Saturday, June 30, 2018
Hope Now: The 1980 Interviews (Jean-Paul Sartre, Benny Lévy, University of Chicago Press, 2007)
In March of 1980, Le Nouvel Observateur published the final interviews between the philosopher Jean-Paul Sartre, then blind and debilitated, and his young assistant, Benny Lévy. Readers immediately denounced the interviews as distorted and fraudulent for portraying a Sartre who had abandoned his leftist convictions, rejected his most intimate friends, and cast aside his fundamental beliefs in favor of a messianic Judaism. Sartre's supporters argued that it was his orthodox interlocutor, Lévy, who had twisted the words of the ailing philosopher.
Yet, shortly before his death, Sartre confirmed the authenticity of the interviews and their puzzling content. Here presented in translation, the interviews are framed by two provocative essays by Benny Lévy, accompanied by a comprehensive introduction from noted Sartre authority Ronald Aronson, which places the interviews in biographical and philosophical perspective to demonstrate how they confirm and contribute to Sartre's overall philosophy. This absorbing volume at last contextualizes and elucidates the final thoughts of a brilliant and influential mind. (amazon)
https://www.jstor.org/stable/pdf/23512955.pdf?seq=1#page_scan_tab_contents
Yet, shortly before his death, Sartre confirmed the authenticity of the interviews and their puzzling content. Here presented in translation, the interviews are framed by two provocative essays by Benny Lévy, accompanied by a comprehensive introduction from noted Sartre authority Ronald Aronson, which places the interviews in biographical and philosophical perspective to demonstrate how they confirm and contribute to Sartre's overall philosophy. This absorbing volume at last contextualizes and elucidates the final thoughts of a brilliant and influential mind. (amazon)
https://www.jstor.org/stable/pdf/23512955.pdf?seq=1#page_scan_tab_contents
陳破空專文：「中國模式」的末路狂奔─金錢間諜和成龍現象 (2018-2-5)
http://www.storm.mg/article/394678
https://www.rfa.org/mandarin/pinglun/chenpokong/cpk-01292018104202.html (2018-1-29)
美媒：中国处巨变前夜 〝百年大党〞正在末路狂奔
http://www.ntdtv.com/xtr/gb/2018/06/30/a1381688.html
https://www.youtube.com/watch?v=xZp9KxnJ5kw
https://www.youtube.com/watch?v=xZp9KxnJ5kw
China's Coming Revolution (Gordon G. Chang, 2016-5-21)
http://nationalinterest.org/feature/chinas-coming-revolution-16300
https://foreignpolicy.com/2011/12/29/the-coming-collapse-of-china-2012-edition/ (2011-12-29)
https://en.wikipedia.org/wiki/The_Coming_Collapse_of_China#cite_note-9
https://foreignpolicy.com/2011/12/29/the-coming-collapse-of-china-2012-edition/ (2011-12-29)
https://en.wikipedia.org/wiki/The_Coming_Collapse_of_China#cite_note-9
now, my friend Reacher would let out a giant belly laugh at this one
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https://www.leechild.com/surplus.php
Past Tense: A Jack Reacher Novel (Lee Child, 2018-11-5)
Jack Reacher hits the pavement and sticks out his thumb. He plans to follow the sun on an epic trip across America, from Maine to California. He doesn’t get far. On a country road deep in the New England woods, he sees a sign to a place he has never been: the town where his father was born. He thinks, What’s one extra day? He takes the detour.
The next morning, in the city clerk’s office, Reacher asks about the old family home. He’s told no one named Reacher ever lived in town. He’s always known his father left and never returned, but now Reacher wonders, Was he ever there in the first place?
As Reacher explores his father’s life, and as the Canadians face lethal dangers, strands of different stories begin to merge. Then Reacher makes a shocking discovery: The present can be tough, but the past can be tense . . . and deadly. (amazon) (kindle pre-order 2018-2-26)
Dark Sacred Night (A Ballard and Bosch Novel) (Michael Connelly, 2018-10-30)
Renée Ballard is working the night beat again, and returns to Hollywood Station in the early hours only to find a stranger rifling through old file cabinets. The intruder is retired detective Harry Bosch, working a cold case that has gotten under his skin. Ballard kicks him out, but then checks into the case herself and it brings a deep tug of empathy and anger.
