A combination of the NAFTA “Fatal Flaw” & transnational Chinese shipments, was always at the heart of President Trump placing steel and aluminum tariffs on Canada and Mexico during negotiations that culminated in the USMCA trade agreement.  The goal was to block China from dumping product into the U.S. through the doors of Canada/Mexico.
Within the USMCA President Trump and Robert Lighthizer placed a specific rule Article 32:10 which grants the U.S. the right to veto (control) Canadian and Mexican purchase agreements with “Non FTA Market Countries”, ie. China.

This Article 32:10 rule is at the core of the USMCA agreement.   However, after the USMCA agreement was reached President Trump kept the Steel/Aluminum tariffs in place.  For those who don’t understand Trump (insert Chrystia Freeland here) the question was always: why?
Quite simply the answer behind the question was President Trump’s retention of leverage. Yes, in 2018 the USMCA was agreed to; however, the USMCA was not ratified by either Canada or Mexico…. it was only an agreement.  Why would Trump remove critical leverage on an initial promise.
Trump is not a politician; he’s a businessman who knows promises are paper until they become action. Additionally, President Trump is a tactician; the tariff leverage was held until such a time as removing it would generate an immediate gain in national compliance toward his trade objective… That’s the action.  Today:

(Bloomberg) President Donald Trump said the U.S. will lift steel and aluminum tariffs on Canada and Mexico, boosting efforts to encourage lawmakers to ratify a new North American trade deal.
“I’m pleased to announce that we’ve just reached an agreement with Canada and Mexico and will be selling our product into those countries without the imposition of tariffs or major tariffs,” Trump said at an event Friday. “Hopefully Congress will approve the USMCA quickly.”

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Funny how that happens. Less than 24 hours after President Trump declared new tech telecommunication is a national security issue; and one day after Secretary Wilbur Ross bans Huawei (and affiliates) from buying parts and components from U.S. companies without U.S. government approval; all of a sudden the UK is having second thoughts.
…Huh, go figure:

LONDON (Reuters) – China’s Huawei poses such a grave security risk to the United Kingdom that the government must not allow it to have even a limited role in building 5G networks, a former head of Britain’s MI6 foreign spy service said on Thursday.
In what some have compared to the Cold War arms race, the United States is worried that 5G dominance would give any global competitor such as China an advantage Washington is not ready to accept.

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A clear example of the Administrative State’s seditious alignment with global financial interests and DC indulgences.  This is the deep state at its deepest and most statist.

Mrs. Susan Thornton, the former acting assistant secretary of state in the Trump administration, tells her Beijing audience to stop negotiating until President Trump is removed from office in 2020.

(BEIJING) […] “I want to be optimistic,” said Thornton, whose 27-year career in Washington ended in July. “I tell all our foreign counterparts they should keep steady, keep their heads down and wait. [They should] try to not let anything change dramatically.”
“If this skeptical attitude towards talking diplomacy continues in this administration, you might have to wait till another administration,” Thornton said at an event held by National Committee of US-China relations and Shanghai’s American Chamber. (read more)

There was a prescient article written in Politico when Thornton announced her exit from the State Department. (more…)

The overall strategery here is brilliant.  After two years of rope-a-dope…. Trump exits the corner for the championship rounds in the trade fight: First the body blow, China boxed-in with trade confrontation and consequences of retreat from agreement (Mnuchin and Lighthizer);… Then whammo, the roundhouse XO placing telecom under national security review (Navarro and Pillsbury); then upper-cut, Wilburine places Hauwei and affiliates on Commerce Dept. trade blacklist…  Lions and Killers and Strategists, oh my.

WASHINGTON/NEW YORK (Reuters) – The U.S. Commerce Department said on Wednesday it is adding Huawei Technologies Co Ltd and 70 affiliates to its so-called “Entity List” – a move that bans the telecom giant from buying parts and components from U.S. companies without U.S. government approval.
U.S. officials told Reuters the decision would also make it difficult if not impossible for Huawei, the largest telecommunications equipment producer in the world, to sell some products because of its reliance on U.S. suppliers.
Under the order that will take effect in the coming days, Huawei will need a U.S. government license to buy American technology. Huawei did not immediately comment.

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Here we go….  President Trump is laying the groundwork to ban telecommunication companies based on identified risk to national security (ie. Huawei).  Nations who engage in 5-G technology agreements are on notice they may be cut-off from communication partnerships with the U.S.A.

[I think Wall Street just pee’d their pants a little..]

[Executive Order] By the authority vested in me as President by the Constitution and the laws of the United States of America, including the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.) (IEEPA), the National Emergencies Act (50 U.S.C. 1601 et seq.), and section 301 of title 3, United States Code,
I, DONALD J. TRUMP, President of the United States of America, find that foreign adversaries are increasingly creating and exploiting vulnerabilities in information and communications technology and services, which store and communicate vast amounts of sensitive information, facilitate the digital economy, and support critical infrastructure and vital emergency services, in order to commit malicious cyber-enabled actions, including economic and industrial espionage against the United States and its people.
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Good discussion between Tom Friedman and Steve Bannon on the ‘big picture’ of the U.S. -vs- China geopolitical trade confrontation.   Friedman is an insufferable prog on methods, but he recognizes the President Trump approach is necessary.  Worth Watching:

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Where academic Friedman is helplessly naive is on the key point of how a coalition approach toward China is a pipe-dream.  When it comes to economics each entity has unique self-interests.  Put fifty self-interested governments together (ie. TPP) and you end up with paralysis of analysis and no action; as each entity fights to hold their own interest over the group interest….. While China grows in the background.
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Curtis Ellis was special advisor to Secretary of Labor Acosta in the Trump administration. He is now an outside government advisor to America-First Policies, an unaffiliated economic advisory board and advocacy group. In this video Ellis walks through the big picture behind the U.S. -vs- China Trade confrontation.

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Good China -vs- Bad China

Michael Pillsbury discusses the ongoing U.S-China trade negotiation and notes the internal dynamic within China as their primary negotiator Vice-Premier Liu He was stripped of his title: “Special Envoy of Chairman Xi Jinping”.

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Earlier this afternoon President Trump welcomes Hungarian Prime Minister Viktor Orbán to the White House for bilateral discussions.  During an oval office press availability both leaders answered questions from the media. [Video and Transcript]

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[Transcript] Oval Office – 2:14pm EDT – PRESIDENT TRUMP: Thank you very much. It’s a great honor to have with us the Prime Minister of Hungary. And Viktor Orbán has done a tremendous job in so many different ways. Highly respected. Respected all over Europe. Probably, like me, a little bit controversial, but that’s okay. That’s okay. You’ve done a good job and you’ve kept your country safe.
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President Trump is executing one of the most brilliant geopolitical economic resets in the history of global trade. It really is stunningly remarkable how President Trump has controlled the entire landscape. The consequential phase now begins.
It is fascinating how the financial pundits didn’t see this coming. Perhaps one of the best indicators of where things are today comes from this quote within the South China Post:

“The Administration’s Section 301 tariffs and China’s retaliatory tariffs will now further disrupt – or even break – many thousands of supply chains in both countries.”
[Nelson Dong, a senior partner at Dorsey & Whitney]

The quote by Nelson Dong is stated *as if* shifting/breaking supply chains is a flaw in the approach. It’s not. Exactly the opposite is true; this is a feature of the strategic reset.  A specific and purposeful feature designed by President Trump.
What Dong is predicting is the deconstruction of “one-belt, one-road”.
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