Earlier today President Donald Trump presented the Presidential Medal of Freedom to Dr. Arthur Laffer in the Oval Office. [Video and Transcript]
[Transcript] – 5:16 P.M. EDT – THE PRESIDENT: Well, this is a big day. Very important for a very important subject. Today it’s my privilege to award our nation’s highest civilian honor to the father of supply-side economics: Dr. Arthur Laffer. (Applause.)
I know Art has been to the Oval Office, unlike most people, many times. But this is a very special time for you. This is a tremendous award. You have the Congressional Medal of Honor on the military side, which, of course, is something incredibly special. And the presidential medal is — I just want to congratulate you. There’s nothing like it, right?
DR. LAFFER: Nothing.
THE PRESIDENT: Thank you very much, Art.
Joining us for this momentous ceremony are Art’s six children. Thank you very much. Congratulations. (Applause.) And we’re also grateful to be joined by Vice President Mike Pence. We just got back from Florida. (Applause.) Had a big night. That was a big night in Orlando, Mike. Right?
Secretary Steve Mnuchin, Alex Acosta, Elaine Chao, and Ben Carson, thank you very much for being here. And our top economic advisor and a great friend — of all of us, actually. I hear that voice and I just say “money, money, money.” Larry Kudlow. (Laughter.) Right? Larry. Thank you, Larry.
MR. KUDLOW: Thank you, sir.
THE PRESIDENT: Few people in history have revolutionized economic thought and policy like Dr. Art Laffer.
He developed a brilliant theory, shaped unprecedented economic reforms, and helped turn a severe recession into a remarkable boom. He proved that the most powerful way to grow the economy and raise government revenue was not to increase tax rates but to adopt strong incentives that unleash the power of human freedom and innovate, create jobs, and deliver greater opportunity to all Americans. And he’s proved it over and over again.
A Yale graduate, Art went on to earn his PhD in Economics from Stanford University. He became the youngest-ever tenured professor at the University of Chicago. Oh, that’s good. That wasn’t too long, was it? (Laughter.) He’s very deceiving. He’s a little older than he looks. He looks like he’s in his forties. (Laughter.) He’s a little older than that. Just a little bit, right?
DR. LAFFER: A lot.
THE PRESIDENT: Don’t talk about it. (Laughs.)
In 1970, Art served as the very first chief economist at the Office of Management and Budget, where he designed an economic model that is still used today to forecast tax revenue and accurately predict economic growth.
Art then returned to the University of Chicago. At the start of the Ford administration, our nation’s economic situation was becoming dire indeed. We remember.
In 1974 alone, 2 million Americans joined the unemployment lines, and inflation hit 11 percent. Right now, we have inflation at almost nothing. (Applause.) I like that better. Don’t you? It’s good to read this because we read this and we realize how well we’re doing right now.
The consensus in Washington, on both sides of the aisle, was that the government could tax, inflate, and regulate its way to prosperity. But Art had a different idea. Right? You did have a different idea. I’d have you tell it. It would be much more interesting, huh?
In 1974, Art came to dinner with the White House Chief Staff — Chief of Staff Don Rumsfeld; Deputy Chief of Staff Dick Cheney — who’s been, by the way, a tremendous supporter, and we appreciate Dick very much; and Wall Street Journal reporter Jude Wanniski.
The dinner has since become very, very legendary in many minds. Art drew on his napkin a series of lines and a curve that changed history. With the now famous “Laffer Curve” — still, a very, very highly respected economic curve — Art showed that if tax rates are too high, people stop spending and they stop investing.
The result is less growth and lower tax revenues. On the other hand, at the certain point on the curve, lower tax rates spur investment, economic growth, and raise government revenue.
I think Steve Forbes agrees with that. (Laughter.) Where’s Steve? I’ve heard you for a long time talking about that. Very much agree.
Prominent academics called this theory “insanity,” “totally wacky,” and “completely off the wall.”
With optimism, confidence, and exceptional intellect, Art would go on to prove them all wrong. He proved them wrong on a number of occasions.
