"The GOP's December Surprise"

Jamie Galbraith on political business cycles - the manipulation of the economy for political purposes causing cyclical regularities in the data - and the prospects for the economy after the election:

The GOP's December Surprise, by James K. Galbraith, Mother Jones: Is the worst over? Are we on the road to recovery? ... Early this year, the optimists ... argued that the slowdown was short-term and that a "stimulus" package should be "targeted and temporary." This with rare haste the Democratic Congress enacted. As a result, most taxpayers got one-time $600 checks in May...

The rebate isn't the only little Dutch boy thrown headlong at the dike this election year. Government spending, especially for defense, will be up... Dick Cheney was secretary of defense for Bush 41; just before the 1992 election he engineered a big run-up in outlays, as the military restocked following the first Gulf War. ... Is the Pentagon up to that trick again? I'd be astonished if it were not.

Under intense pressure from panicky bankers, Ben Bernanke cut interest rates relentlessly from August 2007 through the spring of 2008. I don't accuse Bernanke of playing politics. But it's worth noting that this is what usually happens. In presidential election years when Republicans are in office, the Fed ... pursues a more expansionary policy than when Democrats rule—after controlling for differences in the rates of inflation and unemployment. (I made these calculations myself; see the chart.) ...

But much of the ordinary effect of interest cuts on new lending—like a rebound in construction and automobile sales—didn't happen this time. ... Lower interest rates did cut the value of the dollar, however, and that promotes exports and foreign investment. ...

Possibly all this stimulus will ward off the two-quarter decline that has historically defined a recession. Don't be surprised: Republicans haven't had an election-year slump since 1960. .. Even if they can't stop a recession, they may be able to make it short and shallow enough, this year, to put John McCain in the White House. But all this brings up an important question—what of next year?

No matter how effective the stimulus, two enormous clouds remain for whoever becomes president: the housing slump and the banking crisis. Both are far from being finished yet.

The problem with a housing slump is inventory. Unlike factories and Internet startups, shuttered houses don't go away. ... They remain, a drag on the market, decaying and pulling down property values for years. ...

And ... homeowners are now getting hit a second way: in the declining value of their homes. You don't have to be holding a subprime to find yourself underwater. ...

Will students, small businesses, and other borrowers still be able to get credit when this is over? God only knows. The mechanisms of mortgage finance and home-equity drawdown haven't simply been damaged. That well has been poisoned. ...

Let's be clear. The private financial markets did actually fail. It's only the fact that the public trusts government that keeps the system from dissolving in panic. But even if the Fed and its counterparts can hold the line, the problem of mistrust among the big bankers won't go away soon. And that means we're at the end of the age of credit expansions, for now.

As for next year, good luck. No matter who becomes president, there probably won't be another tax cut. Instead, cries for "fiscal responsibility" will be heard. States and localities, hit in 2008 on their property taxes, will cut their spending. Consumers, hit hard on their home equity, will cut back on new borrowing (which they probably couldn't get anyway) and pinch pennies however they can. Businesses won't even think about new investments.

In this situation, more cuts to interest rates—the only applicable tool the Fed has—don't work well. And they weaken the dollar, which raises inflation. ...

Thus far the dollar has fallen, but it hasn't collapsed. Will it? There are two big threats. The first is the financial crisis itself... [T]he fundamental trust that ... the United States was a safe place to put your money ... has come into question.

The second threat, not often mentioned, is our reckless foreign policy, including the invasion of Iraq, bellicosity toward Iran, and the ongoing subtext of hostility toward China. Since the Middle East has the oil and China holds our debts, all this is spitting in the soup, big time. It may not by itself wreck the financial system. But it doesn't exactly build up the reserve of good will that we may need when the financial going gets tough.

For half a century much of the world believed that we provided security under which they too could prosper; many no longer think so. Today, our country, like our banks, has a problem of global trust. Unlike the banks, we have no higher power to keep things going if we screw up.

