Category Archives: Trade

US Negotiations: Masters of Defeats

The US is currently engaged in negotiations with at least a dozen countries — which involve fundamental political, military and economic issues.

The US has adopted diplomatic strategies in the face of its ‘inability’ to secure military victories. The purpose of adopting a diplomatic approach is to secure through negotiations, in part or fully, goals and advantages unattainable through military means.

While diplomacy is less subject to military and economic losses it does require making concessions. Negotiations are only successful if there are reciprocal benefits to both parties.

Those regimes which demand maximum advantages and minimum concessions, usually fail or succeed because they are based on very unequal power relations.

We will proceed to evaluate Washington’s success or failure in recent negotiations and analyze the reasons and consequences for the outcome.

US-North Korea Negotiations

President Trump and North Korean leader Kim Jong-Un have been engaged in negotiations, for nearly a year. The White House has prioritized the ‘de-nuclearization’ of the peninsula which includes dismantling nuclear weapons, missiles, test sites and other strategic military objectives.

North Korea seeks the end of economic sanctions, the signing of a US-Korean peace treaty and diplomatic recognition. A decisive meeting between the two took place Feb. 26-27, 2019 in Hanoi.

The negotiations were a total failure. Washington failed to secure any gains, nor did they advance the peace process; and there are no future prospects.

North Korea offered three significant concessions which were not reciprocated. President Kim Jong-Un proposed to (1) dismantle nuclear testing sites, (2) announced a moratorium on nuclear tests and inter-continental range ballistic missiles tests, and (3) agreed to partially dismantle missile engine test sites.

Washington offered nothing in return. Instead it demanded total disarmament, no lifting of sanctions, no signing of the end of the US-Korea war.

Washington’s asymmetrical ‘negotiations’ were pre-determined to fail. The US underestimated the capacity of the North Koreans to insist on reciprocity; they believed that future verbal promises would entice the North Koreans to disarm. The Koreans were fully aware of the recent US record of reneging on signed agreements with Iran, China and its partners in the Belt and Road agreement.

Moreover, North Korea has powerful allies in China and Russia and nuclear weapons to resist added US pressure.

US-Iran Negotiations

US and Iran negotiated an agreement to terminate economic sanctions in exchange for ending nuclear weapons development. It temporarily succeeded but was quickly reversed by the Trump regime. The White House demanded Iran dismantle its missile defense program and threatened a military attack. Washington did not bargain, it sought to impose a one-sided ‘solution’. The UK, France, Germany, Russia and China, co-signers of the agreement, rejected the Trump dictate, but a number of major EU multi-national corporations capitulated to the White House demand to tighten sanctions.

As a consequence, the US deliberate sabotage of negotiations pushed Iran closer to Russia, China and alternative markets while the US remained wedded to Saudi Arabia and Israel. The former is engaged in a losing war with Yemen, the latter has remained an international pariah receiving billions of US dollars in handouts.

US-China Negotiations

The US has engaged in negotiations with China to downgrade its economy and retain US global supremacy. Beijing has agreed to increase its imports from Washington and tighten controls over Chinese use of US technology, but the US has not offered any concessions. Instead, Washington has demanded that China end the state’s role in financing its cutting-edge technology, artificial intelligence, and communication innovations.

In other words, China is expected to surrender its structural advantages in order to avoid harsh White House tariffs which would reduce Chinese exports.

There is no reciprocity. The Trump regime operates by threats to China which will have negative effects: on US farmers dependent on Chinese markets; on US importers, especially the retail sector which imports Chinese products; consumers who will suffer higher prices for goods purchased from China.

In addition, China will deepen its links with alternative markets in Asia, Africa, Russia, Latin America and elsewhere.

As of the most recent year (2018) China’s positive trade balance with the US rose to $419 billion dollars while the US was forced to increase its subsidies to US agro-exporters to compensate for loss of sales to China.

After several months of negotiations US representatives have secured trade concessions but failed to impose a breakdown of China’s economic model.

By the middle of 2019, while negotiations continue, the likelihood of a ‘grand bargain’ is dismal. In large part this is because Washington fails to recognize that its weakened global position requires that the US engage in ‘structural changes’, which means that the Treasury invests in technology; labor upgrades and education. The US should practice reciprocal relations with dynamic trading partners; to do so, Washington needs to invest billions to upgrade its domestic infrastructure; and reallocate federal spending from military spending and wars to domestic priorities and productive overseas agreements. US diplomatic relations with China based on threats and tariffs are failing and economic negotiations are deteriorating.

US-Venezuela: Non-Negotiations a Formula for Defeat

Over the past half-decade (2015-2019) Washington has succeeded in restoring client regimes in Latin America, by military coups, political intervention and economic pressure. As a consequence, the White House has successfully ‘negotiated’ one-sided political, economic, social and diplomatic outcomes in the region … with the exception of Cuba and Venezuela.

President Trump has broken negotiated agreements with Cuba to no advantage; US threats have led to Cuba securing greater ties with Europe, China, Russia and elsewhere without affecting Cuba’s tourism business.

The Trump regime has escalated its political and economic propaganda and social war against Venezuela. Multiple overt coup efforts have backfired beginning in April 2002 and continuing to February 2019.

While the US succeeded in the rest of Latin America in consolidating hemispheric hegemony, in the case of Venezuela, Washington has suffered diplomatic defeats and the growth of greater popular resistance.

US interventionist and sanctions policies have sharply reduced the presence of its middle- and lower-middle-class supporters who have fled abroad. US propaganda has failed to secure the support of the Venezuelan military which has become more ‘nationalist’ with very few desertions.

The White House appointment of the convicted felon Elliott Abrams, known as the ‘butcher of Central America’, has certainly undermined any prospect of a favorable diplomatic settlement.

US sanction of political and military leaders precludes efforts to co-opt and recruit leaders. The US appointed as its ‘interim ruler’ one Juan Guaidó who has little domestic support – widely seen domestically as an imperial stooge.

The US non-negotiated successes in Latin America have blinded Washington to the different conditions in Venezuela; where structural socio-economic reforms and nationalist military training consolidated political support.

In the case of Venezuela, the US refusal to enter into negotiations has led to greater polarization and multiple defeats, including the failed coup of February 23/24 2019.

US-Russia: Colluding with Failed Diplomacy

Washington successfully ‘negotiated’ the surrender and break-up of the Soviet Union and the subsequent pillage of Russia. It was the US’ most successful ‘negotiations’ of the century. The US ‘negotiations’ allowed it to expand NATO to the Russian frontier, incorporated most of East Europeans into the EU and NATO and led the US to boast of creating a ‘unipolar world’.

Excess hubris led the US to launch prolonged (and losing) wars in Afghanistan, Libya, Iraq, Somalia, Syria and elsewhere.

With the election of President Putin, Russia made a comeback, which led to the Kremlin reconstituting its military, economic and geopolitical power.

The White House reacted by attempting to ‘negotiate’ Russia’s military encirclement and to undermine Moscow’s economic growth.

When Russia refused to submit to US dictates, Washington resorted to economic sanctions and power grabs in the Ukraine, Central Asia and the Middle East (Iraq and Syria).

Washington rejected a diplomatic approach in favor of economic intimidation — especially as some US-backed oligarchs were arrested or fled with their wealth to the UK and Israel.

The US refused to recognize the opportunities which still existed in Russia – a neo-liberal economic elite, a mainly mineral export economy, and Moscow’s conciliatory approach toward US military engagement in Libya, Somalia, Yemen and Iran.

US ‘negotiations’ were non-starters. The White House defined Russia as an enemy to be undermined. Sanctions became the weapon to deal with Russia’s attempt to regain its world standing. Washington’s aggressive posture included its refusal to recognize that the world had become multi-polar; that Russia had allies in China, partners in Germany, military bases in Syria, and has loyal and advanced scientific elite.

The US, operating from a past image of Russia from the Yeltsin era, failed to adapt to the new realities – a resurgent Russia willing to bargain and secure reciprocal advantages.

The US failed to recognize potential allies and economic advantages in open negotiations with Russia. Many Russian economists close to the Kremlin were neo-liberals, ready and willing to open the economy to US penetration. Russia was willing to concede the US a major role in the Middle East and offered to negotiate their oil export policies.

Instead the US refused to negotiate power sharing .US sanctions forced Russia to embrace China; Washington’s drive for global dominance encouraged Russia to build ties with Venezuela, Cuba, Iran, Syria and other independent nations.

Washington’s unipolar policies turned a potentially lucrative and long-term strategic relation into costly confrontations and failed diplomacy.

US and the European Union: Dead End Deals

Bullying Europe has been a successful endeavor, which the US has put on display on innumerable occasions in recent times. Washington negotiates agreements with the French, English and German to end economic sanction on Iran and then reneges and turns around to apply sanctions on European firms which comply with the US and disobey their own government.

The US negotiates with Europe on trade policies and then abruptly threatens to impose sanctions on its crucial auto exports.

Europe negotiates with Washington on NATO security issues and then the White House threatens them in order to raise their military spending.

The US claims that the EU is a strategic ally but treats it as a junior partner.

Negotiations between the two have been a one-sided partnership: the US sells arms and names adversaries, while Europe argues and dissents, eventually submitting and sending troops to fight US wars in Syria, Afghanistan, Iraq, Libya and elsewhere.

The US dictates sanctions against Russia, increasing the price of EU imports of gas and oil. Germany debates, discusses, hems and haws while avoiding an outright rejection.

The US has steadily encroached on EU prerogatives to the point where it claims if the EU fails to comply with the White House’s “America First” agenda, it would cause the US to withdraw from NATO.

