1, 2018 in Buenos Aires, Argentina. (AP Photo/Pablo Martinez Monsivais)

President Donald Trump with China's President Xi Jinping during their bilateral meeting at the G20 Summit, Saturday, Dec. 1, 2018 in Buenos Aires, Argentina. (AP Photo/Pablo Martinez Monsivais)


President Donald Trump meets with China's President Xi Jinping during their bilateral meeting at the G20 Summit, Saturday, Dec. 1, 2018 in Buenos Aires, Argentina. (AP Photo/Pablo Martinez Monsivais)


President Donald Trump listens to China's President Xi Jinping speak during their bilateral meeting at the G20 Summit, Saturday, Dec. 1, 2018 in Buenos Aires, Argentina. (AP Photo/Pablo Martinez Monsivais)


Trump and Xi agreement buys time in trade war

By PAUL WISEMAN

AP Economics Writer

Monday, December 3

WASHINGTON (AP) — The dinner table diplomacy that Presidents Donald Trump and Xi Jinping of China conducted over the weekend produced something as vague as it was valuable: an agreement to keep talking.

Forged over grilled sirloin at the Group of 20 summit Saturday in Buenos Aires, Argentina, the ceasefire Trump and Xi agreed to Saturday night illustrated that the leaders of the world’s two largest economies can at least find some common ground, however tentative and ill-defined it might be. The truce pulled the United States and China back from an escalating trade war that was threatening world economic growth and had set global investors on edge.

“The prospects for real progress on substantive issues with China are now better than at any point in the Trump administration,” said Andy Rothman, investment strategist at Matthews Asia.

What Trump and Xi achieved was the gift of additional time — 90 days, at least — to try to resolve the thorny and complicated issues that divide them. Most important among them, and perhaps the most intractable, is the U.S. argument that Beijing has deployed predatory tactics in a headlong drive to overtake America’s global supremacy in high technology.

Yet reaching a permanent peace will hardly be easy. The Trump administration asserts, and many experts agree, that China systematically steals trade secrets and forces the U.S. and other foreign countries to hand over sensitive technology as the price of admission to the vast Chinese market.

Washington also regards Beijing’s ambitious long-term development plan, “Made in China 2025,” as a scheme to dominate such fields as robotics and electric vehicles by unfairly subsidizing Chinese companies and discriminating against foreign competitors.

This year, Trump imposed an import tax of 25 percent on $50 billion in products, then hit an additional $200 billion worth of goods with 10 percent tariffs. Those 10 percent tariffs were scheduled to ratchet up to 25 percent on Jan. 1 if the United States and China failed to reach an agreement to at least postpone that move.

In Buenos Aires, they did reach such an accord. Trump agreed to delay the scheduled U.S. tariff increase for 90 days while the two sides negotiate over the administration’s technology-related complaints. In return, China agreed to buy what the White House called a “not yet agreed upon, but very substantial” amount of U.S. products to help narrow America’s gaping trade deficit with China. If the Chinese did eventually increase such purchases, it would be warmly welcomed in the U.S. Farm Belt, where producers of soybeans and other crops have been hurt by Beijing’s retaliatory tariffs.

Trump tweeted late Sunday that “China has agreed to reduce and remove tariffs on cars coming into China from the U.S. Currently the tariff is 40%.” There was no Chinese announcement about possible tariff cuts and the Ministry of Commerce in Beijing didn’t immediately respond to questions.

Beijing cut import duties on foreign autos to 15 percent in July but added a 25 percent penalty for U.S.-made vehicles the following month in response to Trump’s tariff hikes.

But can China be trusted? Its contentious tech policies lie at the heart of its economic vision, and Beijing could prove reluctant to sacrifice its ambition, no matter what longer-term agreement with the United States it eventually reaches.

“Make no mistake about it: The issues that we have with China are deep structural issues, and you’re not going to resolve all of them in 90 days or even 180 days,” said Dean Pinkert, a former commissioner on the U.S. International Trade Commission and now a partner at the law firm Hughes Hubbard & Reed. The Trump administration is “going to have to decide how much progress they need in order to define it as a win.”

