Dealing with China  

 Author: R. Alan Harrop, Ph.D   harropcrew1@gmail.com

It should be obvious to any clear-thinking American that China is our biggest threat. During the 1930’s there were many American leaders who refused to recognize the threat posed by Nazi Germany. We cannot allow that to happen again. Just like Nazi Germany, China is rapidly building their military capability while we focus on DEI and woke ideology in our armed forces.

What makes the China threat even greater than Nazi Germany is the degree to which our country is increasingly dependent on Chinese products for our existence. A recent report showed that 75 % of items sold on Amazon are manufactured in China. Similarly, at Walmart the figure is 70-80%. What allowed us to defeat Nazi Germany in large part was the industrial manufacturing capacity of our country to not only arm ourselves, but our allies as well. We were rightfully called the Arsenal of Democracy. Now we are not only losing our manufacturing advantage over China, but we are paying for their military expansion by the profits they make on the products they sell to us. We are funding our own potential destruction.

The most glaring example of this absurdity is “Green Energy.” The Biden regime, uses government taxpayer subsidies and mandates to build solar panels and wind mills that we buy from China, and they turn around and take the profits and build coal fired plants that provide them with abundant cheap energy. Some of the morons in our military have proposed electric powered tanks to replace diesel power! Where do we get most lithium batteries? You guessed it: China.

China is expanding its influence around the world. They are funding ports and infrastructure projects in Asia, Africa, and South America. They are taking over the South China Sea by building island bases. They are threatening the Philippines and our other allies in the region. What is the Biden regime’s answer to all this? Silence.

What we should be doing is recognizing we are in a cold war with China and act accordingly. Restore our manufacturing capacity, impose tariffs as needed, and build our defense capability such as the so-called iron dome which would provide a protection against not only missiles from China, but other bad actors, like North Korea and Iran. Peace can only be secured through strength and resolve. No more allowing China to own land anywhere in the United States. Stop the admission of Chinese students and Chinese funding of our colleges and universities. The flood of single Chinese men over our southern border must be reversed, as also, the fentanyl crisis. We need an administration that recognizes the threat and has the courage to act accordingly. The upcoming election will determine whether we will get one.

 

The Choice Is Between Bad And Awful

On Wednesday, Armstrong Economics posted an article about inflation and recession.

The article reports:

Federal Reserve Bank of Minneapolis President Neel Kashkari has advised against anticipating near-term rate cuts. While speaking to the Financial Times, the Fed president stated that people would simply prefer a recession to continued inflation.

“I have learned that the American people—and maybe people in Europe equally—really hate high inflation. I mean, really viscerally hate high inflation,” he told the Financial Times’ The Economics Show podcast. Kashkari is speaking as if we are not already in a recession. It is not difficult to understand the “visceral” hatred people around the world feel toward rising prices. The effects of inflation are felt with every purchase, causing the average person to adjust their entire lifestyle.

The article concludes:

Real prices have far surpassed anything they calculate in CPI. Everyone understands that prices have risen far more than the arbitrary number the Fed provides us. Taxes are continually increasing for everyone in every tax bracket. The government not only adds to inflationary issues with their spending but then expects their citizens to foot a portion of the bill with taxes, which will simply never be enough.

Then we have Washington telling the masses to blame corporations for price gouging while raising their taxes and making it increasingly difficult to conduct business and maintain a large workforce. It is not that the people would prefer to be in a recession, the real issue is that countless people are entering survival mode. People everywhere want to hold onto whatever they may have out of fear for the future, but they are unable even to hoard as real prices now demand they hand over whatever they have to maintain their lives.

In a recession, consumer spending drops, and people lose their jobs. A service economy such as the one America currently has is more vulnerable to recession than a manufacturing economy. A recession creates hardship for working families.Inflation impacts both working families and retirees. Either one is a bad deal. The most practical way to deal with inflation in America would be to cut government spending and to resume domestic oil production. Both of those things would help revive a miserable economy.

About Those Jobs Numbers

We have all read the reports of some major manufacturing companies and retail stores laying off employees and shutting down stores. So why is the Biden administration so enthusiastically touting their jobs numbers? Could it be that those numbers do not actually reflect what is actually happening?

On Wednesday, The Federalist reported the following:

Last week, the Labor Department issued its jobs report for March 2024. Democrats will tell you the report is rosy and bright, that the economy is heading in the right direction, and that your negative instincts and impressions about the economy are wrong. In reality, the report is abysmal. Below are the facts about employment that Democrats won’t mention: Fewer Americans have full-time jobs, and more of those with full-time jobs are also working part-time jobs to make ends meet.

Democrats claim that the economy added 303,000 jobs in March — but it added no full-time jobs at all in March. The economy actually shed 6,000 full-time jobs that month. In fact, full-time employment in the United States has dropped in each of the past four months. Since November, there are 1,787,000 fewer Americans with full-time employment.

So how do Democrats claim the economy added 303,000 jobs in March? What Democrats do not tell you is that the vast majority of these jobs — 75 percent — are second jobs. Under the Biden economy, the number of people who have had to simultaneously work both a full-time job and a second part-time job just to make ends meet has hovered at historical highs. In March, the number of people who added a second part-time job on top of their other full-time employment totaled 225,000. The Democrats’ “good news” is just you having to work longer and harder to survive.

The article also notes that there is much more growth in government jobs than jobs in the private sector. This is NOT good economic news.

The article reports:

The U.S. has faced another insidious problem for decades that gets little attention. There are more than 3,000 counties or county equivalents in the United States. Yet, half of the 10 wealthiest counties in the U.S., measured in terms of median household income, are suburbs of Washington, D.C. According to U.S. Census data, 50 years ago only five suburban D.C. counties made the list of the top 50 richest U.S. counties or equivalents. By 2020, this figure had more than tripled to 17. 

It’s long past time to shrink government and cut taxes!

America First; Part One: The Economy

Author: R. Alan Harrop, Ph.D

There are two essential things that make a country successful and secure: the economy and military strength. This article will address what we need to do to strengthen our economy, and a subsequent article will deal with the military. Both will focus on putting America first, a principle of our Founding Fathers that we, unfortunately, have gotten away from.