Despite a longstanding alliance, the White House no longer negotiates policies – it threatens and expects compliance. Despite a history of EU submission and pro forma debates, as Washington has hardened its opposition to Russia, China and Iran it no longer considers EU trade relations a point of negotiations. While Europe might consider the US as an ally, it will not be allowed to be treated as such, because it is viewed as a trade adversary.

Conclusion

Washington has succeeded in securing non-reciprocal agreements with weak countries. This was the case in post-war Europe, post-Gorbachev Russia and among Latin America’s current colonized regimes.

In contrast, Washington’s rejection of reciprocal agreements with Russia, China, Iran, Cuba and Venezuela has been a failure. US trade wars with China have led to the loss of markets and allowed China to pursue global agreements through its massive billion-dollar ‘Belt and Road’ infrastructure projects.

US one-sided hostile policies toward Russia have increased ties between the Kremlin and Beijing.

Washington has lost opportunities to work with neo-liberal oligarchs in Russia in order to undermine President Putin. Washington has failed to negotiate reciprocal ties with North Korea which would ‘de-nuclearize’ the peninsula in exchange for lifting economic sanctions and opening the door for a capitalist restoration.

Demanding unilateral concession and submission has led to uniform failures; whereas negotiated compromises could have led to greater market opportunities and long-term political advances.

President Trump and his top policy makers and negotiators have failed to secure any agreements.

The Democratic Congress has been as ineffective and even more bellicose – demanding greater military pressures on Russia, expanded trade wars with China and fewer negotiations with North Korea, Iran and Venezuela.

In a word, failed negotiations and non-reciprocal diplomacy has become the hallmark of US foreign policy.

Turning Screws: China’s Australian Coal Ban

Overly reliant economies are dangerously fragile things.  As it takes two parties, often more, to play the game, the absence of interest, or its withdrawal by one, can spell doom. The Australian economy has been talked up – by Australian economists and those more inclined to look at policy through the wrong end of a drain pipe – as becoming more diverse and capable of withstanding shock.  In truth, it remains a commodity driven entity, vulnerable to the shocks of demand.  Think Australia, think of looting the earth.

Such carefree, plundering optimism lays bare the jarring fact that Australia remains obsessively and maddeningly committed to King Coal.  To coal, she pays tribute, runs errands and sponsors with conviction.  And it is coal that keeps the country tied to hungry markets which, for the moment, see use for it.  But such hunger is not indefinite.  India and China, traditional destinations for Australia’s less than innovative dig-it and export-it approach, have made it clear that their lust for coal is temporary.  The appetite is diminishing, despite occasional spikes. Renewables are peeking over the horizon, forming the briefing documents of energy and trade departments.

To this comes another problem. Australia has been rather bullish of late towards the country that receives most of its earthly treasures. The People’s Republic of China has made it clear that it does not agree with the ambitiously aggressive line Canberra has taken on a range of fronts.  There is the issue of blocking Chinese influence in the Pacific, notably through the provision of alternative cyber infrastructure whilst excluding Huawei in bids to secure 5G telecommunications contracts. There has been a campaign to combat purported Chinese influence on university campuses and claims of meddling in the political process.  (Meddling by the US, by way of contrast, remains gloriously free to continue.)

All of these acts have shown Beijing less Australia’s independence and sovereign will than its unqualified, traditional commitment to the United States, for which it remains undisputed, kowtowing deputy. What Washington dictates, Canberra disposes.

Which bring us to Australia’s lingering weakness. According to Reuters, customs officers of the Dalian Port Group have stopped Australian coal imports, specifically coking coal central to steel making, and announced a plan to cap imports at $A12 million tonnes a year. This comes after the noticeable increase in delays at Chinese ports handling both coking and thermal coal over the course of last year.  So far, Australia’s coal problem seems confined to the northern port.

The anti-panic campaign is already in full swing, which might also be read as an alternate universe in motion.  Prime Minister Scott Morrison insists that “people should be careful about leaping to conclusions about this.”  Local ports make decisions on local matters; no reason, then, to break into a sweat. Treasurer Josh Frydenberg feels there is really nothing to see here. “Our exports with China will continue to be strong as they have been in the past.”  Trade Minister Simon Birmingham has said, banally enough, that China was “a valued partner of Australia and we trust that our free trade agreement commitments to each other will continue to be honoured.”  Hiccups have previously happened in the relationship (“occasional interruptions to the smooth flow”), but this was nothing compared to the common goal: exporting and using more coal.

Reserve Bank governor Philip Lowe prefers to focus on the amount of coal being stopped at Dalian as negligible and, in any case, transferrable. (The Dalian port receives some 1.8 percent of Australian coal exports.)  “The amount of coal that is being blocked is the equivalent of two months’ exports from Australia to China.  It’s entire possible that if it cannot enter the Chinese market then it can go to other markets.”

The justification from the Chinese Foreign Ministry remains vague, pegged to the language of regulation and quality reassurance.  Spokesman Geng Shuang relies heavily on the issue of compliance.  “China’s customs assesses the safety and quality of imported coal, analyses possible risks, and conducts corresponding examination and inspection compliant with laws and regulations.” In so doing, China “can better safeguard the legitimate rights and interests of Chinese importers and protect the environment.”

Geng was also in a playful mood. Did the reporter ask him on “coal” or “cow”? The issue is less amusing for Australian exporters, who have received special attention distinct from their Russian and Indonesian counterparts. This is despite the claim that there is a glut in coal, necessitating a temporary halt for domestic reasons.

The spokesman was also firm: China-Australia relations had not been impaired.  “As we have stressed many times before, a sound and stable China-Australia relationship serves the common interests of both countries and peoples.”  The subtext is hard to ignore: Canberra will need to be taught periodic lessons, bullied when necessary, and reminded about being too overzealous.

US Blunders have made Russia the Global Trade Pivot

The year 2019 had barely begun before news emerged that six Russian sailors were kidnapped by pirates off the coast of Benin. It was perhaps a foretaste of risks to come. As nations reel from deteriorating economic conditions, instances of piracy and other forms of supply chain disruptions are bound to increase.

According to the International Maritime Bureau (IMB), 107 cases of piracy were noted during the first half of 2018 vis-à-vis 87 throughout 2017.  The 2018 tally included 32 cases in Southeast Asian waters and 48 along African shores – representing 75% of the total. To put this figure into perspective, Asian behemoths India and China – despite their vast shorelines – recorded only 2 cases of piracy each during the study period. Russia had none. In terms of hostages taken, the IMB tally read 102 in H1 2018 vs 63 in H1 2017.

Piracy adds to shipping and retail costs worldwide as security, insurance and salaries are hiked to match associated risks in maritime transport. Merchant vessels will also take longer and costlier routes to avoid piracy hotspots.

A United Nations Office on Drugs and Crime (UNODC) report in 2016 sums up the perils ahead:

As over 90% of global trade is carried out by sea, the economic effects of maritime crime can be crippling. Maritime crime includes not only criminal activity directed at vessels or maritime structures, but also the use of the high seas to perpetrate transnational organized crimes such as smuggling of persons or illicit substances.  These forms of maritime crime can have devastating human consequences.

Indeed, cases of human trafficking, organ harvesting, and the smuggling of illicit substances and counterfeit goods are proliferating worldwide in tandem with rising systemic debt and suspect international agendas.

Australia offers a case in point. While it fantasizes over a Quad of allies in the Indo-Pacific – to “save Asians from China” – criminal elements from Hong Kong, Malaysia to squeaky-clean Singapore have been routinely trafficking drugs, tobacco and people right into Sydney harbour for years, swelling the local organised crime economy to as much as $47.4 billion (Australian dollars presumably) between 2016 and 2017.

With criminal elements expected to thrive during a severe recession, they will likely enjoy a degree of prosecutorial shielding from state actors and local politicians. But this is not a Southeast Asian problem alone; any superpower wishing to disrupt Asia-Europe trade arteries – the main engine of global growth – will have targets of opportunity across oceans and lands.  The US-led war against Syria had not only cratered one potential trans-Eurasia energy and trade node, it served as a boon for child trafficking, organ harvesting and slavery as well. Yet, it is President Bashar al-Assad who is repeatedly labelled a “butcher” by the Anglo-American media.

Ultimately, industries in Asia and Europe will seek safer transit routes for their products. The inference here is inevitable: the greatest logistical undertaking in history – China’s Belt and Road Initiative (BRI) – will be highly dependent on Russian security umbrella, particularly in Central Asia. Russia also offers an alternative transit option via the Northern Sea Route, thereby avoiding any potential pan-Turkic ructions in Central Asia in the future.

Russo- and Sinophobia explained?

In retrospect, Washington’s reckless policies post-September 11 2001 seem aimed at disrupting growing synergies between Asia and Europe. This hypothesis helps explain the relentless US-led agitprops against Russia, China and Iran.

When the gilet jaunes (yellow vest) protests rocked France weeks ago, it was only a matter of time before some pundits blamed it on Russia. US President Donald J. Trump cheered on; just as “billionaire activist” George Soros celebrated the refugee invasion of Europe and the Arab Spring earlier.  If the yellow vest contagion spreads to the Western half of Europe, its economies will flounder. Cui bono? A Russia that can reap benefits from the two-way BRI or Arctic trade routes or a moribund United States that can no longer rule roost in an increasingly multipolar world?

Trump’s diplomatic downgrade of the European Union and his opposition to the Nord Stream 2 gas pipeline matches this trade-disruption hypothesis, as do pressures applied on India and China to drop energy and trade ties with Iran.  Washington’s trade war with Beijing and recent charges against Huawei – arguably Asia’s most valuable company – seem to fit this grand strategy.

