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China, Foreign Investment, Trump As “Paper-Tiger”

March 27, 2018

Not sure if the link will work for everyone so I am placing some key paragraphs that underscore some of the larger points made in the article. I am not sure how many others on CP care about international policy, but as a ‘nerd’ or is that ‘wonk'(?) I find it of high interest, and so place this post and link trusting there some others who will find it of value.
 
China is also seizing immediate opportunities presented by Trump. Days before the T.P.P. withdrawal, President Xi Jinping spoke at the World Economic Forum, in Davos, Switzerland, a first for a paramount Chinese leader. Xi reiterated his support for the Paris climate deal and compared protectionism to “locking oneself in a dark room.” He said, “No one will emerge as a winner in a trade war.” This was an ironic performance—for decades, China has relied on protectionism—but Trump provided an irresistible opening. China is negotiating with at least sixteen countries to form the Regional Comprehensive Economic Partnership, a free-trade zone that excludes the United States, which it proposed in 2012 as a response to the T.P.P. If the deal is signed next year, as projected, it will create the world’s largest trade bloc, by population.
 
Rex Tillerson, the Secretary of State, arranged for Trump and Xi to meet at Mar-a-Lago on April 7th, for a cordial get-to-know-you summit. To set the tone, Trump presented two of Kushner and Ivanka Trump’s children, Arabella and Joseph, who sang “Jasmine Flower,” a classic Chinese ballad, and recited poetry. While Xi was at the resort, the Chinese government approved three trademark applications from Ivanka’s company, clearing the way for her to sell jewelry, handbags, and spa services in China.
 
Kushner has faced scrutiny for potential conflicts of interest arising from his China diplomacy and his family’s businesses. During the transition, Kushner dined with Chinese business executives while the Kushner Companies was seeking their investment in a Manhattan property. (After that was revealed in news reports, the firm ended the talks.) In May, Kushner’s sister, Nicole Kushner Meyer, was found to have mentioned his White House position while she courted investors during a trip to China. The Kushner Companies apologized.
 
During the Mar-a-Lago meetings, Chinese officials noticed that, on some of China’s most sensitive issues, Trump did not know enough to push back. “Trump is taking what Xi Jinping says at face value—on Tibet, Taiwan, North Korea,” Daniel Russel, who was, until March, the Assistant Secretary of State for East Asian and Pacific Affairs, told me. “That was a big lesson for them.” Afterward, Trump conceded to the Wall Street Journal how little he understood about China’s relationship to North Korea: “After listening for ten minutes, I realized it’s not so easy.”
 
Russel spoke to Chinese officials after the Mar-a-Lago visit. “The Chinese felt like they had Trump’s number,” he said. “Yes, there is this random, unpredictable Ouija-board quality to him that worries them, and they have to brace for some problems, but, fundamentally, what they said was ‘He’s a paper tiger.’ Because he hasn’t delivered on any of his threats. There’s no wall on Mexico. There’s no repeal of health care. He can’t get the Congress to back him up. He’s under investigation.”
 
Before Trump took office, the Chinese government was far outspending the U.S. in the development of the types of artificial intelligence with benefits for espionage and security. According to In-Q-Tel, an investment arm of the United States intelligence community, the U.S. government spent an estimated $1.2 billion on unclassified A.I. programs in 2016. The Chinese government, in its current five-year plan, has committed a hundred and fifty billion dollars to A.I.
 
The Trump Administration’s proposed 2018 budget would cut scientific research by fifteen per cent, or $11.1 billion. That includes a ten-per-cent decrease in the National Science Foundation’s spending on “intelligent systems.” In November, Eric Schmidt, then the chairman of Alphabet, told the Artificial Intelligence & Global Security Summit, in Washington, that reductions in the funding of basic-science research will help China overtake the U.S. in artificial intelligence within a decade. “By 2020, they will have caught up. By 2025, they will be better than us. By 2030, they will dominate the industries of A.I.,” he said. Schmidt, who chairs the Defense Innovation Advisory Board, added that the ban on visitors from Iran was an obstacle to technology development. “Iran produces some of the top computer scientists in the world. I want them here. I want them working for Alphabet and Google. It’s crazy not to let these people in.”

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