In 1978, California Governor Jerry Brown asked Art to help him implement Proposition 13, which the people had overwhelmingly enacted to dramatically reduce the state property tax. I think they could use it again out there, by the way. They should do that immediately. The results were so successful that job creation soon grew at twice the nationwide rate. Within two years, 43 states adopted similar reforms.
During that same period, Art also advised Ronald Reagan, and helped shape his low-tax, pro-growth agenda. After President Reagan’s election, Art served on the President’s Economic Policy Advisory Board. He played a vital role in both the 1981 and 1986 tax rate cuts, which ultimately lowered the top marginal tax rate from 70 percent to 28 percent. That’s not bad. That’s a pretty big reduction, I would say.
The Reagan economy soared, creating sustained economic growth, shrinking poverty, expanding incomes, and dramatically increasing federal revenue. Sounds very familiar. Sounds very, very familiar, actually. Our economy has never, ever been stronger than it is today. (Applause.) It’s true.
Dr. Laffer’s policies not only expanded opportunity for our citizens; they spurred economic reforms around the world and helped lift untold millions out of poverty. Art has advised many world leaders, including former UK Prime Minister Margaret Thatcher — a great one.
Staying true to the pro-growth vision that Dr. Laffer helped develop, in 2017, we passed historic tax cuts and reforms into law. Now, unemployment has reached its lowest level in over 51 years, with fast-growing wages, low inflation, and real GDP. And this is GDP growth that’s higher than anybody ever thought possible. First quarter was 3.2. And everybody said the first quarter is not going to be so good because the first quarter is never very good for us. But it was not only good; it was double and even triple what people expected. And we’re going to see some other very pleasant surprises, especially when the trade deals are all worked out. And they’re coming along very well, Art, as you know.
Our tax cuts and reforms also created Opportunity Zones in distressed communities, another idea that Dr. Laffer helped develop early in his career.
In 1999, TIME magazine named Dr. Laffer one of the greatest minds of the 20th century. Former Wall Street Journal reporter Jude Wanniski wrote, “In studying public finance, there is nothing more important than an appreciation of the Laffer Curve.” I’ve heard and studied the Laffer Curve for many years in the Wharton School of Finance. It’s a very important thing that you’ve done, Art. Very important.
Dr. Laffer helped inspire, guide, and implement extraordinary economic reforms that recognize the power of human freedom and ingenuity to grow our economy and lift families out of poverty and into a really bright future.
Today, our nation is stronger, our people more prosperous, and the world a much better place because of the brilliance and boldness of Dr. Arthur Laffer.
And it’s now my profound honor to ask the military aide to come forward as I present Dr. Laffer with the Presidential Medal of Freedom. It’s my great honor. Thank you. (Applause.)
MILITARY AIDE: Arthur B. Laffer, the Father of Supply-Side Economics, is one of the most influential economists in American history. He is renowned for his economic theory, “The Laffer Curve,” which establishes the strong incentive effects of lower tax rates that spur investment, production, jobs, wages, economic growth, and tax compliance.
Among other accomplishments during his distinguished career, Dr. Laffer was the first chief economist of the Office of Management and Budget and a top economic advisor to President Ronald Reagan.
The United States proudly recognizes Arthur B. Laffer for his public service and his contributions to economic policy, which have helped spur prosperity for our nation.
(The Medal of Freedom is presented.) (Applause.)
DR. LAFFER: Oh, my gosh. (Laughter.) When your staff said, “Keep it short,” I didn’t know that’s what they meant. (Laughter.) No, I’m just joking.
THE PRESIDENT: This is your day.
DR. LAFFER: Thank you very much.
Let me, if I can: Sincerity and brevity — or so they say — go hand in hand. And in that vein, Mr. President, I want to thank you from the top, the middle, and the bottom of my heart. Thank you.
Good economic policy is a team effort. And goodness knows my fellow teammates are the best ever: Larry Kudlow, my friend forever and ever and ever. Steve Moore. Where are you, Steve? Steve Moore. Steve Forbes. Steve Forbes canceled his trip abroad to be here today. Is David Malpass here? Kevin Hassett. Team players, Steven Mnuchin, wherever — there you are. You’re way back there. Steven. You don’t get a better team than that, ever. I mean, this is the team of all teams.
