Our So-Called Foreign Policy: A Narrow-Minded Wake-Up Call on China’s Tech Drive

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artificial intelligence, Barack Obama, budget, China, mercantilism, National Science Foundation, Our So-Called Foreign Policy, research and development, technology, technology transfer, Trade, trade surpluses, Trump

“#SMH” (Shaking My Head) is one of my favorite Twitter hashtags, and it’s the perfect reaction to a new post on FOREIGNPOLICY.com on the growing technological challenge being posed to the United States by China, and on its frightening national security implications. The post has me shaking my head, and should have you shaking yours, because for all the useful information it contains on this critical subject, it completely misses the much bigger, much more important picture. And it misses it because the authors are so transparently determined to lionize former President Obama’s record in this regard, and vilify President Trump’s – though few of the facts warrant this conclusion.

The post is useful mainly for calling attention to China’s intensifying effort to establish global superiority in artificial intelligence, and to the Trump administration’s budget policies, which look oblivious to China’s efforts because they don’t provide adequate resources for federal research efforts capable of keeping the United States ahead.

I say “look” because the budget situation may not be as dire as strongly suggested by the authors. Specifically, it’s true that the administration has proposed cutting funding for the National Science Foundation’s artificial intelligence programs by 10 percent. At the same time, as made clear by the source they relied on, “the proposed budget does call for more spending on defense research and some supercomputing.”

Much more misleading is the post’s portrayal of the Obama administration as nothing less than Churchillian in sounding the tocsin. After all, the Obama reports the authors cite as evidence of his foresight on the subject came out at the very end of his presidency. At least as important, they gloss over major non-budgetary developments crucial to understanding China’s progress.

As they themselves admit, for instance, Chinese tech companies have established presences in Silicon Valley because they believe that “by rotating Chinese staff to Silicon Valley and American staff to Chinese campuses, they can accelerate the timeline for reaching parity with the United States in AI technology and depth of talent.” Under whose administration do the authors believe this practice started? And why do they think the Chinese were confident they were so free to proceed?

Also completely ignored: Throughout his presidency, Mr. Obama did absolutely nothing as American companies continued their longstanding efforts to transfer advanced technologies to Chinese partners voluntarily, or were forced to share this knowhow due to Chinese threats to shut them out of its market. Nor did he move to prevent these firms from investing in Chinese companies working on tech products and services with clear defense implications, or to help them cope with Beijing’s demands that they pony up or else.

And let’s not forget: The Obama administration made only the most token efforts to combat the predatory Chinese practices that enabled Beijing to amass immense trade surpluses with the United States; therefore to further fuel the growth of its market and make it that much more difficult for American companies to resist tech extortion demands; and to finance its own multi-billion technology development efforts with these handsome trade profits. Indeed, Mr. Obama staunchly opposed Congressional efforts to punish China for its most important mercantile policy:  currency manipulation.  

So I share the authors’ view that federal research and development efforts have been crucial to establishing America’s intertwined global technology and military leadership, and their hope that President Trump will reject the conservative anti-government dogma that justifies virtually every type of budget cut outside traditional defense or law enforcement spending. But the idea that America’s approach to the Chinese tech challenged was remotely up to snuff before Mr. Trump’s election not only fails the test of historical accuracy. It has blinded them to all the other policy changes needed to ensure that the United States stays Number One.

Im-Politic: The Polls Say “Let Trump Be [Campaign-Version] Trump”

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2016 election, ABC News, budget, conservatism, discretionary spending, entitlements, Freedom Caucus, healthcare, Im-Politic, Immigration, independents, NBC News, Paul Ryan, polls, poverty, Republicans, The Wall Street Journal, Trade, Trump, Washington Post

They’re only polls and we all should remember how badly most polls blew their calls in the last presidential election. But two new surveys from the Washington Post and ABC News on the one hand, and the Wall Street Journal and NBC News on the other, are signaling to me anyway that Donald Trump has made a major mistake so far in his young presidency in tilting so markedly toward the keepers of the orthodoxy (especially the most doctrinaire versions) in his own party. Instead, he should have been focusing all along on developing a promising new American political center of gravity that he started defining (in his own imitable way) during his campaign.