Comments

[Dickeylee]

I don't see China waiting until December to squash Tibet. Right after the Olympics, and before the brutal Tibetan winter sets in, they'll go to it. And they will dare us to do anything about it, holding out our Treasuries-and our Dollar-hostage.

[Sandman]

The commodity boom looks over. Material prices are falling after peaking in June. The dis-inflation of these groups will expose the economy even more.

Best be warned.

[save_the_rustbelt]

Senator Obama is hanging his hat on a middle class tax cut.

I don't really think that is the best medicine.

The middle class is more worried about job security, pensions, health care, college costs, K-12 education, housing problems
and a whole bunch of things more important than a $1000 tax cut.

Time will tell. January 20th seems a really long way off, and the worst of the economic news may be lurking ahead.

[anne]

"I don't see China waiting until December to squash Tibet."

Enough lying; enough, enough, enough.

[anne]

Enough hating China, enough!

[evagrius]

Enough hating China, enough!

Well, you'd better come up with something about Tibet and all the other ethnic regions in China, ( the Tibetans aren't the only ones suffering from the overbearing idiots in Beijing).

[Dickeylee]

Oh please Anne, do you really believe that China is done with Tibet? Or better yet, they're going to grant them independence? I don't hate China one bit, I'm just looking at their history, both recent and long term, and I'm saying that you haven't heard the last of this.

[James]

I can't be sure, but I get the sense that James K. Galbraith is another one of these incompetent economists—like Alan Greenspan, Ben Bernanke, and Martin Feldstein—who cannot recognize a housing bubble. When you take the extreme price increases of the housing bubble and subtract the price declines we've seen so far, you still end up with most homeowners being far better off than if housing had increased at a normal rate over the past decade.

The people who really got screwed by the housing market are not the homeowners, but the renters who were priced out of being able to afford a home of their own. Nobody ever seems to care about renters.

The Bubble Meter Blog: http://bubblemeter.blogspot.com

[halbhh]

Nice article by JG there.

[roger]

I like Galbraith, but I very much doubt this prediction. State governments are just beginning the cutbacks. The second line of the financial system, the local and regional banks, are now taking big hits; the housing market is in the toilet, and it strikes me as highly dubious that the cost of living increases are going to be reversed by a magic snap of the fingers, or that gasoline is going to come down to the price it was even two years ago. Stimulus meets inflation - and, as this inflation is not wage driven, in fact people are making less money than the stagnant level of wages they had achieved over the Bush boom years, we are not going to see morning in America in fall - or at least, I would say that the odds are against it. The setting of the trap is pretty hairy - inflation on the one side, austerity and slowdown on the other. Liberals generally chose the inflation pill, supposing that the bargaining power of labor will make the raised cost of living bearable, and the growth will soak up the unemployed. But does anybody really think that's going to happen this time? Why credit Bush's administration - and Cheney in particular - with some amazing managerial power that they have seemingly lacked in all other fields?

[Winslow R.]

Roger brings up an important issue - the wage issue.

The wage issue is a political choice set by fiscal policy. If government bank bailouts are to be avoided, wage increases are the only alternate fiscal choice.

I see three ways to 'fix' the economy with fiscal/monetary policy.

1) The Mellon way- Continue on the present path of falling asset prices followed by bankruptcy of the American citizens and corporations followed by fed/government bailouts of the banking system. Eventually asset values stabilize around the spending/taxing/saving equilibrium established by fiscal and monetary policy. Ponzi investments eventually will turn hedge after many years of subpar growth, war, and famine.

2)The Winslow way - Avoid bank bailouts by shifting Fed policy directly to the American public. Allow the monetary transmission mechanism to gain traction by loaning directly to American citizens. Allow American citizens to mortgage their citizenship. Allow increased limits/reduced rates for education, and renewables. Side benefit is the removal of the bank monopoly on Fed access.