Bosch is investigating the death of fifteen-year-old Daisy Clayton, a runaway on the streets of Hollywood who was brutally murdered and her body left in a dumpster like so much trash. Now, Ballard joins forces with Bosch to find out what happened to Daisy and finally bring her killer to justice. (amazon) (kindle pre-order 2018-6-27)
高新
https://www.rfa.org/mandarin/zhuanlan/yehuazhongnanhai/gx-06152018153206.html
http://www.chinesepen.org/blog/archives/105617
https://www.rfa.org/mandarin/zhuanlan/yehuazhongnanhai/gx-04252018144433.html
http://www.chinesepen.org/blog/archives/105617
https://www.rfa.org/mandarin/zhuanlan/yehuazhongnanhai/gx-04252018144433.html
Tuesday, 30 January: Nothing new
There is Francoise, the woman who runs the "Railway-men's Rendezvous." But do I speak to her? Sometimes after dinner, when she brings my beer, I ask her: "Have you time this evening?" (Jean Paul-Sartre, Nausea, 1938)
三大攻坚战
https://baike.baidu.com/item/%E4%B8%89%E5%A4%A7%E6%94%BB%E5%9D%9A%E6%88%98
https://www.youtube.com/watch?v=pGb9fIws2Os
http://w1.mingjingnews.com/index.php/%E6%96%B0%E8%81%9E/%E4%B8%AD%E5%9C%8B/%E4%B8%AD%E5%A4%AE%E7%9D%A3%E5%B0%8E%E7%B5%84%E6%8E%83%E9%BB%91-%E7%82%BA%E4%B8%89%E5%A4%A7%E6%94%BB%E5%A0%85%E6%88%B0%E9%96%8B%E8%B7%AF
http://politics.people.com.cn/BIG5/n1/2018/0626/c1001-30085922.html
https://www.youtube.com/watch?v=pGb9fIws2Os
http://w1.mingjingnews.com/index.php/%E6%96%B0%E8%81%9E/%E4%B8%AD%E5%9C%8B/%E4%B8%AD%E5%A4%AE%E7%9D%A3%E5%B0%8E%E7%B5%84%E6%8E%83%E9%BB%91-%E7%82%BA%E4%B8%89%E5%A4%A7%E6%94%BB%E5%A0%85%E6%88%B0%E9%96%8B%E8%B7%AF
http://politics.people.com.cn/BIG5/n1/2018/0626/c1001-30085922.html
Peter Navarro's talk at the Hudson Institute (2018-6-28)
Mastering the understatement somewhat controversial?
My deep
thanks to hudson institute for
sponsoring this and actually two
of my favorite
scholars are
here. One of
them is mr.
Pillsbury. And also seth
who has been at
the forefront of
trying to get this navy and the united
states back on
track. The
president himself is committed
to a 351-ship navy. It's
only through
the analyses of
people like seth that we
have situation awareness of
why we need to do
that. I
congratulate hudson for being at
the forefront. My
mission today is simple. The, quote, seek
truth from
facts. All i'm going
to do today is provide a factual account of the
industrial policies and practices of
the people's
republic of china which are presented
in this matrix. We have six
strategies of what
mr. Pills
burry called
economic aggression. It's
not my term. It
was a term introduced
in the 2017
national security
strategy. And then on the
column here is the
over 50 acts policies
and practices
that china engages in
in order to promote its economy worldwide.
If you can say that
one picture is worth a thousand
words, this
matrix is worth
about half a trillion
dollars a year
that contributes to
the trade surplus of china using
these various acts,
policies, practices. Most of which
are outside the bounds of the
international trade
order.