As widely observed during the 2016 elections, Mr. Trump was anything but a conventional conservative – at least as the term has been understood for the last quarter century. Yes, he made frequent nods toward cutting taxes and regulations, as well as to balancing budgets (objectives that of course aren’t always consistent). He also expressed some support for social conservative positions like further restricting abortion and appointing “strict constructionists” to the Supreme Court. But as also widely observed, if that mix of views was what voters in the Republican primaries and general elections really wanted, they would have voted for an orthodox conservative.

Instead, Mr. Trump trounced his opponents even though he at least as often promised to protect massive federal entitlement programs heavily relied on by the middle class and senior citizens; to guarantee adequate healthcare for non-seniors who can’t afford it; to preserve government support for Planned Parenthood’s provision of non-abortion-related women’s health services; to uphold the rights of gay, lesbian, and transgender Americans; and of course to ignore free market dictates when they seemed to undermine public safety and prosperity by fostering unrestricted trade and immigration.

Undoubtedly, much of candidate Trump’s appeal also sprang from simple, nonpartisan voter anger at the failures and self-serving priorities of the bipartisan national political establishment. But Mr. Trump did the best job of all last year’s presidential hopefuls of identifying the combination of specific grievances that created this anger: notably, over those jobs and incomes lost to Americans Last trade and immigration policies, over those related dangers posed by terrorism and leaky borders, and over the astronomical costs and risks of fighting seemingly futile foreign wars and defending free-riding allies.

The president’s Inaugural Address – which declared his intention to fix these problems with America- and Americans’- First policies – unabashedly proclaimed that President Trump would govern like candidate Trump.

Yet although the president has by and large kept his immigration promises, and approved some (limited) measures to combat foreign trade predation, his domestic policy proposals look like they’re right out of the Chamber of Commerce and Moral Majority playbooks. Nowhere has this development been more obvious than in his endorsement of House Speaker Paul Ryan’s healthcare plan, and in his release of a budget outline that, outside of defense spending, libertarians should be swooning over.

Late last month, I ventured that the president’s support for the “Ryan Care” proposal was a head fake: He had knowingly backed a measure so draconian that he knew it would fail, in order to establish some orthodox conservative street cred with Congressional Republicans and thus enlist their support for the pivot to greater moderation he had planned all along. Something like this scenario could still unfold; according to press reports, even the hard-core anti-government House Freedom Caucus members are growing more amenable to a compromise proposal that would preserve many of the more popular provisions of President Obama’s healthcare reforms.

But Mr. Trump’s continuing insistence on a federal spending blueprint that either eliminates or greatly slashes funding for medical and other scientific research, Chesapeake Bay cleanup, and food and heating aid for the poor, is not only plain bizarre, especially since the dollars involved are trivially small. It’s also politically inexplicable, because there’s absolutely no evidence that these are viewed as priority savings among any important Trump constituencies.

And that’s where the new polls come in. As per the headline results, Mr. Trump’s popularity at this point in his presidency is much lower than the ratings of most of his predecessors early in their first terms. In fairness, the Post-ABC survey also shows that the president would beat his chief 2016 rival, Hillary Clinton, in the popular vote if a new election was held – showing that he’s even more popular versus the Democratic nominee than on election day.

But the both polls showed the president’s support tightly concentrated among his own core voters and Republicans generally. Even accepting the claim that rapid partisanship by Democratic party leaders is proving effective in limiting Mr. Trump’s appeal to their rank and file, it’s still a sign of trouble for the president that his ratings among self-described political independents is markedly on the wane according to the Journal-NBC findings (falling to 30 percent) and low (38 percent) according to the Post-ABC survey.

One main reason: The Washington Republicans President Trump is apparently still courting are even less popular than he is. The Journal-NBC poll reports that many more Americans are dissatisfied with the Republican-led Congress nowadays than in February, and Ryan’s approval ratings are even lower. Moreover, the Republican-led Congress and the Speaker, in turn, are less popular than the president even among voters identifying as Republicans.

None of these results necessarily bodes ill for the Freedom Caucus. Its members don’t care for Ryan, either – allegedly for being too moderate. But many of the latest measures of Americans’ views of major policy issues do. For example, the Journal-NBC poll found that, since February, the share of respondents agreeing that “Government should do more to solve problems and help meet people’s needs” shot up to 57 percent. Even more independents (59 percent) endorsed this position. The share of total respondents believing that “Government is doing too many things better left to businesses and individuals plummeted to 39 percent.