3)The most probable way, as JG hints the next president could create a fiscal 'bubble' with the defense industry as its focus, as did Reagan or infrastructure/defense as did FDR. If fiscal stimulus is large we could see increases in wages sufficient to bailout the banking sector.

All the Andrew Mellons (Brad Delongs) need to realize the error of their ways.

"Mellon became unpopular with the onset of the Great Depression. He advocated spending cuts to keep the Federal budget balanced"

http://en.wikipedia.org/wiki/Andrew_Mellon

[A.Citizen]

Gee....why doe I feel such a wave of total disappointment at the idea of a "'fiscal bubble' centered on the defense industry..."

Maybe 'cause it's a dumb idea that we've already tried. By this time most should have noticed that when you have a whopping big military...

...you fight a lot of wars. Of course in one way this is good. You destroy a lot of equipment which needs to be repaired and replaced. In another not so good. The neighbors have finally noticed that we are....

....'the biggest threat to world peace.' as reported by numerous polls. I do not however want to get bogged down in this issue.

I just want to say that if I were Mr. 'Magic Man' and I got elected I'd create my bubble around alternative energy and rebuilding our decaying infrastructure. You know roads, bridges and dams along with this:

TheSolar Grand Plan

And I'd funnel Billions into the Universities under the mandates of: Stopping the worldwide destruction of habitat, and a bunch of other 'stuff' I won't go into here.

We need leaders like JFK, Edmund and Jerry Brown to help get started in the right direction. Call 'em bubbles if you want but in CA after the two Browns invested heavily in education and infrastructure CA exploded economically. Same with JFK and the 'Space Race'.

Not morons like McSame and The Precious who cannot see beyond their own elections.

Who cannot think BIG because they are small men. Maybe we'll get lucky and one of 'em will grow into it.

[Francois]

"Enough hating China, enough!"

WTF? Denouncing human rights abuse is tantamount to hate?

The Soviet propaganda machine pulled that one for decades to try to make us, (the West) STFU.

We didn't! And won't do it this time around.

Got a problem with that?

[hari]

@ Dickbee -

*China does not have to take Tibet - *The Roof The World* - it is a sovereign territorial part of mainland China. And as far as I can fresee, it will remain part and parcel of China. Similar to Hong Kong and Taiwan - as recognized by rest of the civilized world.

*Jamie is more like a contrarian - dollar is sliding and with a bit more policy disregard from Fed, it's likely to plummet. God knows what will happen to global equity and commodity markets - shld dollar become devalued.

* What if SWF dump their dollar - mountain - reserves and move to alternative currencies to protect their portfolios?

[Tyranny of the Masses]

"The people who really got screwed by the housing market are not the homeowners, but the renters who were priced out of being able to afford a home of their own. Nobody ever seems to care about renters."

It was a problem known as tyranny of the masses among the Founders, and written about in the Federalist Papers. The majority vote to harm the minority. The majority are homeowners, so they vote to harm non owners with escalating prices. The majority are debtors, so they vote to harm non debtors with inflation. Renters are hurt by price rises, pensioners are hurt by inflation, etc... It is the way democracy works, if it doesn't have sufficient checks and balances to protect minorities.

says...

"In this situation, more cuts to interest rates—the only applicable tool the Fed has—don't work well. And they weaken the dollar, which raises inflation..."

Excessively low rates exacerbated the housing bubble, and helped create the current crises. The problem can be solved by allowing prices to fall to market clearing levels (as fast as practical), and restoring trust among savers. Negative interest rates discourage saving, and simultaneously encourage reckless borrowing for speculation.

Eliminate inflation (zero), and set lending standards high enough so that the default rate is very low. Negative interest rates to encourage price rises during boom times is just asking for trouble. The Great Depression was caused by widespread loan default. The default was caused by low rates in the 1920s encouraging speculative loans on margin. No speculative loans, no default, and no depression.

[anne]

"I don't see China waiting until December to squash Tibet. Right after the Olympics, and before the brutal Tibetan winter sets in, they'll go to it. And they will dare us to do anything about it, holding out our Treasuries-and our Dollar-hostage."