The out of control national debt must be reversed if we have any hope of maintaining a strong economy. Beyond that, however, we need to go back to the American economy of the 1950s that made us the envy of the world. First, we need to return essential industries to America. For the past thirty years we have been allowing key manufacturing industries to move overseas, primarily to access cheap labor and increase corporate profits. This has made us very vulnerable to foreign countries, some of whom are our adversaries like China, for products essential to our economy. The recent supply shortage showed how the lack of items like computer chips can shut down our economy. Recently, it was announced that U.S. Steel may be sold to a foreign country. Automobile and parts manufacturing is increasingly occurring in other countries. China, for example, is the major manufacturer of electric vehicles. Allowing key manufacturing to leave this country not only diminishes good paying jobs, but prevents us from converting these manufacturing capabilities to military needs (such as tanks and planes) as we were able to do in World War II. The solution is to identify essential manufacturing products and to prohibit their movement to other countries. Imposing high tariffs on foreign competition should also be implemented for these essential products/industries. Republican Senator Josh Hawley just introduced a bill to place a 100% tariff on Chinese made electric vehicles. A good start.

Any country that does not control its food production is vulnerable to outside threat. Currently there are over 3.5 million acres of agricultural land in American owned by foreign entities. This also includes food processing companies, like Smithfield, now owned by a Chinese company. Does China allow foreign countries to own their food production? Absolutely not. This problem is rapidly getting worse and needs to be stopped by legislation at the state and federal levels.

Another essential category of products are pharmaceuticals. As we found out during the COVID outbreak, many of our essential drugs are produced overseas;. again, many in China. Totally absurd.

Lastly, modern manufacturing capacity and product development are based on evolving, complex technologies. Our educational system is failing us by not producing sufficient numbers of science and technology graduates. We focus on gender studies and sociology, while other countries focus on math and science. This needs to change if we have any hope of competing in the modern world.

Before you can solve a problem, you have to recognize and identify the problem. Our country must refocus on making America first to ensure we can remain secure and independent through a strong economy.

Dealing With China II

Author: R. Alan Harrop, Ph.D

Question: Is China an ally, adversary, or enemy? The answer to this question should define how we interact with them. Clearly, China is not an ally. An adversary is one who acts in ways opposed to another’s interests. An enemy, is one who is seeking to injure, harm or overthrow another country. Let’s look at some facts.

China has stated that their intention is to replace our position in the world by weakening us and is committed to expanding their military and replacing the dollar as world currency with their yuan in order to do so. They are also enabling the smuggling of deadly fentanyl into our country which kills 100,000 of our youth each year. They steal our technology, ignore our patents and copyrights, and use deceptive trade practices. They recently sent a spy balloon over our country which the inept Biden regime failed to shoot down or take retaliatory action. They produced a deadly virus that killed millions throughout the world including thousands in the United States. They are sending thousands of their citizens over our border illegally. Currently there are over 350.000 Chinese students attending our universities, many of which have been caught spying for China. Also, China is apparently giving millions of dollars to the family of president Biden to control his decision making.

How do you think China would respond if we were doing these things to them? It is no wonder that they see us as weak, in decline, and ready for take over. The question, now that we recognize China as an enemy, is what action to we take to protect ourselves? First, elect a non-compromised president who has the courage to face the threat that China presents. Second, eliminate our dependency on China for essential manufacturing products and importantly, essential pharmaceuticals. Third, expel all Chinese in our universities. Fourth, impose draconian tariffs on all Chinese products until their enabling of fentanyl smuggling over our border is stopped. Fifth, prohibit the sale of any land or food processing companies.in our country to China.

These actions may seem extreme to some. However, history is replete with countries who were destroyed by not recognizing external threats. It is time to recognize reality and take appropriate action before it is too late.

How Safe Is The Manufacturing Of The Vaccine?

On Sunday (updated Monday), The Epoch Times posted an article about manufacturing violations in the production of the Moderna Covid-19 vaccine.

The article reports:

U.S. Food and Drug Administration (FDA) inspectors uncovered problems at a Moderna plant used to manufacture a substance that is part of the company’s COVID-19 vaccine, according to a newly released document.

Moderna failed to meet multiple requirements, including rules aimed at minimizing the potential for contamination, according to the document.

FDA inspectors performed inspections at the plant in Norwood, Massachusetts from, Sept. 11 to Sept. 21, visiting nine times in total.

They found that equipment used to manufacture the substance was not cleaned properly before usage, that a mock cleaning done for manufacturing did not adequately simulate the actual process, that written alarm procedures were not followed, and that neither the equipment nor the plant were designed in a way that would make contamination less likely.

Inspectors also learned that Moderna used materials beyond their expiration date.

“There are more than two thousand expired items stored in your … warehouse and cold storage at time of inspection,” Unnee Ranjan, the FDA’s lead investigator, wrote in a summary of the inspections.

The article concludes:

Another part of the FDA report, dated Sept. 21, described how the Norwood facility did not have adequately designed air handling systems to “assure appropriate air quality in the … cleanroom in which the mRNA drug substance is manufactured.”

Inspectors also said they found positive air pressure was not “consistently maintained” between cleanrooms and airlocks and that monitoring data showed the cleanroom pressure turned negative between January and September. That development was “not assessed for potential impact,” they said.

“At face value, it appears multiple controls designed to prevent contamination were deficient,” Mr. Lynn said.

Another recently released document, produced by the nonprofit Informed Consent Action Network on orders from a federal judge, showed the FDA detected in Andover, Massachusetts, issues with the manufacture of a substance used in the Pfizer-BioNTech vaccine. Pfizer said in response it had taken actions to correct the issues.

The government is still putting ads up on television encouraging Americans to take the vaccine, even after there have been numerous reports of serious side effects. Now we find out there are manufacturing problems also? It’s time for the Covid vaccine to go away.

 

 

Policies Have Consequences

Recently, The Epoch Times posted an article about the village of Ilion, New York. For two centuries, Ilion has been the home of a Remington Arms Co. manufacturing plant.

The article reports:

In the village of Ilion, New York, 80 miles west of the state capital in Albany, residents are mourning the departure of gunmaker Remington Arms Co. after two centuries of continuous operation.

Without fanfare, the company announced last month that the manufacturing plant would be closing its doors on March 4, 2024.

“I feel like a family member has died,” Ilion Mayor John Stephens told The Epoch Times. “My dad raised four kids on a paycheck from there for 37 years. He walked to work and carried his lunch every day.”