More pointedly, the Post-ABC poll showed Americans opposing the Trump budget proposals by 50 percent to 37 percent overall, and independents disapproving by an even wider 52 percent to 35 percent margin.

The Journal-NBC survey also found record shares of Americans viewing “free trade” and “immigration” positively – at 57 percent and 60 percent, respectively. But the abstract nature of these questions could well have tilted these answers. One reason for supposing so: The Post-ABC poll reporting that, by a strong 73 percent to 22 percent, Americans favor “Trump pressuring companies to keep jobs in the United States.” Among independents, the results are an even better 75 percent to 19 percent.

So the recipe for Trump political success seems pretty clear: Dump the Freedom Caucus under the Trump Train on the budget and healthcare; preserve (and even boost to some extent) discretionary spending programs that strengthen the economy’s foundations and provide for the needy; keep the campaign promises on entitlements so highly prized by the middle class; and take bolder measures to Buy American and Hire American (as one new set of trade-related Trump jobs programs is called).

Keeping the focus on these priorities, along with a well thought out infrastructure program, should attract and keep enough backing among Republicans and independents to offset any losses in Freedom Caucus ranks, both in Congress and at the grassroots level (where they seem modest in number). Adding new policies to combat predatory foreign trade practices, moreover, should please organized labor enough to bring into the fold many union members and leaders plus the Congressional Democrats they strongly influence. An extra bonus – this program could well give President Trump the political leeway he needs to stay his course on immigration (which of course has seen a softening of his views on the so-called Dreamers).

Often in American history, calls to “Let [name your favorite politician] be [name that same politician]” have reflected core supporters’ naive beliefs that campaign promises can easily be turned into policy by the office-seekers they elect. But as is so often the case with the current president, Letting Trump be Trump, could confound the political conventional wisdom.

(What’s Left of) Our Economy: Why Trump’s Budget Proposal is a Win for Trade Policy Realism

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border adjustment, budget, Commerce Department, enforcement, exports, imports, Robert Lighthizer, tax reform, Trade, trade law, Trump, U.S. Trade Representative, Wilbur Ross, {What's Left of) Our Economy

Certainly since Donald Trump has been elected president, there’s been a tension even among his most supposedly hawkish trade policy advisers over basic objectives: Should the United States seek to solve its major trade-related problems mainly by promoting exports, or mainly by curbing imports? Of course, the two goals aren’t mutually exclusive. But the first suggests that the nation’s approach to trade will essentially be more of the same (albeit executed more competently), while the latter suggests a significant shift and is vigorously put into effect.

That’s one trade-related reason why Mr. Trump’s new budget proposal is so interesting and potentially important. If you believe that “money talks,” or “deeds count more than words” or any homilies to that effect, then it looks like that the tension has been resolved in favor of import limits – which would be good news indeed if it remains intact.

The reasons, as I’ve long written, are pretty simple, and should be much more obvious than they’ve been. First, for all its problems, the U.S. economy has been growing faster recently than most major world economies. And unlike the faster growers (mainly in the developing world), America’s growth isn’t export-led or -heavy. For that reason alone, its domestic market continues to be the world’s paramount emerging market.

Second, that relatively fast growth, combined with the ongoing export-heavy nature of most foreign economies means, and the huge and chronic American trade deficit, means that the size of the U.S. domestic market into which domestic producers can sell is enormous in absolute terms and indeed much bigger relative to foreign markets than widely realized. After all, this American market includes not only whatever growth the United States can generate going forward, but the large chunks of its market currently controlled by foreign competition.

Third, however much leverage the United States enjoys in global trade, and over foreign countries, its influence over its own market will always be much greater. And that goes double for countries with long records of sweeping protectionism.

Fourth, the domestic market is the market that domestic American producers should know best. Therefore, despite its undeniably impressive dynamism, these domestic producers have less to learn about customer preferences than is the case with foreign market.

For examples of the administration’s apparent ambivalence, simply check out statements made in the confirmation hearings of Commerce Secretary Wilbur Ross and U.S. Trade Representative-designate Robert Lighthizer. Indeed, it’s easy to conclude that their stated bottom line endorses the export-focused approach.

But the new Trump budget document is sending the opposite message – and its declared spending priorities arguably matter more than even sworn testimony. Specifically, according to the Commerce Department section, the final budget

“Strengthens the International Trade Administration’s trade enforcement and compliance functions, including the anti-dumping and countervailing duty investigations, while rescaling the agency’s export promotion and trade analysis activities.”