Hating China!

[anne]

http://www.nytimes.com/2008/07/09/world/europe/09shield.html?hp&pagewanted=print

July 9, 2008

U.S. and Czechs Sign Accord on Missile Shield
By JUDY DEMPSEY and DAN BILEFSKY

BERLIN — The United States and the Czech Republic signed a landmark accord on Tuesday to allow the Pentagon to deploy part of its widely debated antiballistic missile shield on territory once occupied by Soviet troops.

The accord, the first of its kind to be reached with a Central or East European country, was signed in Prague by Secretary of State Condoleezza Rice and her Czech counterpart, Karel Schwarzenberg, despite strong opposition from Russia. It also needs to be ratified by Czech lawmakers, many of whom oppose it.

Russia warned on Tuesday that the accord could lead to a military response, which the Kremlin had previously threatened but never specified.

President Dmitri A. Medvedev and his predecessor, Vladimir V. Putin, who is now the Russian prime minister, have told the United States that the Kremlin sees a missile shield in this part of Europe as a threat to Russian security. Mr. Putin has said it could even lead to a new cold war.

But American and Czech officials said the system's radar component, to be stationed south of Prague, would defend the NATO members in Europe and the United States against long-range weapons from the Middle East, particularly Iran.

"Ballistic missile proliferation is not an imaginary threat," Ms. Rice said Tuesday after meeting with the Czech prime minister, Mirek Topolanek. She said Iran continued to work toward a nuclear bomb, along with long-range missiles that could carry a warhead.

Ms. Rice is on a European tour that includes Bulgaria and Georgia, but not Poland. The United States hopes to base 10 interceptor missiles there, but the governments in Warsaw and Washington have so far failed to reach agreement on the terms.

Unlike the Czech Republic's government, the Polish center-right government led by Donald Tusk has taken a tough negotiating stance. In return for hosting the interceptors, Poland has asked the United States to modernize Polish air defenses so that the country can defend itself against incoming short-range and medium-range missiles....

[China!]

[Farrar]

Winslow R.

Ever since I've been hanging around this blog, you've been suggesting that Fed windows be opened to individual borrowers:

"The Winslow way - Avoid bank bailouts by shifting Fed policy directly to the American public. Allow the monetary transmission mechanism to gain traction by loaning directly to American citizens. Allow American citizens to mortgage their citizenship. Allow increased limits/reduced rates for education, and renewables. Side benefit is the removal of the bank monopoly on Fed access."

You haven't had much response, and I empathize, largely because nobody likes my good ideas either. My immediate reaction was to the Winslow way was, who the hell even knows where to find a Fed branch, so how would that help?

In fact, what you are actually proposing if implemented would be something much bigger than opening up a Fed window.

Thanks to your persistent posts, I began to think about it and realized that what you are actually recommending is THE NATIONALISATION OF THE BANKING SYSTEM or at least a significant part thereof. Thus your idea coincides with one of my pet ideas and I begin to pay more attention. Not that either idea risks being implemented in the present ideological climate, but admit that by using the word "nationalization" we are bound bound to draw more attention - pro or contre.

[kharris]

DickieL,

In this world, there are some ideas you are not allowed to have. This world being the one with anne in it. Your initial construction - "I don't see..." - was clearly not a statement of fact. It was clearly offered as a personal view. Then anne called you a liar. Logically, that could only be true if you do not hold the view you claim to hold. But no matter. anne's role in the world is to be what she claims to hate. Any disagreement with China, no matter how well reasoned or congruent with the historic record, is given the full Cheney treatment - attack the thought and the thinker.

anne has been writing on blogs for a long time. The poisonous, sheiking, relentless thing we face these days has developed over the past couple of years. Best to ignore her since admission of error is not part of anne's behavioral repertoire.

[Winslow R.]

Farrar wrote: "THE NATIONALISATION OF THE BANKING SYSTEM or at least a significant part thereof."