And I just want to reflect for a second on some of my past colleagues and working with other administrations. For example, in the past, my colleagues included Nobel Laureate and dear friend Bob Mundell; the legendary editorial page editor, Bob Bartley, of the Wall Street Journal; Jude Wanniski, the crazy, wild revolutionary for supply-side economics; Milton Friedman, of course; my godfather and dearest supporter, Justin Dart; George Schultz, my mentor who has hired me four times and not gotten tired of it yet, I guess; Jack Kemp, who we called, “The Weapon” — he’s delivered it; and my classmate at Yale, and my dear friend, a guy named Dick Cheney. It’s just really wonderful to have — each of whom deserves a lot of praise.
By the way, just for the record, Bob Bartley, Milton Friedman, Justin Dart, George Schultz, Jack Kemp, and Dick Cheney all received the President Medal of Freedom. Isn’t that amazing? I’m in great, great company, let me tell you. I’m awed by that.
But to get over the — to get the ball over the — to get the ball over the goal line, committed leadership is the sine qua non for this. And we had President Kennedy, President Reagan, Prime Minister Margaret Thatcher, and of course, you, Mr. President, Donald Trump, to really make it all happen. Without the leaders — (applause) — and all I can say is, wow.
I mean, you know, President Kennedy established the current Presidential Medal of Freedom, and both President Reagan and Margaret Thatcher were recipients.
My business partner is here. My business partner’s friends and fellow dreamcatchers — a number of whom are here today, by the way — have allowed all of this to happen for me, and I am eternally grateful. They are the salt of the Earth. And, in fact, they actually lived the lives that we economists just talk about. They actually do it. And it is for them that we do what we do. They have kept, do keep, and will keep America prosperous.
And my final shout-out, if I may, is to my family — my wonderful family. All six of my children are here today, as well as Mike Madzin and Mike Stabile. I’m missing my 13 grandchildren and my 4 great-grandchildren, for which I am sure the White House staff is eternally grateful. (Laughter.)
My family makes me very, very proud and gives me a reason every morning to get up and get to work. Thank you. (Applause.)
The construct of the USMCA was always anticipated to sail through ratification in Mexico because, well, quite frankly, the USMCA is specifically structured to provide great benefit toward Mexico. It’s not because the language within the USMCA favors Mexico, but rather the rules are centered around deregulating industry, and lifting wages.
The rules-of-origin, in combination with mandated minimum wage rates attached to the manufacturing sector; and the fact that Mexico has the lowest current wage rates in North American; specifically means that Mexican workers stand to get the biggest financial benefits… and that’s ok. Trump, Lighthizer and Ross designed it that way.
The U.S. benefits when the Mexican wage rates are raised. Heck, there was a time in the early negotiations, after Canada was kicked out of the room, when Secretary Wilbur Ross was advocating for an $11/hr minimum wage in Mexico, and the Mexicans were like ‘whoa, wait a minute, too high, too high’… [It was quite funny, because Trump was being called racist simultaneous to him trying to give a $85/day pay raise to Mexicans (from $3/day)].
MEXICO CITY (Reuters) – Mexico on Wednesday became the first country to ratify the United States-Mexico-Canada Agreement (USMCA) agreed late last year to replace the North American Free Trade Agreement (NAFTA) at the behest of U.S. President Donald Trump.
By a vote of 114 in favor to 4 against, Mexico’s Senate backed the deal tortuously negotiated between 2017 and 2018 after Trump repeatedly threatened to withdraw from NAFTA if he could not get a better trade agreement for the United States.
Mexican President Andres Manuel Lopez Obrador had already anticipated ratification this week in the Senate, where his leftist National Regeneration Movement (MORENA) and its allies have a comfortable majority in the 128-member chamber.
There has been little parliamentary opposition in Mexico to trying to safeguard market access to United States, by far Mexico’s top export destination, and the trade deal was approved with overwhelming cross-party support in the Senate.
Mexico sends around 80% of its exports to the United States, and Trump last month vowed to impose tariffs on all Mexican goods if Lopez Obrador does not reduce the flow of U.S.-bound illegal immigration from Central America.
Lopez Obrador says he wants to avoid conflict with Trump (read more).