Mr. Stephens said no one expected the announcement a week after Thanksgiving that the plant was set to close.

On Nov. 30, at 3:26 p.m., the company notified village officials of the decision by email. The message noted that “all separations” with the village would be completed by March 18, 2024.

Likewise, the company notified its 270 employees that they would soon be out of a job.

The article notes:

Publicly, the company attributed the plant closure in part to a hostile political climate in Albany regarding firearms production.

“I am writing to inform you that RemArms LLC has decided to close its entire operation at 14 Hoefler Avenue, NY 13357,” Remington Arms said in a letter to employees. “The company expects that operations at the Ilion facility will conclude on or about March 4, 2024.”

The Georgia-based company said it would continue to make firearms at its facility in Huntsville, Alabama, which opened in 2014, a year after New York’s passage of the Safe Act, which created stricter gun laws.

The anti-gun political climate in Democrat-controlled Massachusetts prompted competitor Smith & Wesson to move from its longtime base in Springfield to Maryville, Tennessee. The company announced the opening of its new headquarters there in October.

The article notes that the town has been losing population in recent years:

Until recently, Remington Arms employed about 1,500 workers, whose wages helped support the local retail economy, said village public historian Mike Disotelle.

“At noontime, when the employees would go to lunch, there would be a flood of factory employees going to local businesses,” he said.

Mr. Disotelle said Remington Arms was one of the village’s largest employers and a centerpiece of the downtown economy. This remained true even as the village continued to lose residents over the course of several decades, he said.

In 1960, the village had 10,000 residents. Today, that number is down to about 7,700 and could drop below 6,500 by 2030 due to the slow economy, high taxes, and limited housing availability, Mr. Disotelle said.

The northeast is losing its luster because of high taxes, limited housing, and the high cost of living. There is an exodus from blue states to red states. We just need to remind people not to bring their blue politics into red states.

Good Economic News

The Epoch Times reported the following yesterday:

Manufacturing in the United States, as measured by a key business activity gauge, surged to a 15-month high in July, exceeding economists’ expectations.

The Institute for Supply Management (ISM) business survey, published Aug. 3, shows that its topline manufacturing activity indicator, called the Purchasing Managers’ Index (PMI), surged to a reading of 54.2 in July.

Readings above 50 indicate expansion, while those below mean contraction.

“The PMI signaled a continued rebuilding of economic activity in July and reached its highest level of expansion since March 2019,” Timothy Fiore, chair of the ISM Manufacturing Business Survey Committee, said in a statement (pdf).

Economists polled by Reuters predicted the manufacturing index would rise to 53.6 in July, so the higher-than-expected number is encouraging, particularly in light of April’s 11-year low of 41.5.

Why is it that when a Republican is the President, good economic news always exceeds expectations?

The article also notes:

Another manufacturing sector gauge tapped by ISM in the survey is the New Orders measure, which soared to 61.5, up 5.1 percentage points from June.

“Orders starting to pick up. [An] increase of about 35 percent to 40 percent,” a chemical product manufacturing executive said.

“Incoming orders are slow. This is usually our busiest time of the year, but production is reduced due to lack of demand. Additional layoffs expected,” an executive at a furniture maker said.

Another gauge, the production index, showed 4.8 percentage point growth from June to July, coming in at 62.1, the highest reading of all the ISM gauges.

“Manufacturing outlook has improved greatly in June, as business has resumed at nearly 100 percent. We have implemented a number of safeguards that are costing extra money, but we are running,” an executive at a computer and electronics products maker said.

There was also some negative news included in the article, but considering the fact that the country has been locked down or in semi-lockdown since March, that is not surprising. The two-week shutdown has extended far past where it was scheduled to be. I would also like to note that the purpose of the lockdown was to avoid overwhelming our hospitals. Now we are in semi-lockdown to avoid the spread of the disease. There is significant information that this is not the best course of action (see article here), so why are we still in semi-lockdown? Why are churches limited in the amount of people they can allow in their buildings when the John Lewis funeral was packed? Why was there an exception to the quarantine rule for the people who attended the John Lewis funeral? Has the damage from the lockdown now exceeded the possible damage from the disease?

Good News

It always amazes me that good economic news is always ‘unexpected’ when a Republican is in the White House. Well, last month’s economic news also fits that pattern. Breitbart reported yesterday that factory activity in the U.S. surged higher than expected in June. That always makes me wonder who expected what.

The article reports:

The Institute for Supply Management’s index of manufacturing activity jumped 9.5 percentage points to 52.6 in June. The gauge of new orders rose 24.6 points to 56.4, the largest ever monthly increase. The production component of the index also rose by more than 24 points to 57.3.

…Economists had expected a reading of 49, with the highest estimate in those surveyed by Econoday 51.5. June’s score was the best since April of 2019.

“The manufacturing sector is reversing the heavy contraction of April, with the PMI increasing month-over-month at a rate not seen since August 1980, with several other indexes also posting gains not seen in modern times,” ISM’s Timothy Fiore said in a statement.

The article further reports:

“US manufacturers have reported a marked turnaround in business conditions through the second quarter, with collapsing production and demand in April at the height of the COVID-19 lockdown turning rapidly to stabilisation by June. The PMI posted a record 10-point rise in June amid unprecedented gains in the survey’s output, employment and order book gauges,” Chris Williamson, Chief Business Economist at IHS Markit, said.

Williamson said:

“The record rise in the New Orders Index, coupled with low inventory holdings, bodes well for a further improvement in production momentum in July. A record upturn in business sentiment about the year ahead likewise hints that business spending and employment will start to revive. However, while the PMI currently points to a strong v-shaped recovery, concerns have risen that momentum could be lost if rising numbers of virus infections lead to renewed restrictions and cause demand to weaken again.”

The Bureau of Labor Statistics also reported that the workforce participation rate for June was 61.5, up from 60.8 in May. In February the workforce participation rate was 63.4, so we have a ways to go to get back to where we were before the coronavirus shutdown.

Great News For America

Energy independence is wonderful, but in today’s technology age, there are other important areas where America needs to be self-sustaining. One of the them is the rare earth minerals used in the manufacture of our technology. On Wednesday (updated yesterday) The Epoch Times posted an article about one step that has been taken in this direction.