While thanks, I think, I'm not proposing the nationalization of the banking system. What is frustrating to see are proposals to 'reregulate' a broken financial industry transmission mechanism without a major redesign. Bernanke is tinkering, but where are the redesigns proposed by academics?

I am proposing a redesigned monetary transmission mechanism.

CURRENT TRANSMISSION

Fed funnels policy through a small cabal of highly leveraged financial players which tends to create bubbles as they race to approach a zero capital/loan ratio in pursuit of private profits.

Any small disturbance in asset prices (less than 3% currently) then causes the system to come crashing down resulting in socialized losses.

PROPOSED TRANSMISSION

Replace the Primary Dealers with American Citizens. No more highly leveraged financial system. Give Americans the ability to leverage their citizenship at the Fed who's citizenship value depends on the proper functioning of government.

Banks, even international banks, would still have access as well though no longer would they have monopoly access.

[roger]

Actually, nationalisation of bank debt has already occurred. Imagine for a second that GM was treated the way the Fed is presently treating the banks - that is, the government loaned GM money at below par prices in order to loan that money back to the U.S. at normal prices. Meanwhile, the government would accept, "as collateral", all unsold SUVs and Trucks GM happened to have on hand.

This might or might not be a bad idea - I happen to think that rescuing the American car industry and using that rescue to make major changes in car technology would be a good idea. But it is an idea that, naturally, would be debated in Congress. It is something that would certainly be all over the papers.

Which, of course, isn't true about the Fed and the banks. Most Americans do not know that the Government is playing a game to keep banks afloat, and that essentially money is making a disguised route from the taxpayer's pocket to the bank's profit column. In return for which, taxpayers get - lobbying from the banks for less regulation. A wonderful bonus structure for Harvard business school grads. Or, pretty much what the peasants of France got supporting the nobility in the eighteenth century. Nada.

[Dickeylee]

I don't begruge Anne one bit on her views. Her remarks about how China has transfored itself into an economic powerhouse and raised up it's standard of living over the last 40 years are spot-on, it is astounding. But read some history of how Mao, and then his wife, used brute force and pure evil to crush their own countrymen. Or look back to just the 80's and the tanks rolling into the Capitol to put down that uprising. China cannot allow Tibet to believe in a spark of freedom that they cannot control 100%, period. It would be very dangerous to their central control,and maybe the unity of a country that speak's dozens of languages.
They may not need tanks this time, but a couple more divisions placed out on the frontier might do the trick.

[hari]

@ Dickeylee - You're full of b.s. on mainland China.
Either you know the history of Chinese Communist Revolution or you don't. So, I'd shut up for your type of ignorance.

Pls don't try to imitate propaganda which has no place in this thread and our good host, as far as I know.

I could tell you of Martin Luther King and FBI attempt to not only kill him but eliminate his nonviolent movement in the south.

You don't have a monopoly of virtue on your side to call other's stupid and bad names - just because you dislike or hatte their culture or religion.

[hari]

Recall...a revolution is not an invitation to a picknic.

It's a violent overthrow of a social system.

Basta!

[Ex-Worker]

This is non-sense conspiracy talk.

The best thing for the Republican's is to lose this election, while keeping the filibuster to prevent the most egregious left-wing proposals from becoming law. 2010 and 2012 will be sweeps.

Repubican's need to hit reset and regroup. They had their chance and blew it on Terry Schiavo, Iraq, and corrupt. They need to be punished by voters until they find a new way.

Voters will only come back when they realize that the leftist agenda is not in their interest, at least if they work in the private sector. Maybe Obama/ Congress will prove me wrong, but I suspect he will pursue a dogmatic leftist agenda resulting in a depressing return to the late 70's.

Young people who will overwhelmingly back Obama, need to learn the hard way that the 1970's were a drag and that the moderate market-friendly Clinton regime, checked by a prudent Republican Congress, is not what they'll get here.