The USMCA deal positions Mexico to retain their current multinational investments; and through a series of sector-by-sector standards on origination the deal simultaneously closes the fatal NAFTA loophole.
The agreement makes an economic manufacturing partnership between the U.S. and Mexico; and for assembly products third parties will have to produce parts and origination material within the U.S. and Mexico.
Here’s a good example in the auto-sector. The new USMCA agreement requires 75% of automobile parts made in North America; and 45% must come from plants with minimum labor costs ($16/hr), or face tariffs upon export to the U.S. Additionally, the total source-origination rate of 75% USMCA product is higher than everyone thought possible.
This 75% country-of-origin level was possible because President Trump cut out the corporations (ie. U.S. Chamber of Commerce) from having any influence over the agreement. Most people probably don’t know, but the USMCA was the first trade deal negotiated without multinational corporations in the room.
Example of downstream consequences/benefits: German auto-maker BMW recently built a $2 billion assembly plant in Mexico (just came on-line). Most of their core parts were coming from the EU (steel/aluminum casting components) and/or Asia (electronics). Now the assembly plant will have to source 75% of the auto-parts from the U.S. and Mexico, with 45% of those parts from facilities paying $16/hr. The Result: BMW will need to modify their supply chain and build auto parts in the U.S. and Mexico. [That’s Exactly What Happened]
Canada doesn’t gain as much benefit because: (1) Canadian environmentalists don’t allow heavy industrial manufacturing; and (2) the new USMCA closes the NAFTA loophole and blocks Canada from brokering their ‘assembly process‘ access to the U.S. market.
However, knowing this, when President Trump applied the global Steel and Aluminum tariffs toward Canada – he created a USMCA benefit for Canada literally out of thin air. In exchange for Canada agreeing to the terms of the USMCA, President Trump has now agreed to drop the Steel and Aluminum tariffs against Canada.
Canada will ratify the agreement because they have no choice if they want to keep access to the U.S. market for their products. I would predict Canadian ratification within a few weeks (before mid July).
Domestically, Nancy Pelosi is playing ‘OrangeManBad’ politics with the agreement; but once Canada ratifies it Pelosi will have to drop her pretense. Don’t worry, it’ll happen.
“Complicated business folks,… complicated business.”
In the 24 hour period surrounding the Trump/Pence 2020 kick-off the RNC is reporting supporters of President Trump raised a whopping $24.8 million.
WASHINGTON – President Trump’s re-election effort raised $24.8 million in under 24 hours, the Republican National Committee said Wednesday morning, announcing new numbers tied to the president’s kickoff rally in Orlando, Fla.
The RNC said the funds were split across the Trump re-election campaign and two joint Trump-RNC fundraising committees, Trump Victory and Trump Make America Great Again Committee.
The Trump campaign and the RNC together raised more than $75 million in the first quarter and had more than $80 million in the bank at the end of March. The next quarterly reports are due in July.
The 24-hour haul underscores Mr. Trump’s fundraising command and how the GOP has coalesced behind him after shunning his unconventional foray into the 2016 presidential primary. His incumbency has enabled him to partner with the Republican Party to seek six-figure individual donor checks. (read more)
“The enthusiasm across the country for this President is unmatched and unlike anything we’ve ever seen!”
~ RNC Chairwoman Ronna McDaniel
The possibility of U.S. Attorney John Durham exploiting/using documents declassified by his boss, AG Bill Barr, could suggest some of the material may not be made public; indeed that’s the inference from Representative John Ratcliffe three weeks ago as he outlined to Maria Bartiromo.
If accurate, it is worthwhile considering what *could be* publicly declassified by AG Barr, and yet not run afoul of any investigative value for Durham. Example: the declassification of the Rosenstein scope memos to Robert Mueller (no longer a reason to be hidden) would not seem to materially affect the investigative intents of Durham.
So considering investigative value, what documents could be made public that would not impede Durham?
Here’s the list of material possible for declassification. This was the original list as outlined in 2018:
- All versions of the Carter Page FISA applications (DOJ) (FBI) (ODNI).