If China concedes to importing more US products, Europe will bear the consequences. Asians love European products ranging from German cars to Italian shoes and Europe remains the favourite vacation destination for its growing middle class. Eastern European products and institutions are also beginning to gain traction in Asia. However, these emerging economies will suffer if their leaders cave in to Washington’s bogeyman fetish.

Even if Europe is somehow taken out of the trade equation, greater synergy between the RIC (Russia, India and China) nations may be enough – at least theoretically – to pull their nations through anticipated global volatilities ahead.

In the meantime, as the US-led world crumbles, it looks like Russia is patiently bidding its time to become the security guarantor and kingmaker of Asia-Europe trade.  A possible state of affairs wrought more by American inanity rather than Russian ingenuity…

 

Dr Mathew Maavak is a regular commentator on risk-related geostrategic issues

A Historic Opportunity To Transform Trade When We Stop NAFTA II

Donald Trump was right when he said that the North American Free Trade Agreement (NAFTA) has been a disaster for the United States and promised to renegotiate it when he became president. However, the renegotiated NAFTA-2 is worse than the original NAFTA and should be rejected.

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On December 1, NAFTA-2 was signed by President Trump, Prime Minister Justin Trudeau of Canada, and Mexican President Enrique Peña Nietos. This started the process of approval by the legislatures of each country.

Our movement for trade that puts people and planet first now has two synergistic opportunities: We can stop NAFTA II and replace corporate trade with a new model that raises working conditions and protects the environment.

Join our No More Rigged Corporate Trade campaign and take action now.

No NAFTA -2 from Popular Resistance

Stopping NAFTA-2

When NAFTA became law on January 1, 1994, it began a new era of trade – written by and for transnational corporations at the expense of people and planet. President George H.W. Bush failed twice to pass NAFTA. During Bush’s re-election campaign, independent Ross Perot described NAFTA as the “giant sucking sound” that would undermine the US economy.

President Clinton was able to get it through Congress. The Los Angeles Times described that vote as “a painfully divided House of Representatives” voting a 234-200 for NAFTA. A majority of Democrats 156-102 opposed NAFTA. During the debate, protesters were ejected when they showered fake $50 bills that said “trading pork for poison” from the visitors gallery.

In the 2016 election, President Trump showed he understood what the United States experienced — NAFTA was bad for the people undermining manufacturing and agriculture. People want it repealed. Unlike Hillary Clinton, Trump had his finger on the pulse of the population.

NAFTA-2 is another trade agreement designed for corporate profit. Trump trade fails to provide enforceable protections for workers or the environment. In this time of climate crisis, it does not mention climate change. It fails to protect the food supply and will result in increased cost of medicines.

Citizen’s Trade Campaign writes, there are positive labor standards “but only if currently absent enforcement mechanisms are added.” As the Labor Advisory Committee states: “Unenforced rules are not worth the paper they are written on.”

The Sierra Club reports NAFTA-2 takes a significant step backward from environmental protections included in the last four trade deals by failing to reinforce a standard set of seven Multilateral Environmental Agreements that protect everything from wetlands to sea turtles.

NAFTA-2 allows intensely-polluting oil and gas corporations involved in offshore drilling, fracking, oil and gas pipelines, refineries, or other polluting activities to challenge environmental protections in rigged corporate trade tribunals. Trump Trade preserves a NAFTA rule that prevents the US government from determining whether gas exports to Mexico are in the public interest. This creates an automatic gas export guarantee, which will increase fracking, expand cross-border gas pipelines, and increase dependency on Mexican climate-polluting gas.

Food and Water Watch summarizes:

The energy provisions will encourage more pipelines and exports of natural gas and oil that would further expand fracking in the United States and Mexico. The text also provides new avenues for polluters to challenge and try and roll back proposed environmental safeguards, cementing Trump’s pro-polluter agenda in the trade deal.

NAFTA-2 undermines food safety and health by making it more difficult to regulate and inspect foods. It limits inspections and allows food that fails to meet US safety standards to be imported. NAFTA-2 serves Monsanto and other giant agro-chemical corporations by allowing unregulated GMOs, rolling back Mexico’s regulation of GMOs, and letting chemical giants like Monsanto and Dow keep data on the risks of their pesticides secret for 10 years. NAFTA-2 is designed for agribusiness, not family farmers and consumers.

NAFTA-2 increases the cost of pharmaceutical drugs through intellectual property protections that go “significantly beyond” NAFTA. Trump’s NAFTA-2 gives pharmaceutical companies a minimum 10 years of market exclusivity for biologic drugs and protects US-based drug companies from generic competition, driving up the price of medicine at home and abroad.

All the ingredients that led to a mass movement of movements that stopped the Trans-Pacific Partnership  exist to stop NAFTA-2. Citizens Trade Campaign sent a letter signed by 1,043 organizations to Congress outlining civil society’s shared criteria for a NAFTA replacement. The requirements outlined in this letter have not been met.

Just as it became impossible across the political spectrum to support the TPP, we can make it impossible to support NAFTA-2. Democrats are signaling NAFTA-2 is not going to pass in its present form. After Robert Lighthizer met with Democratic Leader Nancy Pelosi last week, she described NAFTA-2 as “just a list without real enforcement of the labor and environmental protections,” that would be unlikely to pass in its present form. We can stop NAFTA-2.

No Ne NAFTA protest, Fair Deal or No Deal from Green Watch

Defeat of NAFTA-2 Creates the Opportunity to Transform Trade

The defeat of NAFTA-2 will show that corporate trade will no longer be approved by Congress.  Trade must be transformed to uplift workers, reduce inequality, confront climate change and improve the quality of our food and healthcare. The defeat NAFTA-2 opens the space to make transforming trade a major issue in the 2020 presidential campaigns.

President Trump has signaled that he will withdraw from NAFTA to pressure Congress to ratify NAFTA-2. Trump’s threat to withdraw from NAFTA should not be feared but embraced. It will create an opportunity for trade transformation.

A smart presidential campaign will use the defeat of NAFTA-2 as an opportunity to begin a new era of trade transformed for the public good, serving the many, not the few. Politicians running for president in 2020 can put forward a vision of trade that the people will support.

Already, Senator Elizabeth Warren (MA) has taken initial steps in this direction. In a speech to American University, Warren said she opposed Trump’s NAFTA-2 agreement, challenged the bipartisan embrace of “free” trade, and called for starting “our defense of democracy by fixing” corporate trade. In discussing trade she said, “Wow. Did Washington get that one wrong.”  She described trade as delivering “one punch in the gut after another to workers…” She urged, “We need a new approach to trade, and it should begin with a simple principle: our policies should not prioritize corporate profits over American paychecks.” This is a start, if she adds the environment, climate change, healthcare, food safety, sovereignty and Internet freedom, she will put forward a vision of smart trade that will bring millions to support her.

Warren is not alone, Senator Sherrod Brown (OH), who easily won re-election in Ohio and is considering a presidential run, has been a longtime advocate for trade that lifts up workers and challenged agreements that failed to do so. Brown sent a letter to the president eight days after the 2016 election urging Trump to keep his trade promises. Brown voted against NAFTA in one of his first acts as a member of Congress in 1993 and wrote a book entitled “Myths of Free Trade: Why American Trade Policy Has Failed.”

Transforming trade, by rejecting corporate trade, creates an opportunity for candidates to turn a negative issue into a positive one. The movement needs to demand candidates put forward a new vision for 21st century trade.

Source Bilaterals.org

A Vision for Trade for People and Planet

We must put forward the vision for trade we want to see as part of the campaign to stop NAFTA-2. Trade in the 21st entury needs to confront multiple crisis issues made worse by trade designed for corporate wealth. Transformed trade needs to focus on the public interest.

Pubic interest includes shrinking inequality within the United States and between nations. It means workers having a livable wage, encouraging worker-ownership of businesses so they grow their wealth not just their incomes. Trade should strengthen the rights of workers to organize, create unions and adhere to International Labor Organization standards.

Trade should aid in preventing transnational corporations and wealthy individuals from avoiding taxes. Trade should end tax havens and require transparency, end banking abroad or locating corporate charters offshore to ensure wealthy individuals and corporations pay their taxes. Countries can negotiate a global tax collected to solve global problems like poverty, homelessness, lack of healthcare and environmental degradation.

There are numerous environmental crises that trade needs to address. Three reports, the dire October 2018 IPCC report, warning we have 12 years to transform the energy economy to prevent climate catastrophe, the November 23, 2018 4th National Climate Assessment, which warned of the serious impacts of the climate crisis and the Global Carbon Project which reported carbon emissions are at record highs, show climate change must be central to trade policies.

International trade needs to be re-formulated to protect the labor, human rights, economy, environment and domestic industry of partner and recipient nations so local industry and agriculture has the advantage over foreign corporate domination. Trade needs to guarantee people their right to public ownership and control of their own resources. Trade agreements must protect the rights of nations to establish stricter standards for health, safety, human rights and environmental protections.

Take action now to stop NAFTA-2.

US Trade War with China: Desperate Move to Save Western Empire

Most of those who have had a chance to witness Chinese internationalist mega-projects, clearly understand that the West is near to collapsing; it will never be able to compete with tremendous enthusiasm and progressive spirit of the most populous country on earth, which on top of it, is built on socialist principles (with Chinese characteristics).

Writing this essay in rural Laos, I just saw literally an entire army of Chinese engineers and workers in action, building huge bridges and tunnels, connecting one of the poorest countries in Asia, to both China and Southeast Asia, erecting hospitals and schools, small factories for the rural population, airports and hydro-electric power plants or in brief: putting the great majority of Laotian people out of poverty by providing them with both livelihood and infrastructure.

