Some Observation of US-China Trade War

The US-China trade war has been the highlight of 2018. In the long months of marathon like difficult negotiation, facing the tremendous confrontations domestically and internationally, both presidents demonstrated great sensibility and containment. I certainly feel both presidents are very good in downplay the intensity, just as the Chinese proverb that says, the wiser may appear like dummy (大智若愚).

The essence of the conflict reflects different social values of the two countries as inherent from their social and governmental structure.  At a time when nature resource is running low, when globally most nation still suffer more or less from the 2008 financial crisis, when huge debt triggers government printing machine to reduce consuming power, the need for economic of scale and efficiency of business operation is an prevalent sentiments.  As the saying goes that the whole is bigger than the parts add up together, global collaboration among the nations becomes ever pressing issues of our time. 

The acceleration of technology advancement brings both capability and challenges that requires more global standards and arching administration body to keep up the regulation.   Just like the case of environmental protection, we believe that there is great urgency to establish some sort of global governance for the public good/common welfare for the earth people. In line with that thought, potentially there are more that can be done to ease the trade/relation conflict,  in addition to whatever is already put on the table.  Here are some more ideas for the sake of thinking out of box.

Potentials for Chinese to Request from USA

1. Special work visa of certain period of time to allow Chinese doctor to come to America, thus address the problem of not enough doctor and overcharges of doctor association.  Maybe Chinese medical institution should be allow to operate in America to help more people to provide competition for low cost get medical treatments.  In the same token, the nursing home is very expensive, Chinese nurses should be allowed work visa to work in the field in America.  There is huge space to cut down the license fees for medical professions. 
2. There maybe an opportunity exists for Chinese and US government to collaborate in medical insurance as the pool is much bigger now to allow lower cost to the ordinary people?  There maybe cost cutting opportunity in medical travelling to China for extensive period of treatment.
3. The copyrights and patent s give the holders monopolies on technology or creative work for their duration.  Over the last four decades, a wide variety of measures have been put into law that make these protections longer and stronger. But according to Dean Baker, Co-director of the Center for Economic and Policy Research in Washington, D.C., evidence doesn’t indicate there has been any noticeable growth dividend associated with this policy.  Stronger patent protection seems to be associated with slower growth and innovation, which is not aligning well with the purpose to patent/copyrights protection.  Chinese government should be able to negotiate the length of time to observe the protection in its agreements.
4. Chinese over the counter drugs should be allow importing into USA without any tariff to cut down medical costs.  The same would be the case with various medical tests and treatments.
5. Teachers exchange programs is a good idea to both American and Chinese schools to connect for improvement and diversify their teaching programs and culture exposures. Similar to doctors’ labor visa, the teacher, especially more math, science teacher should be introducing to American schools. Summer camps for exchange students programs may be another good ways to cultivate language and culture exposure.
6. American Technology Company should go through the same level of regulation that HuaWei go through in exporting its products to Chinese market.  There should be global governance and regulation to protect consumers from totalitarian from the technology monopoly.  The technology company is increasingly post threat to democracy and human right.  Chinese government should have the right to renegotiate terms and restrictions of specific market territorial takeover case by case.  The Chinese government should allow their directors sit on company board and/or management team of these multinational technology company in order keep up with the changes. 
7. Technology and financial company’s profit margin is unreasonably high, and the benefits of these two line of business to the society may not warrant their extremely high return.  The Chinese government should reserve the right to regulate/adjust the payment schedule these type of virtue business as they may not produce as much benefits for the society.
8. Chinese train is a low cost and long term solution to reduce traffic pollution.  Chinese transportation model can replace airplane to cut cost.  In return, America can request Chinese to share their space exploration technology for exchange.  Chinese government should arrange the open door policy of American company in phrases. 
9. Chinese movie industry can be an enrichment to American culture, and thus there may exist a opportunity for more in-depth collaboration or even Chinese firm to come to America for production and release for profits.