Parag Khanna, founder of the FutureMap consultancy and author of the forthcoming book “The Future is Asian,” noted that in speeches to domestic Chinese audiences, Xi is still promoting the economic self-reliance that Made in China 2025 symbolizes.

“What he’s saying to his own people has more long-term validity than what he’s saying to Trump over dinner for the sake of everyone saving face,” Khanna said.

Even so, the Buenos Aires breakthrough may calm investors who worried about financial damage from the trade hostilities. Caterpillar, Ford and other U.S. corporate giants have complained that the higher Trump tariffs, if kept in place, would guarantee higher costs and lower profits. That’s one reason the Dow Jones Industrial Average tumbled this fall after hitting a record close Oct. 3.

In the meantime, just as Trump dialed back the drama on one trade front over the weekend, he magnified the tension on another. En route from Buenos Aires on Air Force One, the president told reporters that he would soon notify Congress that he’s abandoning the North American Free Trade Agreement. Such a move would force lawmakers to approve the NAFTA replacement he reached Sept. 30 with Canada and Mexico — or have no North American trade bloc at all. The absence of any such bloc would hurt companies that have built supply chains that crisscross the three countries’ borders.

“This trades one trade uncertainty for another,” Diane Swonk, chief economist at Grant Thornton, tweeted. “Policy uncertainty remains unusually high for an economy that on paper should be feeling fat and happy.”

Prospects in Congress for the new deal — the U.S.-Mexico-Canada Trade Agreement — were complicated by the midterm elections, which left opposition Democrats in control of the U.S. House. Democrats favor provisions of the USMCA that encourage automakers to shift production back to the United States. But they say the deal must do more to protect U.S. workers from low-wage Mexican competition.

“The work is not done yet,” Democratic Sen. Sherrod Brown of Ohio told CNN’s “State of the Union” on Sunday.

Associated Press writer Darlene Superville contributed to this report.

Follow Paul Wiseman on Twitter at https://twitter.com/PaulWisemanAP

The Conversation

US-China trade war truce: 2 reasons why it’s unlikely to last

December 3, 2018

Author: Jeffrey Kucik, Assistant Professor of Political Science, University of Arizona

Disclosure statement: Jeffrey Kucik does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.

Presidents Donald Trump and Xi Jinping have agreed to a ceasefire in their increasingly painful trade war, yet their governments’ differing depictions of the deal show just how far apart they really are.

While the Trump administration emphasized trade issues such as a 90-day moratorium on raising tariffs and Xi’s concession to buy “very substantial” amounts of U.S. goods, China focused on diplomacy, regional issues and an agreement to try to quickly resolve their differences.

That’s because for China, Trump’s trade war has never been only – or even mainly – about trade.

As a political scientist following the escalating tensions, I believe that the statements coming out of the G-20 meeting reveal that a wide gap still separates Xi and Trump, both in terms of what matters most to them and their approach to getting it.

Territory trumps trade

One of China’s major concerns is U.S. interference in areas it considers “internal” matters.

A major flashpoint is Taiwan. Earlier this year, for example, Trump approved a US$330 million arms deal with Taiwan, following up on a previous deal of $1.3 billion.

These sales irk China because they directly conflict with Beijing’s long-standing policy that there is only one Chinese government, and Taiwan is merely a breakaway province that will inevitably be reunited with the mainland.

Another sticking point is the South China Sea, where the Chinese government has been increasingly aggressive in asserting territorial claims at odds with its neighbors. In the past, the U.S. has acted as a counterweight to China’s claims, Now inconsistency in Trump’s stance has added to tensions in the region.

Both of these issues have implications for the trade war. China is willing to absorb economic losses in exchange for standing firm on issues vital to the national interest.

That’s precisely why China’s statement highlighted Trump’s apparent commitment to continue respecting the so-called one China policy – something not mentioned by the Americans. As it so often does, trade takes a back seat to territory.

Taking the high road

China’s statement also placed greater emphasis on economic cooperation and restoring diplomatic relations, the kind of high-minded talk that for decades has been more typical of American presidents.