But before i do that, let me just step back for a minute and talk a little bit about the administration's trade policy and trade philosophy.
The president, president donald j. Trump has made it clear that he's a free trader. He's made it abundantly clear for this administration, free trade means trade that's free, fair, reciprocal and balance. Free, fair, reciprocal and balance. In a world where we had free, fair, reciprocal and balance trade we would have zero tariffs. We would have zero nontariff barriers. We would have zero subsidies to industry. We would have zero incidents of currency manipulation and currency undervaluation. And we would have zero instances of using the value-added tax, not as a way to raise revenue in a given country, but also as a tool of mercantilism to keep goods out of that country and provide competitive advantage. If we were in china, they might call that the five zeros. We're not in that world, and because we're not in that world, every year the united states of america basically sends about a half a trillion dollars a year off-shore in the form of a trade deficit. This is something that's not supposed to happen in the recardian trade model.
Let me say that again.
This is not what is supposed to happen in the recardian trade model which my colleagues in economics and folks in the media and everybody in between love to cite is the free trade model. Gains from trade, everybody wins. In the recardian trade model you never have these persistent deficits because of things like currency adjustments, right? We're shipping off half a trillion dollars a year. We are, as president trump has said, the piggy bank of the world. And the reason why this happens is because countries around the world do not engage in free, fair, reciprocal and balance trade.
We have, for example, a trade deficit with china which accounts for about half of the problem. But at the same time the european union is about $151 billion in 2017 in trade deficit in goods. That's about 20% of the problem. Then you have japan and mexico with about another 18% of the problem. And if you look at these different countries, they all manage to gain advantage over this. I don't call it competitive advantage. I simply say advantage over this country in different ways. Germany, for example, which sells us three cars for every one we sell to them, has a tariff on autos which is four times higher than ours. Japan, which has very low tariffs, sells us over 100 cars for every one we sell them. Extraordinary. And the problem there is nontariff barriers.
So all the president is trying to do with his trade policy, all he's trying to do is level the playing field. We would love to live in a world where the rest of the world caught up to us. I don't know if you know this but the united states of america has among the lowest tariff and nontariff barriers in the world.
Last thing i should tell you is about the world trade organization which is very, very interesting. You might thing the world trade organization was an organization where it led to a lowering of tariffs for everybody. But the problem is they have this thing called m.f.n., most favored nation, rule which says any given country has to charge the lowest tariffs in the -- to any one country that they charge to everybody else.
Let me say that again. The tariff they're going to set , the lowest they give to one country they have to charge to everybody else.
So if we set 2.5% tariffs on autos, that's what we set to everybody. But if china sets 25% to everybody, they can get away with that. European union can get away with 10%. So that's the global trading order that this president and this administration wants to move towards the more ideal world of free, fair, balance, and reciprocal trade.
Now, let's get to the matter at hand. This report by the office of trade manufacturing policy was months in the making. It was an interagency effort where the report went out to numerous agencies in the intelligence community. It was reviewed very carefully. I think it's well-documented. I won't challenge you, but, please, look through the footnotes and tell me if you find anything that doesn't ring true. The foundation of this report is good analysis by a lot of people. I would say diux report that the pentagon put out is very, very good in the technology space. There's reports by the european and american chambers of commerce which detail chapter and verse all of the unfair trade practices. European and american businesses encounter when trying to get into the chinese market. So there is that. There is the united states trade representative 301 investigation report that came about as a result of the section 301 which is -- it's an extraordinary sweeping tone because it's so dense but it's also so good. If you're going to be an expert in this, you need to read that chapter and verse. But it's not just these documents. It's also what the chinese government tells us. If you read, for example, two documents, medium to long-range planning document in 2006, it pretty much lays out these industrial policies that are used to promote the chinese economy.
And then, of course, there's the now banned in china, apparently. They banned their own policy. China, made in china 2025, this is extraordinary. This is a policy which came out with great fanfare. It's referenced repeatedly in different government documents as you can find and now there are reports out in the press that chinese themselves are suppressing that as a way of not letting you know that the intent of that report is to put forward a set of plans that would capture 70% of the production of the emerging industries of the future within seven years. Extraordinary.