The article reports:

Owners of the Wheat Ridge facility for processing rare earth elements and critical minerals have received an operating permit that will enable minerals critical to advanced technology manufacturing to be mined and processed in the United States.

USA Rare Earth, LLC, and Texas Mineral Resources Corp. announced on June 18 that their Wheat Ridge, Colorado, facility has received its operating permit, with its pilot plant now in the commissioning process.

Texas Mineral said in a press release that the plant “will have the ability to produce the full range of high purity, separated rare earths as well as other critical minerals … which are essential for modern manufacturing ranging from defense applications to wind turbines, electric vehicles, smart phones, advanced medical devices, and the physical backbone of emerging 5G networks.”

The company says its objective is “to build the first rare earth and critical minerals processing facility outside China.”

The CEO of USA Rare Earth, Pini Althaus, said in a press release that the establishment of an independent, robust, and domestic rare earth metal and critical mineral supply chain is vital for the United States, “overcoming reliance on China.”

Congress and President Trump have both recognized the need to produce these minerals in America.

The article notes:

Reps. Michael Waltz (R-Fla.) and Paul Gosar (R-Ariz.) introduced legislation (pdf) on May 28 to protect American mineral supply chains.

Gosar described critical minerals as the building blocks of our modern lives, as they are vitally important for special components in defense systems, health care applications, and energy generation technology.

“For years, our country has become increasingly dependent on China and other nations to fulfill our demand for minerals,” said Gosar. “The global pandemic has demonstrated the severe consequences of allowing this longstanding over-reliance on China to go unchecked.”

Waltz said that critical minerals are integral to our way of life.

“As coronavirus has unfortunately demonstrated, if China can threaten to cut off our pharmaceutical supply, they can do the same with their supply of rare earth minerals,” said Waltz. “We need to bring this supply chain back to America—and this bill will be an important step to do that.”

…President Donald Trump issued Executive Order 13817 in December 2017, titled “A Federal Strategy to Ensure Secure and Reliable Supplies of Critical Minerals.” The order directed federal agencies to list critical minerals, develop strategies to reduce reliance on the minerals themselves and on foreign suppliers, and increase domestic production.

The positive impact of the coronavirus is that it reminded us that as a nation we need to be as self-sufficient as possible. It is encouraging to see steps being taken in this direction.

Foreign Interference In Our Government In Plain Sight

PJ Media posted an article yesterday with the following headline, “Dems Block China Investigation Even After Communist Regime Threatens U.S. Senators by Name.” Great. We have another country threatening our Representatives if they do their job.

The article reports:

“Coronavirus Committee Dems won’t let us investigate China’s cover-up,” House Minority Whip Steve Scalise (R-La.) tweeted. “Why? – China’s lies caused global suffering & economic devastation – China undermined our efforts to combat the virus – China is reportedly trying to steal our vaccine research They must be held accountable.”

The article notes:

If Democrats are going to investigate President Trump’s response to the coronavirus crisis, they should also investigate China’s malfeasance. Just last week, Chinese officials threatened “serious consequences” for members of the U.S. House of Representatives and the U.S. Senate, along with two state attorneys general. The officials named Sens. Marsha Blackburn (R-Tenn.), Tom Cotton (R-Ark.), Josh Hawley (R-Mo.), Martha McSally (R-Ariz.), and Rick Scott (R-Fla.), along with Reps. Jim Banks (R-Ind.) and Dan Crenshaw (R-Texas).

“The Chinese government is lashing out at those in the U.S. who are appropriately trying to hold them accountable for intentionally misleading us about the nature of the novel coronavirus, where it was spreading and how quickly things were getting out of control. I consider their threats a badge of honor,” Banks replied.

Attorney General Eric Schmitt (R-Mo.) filed a lawsuit last month demanding tens of billions of dollars in damages due to China’s coronavirus malfeasance, which allegedly violated Missouri law. Attorney General Lynn Fitch (R-Miss.) filed a lawsuit allowing Mississippians to bring claims against China.

We need to remember that the communist government of China is not our friend. They are not anyone’s friend.

The article lists some of the destructive actions of China relating to the coronavirus:

China received 2.4 billion pieces of PPE from other countries. Yet when countries asked China for PPE, the Communist Party extorted them — only sending valuable medical aid if political leaders agreed to publicly praise Beijing. Chinese companies also sent faulty medical gear and coronavirus antibody tests to European countries, and an Associated Press investigation revealed the prevalence of counterfeit masks in America, likely tracing back to a major Chinese factory. Meanwhile, the Communist Party also prevented U.S. companies from shipping their own medical gear back home, where it is sorely needed.

Wuhan was not put under lockdown until January 22-23. On January 26, Wuhan’s mayor admitted that 5 million people had already left the city. Chinese President Xi Jinping said he had “issued requirements for the prevention and control of the new Coronavirus” as early as January 7. He could have acted to shut down Wuhan as early as January 7, two weeks before the city was shut down. A University of Southampton study found that if strict quarantine measures had been introduced three weeks earlier, the coronavirus’s spread would have been reduced by 95 percent.

As the coronavirus spread across the globe, China’s Communist Party put out a video encouraging Italians to hug Chinese people to prove they weren’t racist — while China was lying about the true danger of the virus.

According to the FBI and the Department of Homeland Security, the Chinese Communist Party is also attempting cyber espionage on American attempts to create a coronavirus vaccine and cure. Chinese officials are also refusing to cooperate in the search for the coronavirus’ origins.

It is definitely time to put trade restrictions on China and move American manufacturing out of China. We need to start shopping for ‘made in America’ products.

Recognizing A Long-Standing Problem

The Washington Examiner posted an article today about America’s dependence on Chinese manufacturing for inexpensive products.

The article reports:

American companies that produce essential goods in China should plan to shift their operations back to the United States or other Western countries, according to a senior Republican lawmaker.

“We’re staring into a significant, significant crisis of supply chain,” Colorado Sen. Cory Gardner told the Washington Examiner. “Cheap labor or cheap manufacturing be damned if you are reliant on them for your life and livelihood.”

Gardner’s warning was spurred by the shortage of hospital masks in the United States, a dearth driven by Beijing’s refusal to allow American companies that make the products in China to ship them out of the country amid the coronavirus pandemic. And he’s not alone in that sentiment, raising the possibility that anger over China’s self-interested response to the coronavirus outbreak could produce one of the most dramatic alterations of global economics in decades.