Specifically, China highlighted that the two leaders plan to visit each other’s countries at some point and that both sides would work toward scrapping all tariffs to reach a mutually beneficial, win-win agreement.

Contrast that with the U.S. statement, which focused more narrowly on the truce’s benefits for its side.

It’s another stark demonstration of the contrast between the two leaders on the global stage. Trump has been focused on putting “America first” and urging other countries to also pursue economic nationalism. Meanwhile, Xi has cultivated an outward-looking posture that aims for cooperation and compromise, embracing the virtues of economic cooperation, free trade and global leadership.

Ultimately, a meaningful, lasting deal is unlikely in the 90-day window. Quite apart from trade deficits or jobs, the trade war has grown to represent a deeper geopolitical rivalry. If Trump wants a win from this battle, he’ll need to understand that Xi won’t give in easily. And China’s leader will likely expect compromise on complex territorial issues like Taiwan or the South China Sea before the ceasefire will begin to look like a full-fledged peace accord.

With the two leaders’ approach to the world looking increasingly different, it’s likely that the G-20 truce will merely have paused the trade war – not stopped it.

Ukraine calls up reservists amid tensions with Russia

By YURAS KARMANAU and VLADIMIR ISACHENKOV

Associated Press

Monday, December 3

KIEV, Ukraine (AP) — Ukraine’s president on Monday announced a partial call-up of reservists for training amid tensions with Russia, saying the country needs to beef up its defenses to counter the threat of a Russian invasion.

The Kremlin dismissed the Ukrainian leader’s statement as an “absurd” attempt to inflame tensions.

Relations between the two neighbors have been strained further following a Nov. 25 incident in which the Russian coast guard fired upon and seized three Ukrainian naval vessels and their crews off the Crimean Peninsula that Russia annexed from Ukraine.

Ukrainian President Petro Poroshenko responded by introducing martial law for 30 days in much of Ukraine. For the duration of martial law, Ukrainian authorities barred entry to all Russian males aged 16 to 60 in a move the Ukrainian leader said was needed to prevent Russia from further destabilizing the country.

Poroshenko said Monday that some reservists will be summoned for training as part of martial law. He also said that some military units will be redeployed to strengthen the nation’s defenses.

“Ukraine is taking its own steps in response to the threat of a large-scale Russian invasion,” the Ukrainian leader said.

Over the weekend, Poroshenko said that Russia has deployed a large number of troops along its border with Ukraine and alleged that the Kremlin intends to push inland into Ukraine. Ukraine also accused Russia of blockading its ports on the Sea of Azov.

Russian President Vladimir Putin’s spokesman, Dmitry Peskov, dismissed Poroshenko’s claims as an “absurd attempt to foment tensions.”

“The accusations against Russia have no basis whatsoever,” he said.

Peskov also rejected Kiev’s claim that Russia was blocking traffic to and from Ukrainian ports on the Sea of Azov, saying that navigation has continued normally except for occasional breaks because of bad weather.

The separatist conflict in eastern regions forming Ukraine’s industrial heartland has taken a toll on the national economy, reducing the cargo flow through the Ukrainian ports of Mariupol and Berdyansk on the Sea of Azov. The naval incident further stoked tensions.

Vitaliy Sinhur, a dock worker in Berdyansk, said the movement of ships has significantly ebbed.

Amid the tensions, the Russian military said its forces in Crimea were conducting drills involving Bal and Bastion long-range anti-ship missile systems.

Over the weekend, Poroshenko urged Germany and other Western allies to boost their naval presence in the Black Sea to help deter Russia from further aggression.

Ukraine’s deputy defense minister, Anatoliy Petrenko, said the country is talking to its Western partners to respond to Russia’s “escalatory actions.”

The U.S. and its NATO allies have strongly urged Russia to free the Ukrainian vessels and the crews.

“There is no justification for this use of force,” NATO Secretary-General Jens Stoltenberg told reporters Monday. “Russia must release the Ukrainian sailors and ships. It must also allow freedom of navigation and unhindered access to Ukrainian ports in the Sea of Azov.”

NATO foreign ministers are set to discuss the incident later this week.

Asked what action NATO could take, Stoltenberg said: “We provide strong political but also strong practical support to Ukraine.”

He added that NATO allies have helped modernize Ukraine’s armed forces, have boosted their presence in the Black Sea over the last year, with more ships deployed in the region and more air policing.

In the Nov. 25 incident, three Ukrainian naval vessels were heading from the Black Sea into the Sea of Azov when they were blocked by the Russian coast guard near the Kerch Strait between Russia’s mainland and Crimea. After many tense hours of maneuvering, the Russians opened fire and seized the Ukrainian vessels and 24 crew members.

The Ukrainian seamen have been put in custody for two months pending Russia’s investigation into the clash.

Ukraine and Russia have traded blame for the naval incident that further escalated the tug-of-war that began in 2014 when Russian annexed Crimea and backed separatist rebels in eastern Ukraine.

Ukraine says that its ships were operating in line with a 2003 treaty with Russia envisaging free navigation for vessels of both countries in the Sea of Azov and the Kerch Strait.

Russia is adamant that the Ukrainian ships had entered its waters without permission.

Later this week, the Ukrainian parliament is expected to mull a presidential bill blocking the extension of a friendship treaty after it expires next April, a long-anticipated symbolic move.

Poroshenko has said he tried to arrange a phone call with Putin to discuss the standoff but faced the Kremlin’s refusal.

Peskov said Monday that “no such conversation is planned.”

Vladimir Isachenkov reported from Moscow. Lorne Cook in Brussels contributed to this report.

The Conversation

How where you’re born influences the person you become

December 3, 2018

Authors

Samuel Putnam

Professor of Psychology, Bowdoin College

Masha A. Gartstein

Professor of Psychology, Washington State University

Disclosure statement

Samuel Putnam receives funding from National Institutes of Health and National Science Foundation.

Masha A. Gartstein receives funding from Washington State University.

Partners: Bowdoin College provides funding as a member of The Conversation US.

As early as the fifth century, the Greek philosopher Thucydides contrasted the self-control and stoicism of Spartans with the more indulgent and free-thinking citizens of Athens.

Today, unique behaviors and characteristics seem ingrained in certain cultures.

Italians wildly gesticulate when they talk. Dutch children are notably easygoing and less fussy. Russians rarely smile in public.

As developmental psychologists, we’re fascinated by these differences, how they take shape and how they get passed along from one generation to the next.

Our new book, “Toddlers, Parents and Culture,” explores the way a society’s values influences the choices parents make – and how this, in turn, influences who their kids become.

The enduring influence of cultural values

Although genetics certainly matter, the way you behave isn’t hardwired.

Over the past two decades, researchers have shown how culture can shape your personality.

In 2005, psychologist Robert McCrae and his colleagues were able to document pronounced differences in the personalities of people living in different parts of the world. For example, adults from European cultures tended to be more outgoing and open to new experiences than those from Asian cultures. Within Europe, they found that people from Northern Europe were more conscientious than their peers in Southern Europe.

Recently, we’ve been able to trace some of these differences to early childhood.

Parenting – perhaps not surprisingly – played a role.

Working with colleagues from 14 countries, we looked at the way broad societal values influenced how parents raise their children. We then studied how these different parenting styles shaped the behavior and personality of kids.

We did this primarily by administering questionnaires to parents around the world, asking them to describe their daily routines, hopes for their kids and methods of discipline. We then asked them to detail the behaviors of their children.

We also relied on the work of Dutch social psychologist Geert Hofstede, who, in the 1970s, asked IBM employees around the world about factors that led to work satisfaction.

We were able to compare his findings to ours, and we were surprised to see that his results correlated with our own. The cultural values that were revealed through work preferences in the 1970s could be seen in parenting practices and child temperament 40 years later.

This is important: It shows cultural values are relatively enduring, and seem to have an effect on how kids develop over time.

To think about yourself, or to think of others?

Perhaps the most well-known of these broad cultural values are individualism and collectivism.

In some societies, such as the U.S. and Netherlands, people are largely driven by pursuits that benefit themselves. They’re expected to seek personal recognition and boost their own social or financial status.