As president trump has said, if we lose the industries of the future, we won't have a future.
So some of you at least have the chart as a handout, and it will be up on the web available to you, but let me just now walk through what the chart looks like.
It's a standard matrix where you have these six categories of economic aggression. This is the industrial policy of china. What distinguishes china from the rest of the world, most of the rest of the world, is that it's a nonmarket economy. It's a heavily state-driven economy.
So in the second column here, one goal is to protect the chinese market from competition and imports. No secret there.
The second goal is to expand the global share of markets. That is to attack global markets. This would be in a vernacular protectionism, a mark tilist. China has a policy of going out and trying to secure the core resources of the world. It can be things like copper in chile. It can be things like cobalt which is really important in high-tech production in the congo. And they've done a very, very good job of doing that.
The third -- the fourth category, dominate traditional manufacturing industries. They've done a superb job of doing that. Air conditioning, appliances, machine tools, shoes, computers, electronics. They have well over 50% market share in most of the traditional manufacturing industries. They have become the factory floor of the world. This didn't happen by accident. It didn't happen through free market capitalism. It happened through these set of practices which i'm going to talk about shortly.
And then these last two columns here capture in essence the problem that united states trade representative's been grappling with in terms of the attacks on our technological base by the people's republic of china. This is simply acquiring the technologies and intellectual property from not just the united states but from the rest of the world. And at the same time capturing the emerging high-tech industries that will drive future growth and advancements in the defense industry.
And what's important -- what's important about this last column here, this is the made in china 2025 industries plus the industries identified in medium to long-range planning 2006 document. It's things like autonomous vehicles, robotics, high-tech shipping, advanced manufacturing. There's things called extreme manufacturing which is the nanotechnology of one end but also large facilities bigger than anything you could see or imagine. China is trying to dominate all of this.
Now, how do they go about it? And this is where we get to the 50 different ways.
There's over 50 different things here, and if you look at the chart, you can't see it from where you're sitting, but there's a little y for yes in each one. So, for example, there are some things that china does which is also used to advance one goal. For example, there's a technique they use called brand forcing or the forced use of chinese brands. This is when a company, foreign company with a well-known brand comes in with a quality product, sets up their facilities in china and wants to sell into the market but it's forbidden from using its own brand. You put a chinese brand on it and then that is used in the domestic market and down the road the hope is they'll build that brand and begin using that internationally. So that would be one where it's simply in one cell.
On the other hand, there are some things on the chart which run the table, all six strategies. One of them, for example, is consolidating state-owned enterprises into national champions. Consolidating state-owned enterprises into national champions. This is really, really important to understand. If, for example, you look at the rolling stock industry. This is the trains and the metro cars and things like that. A lot of jobs. A lot of technology. A lot of implications for the future. In the beginning in china, they had a number of national champions that they were breeding within the country to produce first in china and then sally fourth around the world. As they proceeded in that industry and others, they realized that the best thing to do is to consolidate those industries, basically create monopolies within the country to go out and do battle with the rest of the world. In that particular industry, rolling stock, it basically put all-star out of business -- australia out of business. The company is making a very strong bid in this country. And the problem that you have is that these national champions, when they sally forth, benefit from a lot of the things that are on the rest of the matrix here.
So let me begin seek truths from fact, let me walk you through some of the things they do on this chart. So it's literally, i couldn't find to z but i got to w. You start with the adverse administrative approvals and licensing processes. We have approvals and licensing processes for any foreign company, or a domestic company that wants to produce into this market, sell in this market and that's fine. The problem is, there are well over a dozen or more of these approval processes, the chinese will use the ability to gain your license or your administrative approval as a tool to extract some kind of concessions, usually on technology. And so this is a very powerful tool, it's very difficult to detect as an unfair trade practice but it's systemic in the chinese economy when you try to go in there. Second one is anti-monopoly law extortion. I think the poster child for this is what happened with qualcomm. Basically this law was invoked against qualcomm and there was an extraction of a very large sum of money but also some promises. Technology transfer. It's all about text -- technology transfer.