Not that this text is the end of the story, or even close. As widely recognized, the new budget statement is the first step in a lengthy process in which Congress will be heavily involved. Moreover, because so much of it is so controversial, and because the nation is so far from a consensus on official spending priorities, it’s entirely likely that the current budget priorities will simply wind up being carried over for the time being.

And as for trade policy specifically, Commerce Department funding will be far from the only determinant as to where the administration will put most of its energies. Just one example: the structure of whatever new or revised trade agreements it seeks will matter greatly as well. So will the fate of the border adjustability feature of the House Republican leadership’s tax reform proposals – which would both in effect penalize imports and subsidize exports. Moreover, because the U.S. trade law system is so (inevitably) slow-moving, episodic and reactive, relying exclusively or even mainly on this traditional trade enforcement tool will become a recipe for trade policy failure.    

But the Commerce budget priorities appear to be a straw in the wind that’s unmistakable – and because realistic, unmistakably welcome.

Our So-Called Foreign Policy: New White House Blueprint Flunks the Main Test of Strategy

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allies, budget, energy, Middle East, milieu goals, national interests, National Security Strategy, Obama, oil, Our So-Called Foreign Policy, resources, Russia, sequester, strategy

I was of course planning to read the entire new U.S. National Security Strategy statement released last Friday by the White House before posting on it, but my plans have been upended, at least for now, by the sheer number of ditzy statements in President Obama’s two-page introduction.  (After all, he’s the boss.)

Here’s the first (it’s clear that this document will be blogging fodder for many days going forward): The president’s ideas flunk the most basic test of a successful strategy – aligning ends and means on a sustainable basis.  He seems to be no more willing than any of his post-World War II predecessors to deal seriously with the dangerous contrast between the sweeping, and indeed millennial goals set for the nation’s foreign policy on the one hand, and the finite amount of resources inevitably available to pursue these goals on the other. Indeed, it’s arguable that the gap between Mr. Obama’s views on the wherewithal that can be brought to bear on international objectives (or at least, his views on the resources that should be brought to bear), and the objectives he seeks, is unusually large by historical standards.

In his introduction to the strategy document, the president speaks of (in order of appearance):

>”shaping the opportunities of tomorrow”:

>”promoting global security and prosperity as well as the dignity and human rights of all people”;

>”confronting the acute challenges posed by aggression, terrorism, and disease”:

>”cementing an international consensus on arresting climate change”;

>”shaping global standards for cybersecurity”:

>”advancing human rights and building new coalitions to combat corruption and support open governments and open societies”:

>”defending our interests and upholding our commitments to allies and partners”; and

>”countering the ideology and root causes of violent extremism”:

It’s important to note that none of these objectives is accompanied by any geographical limitations. In other words, the United States is going to seek these goals everywhere. These positions are nothing more than the president’s distinctive version of the utopian – and bipartisanly supported – milieu goals that have led the nation so disastrously astray so often, and which in fact conveniently define most genuinely strategic challenges and dilemmas out of existence. 

To be fair, the president does address resource issues. He touts the multi-dimensional strengths of the American economy, which certainly looks good compared with the economies of most major allies and, among rivals, Russia. But is a recovery still heavily dependent on unprecedentedly loose monetary policies a strong enough foundation for such worldwide endeavors?  

Mr. Obama also promises to “continue to insist on budgets that safeguard our strength and work with the Congress to end sequestration, which undercuts our national security.” In addition, he emphasizes the importance of contributions from allies, although wheezing economies in Japan and Western Europe, along with the chronic internal weaknesses, to put it kindly, of Middle East partners appear to make these countries less reliable than ever.

But in the same preface listing all those ambitious goals, the president also specifies that although the nation will “lead from a position of strength,” this “does not mean we can or should attempt to dictate the trajectory of all unfolding events around the world. As powerful as we are and will remain, our resources and influence are not infinite.” He adds that “we have to make hard choices among many competing priorities, and we must always resist the over-reach that comes when we make decisions based upon fear.”  Not a word is devoted to what these priorities and hard choices might be, or how the president proposes to make these decisions.