“Because of the coronavirus problem, people are recognizing that any supply chain that has single points of failure is incredibly vulnerable,” the Heritage Foundation’s Dean Cheng, a senior research fellow in the organization’s Asian Studies Center, told the Washington Examiner. “China is going to be very concerned about decoupling, offshoring, [or any] redirection of investments out of China.”

Obviously, the coronavirus has caused American companies to rethink outsourcing manufacturing to China, but the threats by the Chinese government have not helped the situation.

The article notes:

That suspicion of China reflects the degree to which the coronavirus pandemic has exacerbated the tensions between the world’s two largest economies. American officials are angry that Chinese Communist officials censored the early warnings that a new virus had emerged in Wuhan. In response, fuming Chinese diplomats have accused the U.S. Army of starting the pandemic while reminding the West that China controls key parts of the medical supply chain.

“There could be nothing more ham-handed and catastrophic than for the Chinese to talk some more about ‘how the U.S. created coronavirus, and, by the way, maybe we’ll cut off pharmaceuticals,’” Cheng said. “You want to have a situation where there really is that kind of a backlash, where the U.S. actively tries to not only decouple but move specifically away from China? That’s inviting that kind of a backlash.”

America can’t afford to outsource its drug manufacturing to a country that threatens to cut off the supply. It’s time to bring drug manufacturing home and employ American workers.

Some Thoughts On One Long-Term Effect Of The Coronavirus

On March 1, Forbes Magazine posted an article about the long-term impact of the coronavirus. Obviously the article was written before America went on lockdown and the stock market felt the full impact of the epidemic.

The article reports:

The new coronavirus Covid-19 will end up being the final curtain on China’s nearly 30 year role as the world’s leading manufacturer.

“Using China as a hub…that model died this week, I think,” says Vladimir Signorelli, head of Bretton Woods Research, a macro investment research firm.

China’s economy is getting hit much harder by the coronavirus outbreak than markets currently recognize. Wall Street appeared to be the last to realize this last week. The S&P 500 fell over 8%, the worst performing market of all the big coronavirus infected nations. Even Italy, which has over a thousand cases now, did better last week than the U.S.

So who wins as China loses its place as the world’s leading manufacturer?

The article notes:

Yes. It is Mexico’s turn.

Mexico and the U.S. get a long. They are neighbors. Their president Andres Manuel Lopez Obrador wants to oversee a blue collar boom in his country. Trump would like to see that too, especially if it means less Central Americans coming into the U.S. and depressing wages for American blue collar workers.

According to 160 executives who participated in Foley & Lardner LLP’s 2020 International Trade and Trends in Mexico survey, released on February 25, respondents from the manufacturing, automotive and technology sectors said they intended to move business to Mexico from other countries – and they plan on doing so within the next one to five years.

“Our survey shows that a large majority of executives are moving or have moved portions of their operations from another country to Mexico,” says Christopher Swift, Foley partner and litigator in the firm’s Government Enforcement Defense & Investigations Practice.

Swift says the move is due to the trade war and the passing of the USMCA.

The article points out one of the major problems with manufacturing in Mexico:

Safety remains a top issue for foreign businesses in Mexico who have to worry about kidnappings, drug cartels, and personal protection rackets. If Mexico was half as safe as China, it would be a boon for the economy. If it was as safe, Mexico would be the best country in Latin America.

“The repercussions of the trade war are already being felt in Mexico,” says Miralles.

Mexico replaced China as the U.S. leading trading partner. China overtook Mexico only for a short while.

A strong Mexican economy would solve a lot of problems for America if the drug cartels and other illegal activities could be stopped. A strong Mexican economy would provide incentive for migrants from poorer South American countries to remain there and work. It might ebb the flow of illegals into America that burden the American welfare system and negatively impact the wages of Americans on the lower end of the wage scale.

There will always be drawbacks to outsourcing manufacturing to a country that is controlled by a group of tyrants. American companies who scream about civil rights in America have been willing to overlook sweatshops in China. It is time to add the concept of conscience to the corporate decision-making process.

Common Sense Has Entered The Building

On Wednesday The Daily Caller posted an article with the following headline, “‘Buy American’ — White House Confirms Executive Order That Will End Medical Supply Chain Reliance On China.” China is the last country in the world we want to be dependent on for drugs.

The article reports:

White House Director of Trade and Manufacturing Policy Peter Navarro confirmed Wednesday the administration is working on an executive order to eliminate the government’s reliance on foreign-made medical supplies.

The “Buy American” order comes on the heels of concerns expressed by senators during their Tuesday meeting with President Donald Trump on Capitol Hill.

…The order would prevent federal agencies from purchasing medical supplies, including face masks, gloves and ventilators, from China.

As the United States has battled the domestic spread of coronavirus, consumers were alerted to the fact that China manufactures an overwhelming percentage of the federal government’s medical equipment. 90 percent of all U.S. antibiotics were manufactured in China.

China has prevented the export of surgical face masks, severely limiting supplies in the U.S. and countries around the world.

Under the Trump administration, we have gained energy independence. Now it is time to gain pharmaceutical independence.

The Economy Is Strong

No one really knows what impact the coronavirus will have on our economy, but as for now, the February jobs report showed a strong, vibrant, growing economy.

Yahoo News posted details of the report today.

The article reports:

The Labor Department released its February jobs report at 8:30 a.m. ET Friday. Here were the main results from the report, compared to consensus expectations compiled by Bloomberg:

  • Change in non-farm payrolls: +273,000 vs. +175,000 expected and 273,000 in January
  • Unemployment rate: 3.5% vs. 3.6% expected and 3.6% in January
  • Avg. hourly earnings, month on month: +0.3% vs. +0.3% expected and +0.2% in January
  • Avg. hourly earnings, year on year: 3.0% vs. +3.0% expected and 3.1% in January

January’s job gains were upwardly revised to 273,000, from the 225,000 previously reported, and December’s non-farm payroll additions were upwardly revised by 37,000 to 184,000. This brought average job gains over the past three months up to 243,000, or above the average from 2019, when job growth averaged 178,000 per month.

