As the New York Times has noted in an email this morning:
China has suspended exports of certain rare earth minerals and magnets that are crucial for the world's car, semiconductor and aerospace industries. The move is in retaliation for President Trump's sharp increase in tariffs.
The metals and the special magnets made with them can now be shipped out of China only with special export licenses. But Beijing has barely started setting up a system for issuing the licenses. Industry executives said that supplies of minerals and products outside the country could run low.
This is the obvious response to Trump's tariffs on their part.
There are items such as these where China has an absolute advantage over the USA. This is not a competitive advantage, per se. It is an absolute advantage because it has what the US needs, and the US has none of it. More than that, the US has no choice but to buy this stuff, because in the modern world of deeply integrated supply chains creating exceedingly complicated products, production processes will grind to a halt with major consequences within the USA itself.
China has struck at the US Achilles heel. It is not imposing tariffs by doing this. It is simply refusing to sell. This is the ultimate transactional rebuff to a President who thinks himself entirely transactional. There is no transaction to make if China chooses not to take part in the process, as it is signalling it might do.
Of course, there is a cost to China from doing this. But it is not high. After all, these minerals can be sold by it later. They will not go off. It might lose cash flow, but it does not need that. What it wins is near-total strategic advantage.
Trump did not, very obviously, see that one coming. He has been well and truly outmanoeuvred here. Keep this up for a few months, and the US will be doing whatever China demands. It's an issue that has been discussed on this blog and in comments to it before. So why didn't Trump know this might happen? Maybe he really is a bear with a very small brain.
His latest medical might say Trump's fit to be President and not impaired in any way. But maybe he never had the capacity to do this job. That's just a thought. Unless you can see the big picture, you cannot govern. Trump does not have that capacity. The UK is riddled with politicians of that ilk. It's a skill our education system does not teach or encourage. No wonder we're in a mess.
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Mango can hardly string a coherent sentence together, far less do strategic or critical thinking. Not only has he been outmaneuvered by China, he has actually bolstered them.
It was obvious that China would withhold these materials / goods and equally obvious Mango would have to do a climb-down on the tariffs if he didn’t want to cause huge increases in iPhones, etc.
It is quite astonishing that anyone would vote for him far less for anyone to think that he is doing anything even remotely well. The crowds for Bernie Sanders and AOC suggest his crass stupidly is becoming evident.
Strangely, performative “progressives” like Sanders and AOC gather crowds between elections, but retire behind the massed ranks of the neoliberal-supporting Democrats during them. Nobody is allowed to actually vote for real democratic socialism when it matters.
Thank you and well said.
Black Agenda Report has this to say about the sheep dog Sanders: https://www.blackagendareport.com/bernie-sanders-sheepdog-4-hillary.
They have this to say about Cory Booker: https://www.blackagendareport.com/cory-booker-confused-liberals-obamas-reappearance-and-dangers-fake-movement.
Thank you and well said.
Further to the pair, this is what Black Agenda Report had to say: https://www.blackagendareport.com/bernie-and-aoc-sheepdog-democrats.
AOC used to work a for a tech firm, not American, that produces surveillance software and may well conduct surveillance as a contractor. It has long been thought that she’s a plant.
Are you sure that’s right?
And I seriously doubt she is a plant. But we can differ sometimes.
In response to Col Smithers & AOC – as far as I can see (perhaps I did not look hard enough) she does not seem to have worked for a software company. Perhaps as an internship?
As a former business partner once said to me: “Mike never educate a c..t”.
Thus, working on the basis that to work for the USM(ango) gov one needs to be literate, I will not give the game away.
The USM does hold one erm… trump card which relates to the semiconductor ind’ & there is no “work-around” wrt this card. None. I rather doubt that the chimp-in-chief & his acolytes are aware of this card & I have no intention of revealing it here. Furthermore, I suspect, the Chinese (@ politburo level) might not be fully aware of this – very much “devil in the detail” sort of thing. My guess is that USM will enter a period of civil unrest & the EU will pivot towards China. Which leaves Ruzzia. The Chinese have already taken a slice of Ruzzian territory on the Amur river. Further acqusitions will follow & it would not surprise me to see lumps of Ruzzia falling into the Chinese orbit – an orbit which they used to follow – pre-17th cent. Apologies for being slightly off-topic. (If you want a 1st hand account of Ruzzian-Chinese attitudes on this border: Amur – by Colin Thuberon (2020).
Agree.
Trump and his ilk exist because western thinking is linear, not circular. So, ‘tariff’s are beautiful!’