China does precisely this all over the world, from the tiny South Pacific island nations to African countries, plundered for centuries by Western colonialism and imperialism. It helps Latin American nations that are in need, and while it does all that, it is also quickly growing into a middle class, ecologically and culturally responsible nation; a nation which is likely to eradicate all extreme misery very soon, most likely by the year 2020.

The West is horrified!

This could easily be the end of its global order, and it could all actually happen much earlier than expected.

And so, it antagonizes, provokes China, in all imaginable ways possible, from the US military buildup in Asia Pacific, to encouraging several Southeast Asian countries plus Japan to politically and even militarily irritate the PRC. Anti-Chinese propaganda in the West and its client states has lately been reaching a cacophonic crescendo. China is attacked, as I recently described in my essays, from literally all sides; attacked for being ‘too Communist’, or ‘for not being Communist enough’.

The West, it seems, despises all the economic practices of China, be it central planning, ‘capitalist means for socialist ends’, or the unwavering desire of the new Chinese leadership to improve the standard of living of its people, instead of enriching multi-national corporations at the expense of the common citizens of the PRC.

It looks like a trade war, but it actually is not: like the ‘West versus Russia’, the ‘West versus China’ is an ideological war.

China, together with Russia, is effectively de-colonizing part of the world which used to be at the mercy and disposal of the West and its companies (as well as the companies of such client-states of the West as Japan and South Korea).

However it is being labelled, de-colonization is clearly taking place, as many poor and previously vulnerable countries worldwide are now seeking protection from Beijing and Moscow.

But to ‘add insult to injury’, parallel to de-colonialization, there is also ‘de-dollarization’, that is inspiring more and more nations, particularly those that are victims of Western embargos, and the unjust, often murderous sanctions. Venezuela is the latest such example.

The most reliable and stable ‘alternative’ currency that is being adopted by dozens of countries, for international transactions, is the Chinese Yuan (RMB).

*****

The prosperity of the entire world, or call it ‘global prosperity’, is clearly not what the West desires. As far as Washington and London are concerned, the ‘surrounding’, peripheric world is there predominantly to supply raw materials (like Indonesia), cheap labor (like Mexico), and guarantee that there is an obedient, indoctrinated population which sees absolutely nothing wrong with the present arrangement of the world.

In his recent essay for the Canadian magazine Global Research titled “IMF – WB – WTO – Scaremongering Threats on De-Globalization and Tariffs – The Return to Sovereign Nations” a distinct Swiss economist and a colleague of mine, Peter Koenig, who used to work for the World Bank, wrote:

As key representatives of the three chief villains of international finance and trade, the IMF, World Bank (WB) and the World Trade Organization (WTO) met on the lush resort island of Bali, Indonesia, they warned the world of dire consequences in terms of reduced international investments and decline of economic growth as a result of the ever-widening trade wars initiated and instigated by the Trump Administration. They criticized protectionism that might draw countries into decline of prosperity. The IMF cuts its global economic growth forecast for the current year and for 2019.

This is pure scaremongering based on nothing. In fact, economic growth of the past that claimed of having emanated from increased trade and investments has served a small minority and driven a widening wedge between rich and poor of both developing and industrialized countries. It’s interesting, how nobody ever talks about the internal distribution of GDP growth…

Peter Koenig further argues that globalization and ‘free trade’ are far from desirable for the majority of the countries on our planet. He is giving an example of China:

Time and again it has been proven that countries that need and want to recover from economic fallouts do best by concentrating on and promoting their own internal socioeconomic capacities, with as little as possible outside interference. One of the most prominent cases in point is China. After China emerged on 1 October 1949 from centuries of western colonization and oppression by Chairman Mao’s creation of the People’s Republic of China (PRC), Mao and the Chinese Communist party first had to put a devastated ‘house in order’, a country ruined by disease, lack of education, suffering from hopeless famine as a result of shameless exploitation by western colons. In order to do that China remained practically closed to the outside world until about the mid- 1980’s. Only then, when China had overcome the rampant diseases and famine, built a countrywide education system and became a net exporter of grains and other agricultural products, China, by now totally self-sufficient, gradually opened its borders for international investments and trade. And look where China is today. Only 30 years later, China has not only become the world’s number one economy, but also a world super power that can no longer be overrun by western imperialism.

To be self-sufficient may be great for the people of every country on our planet, but it is definitely a ‘crime’ in the eyes of the West.

Now China is not only independent, but it dares to introduce to the entire world a totally new system, in which private companies are subservient to the interests of the state and the people. This is the total opposite to what is happening in the West (and its ‘client states’), where the governments are actually indebted to private companies, and where people exist mainly in order to generate huge corporate profits.

On top of it, China’s population is educated, enthusiastic, patriotic and incredibly productive.

As a result, China competes with the West, and it is easily winning the competition. It does it without plundering the world, without overthrowing foreign governments, and starving people.

This is seen by the United States as ‘unfair competition’. And it is being punished by sanctions, threats and provocations. Call it a ‘trade war’, but it actually isn’t.

And why unfair competition? Because China is refusing to ‘join’ and to play by the old imperialist rules dictated by the West, and also readily accepted by countries such as Japan and South Korea. China does not want to rule. And that scares the West.

*****

In a way, both President Trump and the present leadership of China want to make their countries ‘great again’. However, both countries see greatness differently.

For the United States, to be ‘great’ is to control the world, once again, as it did right after WWII.

For China, to be great is to provide a high quality of living for its citizens, and for the citizens of most of the world. It also means, to have great culture, which China used to have for millennia, before the ‘era of humiliation’, and which was rebuilt and greatly improved from the 1949, onward.

*****

A leading US philosopher, John Cobb Jr., in a book which we are writing together, recently pointed out:

Ever since World War II, what the United States has done has been widely copied.  Hence this country has had a great opportunity to lead the world.  For the most part, it has led in the wrong direction.  The United States and the whole world, including China, are paying, and will continue to pay, a high price.  But the days of American leadership are ending.  I would still like for the U.S. to engage in major reforms, but it is too late for these to change the world. We can rejoice that the American century is giving way to the Chinese century.

Many do, but some don’t. The end of the American leadership, or call it the “American Century”, may scare people in various Western countries, particularly in Europe. Rightly so! Those days of unopposed Western economic dictatorship are over. Soon, perhaps, Europeans will have to really compete, and work hard for their money, instead of living high life relying on plunder of natural resources and cheap labor in their semi or neo-colonies.

While many in the West are scared, the situation is simultaneously rising hopes in all other parts of the world.

For China, not to yield to the US pressure, is to show that it is serious when it comes to its independence. The most populous nation on earth is ready to defend its interests, its people and its values.

It is far from being alone. From Russia to Iran, from Venezuela to South Africa, new and newer nations are going to stand by China, and by doing so, they will be defending their own independence and freedom.

• First published by International Daily News in China

Unnecessary Fussing: China, the United States and APEC

The parents on the global stage of power are bickering and now, such entertainingly distracting forums as APEC (the Asia-Pacific Economic Cooperation Forum) are left without a unifying message.  This should hardly matter, but the absence of a final communiqué of agreement is being treated in some circles as the preliminary perturbations to conflict between Beijing and Washington.

Often forgotten at the end of such deliberations is their acceptable irrelevance.  APEC as a forum was already deemed by former Australian foreign minister Gareth Evans in 1993 to be “four adjectives in search of a noun.”  Charles E Morrison of the East-West Centre in Hawaii noted another view.  “Some wag described it as an international dating service for leaders.”  On this occasion, the dates failed to reach a merry accord.

Such gatherings provide distractions and fodder for the global press corps to identify trouble, brewing or actual.  They can also supply the converse: that the state of adherence to international norms, whatever they may be, is better because of such meetings.  But in Port Moresby, coarseness emerged with tartness.  China and the United States were jostling.

US Vice President Mike Pence, who revealed his interest in the summit by basing himself in Australia rather than staying in Port Moresby, threw down what must have been a gauntlet of sorts.  At the Hudson Institute in October, he was moodily accusing Beijing of pilfering military blueprints, “using that stolen technology” to turn “ploughshares into swords on a massive scale”.

A puzzled Pence seemed to be gazing at a mirror, accusing Beijing of “employing a whole-of-government, using political, economic and military tools, as well as propaganda, to advance its influence and benefit its interests in the United States.”

At the APEC gathering itself, Pence made it clear that there would be no warming of relations with Beijing.  Rather amusingly, he insisted that, “The United States deals openly, fairly.  We do not offer a constricting belt or a one-way road.”  China’s Xi Jinping, for his part, was also in a mood to impress. “Unilateralism and protectionism will not solve problems but add uncertainly to the world economy.”

The forum was filled with more rumours than a village from the middle ages.  Chinese officials, went one well flighted suggestion, supposedly forced their way into the office of Rimbink Pato, PNG’s foreign minister, being most insistent on discussing the wording of a section of the proposed communiqué.  A suggested sentence featured in the agitated encounter: “We agreed to fight protectionism, including all unfair trade practices.”  So worded, it was clear what the intended meaning was: Beijing was being singled out as a possible purveyor of unfair trade practices.   These were deemed “malicious rumours” by the Chinese delegation.