The services sector again led the advance in job gains in February. Within this sector, health-care and social assistance added 56,500 payrolls, accelerating gains from January. Professional and business services also posted strong job gains, adding a net 41,000 positions.

Within the services sector, wholesale trade, retail trade, transportation and warehousing and temporary health services shed jobs in February. Retail posted the largest declines, losing a net 7,000 positions and extending a drop of 5,800 from January.

For the goods-producing sector, manufacturing added jobs for the first time in three months, posting a net 15,000 payroll gains. Construction and mining each also added jobs, underscoring a firming of the goods-producing sector in February after months of weakness relative to services. Employment in construction rose by 42,000 positions for the month after a gain of 49,000 in January, representing the best two-month advance for the industry since March 2018, as unseasonably warm weather and a strengthening housing market helped supported hiring.

The Workforce Participation Rate remained steady at 63.4 percent.

It’s always interesting to me that when the jobs report comes out during a Republican administration, the numbers always seem to be higher than the experts predicted. There will be some impact in March from the coronavirus because of the disruption in the global supply chain the virus has caused, but I believe the economy is strong enough to recover from any glitches that may occur (despite the undisguised wishes of the Democrat party for a serious economic downturn).

The Obvious Is Sometimes Overlooked

On Friday, Frank Gaffney, Jr., posted an article at the Center for Security Policy about America’s dependence on China for the manufacturing of drugs.

The article reports:

Communist China has been waging “unrestricted warfare” against this country for decades. One of its most devastating lines of attack in that war has been the hollowing out of America’s industrial base. 

A stupefying case in point is the Chinese Communist Party’s success in destroying our nation’s capacity to manufacture prescription drugs – to the point where we are virtually completely dependent on China for our medicines. 

A recent poll of likely voters found that 83% were concerned about such a dependency. 76% worried that China may cut off the supply, devastating our health care system and people.

Rosemary Gibson, the co-author of China Rx, has warned about such a scenario for years. Now, in the midst of the coronavirus crisis, it is upon us. We need immediately to heed Ms. Gibson’s call urgently to reconstitute an America First drug manufacturing capability.

We have achieved energy independence which has increased our influence around the world. Now it is time to achieve drug independence.

 

President Trump And His Trade Policies

Yesterday Fox News reported that the US trade deficit has dropped for first time in 6 years because of the taxes President Trump has placed on China.

The article reports:

The U.S. trade deficit fell for the first time in six years in 2019 as President Donald Trump hammered China with import taxes.

The Commerce Department said Wednesday that the gap between what the United States sells and what it buys abroad fell 1.7 percent last year to $616.8 billion. U.S. exports fell 0.1 percent to $2.5 trillion. But imports fell more, slipping 0.4 percent to $3.1 trillion. Imports of crude oil plunged 19.3% to $126.6 billion.

The deficit in the trade of goods with China narrowed last year by 17.6 percent to $345.6 billion. Trump has imposed tariffs on $360 billion worth of Chinese imports in a battle over Beijing’s aggressive drive to challenge American technological dominance. The world’s two biggest economies reached an interim trade deal last month, and Trump dropped plans to extend the tariffs to another $160 billion in Chinese goods.

The article notes:

Overall, the United States posted a $866 billion deficit in the trade of goods such as cars and appliances, down from $887.3 billion in 2018. But it ran a $249.2 billion surplus in the trade of services such as tourism and banking, down from $260 billion in 2018.

America is a nation of consumers, so I suspect trade deficits are something that will always be with us, but as the manufacturing base in America expands and our trade policies become more balanced, I believe we will see lower trade deficits.

The Trump Economy

Newsmax posted an article today about the state of the American economy.

The article reports:

Companies in the U.S. ramped up hiring at the start of the year, taking on the most workers since May 2015 and indicating the labor market remains robust, a report on private payrolls showed Wednesday.

Employment at businesses increased by 291,000 in January after a revised 199,000 gain in the previous month, according to data from the ADP Research Institute.

The article includes the following statistics:

  • The larger-than-expected gain was broad-based and included the biggest advance in service industry payrolls since February 2016, including a record surge in hiring at leisure and hospitality companies in data back to 2002.
  • The report is in line with last week’s statement from Federal Reserve policy makers following their meeting on interest rates. The Fed said that “job gains have been solid, on average, in recent months.”
  • Economists monitor the ADP data for clues about the government’s job report. The Labor Department’s employment data due Friday is expected to show a 150,000 gain in private payrolls and an unemployment rate remaining at a 50-year-low of 3.5%.
  • The government figures will also include annual revisions. In August, the Labor Department’s preliminary benchmark projections showed the number of workers added to payrolls will probably be revised down by 501,000 in the year through March 2019. ADP’s report follows a different methodology than the government’s, and the two do not directly correlate with each other.
  • ADP report showed goods-producing payrolls rose 54,000 in January, while service-provider employment increased 237,000.
  • Hiring in construction jumped 47,000, the most in a year, and manufacturing showed a 10,000 increase in January, which was the biggest gain in 11 months.
  • Payrolls at small businesses increased by 94,000 last month, the most since July 2018; rose 128,000 at medium-sized companies and 69,000 at large firms.
  • ADP’s payroll data represent about 411,000 firms employing nearly 24 million workers in the U.S.

President Trump was mocked during the election campaign for saying he could bring back manufacturing jobs and turn the economy around. His trade agreements have done what other politicians considered impossible. I should note that people who think something is impossible don’t attempt to accomplish it. Maybe we need to elect people who are willing to attempt the impossible rather than those who simply make empty promises.

Economic Indicators In November

One America News is reporting today that U.S. homebuilding increased more than expected in November and permits for future home construction surged to a 12-1/2-year high.

The article reports:

The economy’s near-term prospects were also bolstered by other data on Tuesday showing a strong rebound in manufacturing production in November as the return of formerly striking General Motors’ <GM.N> workers boosted automobile output. The data suggested the economy remained on a moderate growth path in the fourth quarter despite slowing consumer spending.

…In a separate report on Tuesday, the Fed said manufacturing production rose 1.1% last month after dropping 0.7% in October. Excluding motor vehicles and parts, manufacturing output increased 0.3%.

The rebound in manufacturing production suggests the factory downturn is probably close to running its course. Manufacturing output is still expected to contract in the fourth quarter.