Just as serious, the president makes no acknowledgment that the nation’s unrivaled strength and geopolitical security argues, even in at least some cases, for less, rather than more international engagement, or at least moving toward that goal (e.g., in the Middle East, whose role as an energy supplier has been greatly reduced by the boom in America’s domestic energy production).  In this post, I sketch out some of the case for such retrenchment.

That’s just one reason that it seems long overdue to rename this series of National Security Strategy blueprints. National Security Wish List is much more appropriate.

Im-Politic: Budget Strengthens Case that Obama’s Border Security Strategy isn’t Serious

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Biden, border security, budget, CAFTA, Central America, Colombia, foreign aid, George W. Bush, Im-Politic, Immigration, Obama, Plan Colombia, Ronald Reagan

With immigration and Department of Homeland Security funding at the center of a looming budget showdown between President Obama and Congress’ Republican leaders, it’s surely useful to look over the new Obama budget and see what it actually proposes on this front. And it’s hard to avoid concluding that the president’s claimed determination to bolster border security shouldn’t be taken seriously.

Let’s leave aside Mr. Obama’s “executive amnesty” move last fall, which can only strengthen the already powerful policy magnet that’s been luring illegal immigrants to the United States for so long. Yes, the president did propose to increase border security funding by nearly 25 percent over current funding levels – to just under $374 million. But the week before the official budget request was unveiled, the administration dropped a powerful hint that it doesn’t expect any of these new resources to do much good. Why else would the White House have touted so prominently – in a New York Times op-ed by the Vice President – its decision to attack the proverbial root causes of last year’s Central American immigration surge by spending $1 billion to promote reform in the region?

The administration’s ostensible belief that the best way to deal with the international problems facing the United States is to manipulate hard-to-contol revents abroad is, as I’ve written, a time-honored tenet of American foreign policy. With the huge but long-ago exceptions of post-World War II aid to Western Europe and Japan, this strategy has also failed so completely in the closely related foreign aid and trade spheres that it deserves the label delusional. Moreover, as I’ve also written, this approach becomes absolutely unforgivable upon realizing the unique geopolitical advantages enjoyed by the United States that make much easier-to-control and more promising domestic solutions – like serious border security efforts, in this case – vastly superior.

After all, it’s not as if the United States hasn’t tried promoting reform in Central America before. During the Cold War, President Reagan launched a “Caribbean Basin Initiative” aimed at preventing the rise of “new Cubas” and a repeat of the Sandinista revolution in Nicaragua. In 2005, Congress passed President George W. Bush’s Central America Free Trade Agreement, which was hyped in part as an immigration control measure. Vice President Biden’s own new article makes clear that substantial American aid to the region has been continuing. Yet he admits that the region’s countries are still held back by “inadequate education, institutional corruption, rampant crime and a lack of investment….”

Nor does Mr. Biden stop there in knee-capping his apparent belief that yet more money is the cure for most of what ails Central America. He adds that Central American countries and their economies still lack “clear rules and regulations; protections for investors; courts that can be trusted to adjudicate disputes fairly; serious efforts to root out corruption; protections for intellectual property; and transparency to ensure that international assistance is spent accountably and effectively.” Who can reasonably doubt, therefore, that what’s fundamentally crippling the region after all this time is not a lack of resources (especially considering how tiny these nations are) but a dysfunctional political culture. And why on earth does the Vice President suggest that this disease can be cured with more “training”?

Mr. Biden at least does provide some concrete answers – mainly, the U.S.-assisted transformation of the much larger nation of Colombia. There’s no doubt that progress has been made in that strife-torn country on many fronts. According to World Bank data, economic growth has been trending up and the poverty rate is declining. At the same time, though down from its peak at the turn of the century, illicit drug production in the country has now stabilized, and a final peace agreement to end Colombia’s 30-year insurgency remains elusive. (Indeed, casualties continue.) Moreover, although this progress has been made at the cost of $9 billion from American taxpayers, the Obama administration is still asking Congress for nearly $300 million more in annual aid in its new budget. More ominously, the end of a long global boom in raw materials is already imposing major economic pain throughout Latin America, which has relied on strong commodity exports for much of its recent growth. So expect those root socio-economic roots of mass emigration to start growing again all over the region.

A president serious about sensible immigration reform would recognize what a losing battle the nation has been fighting in order to curb illegal migrant inflows at their sources. Mr. Obama’s continued hype of these utopian proposals greatly strengthens the case that he’s anything but that president.