- All of the Bruce Ohr 302’s filled out by the FBI. (FBI) (ODNI)
- All of Bruce Ohr’s emails (FBI) (DOJ) (CIA) (ODNI). All supportive documents and material provided by Bruce Ohr to the FBI. (FBI)
- All relevant documents pertaining to the supportive material within the FISA application. (FBI) (DOJ-NSD ) (DoS) (CIA) (DNI) (NSA) (ODNI);
- All intelligence documents that were presented to the Gang of Eight in 2016 that pertain to the FISA application used against U.S. person Carter Page; including all intelligence documents that may not have been presented to the FISA Court. (CIA) (FBI) (DOJ) (ODNI) (DoS) (NSA) Presumably this would include the recently revealed State Dept Kavalac email; and the FBI transcripts from wiretaps of George Papadopoulos (also listed in Carter Page FISA). [AKA ‘Bucket Five’]
- All unredacted text messages and email content between Lisa Page and Peter Strzok on all devices. (FBI) (DOJ) (DOJ-NSD) (ODNI)
- The originating CIA “EC” or two-page electronic communication from former CIA Director John Brennan to FBI Director James Comey that started Operation Crossfire Hurricane in July 2016. (CIA) (FBI) (ODNI)
Additionally, since the 2018 list was developed, more information has surfaced about underlying material. This added to the possibility of documents for declassification:
♦ President Trump can prove the July 31st, 2016, Crossfire Hurricane counterintelligence operation originated from a scheme within the intelligence apparatus by exposing the preceding CIA operation that created the originating “Electronic Communication” memo. Declassify that two-page “EC” document that Brennan gave to Comey. [The trail is found within the Weissmann report and the use of Alexander Downer – SEE HERE]
♦ Release and declassify all of the Comey memos that document the investigative steps taken by the FBI as an outcome of the operation coordinated by CIA Director John Brennan in early 2016. [The trail was memorialized by James Comey – SEE HERE]
♦ Reveal the November 2015 through April 2016 FISA-702 search query abuse by declassifying the April 2017 court opinion written by FISC Presiding Judge Rosemary Collyer. Show the FBI contractors behind the 85% fraudulent search queries. [Crowdstrike? Fusion-GPS? Nellie Ohr? Daniel Richman?] This was a weaponized surveillance and domestic political spying operation. [The trail was laid down in specific detail by Judge Collyer – SEE HERE]
♦ Subpoena former DOJ-NSD (National Security Division) head John Carlin, or haul him in front of a grand jury, and get his testimony about why he hid the abuse from the FISA court in October 2016; why the DOJ-NSD rushed the Carter Page application to beat NSA Director Admiral Mike Rogers to the FISA court; and why Carlin quit immediately thereafter.
♦ Prove the Carter Page FISA application (October 2016) was fraudulent and based on deceptions to the FISA Court. Declassify the entire document, and release the transcripts of those who signed the application(s); and/or depose those who have not yet testified. The creation of the Steele Dossier was the cover-up operation. [SEE HERE]
♦ Release all of the Lisa Page and Peter Strzok text messages without redactions. Let sunlight pour in on the actual conversation(s) that were taking place when Crossfire Hurricane (July ’16) and the FISA Application (Oct ’16) were taking place. The current redactions were made by the people who weaponized the intelligence system for political surveillance and spy operation. This is why Page and Strzok texts are redacted!
♦ Release all of Bruce Ohr 302’s, FBI notes from interviews and debriefing sessions, and other relevant documents associated with the interviews of Bruce Ohr and his internal communications. Including exculpatory evidence that Bruce Ohr may have shared with FBI Agent Joseph Pientka. [And get a deposition from this Pientka fella] Bruce Ohr is the courier, carrying information from those outside to those on the inside.
♦ Release the August 2nd, 2017, two-page scope memo provided by DAG Rod Rosenstein to special counsel Robert Mueller to advance the fraudulent Trump investigation, and initiate the more purposeful obstruction of justice investigation. Also Release the October 20th, 2017, second scope memo recently discovered. The Scope Memos are keys to unlocking the underlying spy/surveillance cover-up. [SEE HERE and SEE HERE]
It would appear the Rosenstein scope memos, Kavalec memo about contact with Chris Steele, original FISA application of Carter Page and transcript of Papadopoulos conversation with Halper etc, could be released without impeding a grand jury review.