[Dickeylee]

Wow Hari, sure didn't mean to insult your blessed cultural revolution or anything. While I'm apologizing to Mao, should I also say I'm sorry to Stalin also? And Pol Pot? No picnic their, either! Say hello to Fidel for me, will you?

[anne]

"While I'm apologizing to Mao, should I also say I'm sorry to Stalin also? And Pol Pot? No picnic their, either! Say hello to Fidel for me, will you?"

Rubbish, but keep right on trying to improve on the lying.

[anne]

Jamie Galbraith:

"The second threat, not often mentioned, is our reckless foreign policy, including the invasion of Iraq, bellicosity toward Iran, and the ongoing subtext of hostility toward China."

[BJ Feng]

The Chinese government has spent trillions of Yuan to improve conditions in Tibet. Unfortunately, the incredible economic growth of China's coastal provinces have outmatched the government spending efforts in Tibet. But it's not from a lack of trying. Tibetans are free to practice their religion and culture in anyway they want to as long as it does not call for the overthrow of the State. This policy is pretty much standard around the world. Can Hawaii declare independence? Can Virginia and The Carolinas leave the Union? Tibet has been part of China for far longer.

Ex-Worker is right, the Republican Party of today is nothing more than Democrat-lite. Most are a bunch of cowards who are too afraid to stand up and make a case for limited government, lest they receive criticism from the media.

[Dickeylee]

Gee, and I thought that the Carolina's had been part of the Union since the 1700's? With Tibet, they were over-run by Mao in the 50's-1950's. So BJ, should we let Russia re-take controlling influence of Poland?

[anne]

http://www.nytimes.com/2008/04/13/opinion/13sperling.html?ref=opinion

April 13, 2008

Don't Know Much About Tibetan History
By ELLIOT SPERLING

Bloomington, Ind.

FOR many Tibetans, the case for the historical independence of their land is unequivocal. They assert that Tibet has always been and by rights now ought to be an independent country. China's assertions are equally unequivocal: Tibet became a part of China during Mongol rule and its status as a part of China has never changed. Both of these assertions are at odds with Tibet's history.

The Tibetan view holds that Tibet was never subject to foreign rule after it emerged in the mid-seventh century as a dynamic power holding sway over an Inner Asian empire. These Tibetans say the appearance of subjugation to the Mongol rulers of the Yuan Dynasty in the 13th and 14th centuries, and to the Manchu rulers of China's Qing Dynasty from the 18th century until the 20th century, is due to a modern, largely Western misunderstanding of the personal relations among the Yuan and Qing emperors and the pre-eminent lamas of Tibet. In this view, the lamas simply served as spiritual mentors to the emperors, with no compromise of Tibet's independent status.

In China's view, the Western misunderstandings are about the nature of China: Western critics don't understand that China has a history of thousands of years as a unified multinational state; all of its nationalities are Chinese. The Mongols, who entered China as conquerers, are claimed as Chinese, and their subjugation of Tibet is claimed as a Chinese subjugation.

Here are the facts. The claim that Tibet entertained only personal relations with China at the leadership level is easily rebutted. Administrative records and dynastic histories outline the governing structures of Mongol and Manchu rule. These make it clear that Tibet was subject to rules, laws and decisions made by the Yuan and Qing rulers. Tibet was not independent during these two periods. One of the Tibetan cabinet ministers summoned to Beijing at the end of the 18th century describes himself unambiguously in his memoirs as a subject of the Manchu emperor.

But although Tibet did submit to the Mongol and Manchu Empires, neither attached Tibet to China. The same documentary record that shows Tibetan subjugation to the Mongols and Manchus also shows that China's intervening Ming Dynasty (which ruled from 1368 to 1644) had no control over Tibet. This is problematic, given China's insistence that Chinese sovereignty was exercised in an unbroken line from the 13th century onward.