At the conclusion of the summit, Papua New Guinea, as host, expressed its concerns through a rattled Prime Minister Peter O’Neill: the “giants” had disagreed; the “entire world” was worried.  Other delegates bore witness to the Beijing-Washington tension, and were similarly left disappointed.  New Zealand’s Jacinda Ardern was tepid in suggesting that there were “some minor differences in the international trade environment”.  She claimed, as did others, that “it was disappointing that we were unable to have a communiqué issued at the conclusion of the APEC meeting… but it shouldn’t diminish from the areas of substantive agreement.”

Former US Treasury Secretary Hank Paulson is one who is pessimistic about such “minor differences” between the powers, insisting that nothing less than an “Economic Iron Curtain” risks coming down upon the globe.  Given Paulson’s stint at that rogue-of-rogue banks Goldman Sachs, such warnings should be treated with due caution, largely because they fly in the face of the ideology of, to use Paulson’s own words, the “free flow of investment and trade”.

Commentators such as veteran journalist Tony Walker did not spare the drama, peering into the implications with the keenness of a history student in search of parallels.  “Port Moresby may not be Yalta, nor, it might be said, is it Potsdam.”  (Highly tuned, is Walker’s embellishing antennae.)  “But for a moment at the weekend the steamy out-of-the-way Papua New Guinea capital found itself at the intersection of great power combustibility.” Yet no bullets were fired, nor vessels launched.

The disagreement is merely the consequence of initiatives that are grating on both powers.  China is getting bolder with its global investment and infrastructure strategy, wooing states with no-strings financing. It is huffing in the South China Sea.  The United States can no longer claim to be the primary occupant of the world’s playgrounds, the bully of patronage, sponsorship and cant haloed by that advertising slogan, “the American way of life”.  Building sand castles is a task that will have to be shared, but bullies tend to eventually let the punches fly.

The result, at the moment, is a trade war of simmering intensity that continues to govern relations between Beijing and Washington.  APEC was meant to supply a forum of diffusion but merely affirmed the status quo. (On January, US tariffs on $250 billion worth of Chinese goods will increase from 10 per cent to 25 per cent.)

Countries keen to back both powers find themselves facing split loyalties, though that point is often exaggerated.  China knows where many countries in the South East Asian-Australasia region will turn to if the beads of sweat start to show.  Singapore’s Prime Minister Lee Hsien Loong was trying to make the obvious sound simple.  “It’s easiest not to take sides when everybody else is on the same side.  But if you are friends with two countries which are on different sides, then sometimes it is possible to get along with both, sometimes it’s more awkward if you try to get along with both.”

The next show takes place in Buenos Aires, and that November 30 gathering of the G20 promises another re-run of tensions.  On that occasion, President Donald Trump will be bothered to turn up.  Again, such a summit is bound to yield to the law of acceptable chaos and modestly bearable tension.

It Is a New Era, But China’s Balancing Act Will Fail in the Middle East

Although ties between Washington and Tel Aviv are stronger than ever, Israeli leaders are aware of a vastly changing political landscape. The US’ own political turmoil and the global power realignment – which is on full display in the Middle East – indicate that a new era is, indeed, in the making.

Unsurprisingly, this new era involves China.

China’s Vice President, Wang Qishan, arrived in Israel on October 22 on a four-day visit to head the fourth China-Israel Innovation Committee. He is the highest-ranking Chinese official to visit Israel in nearly two decades.

In April 2000, the former president of China, Jiang Zemin, was the first Chinese leader to ever visit Israel, touring the Yad Vashem Holocaust Museum and paying diplomatic dues to his Israeli counterparts. At the time, he spoke of China’s intentions to cement the bond between the two countries.

Wang Qishan’s visit, however, is different. The “bond” between Beijing and Tel Aviv is much stronger now than it was then, as expressed in sheer numbers. Soon after the two countries exchanged diplomatic missions in 1992, trade figures soared. The size of Chinese investments in Israel also grew exponentially, from $50m in the early 1990s to a whopping $16.5bn according to 2016 estimates.

China’s growing investments and strategic ties to Israel are predicated on both countries’ keen interest in technological innovation, as well as on the so-called “Red-Med” Railway, a regional network of sea and rail infrastructure aimed at connecting China with Europe via Asia and the Middle East. Additionally, the railway would also link the two Israeli ports of Eilat and Ashdod.

News of China’s plan to manage the Israeli port of Haifa has already raised the ire of the US and its European allies.

Times have changed, indeed. Whereas in the past, Washington ordered Tel Aviv to immediately cease exchanging American military technology with China, forcing it to cancel the sale of the Phalcon airborne early-warning system, it is now watching as Israeli and Chinese leaders are managing the dawn of a new political era that – for the first time – does not include Washington.

For China, the newfound love for Israel is part of a larger global strategy that can be considered the jewel of China’s revitalized foreign policy.

Qishan’s visit to Israel comes on the heels of accelerated efforts by Beijing to promote its mammoth trillion-dollar economic project, the Belt and Road Initiative (BRI).

China hopes that its grand plan will help it open massive new opportunities across the world and eventually guarantee its dominance in various regions that rotated, since World War II, within an American sphere of influence. BRI aims to connect Asia, Africa, and Europe through a “belt” of overland routes and a maritime “road” of sea lanes.

The China-US competition is heating up. Washington wants to hold on to its global dominance for as long as possible while Beijing is eagerly working to supplant the US’ superpower status, first in Asia, then in Africa and the Middle East. The Chinese strategy in achieving its objectives is quite clear: unlike the US’ disproportionate investments in military power, China is keen on winning its coveted status, at least for the time being, using soft power only.

The Middle East, however, is richer and, thus, more strategic and contested than any other region in the world. Rife with conflicts and distinct political camps, it is likely to derail China’s soft power strategy sooner rather than later. While Chinese foreign policy managed to survive the polarizing war in Syria through engaging all sides and playing second to Russia’s leading role at the UN Security Council, the Israeli Occupation of Palestine is a whole different political challenge.

For years, China has maintained a consistent position in support of the Palestinian people, calling for an end to the Israeli Occupation and for the establishment of an independent Palestinian state. However, Beijing’s firm position regarding the rights of Palestinians, seems of little consequence to its relationship with Israel, as joint technological ventures, trade and investments continue to grow unhindered.

China’s foreign policymakers operate with the mistaken assumption that their country can be pro-Palestine and pro-Israel at once, criticizing the Occupation, yet sustaining it; calling on Israel to respect international law while at the same time empowering Israel, however unwittingly, in its ongoing violations of Palestinian human rights.

Israeli hasbara has perfected the art of political acrobats, and finding the balance between US-western discourse and a Chinese one should not be too arduous a task.

Indeed, it seems that the oft-repeated cliché of Israel being “the only democracy in the Middle East”, is being slightly adjusted to meet the expectations of a fledgling superpower, which is merely interested in technology, trade and investments. Israeli leaders want China and its investors to think of Israel as the only stable economy in the Middle East.

Expectedly, Palestinian priorities are wholly different.

With the Palestinian struggle for freedom and human rights capturing international attention through the rise of the Boycott, Divestment and Sanctions (BDS) movement, more and more countries are under pressure to articulate a clear stance on the Israeli Occupation and apartheid.

For China to enter the fray with an indecisive and self-serving strategy is not just morally objectionable, but strategically unsustainable as well. The Palestinian and Arab peoples are hardly interested in swapping American military dominance with Chinese economic hegemony that does little to change or, at least challenge, the prevailing status quo.

Sadly, while Beijing and Tel Aviv labor to strike the needed balance between foreign policies and economic interests, China finds itself under no particular obligation to side with a well-defined Arab position on Palestine, simply because the latter does not exist. The political division of Arab countries, the wars in Syria and elsewhere have pushed Palestine down from being a top Arab priority into some strange bargain involving “regional peace” as part of Trump’s so-called “Deal of the Century”.

This painful reality has weakened Palestine’s position in China, which, at least for now, values its relationship with Israel at a higher level than its historical bond with Palestine and the Arab people.

Lessons from Switzerland

Almost forty years ago I invented direct democracy – or so I thought at the time. I had been raised in Rhodesia, a racist and mostly fascist country, and had just moved to England. Although England considered itself a fine example of democracy (and still does), I was puzzled how such a fine democracy could have an unelected head of state, and a parliament where more than half its members are unelected. There must be a better way, I thought, so I invented direct democracy and set about writing a political novel based on the idea of a southern African country having a revolution and creating a government that worked in such a way.

The novel was terrible and never saw publication, but the concept of a new democracy stayed with me, and is still with me today. Of course, I now know that I did not invent direct democracy. Some years after my first awful novel I learnt that Switzerland had been using direct democracy for over a hundred years. Far from being disappointed that I was not the inventor of this wonderful concept, I was delighted. It totally validated my belief that such an idea was not only possible, it was already working, and working pretty well. After all, here was Switzerland, one of the most successful and stable countries in the world, that had been using it for ages. It was a country wholly controlled by its people, with high standards of social welfare and enlightened environmental awareness. And it had kept out of wars for almost two hundred years – even when completely surrounded by war, twice. So ever since finding out about Swiss democracy I’ve yearned to visit the place, and see it in action. But Switzerland is an expensive place to visit, and if you ain’t loaded, that ain’t easy.

Then a few months ago we learnt of a cut-price holiday to Chateau D’Oex (pronounced “day”), and I just had to go for it. Although I knew that Switzerland must have its problems, just like anywhere else, I wanted to try to get a feel for what Swiss people think about their country and its relatively exemplar democracy.

I wasn’t especially interested in the beautiful scenery, and it is very beautiful. Many other countries also have beautiful landscapes, and I’ve been fortunate enough to see some of them before. What I wanted was to speak to Swiss people. This is not the easiest thing to do. First of all, although most Swiss people have various levels of competence with the English language, English is not an official language. Swiss children are taught to speak the main language spoken in their region, which means German, French or Italian, and then one of the other two. Romansch, the sort of native Swiss language, is hardly taught at all, which is a bit sad. English is sometimes available to school children as an optional extra.