So true the education system is designed so we don’t join the dots, we’re not supposed to see the big picture.
Gregory Bateson, from Cambridge, an epistemologist and internationally known systems thinker, who saw our problems being within systems and relationships – non-duality thinking. But his work and contribution almost unrecognised here. I often wonder why.
I suspect the British Government’s invitation to China to help build Hinckley Point means it will now be suffering buyer’s regret. The folly of neoliberalism is nowhere more glaring than allowing China to takeover our critical infrastructure.
Allow me to be clear. I respect China. It is the oldest continuous civilisation in the world (around 4,500 years). Historically Zhōngguó (Pinyin), (中國) two ideograms that transliterate into the ‘Central Kingdom’. The rest of the world China considered ‘barbarians’. In 4,500 years, not one day was lived in a democracy. China establishes its own dynastic rules; the modern Communists are a Party Dynasty. Unlike Europeans, the Chinese did not seek to conquer the earth; locked within a Confucian world for centuries it allowed the modern world to pass it by, until Europeans, especially Britain brought aggression, technology and modern military force; not even to turn China into a colony, but a slave market for the British Imperial Drug Cartel to turn China into a desert. Britain (and France) fought two Opium Wars (1840s, 1850s) to force China to bend to the Cartel. Unsurprisingly China learned some hard lessons. Eventually it turned to Marxism to overcome Chinese Imperial paralysis , after the fall of the Manchu dynasty in 1911.We still learned nothing.
In the late 1980s/90s, a very British Daily Telegraph journalist, Peregrine Worsthorne did a grand tour of China (which opened itself to foreigners after the rise of the remarkable Deng Xiao Ping). In his series of articles, Worsthorne decided that the only mistake modern Communist China had made, was abandoning the culture of Confucius. This is one of the stupidest comments ever made about China. Only a country with no standards at all could draw that conclusion. Here is the Britain the Confucian Chinese saw in the 1930s. Great entrepot cities like Shanghai in the 1930s were divided into European/American “concessions”; prosperous sectors controlled by the imperial powers. The British Consulate in Shanghai, near the racecourse (for Europeans) had beautiful manicured lawns, running down to the grand entrance. There was a sign posted on the lawns: no dogs or Chinese allowed.
The young Chinese intellectuals at Beijing University, 1920s-30s, like Li Ta-Chao and Mao Ze dong, as well as Zhou En-lai became Marxists as the only way to overturn Confucionism. The Western Powers and Capitalism, viewed from a Chinese perspective of a century of abuse from States operating as drug dealers, undermining China was the problem; not the answer.
I understand the Chinese perspective: never, ever again. That is not a reason to allow the modern Chinese Superpower, that is a Communist State that has learned that Capitalism has no standards and can be used without commitment to “free markets” (they do not exist); there are always special advantages. Our idea that free trade means free markets is false. There are no free global markets. There never were. States have interests.
“ I respect China. It is the oldest continuous civilisation in the world (around 4,500 years).” Respect is due, but China has had its ups and downs during this period. Eg, it was taken over/ruled by the Mongols for a while. Excellent history of this here (and the subsequent episode): https://podcasts.apple.com/gb/podcast/fall-of-civilizations-podcast/id1449884495?i=1000679227305
I am struggling to grasp the real significance of your point. Genghis Khan’s period was less than 100 years, out of 4,500 years. You appear to be using the wrong measure of time, and the wrong measure of significance. The civilisation and language of China were continuous, and survived lots of invaders and revolutions; and even endured a nineteenth century of European and American belligerent interference China detested, but was powerless to stop.
The Manchu were invaders (The Great Wall underscores the nature of an intractable problem). The point you miss is that China always, sooner or later took over the invader. The invading Manchu (Qing Dynasty, 1644-1912) kept their tents for ritual celebrations of their supposed nomadic warlike distinctiveness, but they disappeared into the overwhelming power of Chinese culture, and the Forbidden City. China always takes the long view; a civilisation of its resilience knows how to survive. Xi Jinping speeches tend to emphasise ‘patience’ and prosperity being ‘a long term mission’. The Belt and Road Initiative, a centrepiece of China’s strategy was begun in 2013, as part of the intention to develop a global community with a shared future; but on terms that advances and protects China’s interests. Japan invaded China in the twentieth century. Following the end of WWII, visiting Japanese intellectuals apologised for Japan’s invasion: Mao Ze Dong crisply remarked; “if it wasn’t for Japan, I wouldn’t be here”. Meaning it was China’s fight against Japan that brought the communist Party and Mao to power.