“This is a welcome shift after declines in three out of the four preceding months, but not the end of the struggles for manufacturing,” said Tim Quinlan, a senior economist at Wells Fargo Securities in Charlotte, North Carolina.

Single-family homebuilding, which accounts for the largest share of the housing market, increased 2.4% to a rate of 938,000 units in November, the highest level since January. Single-family housing starts rose in the West and Northeast, but fell in the Midwest and the South.

Single-family housing building permits rose 0.8% to a rate of 918,000 units in November, the highest since July 2007.

Starts for the volatile multi-family housing segment jumped 4.9% to a rate of 427,000 units last month. Permits for the construction of multi-family homes rose 2.5% to a rate of 564,000 units.

The economy is doing very well. The only thing that would make it better would be if the people we elected and sent to Washington would get serious about cutting spending and lowering our national debt.

Success Often Breeds Success

When President Trump campaigned for President, he said he wanted to redo America’s trade deals and bring manufacturing back to America. He has renegotiated the trade deals. Congress has yet to approve the deal with Mexico and Canada, but a lot of manufacturing has returned to America. The Washington Times posted an article today about public opinion of President Trump’s trade policies.

The article reports:

“Bipartisan consensus has emerged that foreign trade is good,” wrote Gallup senior analyst Lydia Saad. “Americans’ broad view of trade is the most positive it has been in more than a quarter-century.

…“Both Republicans and Democrats have become more positive about trade over this period of improving economic conditions,” she noted. “However, support for trade among both groups jumped sharply after Trump took office in 2017.”

The 2019 poll numbers now reveal:

• 70% of Americans say trade with other nations has a positive effect on “innovation and development of new products.”

• 67% say international trade has a positive effect on U.S. economic growth.

• 63% say trade has a positive effect on American businesses,

• 58% say trade has a positive effect of the quality of products.

• 51% say trade has a positive effect on jobs for U.S. workers.

I wonder if the positive results of President Trump’s policies will be reflected in the 2020 election.

 

 

 

Good News For Working Americans

Breitbart posted an article today about the latest economic numbers.

The article reports:

The U.S. economy created 136,000 jobs in September and the unemployment rate fell to 3.5 percent.

Economists had expected the economy to between 120,000 and 179,000 with the consensus number at 145,000, according to Econoday. Unemployment was expected to remain unchanged at last month’s 3.7 percent.

The jobs data for the two previous months were also revised upward, indicating that the labor market was stronger over the summer than previously indicated. Employment for July was revised up by 7,000 from 159,000 to 166,000, and August was revised up by 38,000 from 130,000 to 168,000. With these revisions, employment gains in July and August combined were 45,000 more than previously reported.

The stronger numbers for July and August may also explain the slightly-below expectations figure for September since some of the growth in employment forecast for last month had already occurred.

The last time the rate was this low was in December 1969, when it also was 3.5 percent.

Economic data has been intensely scrutinized this week for signs of economic sluggishness after the Institute for Supply Management’s survey of manufacturing companies suggested the manufacturing sector had unexpectedly contracted for a second consecutive month. Survey data of non-manufacturing companies, however, showed that the services sector continued to expand in September. Similarly, data on private payrolls and unemployment claims suggested that the U.S. economy had cooled but was not near a recession.

The September workforce participation rate remains unchanged at 63.2 percent. This is a chart showing changes in the rate since 2009:

They Did Get Some Of It Right

Yesterday The National Review posted an article about the decision by Colt to halt production of AR-15 rifles.

The article reports:

This, from ABC, is a nice example of a news organization deliberately bending the truth in order to advance a narrative that it wishes were true but is not:

Venerable gun manufacturer Colt says it will stop producing the AR-15, among other rifles, for the consumer market in the wake of many recent mass shootings in which suspects used the weapon.

Wow. Sounds dramatic. ABC continues:

“At the end of the day, we believe it is good sense to follow consumer demand and to adjust as market dynamics change,” Dennis Veilleux, president and CEO of Colt, said in a statement. “Colt has been a stout supporter of the Second Amendment for over 180 years, remains so, and will continue to provide its customers with the finest quality firearms in the world.”

So the story is that, although it still respects the Second Amendment, Colt is going to stop producing AR-15s after a series of mass shootings in which they were used. Right?

Wrong. That’s actually not the story at all, as ABC notes further down:

The company did not mention mass shootings in its statement about stopping production and instead blamed the indefinite pause in making the weapon on a “significant excess manufacturing capacity.”

And that is how you take truth and twist it until it leaves a totally false impression. That is the way the current mainstream media operates.

Trying To Level The Playing Field Has Its Challenges

Fox Business posted an article today about the devaluing of the Chinese yuan. The devaluing of the Chinese currency (currency manipulation) has been used by China for decades to grow their economy at the expense of America. It has been used to lure manufacturing away from America, impact our trade balance, and generally work against the American economy. We have needed to combat this practice for decades, but no President had the courage.

The article reports:

The onshore Chinese yuan weakened to worse than seven per U.S. dollar, hitting its lowest level since 2008, as Beijing looks to cushion the blow from Trump’s tariffs. A weaker yuan makes Chinese goods cheaper for overseas buyers, which may be necessary as China just lost its spot as the US’s biggest trading partner.

Trade data released Friday by the Department of Commerce showed U.S. imports from China fell by 12% in the first six months of the year, allowing Mexico to supplant it as the U.S.’s biggest trade partner.

“China dropped the price of their currency to an almost a historic low,” Trump tweeted Opens a New Window. on Monday. “It’s called “currency manipulation.” Are you listening Federal Reserve? This is a major violation which will greatly weaken China over time!”

Last week, Trump said beginning Sept. 1 the U.S. would place a 10% tariff on the remaining $300 billion of Chinese goods. He went ahead with the announcement despite objections from his advisers.

The president warned he could “always do much more” with respect to tariffs, adding the 10 percent tax could go “well beyond 25 percent” if necessary. Earlier this year, the administration placed a 25% tariff on $250 billion worth of Chinese goods.

Weakening the yuan isn’t the only form of retaliation Beijing took on Monday. It also ordered state-owned enterprises to stop purchases of U.S. agricultural products, according to a Bloomberg report, citing people familiar with the situation.