The idea that Tibet became part of China in the 13th century is a very recent construction. In the early part of the 20th century, Chinese writers generally dated the annexation of Tibet to the 18th century. They described Tibet's status under the Qing with a term that designates a "feudal dependency," not an integral part of a country. And that's because Tibet was ruled as such, within the empires of the Mongols and the Manchus. When the Qing dynasty collapsed in 1911, Tibet became independent once more.

From 1912 until the founding of the People's Republic of China in 1949, no Chinese government exercised control over what is today China's Tibet Autonomous Region. The Dalai Lama's government alone ruled the land until 1951.

Marxist China adopted the linguistic sleight of hand that asserts it has always been a unitary multinational country, not the hub of empires. There is now firm insistence that "Han," actually one of several ethnonyms for "Chinese," refers to only one of the Chinese nationalities. This was a conscious decision of those who constructed 20th-century Chinese identity. (It stands in contrast to the Russian decision to use a political term, "Soviet," for the peoples of the Union of Soviet Socialist Republics.)

There is something less to the arguments of both sides, but the argument on the Chinese side is weaker. Tibet was not "Chinese" until Mao Zedong's armies marched in and made it so.

Elliot Sperling is the director of the Tibetan Studies program at Indiana University's department of Central Eurasia Studies.

[hari]

I think Elliot Sperling needs to be re-educated in the history of The Roof of The World. Why not try and find the definition of the MacMahon Line acroos the Roof of The World, as defined by British Empire and Zarist Russia. It would allow you to see (at least) de facto that current day mainland China included the Mongols and Tibetans and other non-Han nationalities under the Manchu Dynasty.

For official Chinese history, suggest you view their Tibet history blog under People's Daily.

[Francois]

We can argue ad nauseam about China and Tibet, but one fact is pretty clear: there are systematic human rights abuse in Tibet, and said abuses are not the making of the Dalai Lama.

History and its multiple versions is not an excuse for violating human rights.

And I repeat what I wrote in a previous post: denouncing human rights abuses has nothing to do with hate, bashing or partisan ideology. When it happens, it must be said. It is not an in toto condemnation of the Chinese nation, its culture or its people. It is a condemnation of the actions perpetrated by a government upon part of its people.

[anne]

"WTF? Denouncing human rights abuse is tantamount to hate?

"The Soviet propaganda machine pulled that one for decades to try to make us, (the West) STFU.

"We didn't! And won't do it this time around."

Complete foul mouthed idiocy, but do keep trying.

[anne]

"I don't see China waiting until December to squash Tibet. Right after the Olympics, and before the brutal Tibetan winter sets in, they'll go to it. And they will dare us to do anything about it, holding out our Treasuries-and our Dollar-hostage."

Here was the comment, and the comment had nothing to do with truth or human rights, but only to do with denouncing China.

[Dickeylee]

OK, OK, China can do to the Monks in Tibet whatever they deem fit. I'm sure that the truth about whatever happens to them will be fine by ----.

[anne]

Meetings between Tibetan and Chinese leaders were scheduled and delayed for a time because of the earthquake emergency, but there have been meetings held in recent days and meetings will continue between Tibetan and Chinese leaders. So, the Dalai Lama and representatives are currently being negotiated with over the range of rights of Tibetans, which is precisely what was hoped for.

[anne]

The Dalai Lama has long sought political self-rule of Tibet as a part of China, and that position is reasonable and seemingly practical and can easily be supported by other governments giving support to Tibetans with no offense to China as an entity. There is no reason that as relations between Taiwan and China have been improving, the same could not be expected for Tibet and China.

[Lafayette]

Big time

Dl: And (the Chinese) will dare us to do anything about it, holding out our Treasuries-and our Dollar-hostage.

Good analysis.

The Chinese are going to be a major threat to world order, not by massing armies on any border, nor by tossing ballistic missiles into the Sea of China. But by using their commercial leverage as everyone runs towards the new el dorado.