The Inspector General report on FISA abuse has apparently been delayed due to the new angle of interviewing Christopher Steele. Given the nature of this new aspect; and considering the process for a report assembly after investigation all the way to release (a minimum of a month); it is highly unlikely we will see the IG report until the end of July or August 2019… which triggers suspicions of the proverbial DC can-kicking process.
Prompted to 03:22 Just Hit Play
This is interesting… but not simply because of the surface visibility. Yesterday there was an event in Charlotte, North Carolina, that brought together Apple CEO Tim Cook, Commerce Secretary Wilbur Ross, U.S. Workforce policy advocate Ivanka Trump and U.S. CoC President Tom Donohue (on the margin).
Today, Apple Inc announces a restructuring of their supply chain away from China. In the media report notice the nations that likely stand to gain, and reference Trump’s 2017 golden ticket tour of Asia.
(Reuters) – Apple Inc has asked its major suppliers to assess the cost implications of moving 15%-30% of their production capacity from China to Southeast Asia as it prepares for a restructuring of its supply chain, according to a Nikkei Asian Review report on Wednesday.
Apple’s request was a result of the extended Sino-U.S. trade dispute, but a trade resolution will not lead to a change in the company’s decision, Nikkei said s.nikkei.com/31zCGhw, citing multiple sources.
The iPhone maker has decided the risks of depending heavily on manufacturing in China are too great and even rising, it said.
Earlier this month, credit rating agency Fitch said it views Apple, Dell Technologies Inc and HP Inc as potential blacklist candidates if China blacklists U.S. companies in retaliation for restrictions on Huawei.
The countries being considered include Mexico, India, Vietnam, Indonesia and Malaysia. India and Vietnam are among the favorites for smartphones, Nikkei said, citing sources who did not want to be identified as the discussions are private.
Last week, Foxconn said it had enough capacity outside China to meet Apple’s demand in the American market if the company needed to adjust its production lines, as U.S. President Donald Trump threatened to slap further $300 billion tariffs on Chinese goods. (read more)
In November of 2017, President Trump traveled to a specific set of Asian nations to meet with their leaders in advance of the APEC summit. Included in the individual bilateral discussions (disconnected from APEC) was: Moon Jae-in (S Korea), Shinzo Abe (Japan), Tran Dai Quang (Vietnam), Rodriquo Duterte (Phillipines) and Narenda Modi (India).
Notice the flow… Shinzo Abe, then Moon Jae-In, then meeting with Xi Jinping.
Who are the principals in the DPRK hostage release of Kim Jong Un? Abe, Moon and Xi.
It’s clear that for two-and-a-half years U.S. President Trump has been working on two connected objectives: (1) removing the threat posed by North Korea by severing the ability of Beijing to use the proxy province as a weapon (Kim is hostage to China); and (2) deconstructing the growing economic influence of China.
The second phase of the 2017 tour took place after Trump visited China. Additionally, there was a simultaneous shift in language. President Trump began using the term “Indo-Pacific”. The tour continued with extended bilateral trade discussions with Vietnam (Tran Dai Quang), India (Modi), and Philippines (Duterte).
In hindsight the connection and strategy is clear. Prime Minister Shinzo Abe is the fulcrum for the two objectives: (1) North Korea (denuke via hostage release); and (2) China (global trade rebalance).
There are ASEAN regional economic beneficiaries for #2, breaking the Chinese supply chain and targeting a manufacturing retreat. Namely: Japan, Vietnam, India, South Korea, Philippines, Malaysia, Indonesia… and Mexico (think USMCA).
[Additionally, Singapore and Tokyo pick up the financial benefits from worries over Hong Kong. More pressure on Chairman Xi]
Back to yesterday… Tim Cook, Wilbur Ross and Ivanka Trump:
Flashback to June 2018:
As we noted on Day #1, if we watch how Beijing scripts the messaging we should be able to identify if Chairman Xi Jinping is taking the dragon approach toward his captive Kim Jong Un, or if Xi would instead reshape the geopolitics by announcing his release of Kim as a hostage: The magnanimous panda approach. [Critical Background HERE and HERE]
It looks like we have an answer today as Chairman Xi writes a personal op-ed, published on the front page of North Korea’s state newspaper, where Xi is releasing Kim from proxy province captivity:
…”China supports North Korea’s “correct direction” in politically resolving issues on the Korean Peninsula.”…
Yes, though important details are yet to follow, it appears Beijing is acquiescing to the unrelenting pressure from hostage rescuer President Donald Trump and allowing the DPRK to exit the controlled captivity of China. Likely denuclearization will commence.