Potentials for US Government to Ask from China

China has push forward globalization vigorously since the turn of the century.  But there are several process and functional areas it can improve.

1. For decades, the Chinese trade surplus is benefiting from low exchange rate of Chinese currency – RenMinBi, partly because Chinese use the surplus to purchase US bonds, and partly because RenMinBi is not circulating internationally, so it is regulated by the market force, the Chinese central bank was able to printing money and adjusting its exchange rate without much constrain.  This has caused low consumption power in its domestic market because exceeding majority of people’s wage is low.   If China truly want to push for globalization, and for the amount of trade it generate, it is only make sense to consider If China is able to allow its currency used in the world market.  This will have several benefits, including raising its living standard of the labor force, restructure its consumer base and revenue source, and enable the country to be less reliance on exporting.

• The recent drama involve the retention of HuaWei’s CFO in Canada in lieu of request from US court, because US had mutual judiciary agreement with Canada.  Then Chinese retaliated by arresting three Canadian citizens, and as China does not have a governmental structure of separation in executive, legislative and judiciary branches that most western countries do, It turn the issue to foreign ministry to handle the communication, which is neither transparent, nor legitimate in its process.  This incident epitomizes the notorious rejection of Chinese government to respect human rights in its ideology. It reflects a weakness in modernization of its law enforcement organization, and ignorance of rules and regulation regarding due processes for legal matters domestically and internationally – an important function and concept of a functional society and operation flow that is lacking for addressing conflicts and avoiding violence.  The government should publicly admit its crime in the June 4^th student protest of 1989.  The criminal cases against Falun Gong need to be opened for public hearing.  Both criminal and financial penalty need to discussed and awarded.  The lawyers who argue for the human right should be released from prison.

• As more news regarding HuaWei’s business operation come to news headline, we noticed an company culture that is put huge suppression on its employee – like many incidence of death on work, lacking of integrity in its operation.  HuaWei’s operation model is monopoly in nature, and indicates Chinese government’ is behind the company, – an act of unfair competition and inequality characteristic of China’s business environment.  Also there is no transparency in its managements.  The monopoly power should be break down to have fairness of competition or its should be put under the monitor of global governance.

• HuaWei’s corporation culture is that of extreme exploitation of labors.  This is actually reflects China’s societal-wide prevalent lacking of labor protection regulations and prohibition on labor union.  The same problem rooted in its human right issues.  There is no minimum wages, medical insurance or working hour regulations for the labors.  Government only concerns about collecting the profits and taxes but shows no love for its people.

• Worrying about the security threat from HuaWei’s product, several countries being turned down the consideration to use HuaWei’s products.   Given telecommunication products (especially 5G technology) is increasingly becoming arsenal in nature, and 5G technologies are cutting-edge upgrades in telecommunication that had wide amplification, there are legitimate concerns for the purchasing countries.  But HuaWei have done advanced research and strong in its development.  Not familiar with the particular technology and process, but we ask:

• Can the purchasing country sits in the board of directors, and get involved in management teams of producing the products they purchase?  This would provide much more transparency and comfort to the buyer.
  • Is it possible HuaWei joint effort with participating countries by providing technology and the buyer do the manufacturing themselves.
  • Alternatively, is it possible HuaWei manufacturing the product at the location in buying country? Or allow a few regional manufacturing centers locating over the world? The buying country can then heavily involving in the production to ensure safety.
  • HuaWei can negotiate agreements with these countries for allocation of profits.

• The big data government used to monitor people is a intrusion to privacy, children should not required to wear digital uniform that abuse human rights. We want to cultivate a society that is based on love respect, equality and social contract.  A state/government that demands far more from the individual than it gives is a manifestation of coercive energy, which relies on external force to maintain itself.  It regards the individual is less important than the state/government and must live to serve it.  This does not truly represent the kind of organic evolutionary energy emanate from divine’s law.  The totalitarian system that represses individual liberty is not justified at any rate.  Such a state eventually all disintegrate.  Something better must come along.