What came out of the investigation, when china steals our intellectual property, they force a transfer of it, they evade the export controls that we have in place, and they buy it. And when you're running a third of a trillion dollars deficit with china every year, they accumulate a lot of money to buy it.
Burdensome and intrusive testing. This is an interesting tool. So we have medical device or car or some kind of product that you want to sell into the chinese market. So what do the chinese say? Well, we need to unpack this thing. What's in it? So then you -- they get to look behind the vail. It's like, well, we are doing it to make sure there's no health and safety problems but, again, it's a way of extracting information and technology. And it can be burdensome as well. You can withhold or delay the testing unless you get a concession. This is an effect.
By the way, one of the things my office does at the white house, we have what we call a swat team where companies come to us with specific problems and i've had many, many companies come in with a problem that they're having with china and they'll go, oh, man, they did this to us, and they did this to us. I bring them over to the chart and say, you mean they did that, that, that and they said, oh, we're not the only one. That's the thing, we're not the only one.
This is why i think this report could be useful because it gives everybody a common understanding of the challenges that we need to face, of the structural challenges.
Chinese communist party collapse corporate governance. This is truly extraordinary. We have now by decree the chinese communist party getting seats on governing boards of companies. So this is not profit maximumization anymore. This is more like advance the strategic goals of the state.
Claim sovereign immunity on u.s. soil to prevent litigation. This is kind of interesting. They want access to our market and to do business here but they also want to claim their state-owned enter prices and not subject -- enterprises and not subject to our laws. Interesting. Counterfeiting and piracy. Intellectual property, the i.p. commission report came out with costs in the order of $300 billion a year just on theft alone. This is like an extraordinary transfer of wealth. Cyber-enabled espionage and theft. Data mandates which allows them to peak under the hood.
Financing other countries. This speaks to the idea that the way china is able in many cases to gain control, not just of the resources of a country like copper or cobalt but also of infrastructure is to lend a bunch of money to these countries that they really can't afford to borrow and then foreclose on that loan just like happened -- anybody know the sri lanka issue? That's where the chinese basically gained ownership.
What's going on here? The point is that this is a long list. Over 50 ways that china engages in these acts, policies, and practices with the goal of advancing their own economic dominance which has in itself military implications.
And this is what we're up against when we're basically trying to build an international trading order based on free, fair, balanced and reciprocal trade.
So this is -- i simply present to you this as facts, challenge these as facts if you will. I welcome that challenge. If this matrix accurately describes the industrial policies, acts, and practices of the chinese government, if that is true, then you can understand the structural challenge we face in trying to move to a better place down the road in terms of having a trading system that works for everybody.
Because if you're in a negotiation -- i'll leave you with this. If you are in a negotiation and you take 25 of these off the table in a successful negotiation, you still have 25 left.
Thank you for the audience here at the hudson institute. I salute this institute and i'm going to get on with the mission down the road here. Thank you, sir.
https://www.c-span.org/video/?447685-1/peter-navarro-discusses-trump-administrations-us-china-trade-relations
But before i do that, let me just step back for a minute and talk a little bit about the administration's trade policy and trade philosophy.
The president, president donald j. Trump has made it clear that he's a free trader. He's made it abundantly clear for this administration, free trade means trade that's free, fair, reciprocal and balance. Free, fair, reciprocal and balance. In a world where we had free, fair, reciprocal and balance trade we would have zero tariffs. We would have zero nontariff barriers. We would have zero subsidies to industry. We would have zero incidents of currency manipulation and currency undervaluation. And we would have zero instances of using the value-added tax, not as a way to raise revenue in a given country, but also as a tool of mercantilism to keep goods out of that country and provide competitive advantage. If we were in china, they might call that the five zeros. We're not in that world, and because we're not in that world, every year the united states of america basically sends about a half a trillion dollars a year off-shore in the form of a trade deficit. This is something that's not supposed to happen in the recardian trade model.
Let me say that again.
This is not what is supposed to happen in the recardian trade model which my colleagues in economics and folks in the media and everybody in between love to cite is the free trade model. Gains from trade, everybody wins. In the recardian trade model you never have these persistent deficits because of things like currency adjustments, right? We're shipping off half a trillion dollars a year. We are, as president trump has said, the piggy bank of the world. And the reason why this happens is because countries around the world do not engage in free, fair, reciprocal and balance trade.
We have, for example, a trade deficit with china which accounts for about half of the problem. But at the same time the european union is about $151 billion in 2017 in trade deficit in goods. That's about 20% of the problem. Then you have japan and mexico with about another 18% of the problem. And if you look at these different countries, they all manage to gain advantage over this. I don't call it competitive advantage. I simply say advantage over this country in different ways. Germany, for example, which sells us three cars for every one we sell to them, has a tariff on autos which is four times higher than ours. Japan, which has very low tariffs, sells us over 100 cars for every one we sell them. Extraordinary. And the problem there is nontariff barriers.
So all the president is trying to do with his trade policy, all he's trying to do is level the playing field. We would love to live in a world where the rest of the world caught up to us. I don't know if you know this but the united states of america has among the lowest tariff and nontariff barriers in the world.
Last thing i should tell you is about the world trade organization which is very, very interesting. You might thing the world trade organization was an organization where it led to a lowering of tariffs for everybody. But the problem is they have this thing called m.f.n., most favored nation, rule which says any given country has to charge the lowest tariffs in the -- to any one country that they charge to everybody else.
Let me say that again. The tariff they're going to set , the lowest they give to one country they have to charge to everybody else.
So if we set 2.5% tariffs on autos, that's what we set to everybody. But if china sets 25% to everybody, they can get away with that. European union can get away with 10%. So that's the global trading order that this president and this administration wants to move towards the more ideal world of free, fair, balance, and reciprocal trade.
Now, let's get to the matter at hand. This report by the office of trade manufacturing policy was months in the making. It was an interagency effort where the report went out to numerous agencies in the intelligence community. It was reviewed very carefully. I think it's well-documented. I won't challenge you, but, please, look through the footnotes and tell me if you find anything that doesn't ring true. The foundation of this report is good analysis by a lot of people. I would say diux report that the pentagon put out is very, very good in the technology space. There's reports by the european and american chambers of commerce which detail chapter and verse all of the unfair trade practices. European and american businesses encounter when trying to get into the chinese market. So there is that. There is the united states trade representative 301 investigation report that came about as a result of the section 301 which is -- it's an extraordinary sweeping tone because it's so dense but it's also so good. If you're going to be an expert in this, you need to read that chapter and verse. But it's not just these documents. It's also what the chinese government tells us. If you read, for example, two documents, medium to long-range planning document in 2006, it pretty much lays out these industrial policies that are used to promote the chinese economy.
And then, of course, there's the now banned in china, apparently. They banned their own policy. China, made in china 2025, this is extraordinary. This is a policy which came out with great fanfare. It's referenced repeatedly in different government documents as you can find and now there are reports out in the press that chinese themselves are suppressing that as a way of not letting you know that the intent of that report is to put forward a set of plans that would capture 70% of the production of the emerging industries of the future within seven years. Extraordinary.
As president trump has said, if we lose the industries of the future, we won't have a future.
So some of you at least have the chart as a handout, and it will be up on the web available to you, but let me just now walk through what the chart looks like.
It's a standard matrix where you have these six categories of economic aggression. This is the industrial policy of china. What distinguishes china from the rest of the world, most of the rest of the world, is that it's a nonmarket economy. It's a heavily state-driven economy.
So in the second column here, one goal is to protect the chinese market from competition and imports. No secret there.
The second goal is to expand the global share of markets. That is to attack global markets. This would be in a vernacular protectionism, a mark tilist. China has a policy of going out and trying to secure the core resources of the world. It can be things like copper in chile. It can be things like cobalt which is really important in high-tech production in the congo. And they've done a very, very good job of doing that.
The third -- the fourth category, dominate traditional manufacturing industries. They've done a superb job of doing that. Air conditioning, appliances, machine tools, shoes, computers, electronics. They have well over 50% market share in most of the traditional manufacturing industries. They have become the factory floor of the world. This didn't happen by accident. It didn't happen through free market capitalism. It happened through these set of practices which i'm going to talk about shortly.
And then these last two columns here capture in essence the problem that united states trade representative's been grappling with in terms of the attacks on our technological base by the people's republic of china. This is simply acquiring the technologies and intellectual property from not just the united states but from the rest of the world. And at the same time capturing the emerging high-tech industries that will drive future growth and advancements in the defense industry.
And what's important -- what's important about this last column here, this is the made in china 2025 industries plus the industries identified in medium to long-range planning 2006 document. It's things like autonomous vehicles, robotics, high-tech shipping, advanced manufacturing. There's things called extreme manufacturing which is the nanotechnology of one end but also large facilities bigger than anything you could see or imagine. China is trying to dominate all of this.
Now, how do they go about it? And this is where we get to the 50 different ways.
There's over 50 different things here, and if you look at the chart, you can't see it from where you're sitting, but there's a little y for yes in each one. So, for example, there are some things that china does which is also used to advance one goal. For example, there's a technique they use called brand forcing or the forced use of chinese brands. This is when a company, foreign company with a well-known brand comes in with a quality product, sets up their facilities in china and wants to sell into the market but it's forbidden from using its own brand. You put a chinese brand on it and then that is used in the domestic market and down the road the hope is they'll build that brand and begin using that internationally. So that would be one where it's simply in one cell.
On the other hand, there are some things on the chart which run the table, all six strategies. One of them, for example, is consolidating state-owned enterprises into national champions. Consolidating state-owned enterprises into national champions. This is really, really important to understand. If, for example, you look at the rolling stock industry. This is the trains and the metro cars and things like that. A lot of jobs. A lot of technology. A lot of implications for the future. In the beginning in china, they had a number of national champions that they were breeding within the country to produce first in china and then sally fourth around the world. As they proceeded in that industry and others, they realized that the best thing to do is to consolidate those industries, basically create monopolies within the country to go out and do battle with the rest of the world. In that particular industry, rolling stock, it basically put all-star out of business -- australia out of business. The company is making a very strong bid in this country. And the problem that you have is that these national champions, when they sally forth, benefit from a lot of the things that are on the rest of the matrix here.
So let me begin seek truths from fact, let me walk you through some of the things they do on this chart. So it's literally, i couldn't find to z but i got to w. You start with the adverse administrative approvals and licensing processes. We have approvals and licensing processes for any foreign company, or a domestic company that wants to produce into this market, sell in this market and that's fine. The problem is, there are well over a dozen or more of these approval processes, the chinese will use the ability to gain your license or your administrative approval as a tool to extract some kind of concessions, usually on technology. And so this is a very powerful tool, it's very difficult to detect as an unfair trade practice but it's systemic in the chinese economy when you try to go in there. Second one is anti-monopoly law extortion. I think the poster child for this is what happened with qualcomm. Basically this law was invoked against qualcomm and there was an extraction of a very large sum of money but also some promises. Technology transfer. It's all about text -- technology transfer.
What came out of the investigation, when china steals our intellectual property, they force a transfer of it, they evade the export controls that we have in place, and they buy it. And when you're running a third of a trillion dollars deficit with china every year, they accumulate a lot of money to buy it.
Burdensome and intrusive testing. This is an interesting tool. So we have medical device or car or some kind of product that you want to sell into the chinese market. So what do the chinese say? Well, we need to unpack this thing. What's in it? So then you -- they get to look behind the vail. It's like, well, we are doing it to make sure there's no health and safety problems but, again, it's a way of extracting information and technology. And it can be burdensome as well. You can withhold or delay the testing unless you get a concession. This is an effect.
By the way, one of the things my office does at the white house, we have what we call a swat team where companies come to us with specific problems and i've had many, many companies come in with a problem that they're having with china and they'll go, oh, man, they did this to us, and they did this to us. I bring them over to the chart and say, you mean they did that, that, that and they said, oh, we're not the only one. That's the thing, we're not the only one.
This is why i think this report could be useful because it gives everybody a common understanding of the challenges that we need to face, of the structural challenges.
Chinese communist party collapse corporate governance. This is truly extraordinary. We have now by decree the chinese communist party getting seats on governing boards of companies. So this is not profit maximumization anymore. This is more like advance the strategic goals of the state.
Claim sovereign immunity on u.s. soil to prevent litigation. This is kind of interesting. They want access to our market and to do business here but they also want to claim their state-owned enter prices and not subject -- enterprises and not subject to our laws. Interesting. Counterfeiting and piracy. Intellectual property, the i.p. commission report came out with costs in the order of $300 billion a year just on theft alone. This is like an extraordinary transfer of wealth. Cyber-enabled espionage and theft. Data mandates which allows them to peak under the hood.
Financing other countries. This speaks to the idea that the way china is able in many cases to gain control, not just of the resources of a country like copper or cobalt but also of infrastructure is to lend a bunch of money to these countries that they really can't afford to borrow and then foreclose on that loan just like happened -- anybody know the sri lanka issue? That's where the chinese basically gained ownership.
What's going on here? The point is that this is a long list. Over 50 ways that china engages in these acts, policies, and practices with the goal of advancing their own economic dominance which has in itself military implications.
And this is what we're up against when we're basically trying to build an international trading order based on free, fair, balanced and reciprocal trade.
So this is -- i simply present to you this as facts, challenge these as facts if you will. I welcome that challenge. If this matrix accurately describes the industrial policies, acts, and practices of the chinese government, if that is true, then you can understand the structural challenge we face in trying to move to a better place down the road in terms of having a trading system that works for everybody.
Because if you're in a negotiation -- i'll leave you with this. If you are in a negotiation and you take 25 of these off the table in a successful negotiation, you still have 25 left.
Thank you for the audience here at the hudson institute. I salute this institute and i'm going to get on with the mission down the road here. Thank you, sir.
Thank you very much for coming. I encourage everyone to download both the report and the annex from the internet. There are a number of copies of the matrix sort of being passed around. I don't know how many -- can you put your hand up if you have a copy of it already? Ok. Some more dissemination is left. Thank you for applauding. I think it's quite important that the think tank community take dr. Navarro's work seriously. Not just his free books but now his efforts with the white house. Well, i keep hearing is there's much more of a team strategy at the white house. It's not some sort of debate and factions going on. There's a combined approach, and as i said earlier when introducing dr. Navarro, these concerns go back at least to the obama administration. This -- that may explain why two nights ago 400 members of congress voted to approve the reform of our so-called cfius system, our protection against intellectual property and national security issues and investment coming in the country. 400-2. that's a pretty lopsided vote. In the senate the co-sponsor on the democratic side was dianne feinstein. Obviously silicon valley concerns. This also passed the senate. So this is a really strongly bipartisan concern that many people have. And i think the publication of this report provides a single document where the concerns are listed. And dr. Navarro gave you a clue that just eliminating 25 of the issues, practices, wouldn't be enough. Ideally all 50 will be dispensed with. And the european union seems to have similar concerns. So thank you all, very much, for coming. [applause] [captions copyright national cable satellite corp. 2018] [captioning performed by the national captioning institute, which is responsible for its caption content and accuracy. Visit ncicap.org]
https://www.c-span.org/video/?447685-1/peter-navarro-discusses-trump-administrations-us-china-trade-relations
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