SEOUL (Reuters) – Chinese President Xi Jinping said in an op-ed in North Korean state newspaper Rodong Sinmun on Wednesday that China supports North Korea’s “correct direction” in politically resolving issues on the Korean Peninsula.
The front-page op-ed is an honor rarely granted to foreign leaders and comes a day before Xi is set to visit Pyongyang on Thursday and Friday at the invitation of North Korean leader Kim Jong Un, making him the first Chinese leader to visit in 14 years.
[…] Xi’s visit kicks off a flurry of high-level diplomatic activity around the Korean Peninsula ahead of the G20 summit in Japan later this month. Xi said the two Asian countries will “strengthen our strategic communication and exchanges,” adding that China will firmly support Kim’s achievements in “socialist construction” aimed at economic development and improving people’s lives, according to the newspaper.
Xi said North Korea and China would expand and develop relations in civilian sectors, including education, culture, sports, tourism, youth and rural areas.
“We will actively contribute to peace, stability, development and prosperity in the region by strengthening communication and coordination with the Democratic People’s Republic of Korea,” Xi said. China will also engage with other stakeholders “by jointly expediting progress on dialogue and negotiations on the issues of the Korean peninsula,” he added. (read more)
We now enter a phase of great nuance and subtle signaling where we will need to carefully evaluate the scale of hostage release. Obviously western media -writ large- are oblivious to the multidimensional hostage dynamic; heck, most major western media don’t even acknowledge that China controls North Korea… So we have a front row seat to review the generally coded signals.
Two days ago (Monday) Beijing announced Chairman Xi and South Korean President Moon Jae-in were scheduled for a bilateral meeting at the G20 (Osaka, Japan – June 28th and 29th). Obviously Xi has a plan to position the best face for his magnanimous panda approach. We also know on the issue of DPRK hostage release, Chairman Xi will need to save face against President Trump very carefully (hence the phone call between Xi and Trump on Tuesday).
One way for Xi to avoid the appearance of acquiescence to Trump would be for Xi, with Beijing approval, to place the optic of victory at the feet of Moon Jae-in. As we noted from the outset the most likely scenario is China positioning themselves as magnanimous panda and South Korea as the beneficiary. Hence the pre-planned G20 meeting.
“Peace is the Prize” ~ Donald Trump
Ultimately, I don’t think President Trump really cares about who gets credit for the victory, hostage release of Chairman Kim, and denuclearization of North Korea. The world will know, though the media will not say, the victory is only because President Trump has outwitted Chairman Xi and his communist regime…. and Trump did that though strategic economic pressure.
For two-and-a-half years U.S. President Trump has been working on two connected objectives: (1) removing the threat posed by North Korea by severing the ability of Beijing to use the proxy province as a weapon (Kim is hostage to China); and (2) deconstructing the growing economic influence of China.
Both issues are directly connected to U.S. national security; and both issues are being approached by President Trump through the use of economic leverage to achieve national security results.
In the dynamic of the denuclearization of North Korea, the most likely scenario is Chairman Xi playing the role of magnanimous panda and *guiding* Chairman Kim Jong Un into the world of nations. Hence the op-ed outlined today.
South Korean President Moon Jae-in will be positioned as the hero so that Xi doesn’t look like he lost Kim to Trump. However, what we don’t know is how much autonomy Chairman Xi will allow Chairman Kim. It’s the “guiding” part we need to watch closely.
Beijing isn’t going to let Kim go fully antonymous and independent; not when they share a border; and certainly not after generations of strategic influence and control over the DPRK as a proxy province and hedge against the West. Unfortunately, South Korean President Moon Jae-in will be useless as a counter wedge against the cunning of Xi Jinping in this very important aspect.