But the fact that some Swiss people are not very fluent in English was only part of my problem. Mainly I’m always deeply humiliated when visiting foreign countries because I’m so incompetent at speaking their language, or some other mutually understandable language other than English (which obviously instantly associates me with one of the most vile and repressive regimes of all time), so I always feel very uncomfortable about trying to have conversations with people in non-English-speaking countries: I always feel I have to apologise for being English, and say how ashamed I am of our history. However, I did manage to overcome my discomfort a few times whenever I came upon someone who was clearly quite happy to speak English. Fortunately my wonderful wife Lorraine was with me, and she is usually less inhibited than I am about talking to people, and because she is very good at this she initiated many of the conversations we had with local folk.

So my impressions of modern Swiss life were obtained mainly from discussions with three young Swiss people (one of whom said she would rather live in England!). I’ll call them Belinda, Martina, and Stan.

Referendums

The Swiss provide direct democracy through continual national referendums, which they hold more often than any other country in the world, and now have them about once a month. Contrast that with the fact that the UK has only ever had three national referendums, and the US has never had a single one. Swiss attitudes to their government are possibly similar to many other Europeans about their governments. Whereas Martina said she always voted in every referendum, Stan said he never did, and appeared to have a similar casual indifference to politics that is very common in many young people. I asked him if he trusted the information that came with every referendum question, about whether arguments for and against were equally weighted. He said he thought they were, so that obviously wasn’t the main reason for his indifference to the system – although he possibly wasn’t the best person to ask.

Good information is clearly a vitally important condition to the success of any vote, and I didn’t learn enough to form an opinion on the quality of public information in Switzerland. But according to a recent report by Reporters Without Borders, Switzerland has the fifth most independent press in the world; compared with Britain, at 40, and the US at 45. So presumably the Swiss do get pretty reasonable information about the issues they get to vote on.

However, there do seem to be some glitches in the system, admitted by this fine free press. Here we learn, for example, that there are at least seven weaknesses to how referendum results are implemented. It’s basically a list of tricks that the government has learnt whereby it can either minimize the effect of a people’s referendum, or ignore it altogether if it wants to. It can do this, according to another article on the subject, through the fact that Swiss courts are not specifically required to implement the constitution.

The genius Tom Paine clearly identified this problem over two hundred years ago:

A man, by his natural right, has a right to judge in his own cause… But what availeth it him to judge, if he has not power to redress?1

This crucial point about the difference between having civil rights and having the means to enforce them was highlighted in the landmark legal dispute William B Richardson v The United States of America, where Mr Richardson tried, but eventually failed, to force the US government to make public the money spent on the CIA – as required in the US constitution. But it was decided that as a mere citizen Mr Richardson “lacks standing” to actually enforce the constitution.2 So as far as Switzerland is concerned, it appears the people may indeed have this wonderful democracy where citizens are invited to be directly involved in government decision-making, but there may be a big difference in what the people say they want, and what the people actually get. It could be that Swiss referendums are sometimes little more effective than large opinion polls.

Trade Unions

We asked Martina and Stan about Swiss trade unions, and received blank looks on both occasions. I remember Martina saying she thought there were some, but she knew nothing about them. The tour guide we had, Dave, was pretty knowledgeable about Switzerland, and told us that we were his one hundred and twenty fifth tour there. He told us quite a bit about Swiss life but never mentioned trade unions. So when she had the chance Lorraine asked him that question. Dave is the sort of guy who doesn’t like to admit that he doesn’t know something – especially if it’s about Switzerland, but he had to admit that he knew nothing about Swiss trade unions.

This is quite interesting.

Coming from England, which still has a pretty good trade union movement (albeit it a shadow of its former self) it seemed almost incomprehensible to us that a modern western society would have no significant trade union movement – because given the fact that no one we asked seemed to know anything about it that must be the obvious conclusion to be drawn. And if there’s no significant trade union movement, who looks after workers’ rights? Although there are trade unions in Switzerland, as a percentage of population, membership is only about half of what it is in Britain or the US — both of which countries currently have considerably depleted numbers of trade union members from what they once had.

It could be that the Swiss constitution helps the Swiss out quite a bit in this regard. Because although it may not be exactly user-friendly, it does at least establish clear principles of right and wrong. Its opening words, for example, include this line: “The strength of a people is measured by the wellbeing of its weakest members” ((The Swiss Constitution – Preamble.)), and it begins with a fairly comprehensive section on “Fundamental Rights”. In other words, a pretty high ethical standard of society is clearly defined in the country’s single most important document, reducing the requirement for trade unions.

National Service

All young men leaving full time education are required to do national service – unless, one of our informants told us rather cryptically, they’re rich enough to buy their way out. National service can take the form of joining the armed forces, or doing some form of social service. Girls do not have to do it at all, but may do so if they want.

The initial commitment is spread over five years with different types of training taking place in three or four month blocks once a year. After that every Swiss man joins a unit of reservists and is issued with a rifle which he must keep secure at home.

I asked Martina about the boys she knew when she left school, and how many of them joined the army, or social service. She said she didn’t know of any boy doing social service in preference to the army. But she says there is some public resentment to the practice, and a general feeling that too much money is spent on military training, instead of more important public services. That’s probably true of almost every country in the world.

I had the impression from both Martina and Stan that although they both loved Switzerland, they also felt it was too conservative, and that new ideas and innovation were seldom welcome. It was Martina who said she would rather live in England, because it seemed a freer society, and Stan appeared to have a hankering to move to Amsterdam, where he’d once spent a few months working.

Thinking about this very conservative nature for which the Swiss are quite well known, I wondered how much of it might be down to the fact that so many of them do five years of national service. After all, there are few institutions more conservative than the military, who are also extremely good at brainwashing. Forcing a young mind through such a regime is bound to have long-lasting effects on most. So how much, I wonder, of Swiss conservativeness is a product of military brainwashing?

The Economy

Another main reason I had for visiting Switzerland was to get a feel for how their economy works. I have strong socialist leanings, but Switzerland is an unashamedly capitalist country. But unlike so many other capitalist countries, Switzerland does not appear to have slums and ghettoes. No one appears to go hungry or homeless. There is clearly something different about Swiss capitalism, and I wanted to find out what.

Obviously this is not a scientific report, it’s just a short record of superficial impressions, points I picked up which appear different to the capitalism I’m used to.

Minimum wage

Switzerland is an expensive country to live in, therefore wages have to be pretty high. So the minimum wage is about $23 an hour. This is more than two and a half times higher than minimum wage in Britain. Although prices are definitely higher in Switzerland, the prices of most basics are not two and a half times higher than British prices. Petrol, for example – a vital driver of costs – is only about 20% higher than British prices. Apparently the minimum wage is only a very recent innovation in Switzerland. As I have always been deeply suspicious of the principle of a minimum wage, I would not be surprised to see the purchasing power of those who receive it in Switzerland start to fall – just as it did in Britain.

Although taxes are relatively modest, every Swiss resident is obliged to have private health insurance. Martina, who was probably on minimum wage, told us that her health insurance cost her SF350 a month (about US$350). She did not seem happy with the arrangement, and told us that it was about the cheapest insurance she could find, and wouldn’t cover everything. Dental care is apparently very good, but so expensive that many Swiss people travel to other countries to have it done.

So it comes back to the same basic point as always. Although $23 an hour might seem pretty good, money is only as good as what you can buy with it – and in Switzerland you need quite a lot to buy not very much.

Self-sufficiency

Unlike many capitalist countries, Switzerland does not appear to buy into the concept of globalisation with quite as much enthusiasm as most western countries. Although its banking system has long been an important asset to its economy (arguably the most important), the Swiss have never been huge fans of international trade. Both Britain and the US, for example, who both market themselves as champions of capitalism, have both had negative trade balances for many years (i.e. imports exceeding exports), but the Swiss have nearly always shown the opposite trend, with exports usually exceeding imports. In pure business terms, this is like saying Switzerland is a viable business, whereas both Britain and the US are technically bankrupt.

It would seem the key to Switzerland’s success in this regard is the fact that they value self-sufficiency extremely highly. They resist importing almost anything they could produce for themselves. Given that it has precious little in the way of natural mineral resources this is a singularly fine achievement. A brief glance at almost any set of statistics comparing Swiss trade with the rest of the world shows a remarkably healthy economy.

Swiss Cheese

Directly linked to the Swiss economic principle of self-sufficiency is the fact that they take huge pride in home-produced foods and drinks. Consistent with the notion that imported products should be avoided where there are good local alternatives, Swiss farm products too are usually preferred to imported farm products. A fine example of this in practice is the cheese industry.

Dairy farming is huge in Switzerland. The many beautiful mountainsides are invariably adorned with dairy cattle, seemingly happy to graze the plentiful greenery in one of the most beautiful landscapes in Europe. So dairy products are plentiful. However, consistent with the Swiss principle of subsidiarity, local is always preferred to products from somewhere else – even if the somewhere else is in Switzerland. So almost every rural town has its own small dairy producing milk, butter and cheese. As we were quite close to Gruyere, an internationally recognised Swiss brand, we had the opportunity to visit the cheese factory. But as this is not of much interest to vegans, we didn’t bother. We would far rather have visited the local bakery, because unsurprisingly bread-making is something else the Swiss do very well, and something else they do locally in many areas – once again preferring local to some cheap mass-produced rubbish.

