US-China Trade War: Time is on the Side of the US

Journal of Political Risk, Vol. 7, No. 5, May 2019

Ho-fung Hung
Johns Hopkins University

The US-China trade war has unfolded for nearly a year now. After some false hope of a quick deal, China’s backpedaling in May from earlier promises to stop requiring a technology transfer from US firms in China, and to do more to protect intellectual property, obliterated such hope. Trump’s reaction of raising new tariffs on Chinese goods, followed by China’s retaliation in kind, led to an escalation.

Bipartisan Support of Trade War with China

This escalation of the trade war, interestingly, has not unleashed criticism of President Trump in the US. Sources from the US negotiation team and those from its Chinese counterparts both verified China’s last-minute withdrawal of earlier commitments. There is little doubt that Beijing rather than Trump is to be blamed for this re-escalation. Trump’s strong response to the Chinese backpedaling instead got rare bipartisan support. Congress Democrats are on the same side with the President, judging by Senate Minority Leader Chuck Schumer tweet, “Hang tough on China, President @realDonaldTrump. Don’t back down. Strength is the only way to win with China.”[1]

A line graph shows three upward trends, labelled "Forex reserve", "Stock of external debt" and "FDI net inflow"

Figure 1. China’s External Financial Position. (Source: World Bank)

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Ukraine’s Election Indicates A Strengthening Democracy

Journal of Political Risk, Vol. 7, No. 5, May 2019

Robert T. Person
United States Military Academy

Petro Poroshenko, Ukraine's president, left, speaks as Volodymyr Zelenskiy, comic and presidential candidate, listens during a debate at the Kiev Stadium in Kiev, Ukraine, on April 19, 2019. The two candidates for Ukraine's presidency squared off in a long-awaited and often bad-tempered debate, their last chance to sway opinion before the April 21 runoff, which Zelenskiy won.

Petro Poroshenko, Ukraine’s president, left, speaks as Volodymyr Zelenskiy, comic and presidential candidate, listens during a debate at the Kiev Stadium in Kiev, Ukraine, on April 19, 2019. The two candidates for Ukraine’s presidency squared off in a long-awaited and often bad-tempered debate, their last chance to sway opinion before the April 21 runoff, which Zelenskiy won. Source: Presidential Administration of Ukraine.

With Ukraine’s 2019 presidential campaign now complete, the country finds itself – as it has on numerous occasions in the last 15 years – at a historic crossroads.  Actor-comedian Volodymyr Zelenskiy’s stunning landslide victory over incumbent president Petro Poroshenko by a margin of 73.2 percent to 24.4 percent presents challenges and opportunities with far-reaching implications for Ukraine, Russia, the European Union, and the United States.  On the domestic front, another peaceful transition of power through democratic elections indicates that Ukrainian democracy – though far from perfect – is alive and gaining strength.  In public comments Zelenskiy has reaffirmed Ukraine’s commitment to democratic rule, drawing a sharp contrast with Russia’s authoritarian politics.  On the foreign policy front, he has pledged to stand up to Russia and continue Ukraine’s path to NATO membership, even while expressing a willingness to “negotiate with the devil” to bring the war in Eastern Ukraine to an end.   This is something the prior president, Petro Poroshenko, refused to do, though Zelenskiy’s chances of breaking the stalemate in the Donbas remain slim.  Though it is too early to tell what the future holds for the new Ukrainian president and the country he leads, there can be little doubt that Ukraine will continue to be a key zone of strategic competition – and likely conflict – in Eastern Europe, much as it has been for the last five years.

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Great Power Political Convergence and UN Reform: Solving the Democratic Deficit

Journal of Political Risk, Vol. 7, No. 4, April 2019

Anders Corr, Ph.D.
Publisher of the Journal of Political Risk

The photograph depicts a statue of a gun tied at the end to prevent it from shooting.

A bronze sculpture titled “Non-Violence” by Swedish artist Carl Fredrik Reuterswärd stands to the north of the United Nations Building in New York. It depicts the knotted barrel of a Colt Python .357 Magnum. Reuterswärd designed the sculpture following the murder of songwriter John Lennon. Source: Allan Watt via Flickr.

The international system operates across military, economic, and diplomatic hierarchies of states situated in competing alliances and international organizations. The major powers assert the predominance of influence in these alliances and international organizations, leading to a severe and global democratic deficit. Huge numbers of people, most notably the approximately 18% of the world’s population living in China, and 2% of the population living in Russia, have no democratically-appointed representation at the United Nations or influence in the world’s most important alliance systems.

The global democratic deficit leads to critical inefficiencies and unfair policies. States use unequal access to military, wealth, and knowledge resources to influence international organizations and alliance systems for individual state gains that lead to global inefficiencies and trade-offs where individual major power goals contradict the public good, or the national interests of other states. Perhaps the most dangerous such inefficiency is the rising risk of nuclear war, as countries like the U.S. and China compete to impose their competing visions of the future on the world.

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President Trump Has Authority to Rebuild American Industry: Use the Defense Production Act of 1950

Journal of Political Risk, Vol. 7, No. 3, March 2019

William R. Hawkins
International Economics and National

Security Consultant

Two aircraft carriers are photographed from above in the ocean.

The aircraft carriers USS Dwight D. Eisenhower (CVN 69), top, and USS Harry S. Truman (CVN 75) transit the Arabian Sea. Source: U.S. Navy via Flickr.

President Donald Trump’s trade reform campaign is not meant only to redress the massive deficit with the People’s Republic of China ($419 billion in goods last year, a net figure of how much American money is supporting jobs and production in China rather than at home). His policies have been rooted in national security concerns with a focus on the dangerous transfer of capital and technology that has empowered Beijing’s military buildup and aggressive behavior along the Pacific Rim and beyond. There is concern that the momentum of his efforts is slowing. He delayed elevating tariffs on Chinese goods from 10% to 25% on March 1st to give negotiations more time to reach a deal. But the PRC regime will never curb its pursuit of the wealth and capabilities it needs to replace the U.S. as the world’s preeminent power. It is a long-term economic contest between rivals for the highest of stakes imaginable.

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Tariff Benefits Will Exceed Costs When National Goals Are Met

Journal of Political Risk, Vol. 7, No. 3, March 2019 

US President Donald Trump is photographed behind a podium, giving a speech outside. The US flag is visible in the background.

US President Donald Trump gives a speech. Source: Picryl

William R. Hawkins

International Economics and National Security Consultant

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