That is a reversal from just last week, when Beijing said it had purchased several tons of U.S. soybeans Opens a New Window. as a gesture of a goodwill amid trade negotitations. Before the trade war began, China was the largest buyer of U.S. soybeans, accounting for 70% of all purchases, but their imports have fallen by 97% since the trade war began.

The article notes:

Over the weekened, The Trump administration pushed back against the idea the trade war was hitting the wallets of U.S. consumers.

“China has strategically gamed the tariffs by slashing their prices and by devaluing their currency,” White House trade advisor Peter Navarro told “Fox News Sunday.”

This trade dust-up with China may get ugly, but it is something that has to be done.

Elected Officials Are Supposed To Represent The People Who Voted For Them

The Democrats have always been able to count of the labor unions to support their candidates. However, in recent years, Democrat policies have worked against people who belong to labor unions. Illegal immigration depresses the wages of American workers. Bad trade agreements send jobs overseas. Both of these problems are things that President Trump is trying to fix, but the Democrats in the House of Representatives are generally a road block to dealing with either problem.

Breitbart posted an article on Friday about some recent comments by AFL-CIO President Richard Trumka.

The article reports:

AFL-CIO President Richard Trumka blasted Democrats during a private meeting this week for their globalist free trade agenda where 2020 Democrat presidential primary candidates have continued to embrace the North American Free Trade Agreement (NAFTA) and the Trans-Pacific Partnership (TPP).

During a private meeting with Democrat National Committee (DNC) members, including Chairman Tom Perez who pushed TPP while working for President Obama, Trumka blamed a coalition of elected Republicans and Democrats for the country’s entering into a multitude of free trade agreements that have gutted America’s working and middle class while outsourcing those jobs to China, the Phillippines, Vietnam, and India.

“It’s time to do better,’ Trumka said, scolding Democrat Party leaders, according to the Huffington Post. “I believe you can. I believe you will. And working people are hungry for it. But you can’t offer campaign rhetoric or count on workers’ votes simply because you have a ‘D’ next to your name.”

The article continues:

“You need to prove that this party is the one and only party for working people,” Trumka said, according to the Huffington Post. “And recognize that unions and collective bargaining are the single best way to make this economy work for everyone.”

Trump has sought to protect and create American working and middle-class jobs by imposing tariffs on China and other foreign imports. Likewise, during his first year in office, he ended the Obama effort to enter TPP — which would have eliminated millions more U.S. jobs by allowing multinational corporations to outsource them directly to Vietnam and Malaysia.

Meanwhile, Biden has continued to defend NAFTA, which he claimed in 1993 would add American jobs to the American economy but actually helped eliminate nearly five million U.S. manufacturing jobs and resulted in the closure of nearly 50,000 U.S. manufacturing facilities. A number of American towns and small cities were left economically destroyed and have yet to recover.

I would call this a shot across the bow. Unions provide major money to Democrat political campaigns, even when their members don’t vote for Democrats. If the Democrat party continues in its current direction, the labor union leaders may be less enthusiastic about promoting and funding Democrat candidates.

More Good Economic News

The following is a Press Release from U.S. Steel:

U. S. STEEL ANNOUNCES STATE-OF-THE-ART STEELMAKING TECHNOLOGY INVESTMENT AT MON VALLEY WORKS

PITTSBURGH May 2, 2019–United States Steel Corporation (NYSE: X) announced today it will invest more than $1 billion to construct a new sustainable endless casting and rolling facility at its Edgar Thomson Plant in Braddock, Pa.,and a cogeneration facility at its Clairton Plant in Clairton, Pa., both part of the company’s Mon Valley Works. The cutting-edge endless casting and rolling technology combines thin slab casting and hot rolled band production into one continuous process and will make Mon Valley Works the first facility of this type in the United States, and one of only a handful in the world.

“This is a truly transformational investment for U.S.Steel.We are combining our integrated steelmaking process with industry-leading endless casting and rolling to reinvest in steelmaking and secure the future for a new generation of steelworkers in Western Pennsylvania and the Mon Valley,” said David B. Burritt, President and Chief Executive Officer of U.S.Steel. “U.S.Steel’s investment in leading technology and advanced manufacturing aligns with our vision to be the industry leader in delivering high-quality, value-added products and innovative solutions that address our customers’ most challenging steel needs for the future. We believe that adding sustainable steel technology to our footprint will create long-term value for our employees, our region, our customers and our investors.

The installation of endless casting and rolling technology will give U.S.Steela world-class asset that will improve the quality and attributes of its downstream products for customers in appliance, construction and industrial markets. With this investment, Mon Valley Works will become the principal source of substrate for the production of the company’s industry-leading XG3™ Advanced High Strength Steel (AHSS) that assists automotive customers in meeting fuel efficiency standards. This project, in addition to producing sustainable AHSS, will improve environmental performance, energy conservation and reduce our carbon footprint associated with Mon Valley Works. First coil production is expected in 2022,contingent upon permitting and construction.

With this investment, U.S.Steel continues its more than a century-long commitment to innovative steelmaking in Pennsylvania. The technology will allow for optimization of the Mon Valley Works and other U.S.Steel facilities without increasing the company’s overall steelmaking capacity. The new endless casting and rolling facility will replace the existing traditional slab caster and hot strip mill facilities at the Mon Valley Works. Current and future employees will enhance their skills with more advanced manufacturing to operate and maintain the new facility through training programs developed in partnership with local universities.

As part of the project,U.S.Steel will also include construction of a new cogeneration facility, equipped with state-of-the-art emissions control systems at its Clairton Plant,to convert a portion of the coke oven gas generated at its Clairton Plant into electricity to power the steelmaking and finishing facilities throughout U.S.Steel’s Mon Valley operations.

Once completed, the new advanced steelmaking technology and state-of-the-art cogeneration facilities will incorporate the best available control technologies. Based upon current design and engineering data that is accompanying our air permit applications, we expect that the project will result in significant improvements in emissions compared to the existing facilities to be replaced, including reductions in emissions of Particulate Matter (PM) of approximately 60%, PM10 and PM2.5 of approximately 35%,sulfur dioxide of approximately 50%,and nitrogen oxides of approximately 80%. The project exemplifies our continued commitment to conserve resources and improve air quality in the Mon Valley.

Additional details on the investment, including an investor presentation,can be found at http://www.ussteel.com/MonValleyInvestment.

President Trump’s economic policies are working for everyone.