Moon is essentially the Asian Obama; and has about as much strategic intelligence, foresight and usefulness, as a bag-of-rocks being used as a weather vane. Moon is good for the international optics of unification and dancing joyfully etc, but he’s oblivious to how Beijing may infiltrate and influence all things in/around Korea. Ideological naivete’ makes Moon the perfect person for Chairman Xi to work with.
So we need to keep eyes open for the amount of freedom Chairman Xi will give to Chairman Kim; however, simultaneously we can enjoy watching President Trump exploit the shifted dynamic by engaging with Kim as a freed hostage with full independence.
We can expect that President Trump will immediately start engaging with Chairman Kim Jong Un very openly, as if his captivity never existed. That will drive Beijing bananas, as they will not know of possible private influence by Trump. In turn, President Trump will know the engagement with Kim will drive Beijing bananas; and so Trump will take the U.S. engagement to even higher levels of independence just to watch the dragon flare his nostrils. But that’s still a long way from today….
Remember, two connected objectives: (1) removing the threat posed by North Korea by severing the ability of Beijing to use the proxy province as a weapon; and (2) deconstructing the growing economic influence of China.
With #1 achieved, President Trump will still intend to get #2. Heck, Trump has spent 30-years openly advocating for the principle of restoring American wealth. That means the economic pressure will continue until Beijing is defeated. If Chairman Xi expects POTUS Trump to retreat from the massive geopolitical leverage he has created, well, it’s doubtful that will happen.
President Trump has threatened more tariffs and more consequential action as it relates to non-tariff barriers, IP protection, forced technology transfers etc as a result of China reneging on their prior agreement. Additionally, President Trump has been openly, albeit with coded messages, telling the world North Korea was already no longer a threat.
The best offer -the most likely offer- from President Trump at the G20, is a return to the original 150-page agreement, constructed by USTR Lighthizer and Vice-Premier Liu He, that Beijing and Chairman Xi walked away from. However, even that offer by President Trump is tenuously optimistic at best, because Trump knows China is on its heels.
President Trump has simply outwitted and outmatched Chairman Xi in this economic confrontation. While Xi thought he was outmaneuvering his rival, it was President Trump who was the one wearing the Panda mask all along.
In hindsight every move since early 2017 including: (1) the warm welcome of Chairman Xi Jinping to Trump’s Mar-a-Lago estate; (2) the vociferous praise poured upon Xi; (3) the U.N. sanctions where China and Russia agreed; (4) the November 2017 “golden ticket’ tour of Asia; (5) the direct engagement with North Korean Chairman Kim Jong Un; (6) the strategic relationship with Japanese Prime Minister Shinzo Abe; and a host of smaller nuanced moves were all quietly building toward this conclusion.
For President Trump to have navigated Chairman Xi into such a position is the pinnacle of strategic success. The Chinese culture doesn’t even have a frame of reference for a position that includes ‘less losing’ as their better option.
During the kick-off campaign rally in Orlando Florida, President Donald Trump delivered a farewell tribute to a “warrior”, White House Press Secretary Sarah Huckabee Sanders.
During the first two years of the administration Sarah Sanders has stood firmly in support of President Trump and fearlessly faced a hostile and ideologically corrupt media. Tonight Trump supporters had the opportunity to say thank you. The crowd delivered a rousing standing ovation while shouting: “Sarah, Sarah, Sarah”…. WATCH:
Donald Trump Jr. delivered a rousing testimonial to the power of MAGAnomic and common sense policy during remarks today in a packed Orlando arena.
In advance of President Trump and Vice President Mike Pence arrival to kick off the 2020 Keep America Great campaign, a ‘chip off the old block‘ Donald Trump Jr. warmed up the audience. ENJOY:
President Trump is launching the 2020 campaign kickoff tonight in Orlando Florida. The venue is the Amway center and President Trump is scheduled to appear at 8:00pm EST. President Trump and Vice President Pence will announce their bid for a second term in the White House. First lady Melania Trump and second lady Karen Pence are also attending the launch.
UPDATE: Video Added
The “45 festival” events have been ongoing all day in/around the arena, and ongoing rally speakers are speaking to a massive audience. There is a large media presence including outlets from all over the world. Several live-streams are available: