FROLITICKS

Satirical commentary on Canadian and American current political issues

May 15

U.S. Protectionist Trade Policies Will Drag Canada Into Similar Trade Patterns

by bcurry

By signing the United States-Mexico-Canada Agreement (USMCA) in 2018, the ability of Canada to negotiate a trade deal with China or another “non-market economy” was greatly restricted.  Current or future protectionist policies concerning trade with China or other countries will have a direct effect on Canada’s trade patterns.  Under the USMCA, the U.S. will remain Canada’s biggest trade partner (75.4% of total Canadian exports in 2023), especially in the automotive and energy sectors.  One other result has been that the U.S. bought more goods from Mexico than China in 2023 for the first time in 20 years, evidence of how much global trade patterns have shifted. The U.S. under President Trump and now under President Biden has become the most bilateral-trade-focused government in its history.  Like the U.S., Canada is also looking to conclude deals with the EU, Japan, South Korea, the U.K. and India and other democracies eager to share in the benefits of bilateral trade agreements.  For example, as a result in December 2023, Korean exports to the U.S. surpassed Korean exports to China for the first time in 20 years, driven by shipments of vehicles, electric batteries and other parts.

However, in an apparent effort to protect strategic American industries, President Biden’s recent announcement regarding a sharp increase in tariffs on an array of Chinese imports — including electric vehicles, solar cells, semiconductors and advanced batteries — will have an impact on Canada as well.  Initially, the President had pledged to repeal at least some of Trump’s tariffs imposed on China.  However, the upcoming election in 2024 changed all that.  Mr. Biden’s moves, to be phased in over the next three years, now represent the latest trade-war escalation suggesting that the Democrats refuse to cede any ground to their rivals via a tough-on-China appeal to swing voters in the industrial Midwest and beyond.  Politics appears to be overriding economic considerations once again.

Multinationals operating in both the U.S. and Canada are affected by the array of tariffs imposed on Chinese imports, especially when it comes to the need for parts, pharmaceutical ingredients, or rare earth elements essential for many high-tech devices.  However, not everyone in the business community is happy with the most recent tariff increases on these imports.  The National Retail Federation in the U.S., which represents many companies that source or sell Chinese products, called on Mr. Biden to reverse course and lift tariffs.  As consumers continue to battle inflation, the Federation argues that the last thing the administration should be doing is placing additional taxes on imported products that will be paid by U.S. importers and eventually American consumers.  Although the USMCA eliminated tariffs on all Canadian-purchased goods manufactured in the U.S., if a product includes components that were made outside of the U.S. — like China, for example — then the Canadian customer very likely has to pay tariffs on those components.  The same argument can therefore be made with respect to the impact on Canadian consumers and on the inflation rates in both countries.

Mr. Trump has apparently promised to go even further if he wins in November — restricting investment between the two countries and banning some Chinese products from the U.S. entirely.  Back in 2018, with President Trump’s plan to impose tariffs on up to $60 billion (U.S.) of Chinese imports, experts noted that a full-fledged trade war between the world’s two economic superpowers would damage Canada’s economy.  At the time, the Retail Council of Canada declared that such U.S. tariffs that would raise the prices of Chinese consumer goods, such as electronics, sold in the U.S. and while prompting more Canadians to shop at home.  However, such a situation today would very likely lead to a further inflationary increase at a time of already high inflation.

Economists have long argued that trade protectionism leads to a misappropriation of global goods and inefficiencies by interfering with the normal benefits offered by free trade.  Cheaper Chinese imports to the U.S. and Canada led to many more affordable consumer goods which otherwise would not have been available in both countries, while also raising average standards of living in China.  In addition, bilateral trade agreements can be broken at any time by either party to an agreement, unaffected by normal global market considerations and swings in trade patterns.

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May 15

Investigation Into China’s Meddling In Canadian Politics Could Lead to Witch-hunt

by bcurry

There is little doubt that the Chinese Communist Party (CCP) has attempted to meddle in Canadian politics over several decades.  Conservative foreign affairs critic Michael Chong wrote in a recent statement. “It’s long past time for the Trudeau government to come forward with a robust plan to counter Beijing’s foreign interference operations here on Canadian soil.”  Recently, we learned that the Canadian Security Intelligence Service (CSIS) informed Mr. Chong that they were aware of a Chinese diplomat’s threats to his family in Hong Kong.  This alleged intimidation created further outrage among the opposition members who continue to call for a full public enquiry into the CCP’s attempts to interfere in Canadian politics at the local, provincial and federal levels.  The federal government is currently looking into the matter through an independent review as to whether a full public enquiry is needed.

However, anyone and any organization that has had dealings with or received funds from Chinese sources is now under greater scrutiny, whether deserved or not.  The first instance of note was related to donations apparently given to the Pierre Elliott Trudeau Foundation, which of course can be indirectly connected to his son, current Prime Minister Justin Trudeau.  However, the Foundation is an independent non-profit organization whose mandate is to provide generous financial support for doctoral research by outstanding Scholars, and to support the development of future engaged leaders who inspire innovative approaches as they blaze new trails in the Social Sciences and Humanities.  Being devoted to educational endeavours and scholastic research, there is no proof of any direct influence on the federal government attributed to previous Chinese funding to the Foundation.  However, the optics are not great!

Now, it has been reported that Toronto mayoral candidate Olivia Chow, and a veteran New Democratic Party politician, has won support of a group aligned with China.  However, Chow has been defending democracy activists in Hong Kong and was among a handful of federal MPs who stood in the House of Commons and commemorated the Tiananmen Square massacre and attended Tiananmen vigils.  Toronto has a large Chinese community, so Chow has had meetings to reach out to Toronto’s community of mainland-China immigrants, some of which unfortunately were organized by the CCP branch that spearheads Beijing’s influence and interference efforts worldwide.  In fact, she’s not the only prominent Toronto-area politician to have rubbed shoulders with the group.  Current Liberal Trade Minister Mary Ng posted pictures of her celebrating the lunar New Year with the same group in 2019, praising its efforts to promote “diversity and inclusion.”  As for Vancouver, CSIS reportedly noted that Chinese diplomats tried to get sympathetic candidates elected in last year’s municipal vote, in part by using groups that represented Beijing’s interests.  Ken Sim, who won the mayor’s race in a landslide, has denied that such interference played any part in his victory.  It would now appear that no Canadian politician of Chinese descent is immune to being investigated by the media over possible support received from CCP-affiliated organizations in Canada of which there are several.

The case of Michael Chong has led to the expulsion by the federal government of the Chinese diplomat accused of attempting to intimidate him as a Member of Parliament and outspoken critic of China’s regime.  This is the first high profile case acted upon involving findings by CSIS, and there could potentially be others.  The danger is that, under the current environment, more Canadians of Chinese descent could unjustly become the targets of the media and security agencies simply because of their ethnicity.  One commentator compared the current situation to that of the McCarthy era in American history that saw U.S. Senator Joseph McCarthy produce a series of investigations and hearings during the 1950s in an effort to expose supposed communist infiltration of various areas of the U.S. government.  Numerous Americans suffered unfairly and severely simply from investigations by his Senate committee and its widely publicized indiscriminate allegations.  One can only hope that we will not see a similar witch-hunt taking place in Chinese communities across Canada.  Chinese Canadians have every right as citizens not to be unjustly targeted.  Cooler heads need to prevail during these difficult times.

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Mar 8

China Tried to Meddle in Our Elections, but What Should Come Next?

by bcurry

In recent months in both Canada and the U.S., main media sources have been raising questions about China’s attempts to influence our elections.  However, the involvement of the Chinese government abroad has taken a number of initiatives not only during elections but also all year round.  Not only are they interfering in our affairs, whether through disinformation campaigns, illegal campaign activities or threatening and intimidating nationals of their countries who now live in Canada and the U.S., but also through so-called Chinese police stations.  Both Canada and the U.S. have significant Chinese communities, particularly on the west coast and in cities such as Toronto and New York.  According to the New York Times, Chinese outposts are suspected by the F.B.I. of conducting police operations without jurisdiction or diplomatic approval — one of more than 100 such outfits around the world that are unnerving diplomats and intelligence agents.  Western officials see the outposts as part of Beijing’s larger drive to keep tabs on Chinese nationals abroad, including dissidents.

Declining to get into specifics, Commissioner of the Royal Canadian Mounted Police (RCMP), Brenda Lucki, went on record to stipulate that the RCMP is investigating four such Chinese police stations and that investigation is ongoing.  Chinese personnel at these outposts have been known to carry out surveillance and to covertly harass both American and Canadian citizens of Chinese origin and Chinese nationals.  Beijing on the other hand has explained that these police stations are meant to track down known fugitives abroad and force them to return home.  In response, Canadian officials have called for China to shut down police operations in Canada.  The F.B.I. has carried out at least one raid which was the first known example of the authorities seizing materials from one of the outposts.

Since national opposition parties in Canada have continued to call for a public inquiry into China’s attempts to influence recent federal elections, they have forced Prime Minister Justin Trudeau to at least introduce a review process to be carried out by an independent person with required and acceptable qualifications.  This individual will determine whether or not a full public inquiry could be undertaken without disclosing on-going national security initiatives.  No one denies that China’s evident attempt to influence our elections is a real threat to undermining trust in our electoral processes.  The question then becomes, what can we realistically do about it?  Expelling Chinese officials could be one means to get our point across, but could also lead to a diplomatic war involving the retaliatory expulsion of Canadian/American diplomats and officials.  In the meantime, in order to ensure that our democratic ways are not undermined, one could begin by encouraging and supporting counter measures within both countries.

For example, when it comes to the spreading of misinformation, via the internet or other means, both Americans and Canadians need to be better informed as to where the information is coming from.  In Canada, parties select candidates in each riding through voting processes by registered members.  It has been suggested that the Chinese have sent non-citizens of Chinese descent to vote in constituency candidate meetings in order to support the selection of candidates who support China’s positions on Hong Kong and Taiwan.  The solution appears to be simple enough!  Party officials should only register Canadian citizens for voting purposes, candidate selection being a strong democratic process. 

The last thing that Canadians and Americans want to do is take it out on our Chinese population in response to the Chinese government’s incursion into our democratic processes.  Intimidation and threats of any community members is unacceptable to say the least, and needs to be investigated and stopped by our police and security forces.  Due to the current tense relations between China and the West, one can understand why governments don’t want to get into a full out diplomatic war.  There is little doubt that economic implications are enormous for both Canada and the U.S., particularly when it comes to China and trade.  Nevertheless, we owe it to both our citizens of Chinese descent and to all citizens to make it clear that illegitimate activities by the Chinese regime need to stop.  As citizens, we all have to do our part and become better informed about such activities.

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Feb 6

Both the U.S. and Canada Have Raised Security Concerns About Chinese Businesses

by bcurry

Relations between the U.S. and Canada regarding China haven’t been this low for years.  The recent shooting down of a Chinese surveillance balloon has simply made matters worst.  We know that the balloon flew over parts of western Canada before moving over American air space.  While Chinese authorities argued that this was simply a weather balloon that had gone off course, officials at North American Aerospace Defense Command (NORAD) claimed that it was a spy balloon.  In the end, President Biden ordered that the balloon be shot down over the ocean within American controlled waters, allowing the military to retrieve the balloon’s remnants for further study.  In protest, Secretary of State Antony Blinken postponed a planned high-stakes weekend diplomatic trip to China.  In addition, a number of American Congressional members once again turned their attention to Chinese businesses, such as TikTok and Huawei, which have been operating in the U.S. 

With respect to social media platform TikTok, U.S. lawmakers have expressed concerns about TikTok mining users’ private data and passing on the information to the Chinese Communist Party (CCP).  China’s Vice Foreign Minister Xie Feng insisted that China would “resolutely safeguard the legitimate rights and interests of Chinese companies.”  There is little doubt that Chinese companies are operating under the auspices of the CCP.  Whether or not these companies represent a national security risk has yet to be fully determined, despite all kinds of allegations by some American and Canadian authorities.

China is making major inroads into a number of countries as a way to extend its influence around the world.  For example, the latest interest by Chinese companies is in Mexico due to the advantages for imports to the U.S. because of the North American trade deal involving the three North American countries.  Chinese firms are establishing factories in Mexico that allow them to label their goods “Made in Mexico,” then trucking their products into the U.S. and Canada duty-free.  They are currently setting up operations inside the North American trading bloc as a way to supply Americans and Canadians with goods, from electronics to clothing to furniture.  This also allows Chinese companies to greatly reduce skyrocketing shipping and transportation costs, while taking advantage of Mexico’s highly skilled workforce, given the presence of its universities that churn out engineering graduates.  The Mexican government is openly welcoming billions of dollars worth of Chinese investments as a means to further develop their industrial sites close to the U.S. border and the potential creation of thousands of new jobs.

As a matter of increasing its influence abroad, China has invested in numerous infrastructure investments around the world, notably in Africa, South America and Asia.  Such investments often target critical sectors such as those in transportation (high speed rail), energy (oil and gas extraction) and mining (nickel deposits).  Many countries and their political elites believe that China is now the relevant superpower and the U.S. is in relative decline, especially after the disastrous foreign policies administered by Donald Trump. 

There is little doubt that American and Canadian politicians, particularly those of the right-wing persuasion, will continue to raise security concerns wherever Chinese businesses are active.  What is ironic is that American and Canadian companies were quick to invest in manufacturing operations in China, hoping to take advantage of cheaper labour costs and weaker environmental and health and safety regulation.  China took full advantage of the resulting opportunities to expand their business and economic interests in North America.  At this time, based on speculating about possible security concerns, I question whether we can prevent these business ties?  This recent balloon episode may have raised such concerns, but it apparently is nothing new since it is reported that three similar balloons actually flew over the U.S. when President Trump was in office.  Strange that no one complained about those incursions at that time?

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Nov 20

U.S. and Canada Unlikely to Boycott 2022 Winter Olympic Games in Beijing

by bcurry

The unknown whereabouts of Chinese tennis player Peng Shuai once again has raised the spectre of multiple human rights issues in China.  Peng, one of the country’s most recognizable tennis stars, has not been seen publicly since November 2nd, when she accused a top government official of sexual assault.  Back in 2020, the Australians exposed the fact that a network of nearly 40 internment camps had been constructed or were under construction in China’s far west, used to detain Uighurs and people from other Muslim minorities.  Chinese authorities said that the camps were part of their “re-education” system, which they claimed was about to be phased out.  Then of course, there was the forced closure of Hong Kong’s pro-democracy newspaper the Apple Daily in June 2021, just eight months after the Communist Party of China (CPC) leadership imposed a new national security law on Hong Kong.  The new law was aimed at quelling pro-democracy rallies that started in the summer of 2020 in response to China’s proposed extradition law.  Then there was the arrest of two Canadians Michael Spavor and Michael Kovrig who were imprisoned in China on trumped up charges for nearly three years, as part of China’s retaliation for the arrest in Canada of Huawei executive Meng Wanzhou for possible extradition to the U.S.  Of course, in each and every case the Chinese authorities have denied accusations of human rights abuses.

Make no doubt about it, all powerful President Xi Jinping and the CPC desperately want the winter Olympics to go ahead, putting China once again on the world’s stage.  Now we hear that President Biden is considering a U.S. diplomatic boycott of the 2022 Winter Olympic games in Beijing to protest China’s treatment of its Uyghur Muslim minority and other human rights violations.  Some experts suggest that Canada would most likely follow his lead.  Nevertheless, the games would no doubt proceed with the full participation of American and Canadian Olympians.

Six times in the past, countries officially boycotted the Olympic Games, with as few as three countries refusing to compete in 1964 and as many as 65 nations in 1980, led by the U.S., staying away from Moscow, Russia, as a result of the Soviet invasion of Afghanistan.  Just as Adolf Hitler tried to use the 1936 Olympic games in Berlin to raise the stature of Nazi Germany and Aryan race, President Xi Jinping and the CPC are anxious to use these Olympic Games to highlight China’s achievements.  Politically, Xi’s expected to break precedent and secure a third term to extend his indefinite rule and certainly doesn’t want to be embarrassed by any boycott.

In light of the current situation involving Peng Shuai, there is increasing political pressure on both the U.S. and Canada to at least promote a diplomatic boycott of the winter games.  However, Canadian lawyer and International Olympic Committee (IOC) member Dick Pound notes that implementing such a boycott won’t make any difference to China if only one or two countries are involved.  Certainly, no one wants to penalize the athletes who have trained and competed for years to participate in the Olympics.  Given China’s international initiatives, especially those in developing countries, it would be next to impossible to obtain widespread political support for any full-blown boycott.  As the world’s second most powerful economic entity, China has a tremendous amount of clout.

For this reason, Xi Jinping will have his day in the Chinese winter.  Once again, concerns about human rights will take second place to economic and political matters.  For what it’s worth, this past week, the Washington Post reported that the White House is expected to announce that neither President Biden nor any other U.S. government officials will attend the Beijing Games.  I this is the cases, one can expect that Prime Minister Justin Trudeau would shortly follow the President’s lead.  However, China will proceed with the games and its athletes will prevail in many sports.  Americans and Canadians can be expected to watch in awe as China displays its culture, technologies and athleticism.   As an avid China watcher, I’ll be looking forward to the show!

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Jul 8

Walking a Tightrope When Discussing Human Rights and China

by bcurry

Back in March of this year, Canada joined other Western allies in sanctioning Chinese officials who are suspected of involvement in the persecution of China’s Uighur Muslim minority in the western province of Xinjiang.  There has been an on-going war of words between Chinese officials and state media with the Canadian government over alleged human rights violations in the mistreatment of its Uyghur minority.  More recently, this public war of words escalated with a Chinese anti-Canada offensive soon after the discovery of hundreds of unmarked graves containing the remains of children at former indigenous residential schools in Canada.  Much of the criticism towards Canada, and in particular towards Prime Minister Justin Trudeau, was openly levelled by a Chinese Communist Party newspaper with an active online presence.  The Prime Minister has accused Beijing of having failed even to admit its present-day human rights problems, let alone take measures to alleviate them.  Trudeau views this failure as a “fundamental difference” compared to Canada.  However, with various active Chinese support groups located in Canada, particularly in Chinese communities and on college campuses, one can expect that the state supported campaign will continue for some time to come.

In addition, there is always the matter of economic and trade initiatives between Canada and China to consider.  The Canada China Business Council (CCBC) is a powerful high level lobby group that promotes a greater degree of commercial and diplomatic interaction between Canada and China.  The influential CCBC’s board of directors is a who’s who of Canada’s power elite.  The Council has head a number of trade missions to China, promoting lucrative Canadian business ties in China.  As one observer noted, even the Crown corporation which invests taxpayers’ money, the Canada Pension Plan Investment Board, has invested to the tune of $56 billion, or 12 percent of their total investments, in China.  Investments can include companies with provable links to human rights abuses.  Moreover, it has become clear that Canadian accusations of human rights violations by Chinese authorities is little more than an annoyance, intended primarily for our domestic consumption and not to be taken seriously.  Business goes on as usual.

The reality is that Canadian authorities understand this delicate relationship when it comes to Chinese foreign and domestic policies.  As in the case of Australia and the U.S., the Chinese state propaganda machine will counter with its own accusations of human rights violations in other countries, whether past or present.  They certainly have a vast array of means to counter what they view as foreign interference in their domestic affairs, whether through their on-line presence or through sources readily available within other countries.  Let’s face it, Canada by itself is not in a position to discredit those sources, and indeed may not really want to rock the boat for fear of creating future trade barriers.  When openly discussing human rights in China, Canada is forced to cautiously walk a tightrope.

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Mar 29

China Is Moving Quickly Into International Void Left By The U.S.

by bcurry

Anyone paying attention over the past couple of years to China’s moves on both the trade and diplomatic fronts would have seen great process in its filling the void left by the Trump administration.  China’s influence abroad was greatly led by its ‘Belt and Road Initiative’, a multi-trillion-dollar infrastructure scheme intended to stretch from East Asia to Europe.  China has lent billions of dollars to countries to upgrade old or to build new infrastructure, including roads, dams and railroads.  This initiative recently culminated in a 25-year cooperation agreement signed by China and Iran to strengthen their long-standing economic and political alliance.  This could deepen Beijing’s influence in the Middle East and undercut American efforts to keep Tehran isolated.

Back in January, Bloomberg News produced a synopsis about how China had won Trump’s trade war and even got Americans to foot the bill.  The trade deficit with the U.S. has significantly increased and China had easily withstood Trump’s tariff salvos.  In 2019, a group of 10 Southeast Asian nations replaced the U.S. as China’s second-largest trading partner.  Furthermore, most U.S. manufacturers surveyed last September said they didn’t intend to move production out of China.  There is no evidence that the U.S. tariffs on China benefit American workers and the tariffs have actually cost American companies and consumers in loss incomes.  According to the country’s National Bureau of Statistics, the Chinese economy rose 2.3% last year.  By contrast, the U.S., Canada, Japan and many nations in Europe have suffered steep falls in economic output, especially after the emergence of the pandemic.

Then there is China’s willingness to provide its COVID-19 vaccine to vulnerable countries, including Brazil where hospitals have been overwhelmed by a surge of infections.  CoronaVac has turned out to be the most affordable and most accessible inoculation for the more vulnerable nations.  In China, Sinovac, the maker of CoronaVac, started delivery tens of millions of doses overseas, reportedly providing free samples to 53 nations and exporting it to 22 nations that positioned orders.  Meanwhile, the U.S. appears to be hoarding vaccines and its forecast supply reportedly will be enough to vaccinate 650 million people — nearly twice the U.S. population.

All of the evidence indicates that China, as part of its foreign and trade policies, is attempting to extend its growing influence abroad through a number of avenues.  Meanwhile, countries like the U.S. and Canada can only sit on the sidelines and watch.  It is unclear whether the American or Canadian governments can do much to counteract the growth of Chinese influence in the international sphere.  Indeed, it may be too late given the existing long-term economic problems in both countries.

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