In more collectivist societies, such as South Korea and Chile, high value is placed on the well-being of the larger group – typically their family, but also their workplace or country.

We found that the way parents discipline their children is strongly influenced by these social values, and likely serves to perpetuate these values from one generation to the next.

For example, compared to parents in individualist cultures, collectivist parents are much more likely, when reprimanding their kids, to direct them to “think about” their misbehavior, and how it might negatively impact those around them.

This seems to promote group harmony and prepare a child to thrive in a collectivist society. At the same time, if you’re constantly being told to think about how your actions impact others, you might also be more likely to feel anxiety, guilt and shame.

Indeed, we’ve found that kids in collectivist cultures tend to express higher levels of sadness, fear and discomfort than children growing up in individualist societies.

Free to pursue happiness?

A second set of values we studied was indulgence versus restraint.

Some cultures, such as the U.S., Mexico and Chile, tend to permit and promote self-gratification. Others – like South Korea, Belgium and Russia – encourage restraint in the face of temptation.

These values seem to be connected to a specific set of parenting goals.

In particular, parents in indulgent societies tend to emphasize the importance of developing self-esteem and independence. For example, they expect children to entertain themselves and fall asleep on their own. When one of their kids misbehaves, they’ll often suggest ways he or she can make amends and try to repair the damage.

The message kids may get from this kind of treatment is that they’re the ones in control of their happiness, and that they should be able to fix their own mistakes. At the same time, when kids are expected to pursue gratification, they may be more likely to impulsively seek immediate rewards – whether it’s eating candy before dinner or grabbing a toy off a shelf at a store – before getting permission.

Meanwhile, in societies that prioritize restraint, parents were more likely to shout or swear when disciplining their children.

This might make them more obedient. But it might also cause children to be less optimistic and less likely to enjoy themselves.

Is individualism the future?

Parents seem to be motivated to best prepare their kids for the world they’re likely to inhabit, and what works in one culture might not necessarily work well in another.

But as our world becomes more interconnected, this diversity of parenting approaches may dwindle. In fact, most countries have become more individualistic over the last 50 years – a shift that’s most pronounced in countries that have experienced the most economic development.

Nonetheless, there’s still a huge difference in parenting styles and childhood development across cultures – a testament to the enduring influence of societal values.

President Donald Trump with China’s President Xi Jinping during their bilateral meeting at the G20 Summit, Saturday, Dec. 1, 2018 in Buenos Aires, Argentina. (AP Photo/Pablo Martinez Monsivais)
https://www.sunburynews.com/wp-content/uploads/sites/48/2018/12/web1_121886005-deff854f42674788914a2066b35acf28.jpgPresident Donald Trump with China’s President Xi Jinping during their bilateral meeting at the G20 Summit, Saturday, Dec. 1, 2018 in Buenos Aires, Argentina. (AP Photo/Pablo Martinez Monsivais)

President Donald Trump meets with China’s President Xi Jinping during their bilateral meeting at the G20 Summit, Saturday, Dec. 1, 2018 in Buenos Aires, Argentina. (AP Photo/Pablo Martinez Monsivais)
https://www.sunburynews.com/wp-content/uploads/sites/48/2018/12/web1_121886005-d81b91271f074334905b2fc62d30fbee.jpgPresident Donald Trump meets with China’s President Xi Jinping during their bilateral meeting at the G20 Summit, Saturday, Dec. 1, 2018 in Buenos Aires, Argentina. (AP Photo/Pablo Martinez Monsivais)

President Donald Trump listens to China’s President Xi Jinping speak during their bilateral meeting at the G20 Summit, Saturday, Dec. 1, 2018 in Buenos Aires, Argentina. (AP Photo/Pablo Martinez Monsivais)
https://www.sunburynews.com/wp-content/uploads/sites/48/2018/12/web1_121886005-b6c4a3f817b04f44be6f91b1dec76f9d.jpgPresident Donald Trump listens to China’s President Xi Jinping speak during their bilateral meeting at the G20 Summit, Saturday, Dec. 1, 2018 in Buenos Aires, Argentina. (AP Photo/Pablo Martinez Monsivais)
News & Views

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