In this file:
· On President-elect Biden's strategic challenges
· Alan Guebert: What exactly is China buying on its US shopping spree?
On President-elect Biden's strategic challenges
Richard Penaskovic, Columnist, The Auburn Villager (AL)
Nov 12, 2020
Penaskovic is an Emeritus Professor at Auburn University
This article looks at President-elect Joe Biden’s Strategic Challenges, namely, the “3Cs,” Covid-19, China, and Climate Change. Covid-19 was caused by SARS--CoV-2 that emerged in 2019 and has resulted in a pandemic that has created havoc globally. The immediate pandemic period will last hopefully no later than 2022 provided we wear masks, self-distance and carefully wash our hands numerous times daily.
Though many vaccines are being developed world-wide, it will take more than a year before America achieves “herd immunity,” or an infection level in a population around 40 percent for Covid-19 that limits “the epidemic potential of a pathogen.” (See N. Christakis, “The Long Shadow of The Pandemic: 2024 & Beyond,” Wall Street Journal, Oct. 17-18, 2020, p. C1).
After we have deployed a widely-distributed vaccine or reach herd immunity, we will enter the intermediate phase of the pandemic, when things go back to normal. We likely won’t reach the post-pandemic period in the U.S. until around 2024, so we have a tough road ahead. The pandemic will undoubtedly cause a recession and possibly a depression.
An analysis of the 1918 flu pandemic demonstrates that the flu pandemic depressed the economy rather than public health interventions. Studies of urban cities that insisted on strict interventions at the beginning of the pandemic had their economies rebound more quickly after the flu was under control.
“Reacting ten days earlier with respect to the arrival of the pandemic,” once the recovery commenced, manufacturing employment went up 5 percent. (See N. Christakis, Apollo’s Arrow: The Profound and Enduring Impact of Coronavirus on the Way We Live,” (N.Y.: Little Brown, 2020.)
The second “C” stands for China. China represents the number one geopolitical threat in the 21st century. It has the world’s strongest economy, third-best military, and is arguably tied with the U.S. in terms of technology. In this connection, we must keep in mind that today’s technology is the steel and coal of the 21st century. (See T.G. Ash, “What will President Biden’s United States look like to the rest of the world?” The Guardian, Nov. 7, 2020).
In brief, Joseph Biden’s administration must do a 180-degree turn from the Trump administration in reversing the damage done by Trump’s policy toward Beijing. There are a host of issues that must be kept in mind: (1) America is losing the trade war with China by its many sanctions that hurt U.S. businesses and consumers; (2) We must not blame China for Covid-19, just because the virus began in Wuhan. Rather, we must take drastic steps to contain the virus in the U.S.; and (3) we must empower our allies like Japan, India, the United Kingdom, South Korea, Vietnam and the EU nations to trade with us, rather than alienating our longtime friends. Our allies may serve as our bulwark against China’s ambitions in the East and South China Sea.
Trump’s trade wars and sanctions on China are tantamount to shooting ourselves in the foot since the 15-percent increase on tariffs of Chinese imports like shoes, TVs, sporting goods and meat and dairy products are paid by consumers and pose a challenge to consumer spending, the main driver of our economy.
A first step would be to eliminate the tariffs on cars from Europe and across-the-board tariffs on Mexico and Canada. When push comes to shove, we can’t match China’s economic power on our own. We need allies and friends like never before.
The third “C” is fighting climate change globally. Climate change shows the strong connectivity of the world impacting organisms “from microbes to megafauna” and biological scales “from the subcellular to the global.” (www.nature.com/articles/s41558-020-00947-x). According to the journal, Nature Communications and Juan Cole’s Informed Comment, climate emergency damage may come to $563 trillion, or to more wealth than presently exists on the entire globe. (See Juan Cole, Informed Comment, October, 29, 2020).
There’s only one way out — namely, eliminating fossil fuels...
Alan Guebert: What exactly is China buying on its US shopping spree?
By Alan Guebert Special to the Farm Forum
via Aberdeen News (SD) - Nov 13, 2020
As political winners joust over election spoils, many Americans are tickled pink (or purple) to leave the costliest, most bitter campaign season behind and return to their lives of family, work and dreams.
For U.S. farmers and ranchers that means a return to three pre-election realities: a strong, export-led rise in grain prices; another winter of choppy livestock markets, and China’s growing impact on all U.S. ag markets.
In fact, China’s swift recovery from the viral pandemic it spawned is now the key driver in world ag markets. The International Monetary Fund pegs China’s 2020 economic growth at 2 percent, tiny compared to its decades of ferocious growth but far ahead of the U.S. economy that is forecast to shrink 4 percent.
Equally impressive is how the newly revved-up China is spending its profits. Its consumers are doing what the rest of the world used to do; eating better, traveling more, and buying more consumer goods.
And all this after China’s economy shrank 6.8 percent in the first quarter, its first fallback in almost 50 years, according to the New York Times, because of the coronavirus and its sledgehammer reaction to it.
But that Red sledgehammer, comrade, also made way for China’s current purchases of U.S. farm and food exports. According to Bloomberg News, China already has purchased “more than 10 million metric tons (MMTs) of U.S. corn in the 2020/21 marketing year, or a about 2.5 MMTs more than all of last year.”
Moreover, it’s still buying. Some forecasters believe China will buy a record 17 MMTs, or about 780 million bushels, of corn in 2020/21. If accurate, it will buy all the corn grown this year in Ohio, Pennsylvania, and Oklahoma combined.
The same trend can be seen in its purchases of U.S. soybeans, pork, and beef; all are off to record starts this marketing year as the world’s only healthy major economy continues its grocery-shopping spree.
But is it that simple? Is China just sopping up relatively cheap, unsold global food supplies to restock its COVID-depleted pantry or is there a deeper, less apparent reason for the buying binge?
Yes and yes, argue several long-time trade analysts.
For example, in an Oct. 30 blog post, Daniel Ikenson, a trade expert at the libertarian Cato Institute, argues that President Donald Trump’s (and U.S. farmers’) much cherished Phase One trade deal with China — the rocket fuel for some of the buying — is a bilateral “folly” that “discriminates” against our democratic allies like Japan and Canada. As such, he argues, Phase One undermines U.S. leadership for any future, multilateral effort to contain China’s more sinister international ambitions.
Echoes of Ikenson’s argument can be heard in a Nov. 3 Bloomberg News story that wondered if President Trump’s “shift away from Republican free trade orthodoxy” hasn’t just “… been a very loud civics lesson in the misguided economics of protectionism and the costs of tariffs and economic nationalism.”
Yes, it has but good luck trying to convince American farmers and ranchers — who have received billions in tariff mitigation money under the Trump policy and now, mostly due to China, are enjoying the first major rise to farm prices in years.
It’s hard to argue with them before or after Nov. 3 when red rural America again voted for this administration’s “tariffs and economic nationalism” policy with, as the Trump White House often notes, “red” China.
Still, warns another trade analyst...