And by using Uncle Sam's chronic debt and squeezing his balls. They've just told President Sarkozy that it was correct for him to assist at the Olympic opening ceremony, but that he shouldn't be greeting the Dalai Lama on his European tour! (Germany's Merkel has refused to go. Britain's PM is in a dither about it.)

Watch Bush's kiss-ass Smiley Face show up in Peking for the ceremony.

Where was American "leadership" when this was in the making, since the early 1990s? Self absorbed in the glory of a wealth generating dot.com boom that busted and Billy-boy who sold out Glass-Steagal to fund his wife's long-planned presidential campaign. Only to be followed by a lead-head presidency indebted to BigOil.

This is the World's Greatest Democracy? No, this is a country that has been sold down the river.

Big time.

[Lafayette]

anne: Enough hating China, enough!

Enough will be when the last Tibetan is chained to a dungeon wall.

Seed the wind ... and reap the whirlwind.

[Dickeylee]

The China/Tiawan -vs- China/Tibet comparison is a good one. One hopes that China is in fact changing from it's previous ways.

[Lafayette]

Dl: One hopes that China is in fact changing from it's previous ways.

There is no sign whatsoever of this.

We must understand a bit of sinology. The Chinese measure time in terms of centuries, not decades, not years, not tomorrow or the day after tomorrow. And, certainly not nanoseconds.

They will talk, talk, talk .... until we are bored silly (and hopefully forget what the subject is about). Communist China is run by unelected Mandarins, an elite set of bureaucrats that go back centuries. They are encrusted in power, just as they were under the ancient emperors of China, and act in a painstakingly slow decision-making fashion.

These Modern Mandarins of today's China see no need whatsoever to devalue their currency except in a token manner, nor surrender Tibet that they feel is part and parcel China's, nor adhere to Western Democracy that would effectively confront their privileged status.

They are going to present to us one helluva problem, because they think the world is Their Oyster now. Who's telling them otherwise? Especially with the upcoming Olympics?

These guys only understand one language, called RealPolitik.

[hari]

During the Middle Kingdom, the neighbours came to pay their political respect to the Chinese Emperor with magnificient gifts (including fine horses from Caucusus mountains).

Today, the Marquis is glib but more or less disgusted how Sarkosy flip-flopped on (going or not going) Olympic Opening Ceremony.

Remember ceremonies are still as important as in olden times under the Middle Kingdom! Those leaders who renag and don't show up will eventually face the wrath of the Forbidden City.
No more FDI and what nots....

[Lafayette]

hari: Those leaders who renag and don't show up will eventually face the wrath of the Forbidden City.
No more FDI and what nots....

Sarkozy isn't reneging. He never pronounced on whether he would go or not. Now he has said he will go. Brown is reneging; he said he'd go and now is looking for an escape door. (I'm sure this was all worked out between them in Japan this week.)

Sarkozy took a beating, in person, in front of the entire European Parliament, when Daniel Cohn-Bendit (a German Socialist but of French nationality as well) accused him of pandering to the Chinese. Sarkozy just smiled and listened. Not much he could do, one might say.

It is sufficient that a number of European leaders are not going for the opening ceremony ... and if they will be "punished" with lesser FDI, who cares?

The Chinese are using tactics from the 18th and 19th centuries. One would have thought they evolved. Apparently not.

Not but a decade ago a Very Popular book in Japan was, "The Japan that Can Say No". Does anyone think Japan can say No! nowadays?

No.

[hari]

Marquis - your sympathies (I assume) for old Russia would remind you of the kitchen debate between Nixon-Kruschev and later with Breznev -> Nixon was actually pandering to the Politburo because he wanted a deal on weapons delimitation and peaceful co-existence.

In China, he delivered more than that with Mao and Chou en-Lai. These guys today cannot reach Nixon's capacity at power politics.

I've lived in the Forbidden City - as an official guest - and was really spoiled by their constant offer of green tea!

[Lafayette]

hari: I've lived in the Forbidden City - as an official guest - and was really spoiled by their constant offer of green tea!

Every man has his price! 8^)