My fear is that this leaves President Trump no option but to either invade and capture Green Land or Ukraine to obtain the rare elements that his very rich friends and the US defence industry desperately need.
Scary….
“invade and capture Green Land or Ukraine”
Ruzzia is trying that right now & it is not working out well.
Mango-man hopes to do a deal with Ukraine for rare-eaths and gas (Ukraine as a fair bit) which he will sell to … the EU.
Mango-man the ultimate middle-man profiting from both sides – his modus operandi – always.
Apologies for posting again. This was the quasi-official Chinese response on Channel 4 News to the tariff war:.
https://www.youtube.com/shorts/Xof9FwrCrsg
One does hope that Mango-man sees it & blows a gasket.
Victor Gao, CPC mouthpiece who’s spent most of his adult life living in the West
This was all too predicable. Indeed I think we did discuss it some months ago.
The difficulty is that China currently has a dominant position in the production many critical materials. Not just so-called rare earth but lots of other more mundane and basic resources. It is not that it can’t be done elsewhere but the capacity does not currently exist, and setting up mines and processing and production supply chains takes time and money. Of the order of many months to years and many millions to billions.
Does the US and its allies (if any remain) want to invest to duplicate international supply chains with domestic ones, in a way that will be more expensive but more secure?
Andrew, I know I keep harping on about this, but remember that we have the second largest known worldwide deposit of Tungsten in Devon. OK, there are other rare earths, but at least we have that in UK.
Richard, rather unusually this article of yours had me laughing out loud! (I’m more usually weeping and tearing my hair out. Winky face)
I love your description of Trump: “Maybe he really is a bear with a very small brain.” This felt very appropriate to me since it’s my elder daughter’s Birthday, so to greet her this morning I WhatsApped her the quote of the card Pooh Bear sent to Wol – Hippy Pappy Bthdy Bthday. (I hope I got that right! – Can’t find the books to check since we moved here over 10 years ago!)
As to Trumps medical conditions, I read somewhere (I’m sorry, I can’t remember where) that his docs are recommending he has another colonoscopy. I hope he “enjoys” the pre-test medications etc etc…
Trump is on Sky TV News right now, sitting on his gold coloured upholstered chair with the President of El Salvador. Urk.
Irk, indeed.
Indeed, Maggie. Tungsten West has spent millions since 2019 trying to get Hemerdon back into production. It might start producing ore in 2026. Until then …
And you also need the plant to process the ore into metal.
And that is one metal. China produces about 80% of the world supply of tungsten currently. It also has leading positions in other key elements – gallium and germanium, indium, tellurium and bismuth, and antimony, cobalt, nickel. Often it produces more than half the ores, but process up to 90% into the metal.
As I understand it South Crofty is being dewatered again for tin production, but that is a multi-year project, and the water is polluted so needs to be stored and treated. None of this is easy.
Perhaps a better way to look at King Donald` is look to Brexit.
Recognise the immigrants taking our jobs, our borders are open to mass illegal replacement of the locals, take back control, a hard Brexit, we will never said that it would be rosy, there will be pain, who cares if it wrecks the economy?
The rabid support of the media, huge amounts of money spent to achieve the result.
The wrecking of the health service and social security system
Carefully keeping quiet about who shipped the jobs out of the country in the first place? Oh, the economic and financial elites to maximise profits.
The average King Don supporter is super behind him because they believe the rhetoric not the reality.
The farmers do not expect to lose their federal subsidies. Last time King Donald poured in$23bn to keep them happy. Expect the same again.
The jobs are not coming back to the USA and/or the UK.
King Donald goes will there be change? Not likely. Look at just like Trump Keir and LINO.
China will sit this out, taking the long view.
There are no easily accessible rare earth metals in Ukraine.
Will the USA take Greenland? Who knows. The rare earths are under an awful lot of snow/ice and no one has yet mastered the techniques to extract them in such conditions.
Will it all end badly? Most probably.
Thank you, Richard.
With regard to AOC, she’s like Wes Streeting. This is what I meant. Grooming for the role of controlled opposition was also implied. The word was not used. An American explained, so unlikely to know the British context.
I read recently that Mr Carney of Canada has been quietly organising the sale of US Bonds, with Japan and the EU, as a response to Trumps idiocy. This is another pillar in the way to control the US administration’s excesses. Along with China withholding materials and Canada also threatening to stop energy and materials perhaps the adults (if any) might control the Toddler in the White House who is a puppet for a much darker project.
Here’s Trump talking about China. He also refers to having the most powerful weapons in the world…
https://live.solari.com/w/94vrDQQ9wXSPH7agdSgC8E