Possibly because the Swiss are so protective of their farming industry, vegans can have a fairly bleak time of things. Although our hotel knew we were vegans, and said beforehand they could cater for us, it took them three days to obtain some soya milk, even though it was easily available at a local co-op almost across the road; and all they could produce for our evening meal was rice and vegetable stew, varied on two occasions with a few added mushrooms.

Switzerland is well-known for its cow-bells, which are something of a national symbol, and cows grazing the beautiful hillsides to the sound of clanging cow-bells is supposedly an image of the perfect rural idyll. But walking nearby to such a scene you can’t help but notice how bloody loud those bells are, and my heart went out to the poor animals that are forced to wear the damn things – mostly unnecessarily.

But pigs fare much worse. Dave commented several times on the beautiful rural idylls but observed that you never see pigs in Switzerland, which is very odd, he thought, given that the Swiss apparently eat a lot of pork. It’s not that odd. You don’t see pigs because they’re factory-farmed on a fairly large scale, and the poor creatures seldom see the light of day.

However, the principle of subsidiarity applies to almost everything else in Switzerland – from small local timber mills, to breweries and wine-makers. Wherever local products can be used in preference to goods from anywhere else – even other Swiss goods – the Swiss use them. And providing you’re not a vegan, or a pig, it works extremely well.

One of the most interesting points about all this is that the Swiss policies of subsidiarity and self-sufficiency, which clearly do it no harm whatsoever, could also be called protectionism which, according to the technically bankrupt nations of Britain and the US, is no way to run an economy. But the hard evidence provided by Swiss success shows that their economic policies, coupled to their direct democracy, is a much sounder way to manage a country than Britain or the US manage their countries.

Banking

Switzerland has been known as a haven for dodgy offshore banking and financial services for a very long time, and most infamously for laundering Nazi gold during WW2. But there is a very huge difference between Swiss offshore banking and the basically criminal enterprises operated by other capitalist giants such as Britain and the US. The Swiss National Bank is in full control of money supply, and is also under direct control of the state – which is itself largely controlled by the people through their system of routine referendums. Article 99 of the Swiss constitution states that “A minimum of two thirds of the net profits made by the Swiss National Bank shall be allocated to the cantons.” (My emphasis) In other words, unlike British and American banks, vast quantities of bankers’ profits are distributed throughout Swiss cantons for local development.

Model of capitalism

No self-respecting socialist would put up an argument for capitalism as the best way to manage a country’s economy. However, there’s no escaping the fact that Switzerland is both a capitalist country, and a very successful economy, and has high levels of social care, and has high standards of environmental protections. In other words, if anyone wanted to present a reasonable argument for the virtues of capitalism, they would be hard-pressed to improve on the Swiss example. And yet this is not the model most preferred by the self-appointed champions of capitalism, Britain and the US. Why might that be?

Unlike Britain and the US, Switzerland appears to try to run itself like an honest business enterprise, whereas Britain and the US both manage their economies in much the same way as if they were being run by Al Capone. Adam Smith, credited as the father of capitalism, would most likely approve of the Swiss model, but would certainly abhor the economic practices of Britain and the US. In fact, the two economic systems are so different they really should have different names.

How is it then that Swiss capitalism has managed to escape the traps that British and US capitalism have fallen into? Why have Britain and the US turned into the biggest criminal enterprise on the planet whilst the Swiss tick along as a comparatively decent, honest, solvent society? The answer, surely, lies in the fact that Switzerland is, relatively speaking, a real democracy.

Whilst there’s no doubt there are some glitches with Swiss democracy, it’s leaps and bounds better than the British and American models. Whereas British and American so-called democracies are thoroughly corrupt, basically criminal enterprises wholly controlled by the world’s wealthiest gangsters, the Swiss people have a fine national constitution which provides them with a mechanism whereby they could easily control their government if they had to. In Britain or the US the super-rich controllers of politicians know they can literally get away with murder because there’s no mechanism to stop them, but in Switzerland there is, therefore super-rich Swiss must be far more careful in what they try to get away with.

The British academic R.H. Tawney once observed:

That democracy and extreme economic inequality form, when combined, an unstable compound, is no novel doctrine.3

In other words real democracy and extreme economic injustice are not compatible. You can have one or the other, but not both. Britain and the US resolved this problem by ensuring that real democracy does not exist, which allows extreme economic inequality to thrive. The Swiss on the other hand, with their very different version of democracy, are not only relatively free from economic injustice, they also have a highly successful economy.

So it seems fairly obvious to me that extreme constitutional reform of western so-called democracies – to provide real direct democracies – is the essential first step for eliminating global economic injustice.

Here’s Tawney once more,

Democracy is unstable as a political system as long as it remains a political system and nothing more, instead of being, as it should be, not only a form of government but a type of society, and a manner of life which is in harmony with that type. To make it a type of society requires an advance along two lines. It involves, in the first place, the resolute elimination of all forms of special privilege which favour some groups and depress others, whether their sources be differences of environment, of education, or of pecuniary income. It involves, in the second place, the conversion of economic power, now often an irresponsible tyrant, into a servant of society, working within clearly defined limits and accountable for its actions to a public authority.4

Socialists are unlikely, with good reason, ever to trust any form of capitalism. But the inescapable fact is that when capitalism is managed in the way the Swiss do it it is a reasonable and perfectly workable model. It helps to see that Swiss democracy and the version of so-called democracy that’s practised by most western countries is as different as socialism and capitalism. For me the most perfect economic model is one where the state, directly controlled by the people, is wholly responsible for providing all essential public services, but where the private sector (properly regulated by the state) is free to provide non-essential services for whatever profit it can make.

But the Swiss model is a reasonable alternative.

  1. Rights of Man, Tom Paine, p. 120.
  2. Blank Check, Tim Weiner, p. 226.
  3. The Vote – how it was won, and how it was undermined, Paul Foot, p. 340.
  4. The Vote – how it was won, and how it was undermined, Paul Foot, p. 306.

Trump Trade Revealed: Another Rigged Corporate Deal

Since the Clinton era, when the North American Free Trade Agreement (NAFTA) was created, global trade has been written by and for big corporations at the expense of people’s health, worker’s rights and the environment. Trump Trade – through the renegotiation of NAFTA – continues that approach.

In some areas, people might argue the new United States-Mexico-Canada Agreement (USMCA) makes improvements over NAFTA, although many details are still being withheld. From what we do know, overall, it is a step backward for people and planet. And it undermines the US’ relationship with Canada and Mexico, as Geoffrey Getz of the neo-liberal Brooking’s Institution writes, “Trump’s aggressive, threatening approach succeeded in eliciting modest concessions from two of its closest trading partners.”

Trump is claiming a political victory merely by reaching an agreement, but it is not a victory for people or planet, as will be described below. Trump Trade should be rejected. If we are to achieve a new model of trade that protects the environment, workers and democracy, we need to demonstrate that rigged corporate trade will be rejected every time it is brought forward. The time to organize to stop this agreement is now.

Energy and the Environment

Trump withdrew from the Trans Pacific Partnership (TPP) because a mass social movement made it unacceptable and it could not pass in Congress. Some of the provisions in the TPP are included in the USMCA.

Like the TPP, the USMCA contains polluter-friendly non-binding terms on the environment; e.g., the text “recognizes that air pollution is a serious threat to public health,” but includes no single binding rule to reduce air pollution.

The Sierra Club reports the USMCA takes a significant step backward from environmental protections included in the last four trade deals by failing to reinforce a standard set of seven Multilateral Environmental Agreements that protect everything from wetlands to sea turtles. The absence of environmental enforcement continues the failed corporate trade of the Clinton-Obama eras.

Trade agreements could be designed to reduce greenhouse gas emissions, but climate change is not even mentioned in the USMCA. Greenhouse gas emissions will increase. The Sierra Club reports the deal’s lack of binding environmental standards allows corporations to evade US environmental laws by shifting jobs and toxic pollution to Mexico where environmental policies are weaker. It reinforces the US’ status as the world’s largest outsourcer of climate pollution.

Some keys to preventing greenhouse gas emissions are ‘Buy American’ and ‘Buy Local’ laws that provide incentives for locally-produced goods. The USMCA negates those laws, requiring that industries based in Canada and Mexico be given equal access to US government contracts.

The USMCA exempts oil and gas corporations that have, or may have, government contracts for offshore drilling, fracking, oil and gas pipelines, refineries, or other polluting activities from reforms to Investor State Dispute Settlement (ISDS) provisions. These intensely polluting corporations would be allowed to challenge environmental protections in rigged corporate trade tribunals.

Trump Trade preserves a NAFTA rule that prevents the US government from determining whether gas exports to Mexico are in the public interest. This creates an automatic gas export guarantee, which will increase fracking, expand cross-border gas pipelines, and increase dependency on Mexican climate-polluting gas.

The USMCA gives corporations extra opportunities to challenge proposed regulations before they are final, and to repeal existing regulations. This makes it harder to put in place environmental regulations or rollback the pro-polluting regulations of the Trump era.

Food and Water Watch summarizes:

The energy provisions will encourage more pipelines and exports of natural gas and oil that would further expand fracking in the United States and Mexico. The text also provides new avenues for polluters to challenge and try and roll back proposed environmental safeguards, cementing Trump’s pro-polluter agenda in the trade deal.

Food and Health

The USMCA undermines food safety and health by making it more difficult to regulate and inspect foods. It limits inspections and allows food that fails to meet US safety standards to be imported. Food and Water Watch states that it requires the US to “accept imports from Mexico with less scrutiny than from other countries. The deal even creates new ways for Canada and Mexico to second-guess US border inspectors that halt suspicious food shipments, which would have a dangerously chilling effect on food safety enforcement.”

USMCA does not require Country Of Origin Labeling (COOL), nor dolphin-safe labeling and makes GMO labeling more difficult. It uses the requirement that food labels reflect ‘sound science’ to prevent accurate labeling.

USMCA serves Monsanto and other giant agro-chemical corporations by allowing unregulated GMOs, rolling back Mexico’s regulation of GMOs, and letting chemical giants like Monsanto and Dow keep data on the safety of their pesticides secret for 10 years. USMCA is designed for agribusiness, not family farmers and consumers.

Like the TPP, the USMCA increases the cost of pharmaceutical drugs through intellectual property protections that go “significantly beyond” NAFTA. USMCA gives pharmaceutical companies at minimum 10 years of market exclusivity for biologic drugs and protects US-based drug companies from generic competition, driving up the price of medicine at home and abroad.

Worker Rights and Jobs

The Labor Advisory Committee on Trade Policy and Trade Negotiations (LAC) explained they do not oppose trade, but, “We oppose a set of rules made largely by and for global corporations that reward greed and irresponsibility at the expense of hardworking families across the globe.” They describe the USMCA as moving backwards from the original NAFTA in many areas important to working families:

including with respect to ‘Good Regulatory Practices’ (code for using this trade agreement to attack important consumer, health, safety, and environmental protections), Financial Services (providing new tools for Wall Street to attack efforts to rein in its continuing abuses), and affordable medicines (extending monopolies for brand name pharmaceuticals at the expense of affordability).

Similar to the environment sections, the labor sections do not provide enforcement mechanisms. Citizen’s Trade Campaign writes:

“There is a ground breaking labor annex that could help eliminate Mexican protection contracts and boost labor rights there — but only if currently absent enforcement mechanisms are added.”

As the Labor Advisory Committee states, “Unenforced rules are not worth the paper they are written on.”

Summarizing the impact of USMCA, Citizen’s Trade Campaign states:

Mexican workers will continue to be horribly exploited, American jobs will continue to be outsourced, the environment will continue to be degraded and the wages for workers in all three NAFTA countries will continue to decline.”

Corporate Trade Tribunals

A major area of concern has been ISDS, trade tribunals where corporations can sue governments if new laws or regulations undermine their profits. ISDS empowers corporations to attack environmental and health laws in trade tribunals made up of three corporate lawyers and receive monetary judgments worth billions from tax dollars. The USMCA reduces but does not eliminate the unjustifiable and indefensible ISDS settlement mechanism, which privileges foreign investors over communities regarding access to justice.

After three years, ISDS would be eliminated with Canada and dramatically scaled back with Mexico with some unacceptable exceptions. After that, US and Canadian investors would use domestic courts or administrative bodies to settle investment disputes with another government. Are there workarounds to this ISDS reform that protect investors; e.g., will domestic courts seize assets within their country to repay investors, as a US court did for a Canadian mining company this year?

Regarding Mexico, the new process is designed to protect oil and gas industry investors from the privatization of Mexico’s oil and gas sector. Global Trade Watch writes, “several additional sectors were added, including railways and infrastructure. . . followed by an open-ended list, which could provide problematic flexibility for investors to argue that their investments qualify.” In other words, what looks like ISDS reform contains a giant loophole for corporations to continue to sue governments.

Under NAFTA, corporations can receive exorbitant awards for “expected lost profits.” Under USMCA, investors can only be compensated for losses that they can prove on the “basis of satisfactory evidence and that is not inherently speculative.” How this is interpreted is up to the courts.

USMCA Continues US Imperialism and Corporatism

Popular movements in Mexico urge the incoming government to reject USMCA in an Open Letter To Andrés Manuel López Obrador And The Legislators Of MORENA. They decry the secret nature of the negotiation and the agreement as an attack on Mexico’s sovereignty. They argue the agreement will “further open up our economy for the sole benefit of the large U.S. transnational corporations, with an even greater subordination of our government to the dictates of U.S. foreign policy and its measures of internal security and migration.”

The letter describes the election of MORENA and Obrador as the people voting “to expel the oligarchy that has governed us, along with their paid servants.” The incoming government was given a clear mandate that includes rejecting corporate trade agreements. To create the transformation promised in the election requires Mexico to have full control of its resources and wealth to ensure the well-being of the population, with full rights and liberties. They see rejection of USMCA as a “first step toward reclaiming our nation.”

They urge incoming President Obrador to see this as part of the “mafia of power” that he ran against. They describe how Trump pressured the weakest negotiator, Mexico, with the right wing Peña Nieto administration, and used that to threaten Canada with exclusion and 25% tariffs if they did not agree.

Roger Jordan writes, the new agreement is an act of corporate imperialism by the United States:

Under the new deal, both Mexico, a country historically oppressed by US imperialism, and Canada, a lesser imperialist power that has long been a key US ally, made significant concessions in the face of US demands that the continental pact be refashioned to make it an even more explicit US-led protectionist trade bloc.

As the US struggles to retain power as a global empire, UMCA shows that “through ‘America First’ economic nationalism and the ruthless assertion of its interests against ostensible allies and rivals alike,” it will do what it must “to prevail in the struggle for markets and profits.”

Just as the TPP was President Obama’s attempt at economic domination of Asia, USMCA is part of President Trump’s economic war against China, which has already included “tariffs on $250 billion worth of Chinese goods.” Jordan explains how USMCA sent a message to China, writing:

It grants the US effective veto power over any attempt by Canada or Mexico to negotiate a free trade pact with a ‘non-market economy,’ a clear reference to China. This includes the right to transform USMCA into a bilateral agreement, excluding the third member if it has ratified such a free trade deal.

Stop Corporate Trade

There is still time to stop USMCA. Leaders are expected to sign the deal on December 1 at the G-20 meeting. Then President Trump has 60 days to report to Congress on changes to US law that are required by the agreement. Within 105 days of the agreement being signed, the US International Trade Commission (ITC) must complete a study of the agreement’s economic impact. Congress will have to pass legislation to implement USMCA.  After Congress receives the final bill from the president, it has 90 days of being in session to act on it under Fast Track rules. It is unlikely that all this can be accomplished before the 2019 legislative session.

Now that we know more about the contents of the new NAFTA, we need to mobilize to stop its ratification and implementation by Congress. If we are to win a new model of trade that raises the bar on protection of workers, the environment and democracy, we must show, as we did with the TPP, that rigged corporate trade will be stopped by a popular movement.

US Trade Sanctions Against China

PressTV Interview – Transcript

Background

New Trade Sanctions by the US in the form of tariffs on US$ 200 billion Chinese exports to the US – China in a tit-for-tat move imposed new tariffs on 60 billion of US goods to China

China’s prime minister speaks out about the rise of unilateralism, saying the approach to trade will not solve any problems.

Li Keqiang made the comment at the World Economic Forum in the Chinese city of Tianjin. He said multilateralism should be upheld and the basic principle of free trade should be maintained. The Chinese premier said the trend of globalization is unstoppable, even though there are flaws in the process. Li’s comments come amid heightened trade tensions between China and the United States. Beijing imposed tariffs on 60 more billion dollars-worth of American imports in a tit-for-tat response to Washington’s levies on 200-billion dollars of Chinese goods.

PressTV: What is your take on this?

Peter Koenig:  These are indeed “trade sanctions”. US-imposed trade sanctions.

Of course, the Chinese are right. In a world that strives for free trade – unilateralism as demonstrated by the Trump Administration’s-imposed tariffs – is working in the opposite direction.

Two comments, if I may:

First, personally, I have been doubting from the beginning that globalization — and especially globalization in terms of “free trade” — is a good thing. There is nothing FREE.

Free trade among equals is one thing, but “free trade” American style, where they call the shots is, of course, not what is intended. The weaker always suffers, and I am not referring to China.  China doesn’t really suffer, they dominate the entire Asian market, having overtaken the US in Asia about three years ago, but I’m talking in general about developing countries that have to accept highly subsidized US and EU goods in order to stay within these “free trade deals”.

And we see that the west cannot be trusted; i.e., President Trump. He is making his own rules. Therefore, free trade and the related globalization is in my opinion not a good thing. It has hurt too many people of mostly poor countries over the past 30-some years, when neoliberalism started driving the agenda of “globalized free trade”.

Trading among friendly nations, nations that share the same objective, the same political and economic ideology, would be a much preferable alternative. There, nobody can bully another nation into accept his conditions.

This is something we may want to move back to — trading among friendly and culturally aligned nations, where trading is a win-win for both parties.

The second point I wanted to make is maybe more important: These tariff impositions have nothing really to do with trade. The Chinese know it and the US Administration knows it.

They, the tariffs, have everything to do with pulling down, weakening the Yuan, the very strong Chinese Yuan, and by doing so, the Chinese economy. The Yuan is an officially declared reserve currency recognized by the IMF and is fast replacing the dollar as the key reserve currency in the world.

That is what Washington is afraid of — and rightly so. Once the dollar ceases being the main reserve currency, the demand for the dollar will decline, and the hegemonic role for the dollar is gone – which may mean the collapse of the dollar-empire — and in the end the end of the empire altogether.

Already the biggest hydrocarbon producers and consumers in the world, China, Russia, Venezuela and Iran are no longer using the dollar for their trade deals, but local currencies or the gold-convertible Chinese Yuan.

So, the end of the dollar hegemony is coming sooner or later, but Washington wants to delay it as long as possible, hoping for a miracle, or actually even preparing for a military intervention to save the dollar.