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In Groundbreaking Speech, Xi Vows To Guide China To “Incomparable Glory”, An Alternative To The US
In Groundbreaking Speech, Xi Vows To Guide China To "Incomparable Glory", An Alternative To The US
Flanked by party leaders past and future, …
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Flanked by party leaders past and future, President Xi Jinping on Sunday took center stage to present his grand vision for China, and in a speech running almost two hours, Xi let the world know that China wouldn’t change course and that by rallying around the party center - of which Xi is the core- they would be able to ride out the storms and guide the country to “incomparable glory” as China restores the country to the forefront of global powers even as he highlighted the challenges and risks faced by the country and warned party members to brace for “dangerous storms” ahead. Instead, he declared the “rejuvenation of the Chinese nation is now on an irreversible historical course” and as Bloomberg notes, forcefully offered China up as an alternative to the US and its allies as he laid out the ruling party’s priorities on everything from Covid Zero to its ambitions on Taiwan and goals for tech sufficiency.
In his 105-minute speech on Sunday, which took months to prepare and gives the president an opportunity to review past challenges and achievements and lay out his grand vision and goals for the nation, Xi highlighted the challenges and risks faced by the country and warned party members to brace for “dangerous storms” ahead. But by rallying around the party center, of which Xi is the core, they would be able to ride out the storms and guide the country to “incomparable glory”, he declared.
“China’s international influence, appeal and power to shape the world has significantly increased,” Xi said in kicking off the Communist Party’s once-in-five-year party congress, at which he’s set to secure a norm-breaking third term in office. “Chinese modernization offers humanity a new choice for achieving modernization,” he added.
This came as Xi, widely regarded as the most powerful Chinese politician since Deng Xiaoping, delivered his work report to some 2,000 Communist Party delegates gathered in Beijing for the twice-a-decade national congress. As SCMP reports, the speech marked the beginning of a weeklong session ending on October 22, when a new Central Committee to head the 97 million party members will be formed and ratified.
Some more highlights from Xi's speech:
- By 2049, when the People’s Republic will hold centennial celebrations, China should become a leading power in all aspects, Xi said. To achieve this, the party will first aim to complete all modernization programs by 2035, turning China from the largest developing economy to a middle-to-high-income country, he said. This would mean that China will have successfully avoided the “middle-income trap”.
- Building on the momentum, China will strive to become a leading global power by mid-century. This power will not only be measured by the size of China’s economy but also by its achievements in the fields of science and technology and culture, Xi said.
- The Chinese military force, already the largest in the world, will become a “world-class fighting force”. On the environment front, China will also “largely eliminate pollution” and achieve carbon neutrality.
But what drew the longest applause from the audience, was Xi's vow that the island of Taiwan – self-governed since a bitter civil war in 1949 – must be brought back into the fold. But he also said Beijing would show the “utmost sincerity and make the greatest efforts” to achieve such reunification by peaceful means, while stressing that it would not give up the use of force as a last resort.
Xi’s remarks indicate that China is ready to stare down a growing challenge from the US under President Joe Biden, who has moved to hinder Beijing’s ability to access advanced technology and sought to deter any military action against Taiwan - the biggest flash point between the world’s biggest economies. The Chinese leader hailed the nation’s “fighting spirit” and said the country was “well-positioned for pursuing development and ensuring security.”
“The message to the party is that China can develop its technological advantages without the United States, and is going to be able to withstand the policies that Biden and others are promoting to cut China off from certain high-tech goods like semiconductors,” said Neil Thomas, a China analyst at Eurasia Group Ltd., a political risk advisory and consulting firm. “Whether that’s going to succeed is a totally different question of course, but it’s certainly expressing confidence to those in the system.”
According to Bloomberg, Xi’s speech reflected a changed world from 2017, when he declared that China was “standing tall and firm in the East.” Since then, he’s faced a barrage of US tariffs, financial sanctions and trade curbs aimed at blocking China’s ability to grow even more powerful, culminating in a sweeping order this month restricting Beijing’s access to high-end chips used in artificial intelligence, supercomputing and other technologies set to drive the modern economy.
On Sunday, Xi vowed to “resolutely win the battle in key core technologies.” Pledging to speed up innovation in areas vital to “technology self-reliance,” he said that China “will move faster to launch a number of major national projects that are of strategic, big-picture and long-term importance.”
Xi’s defiant tone stood in stark contrast with the calamitous problems facing China’s economy. The country is facing one of its most challenging periods in decades as Covid Zero policies and a property crackdown place pre-pandemic predictions of a 5% growth rate out of reach. In addition to failing to make significant breakthroughs on chip technology despite spending tens of billions of dollars, the nation is also facing the slowest economic growth in more than four decades, excluding 2020’s Covid slump. Restrictive pandemic policies have cut off visitors and hurt spending, while youth unemployment is around record highs. A property crisis has also spurred a wave of mortgage boycotts.
Xi reiterated that economic development was the party’s “top priority,” even as he twice mentioned the need to “balance development with security” -- a phrase suggesting growth can be sacrificed for goals like self-sufficiency and national defense. Noting “drastic changes in the international landscape,” he said the party “safeguarded China’s dignity and core interests.”
The speech delivered by Xi at the Great Hall of the People was an abridged version of his work report. This was a departure from tradition, as the party chief usually reads out the entire document. The only exception was at the 16th party congress 20 years ago, when the then-party chief, Jiang Zemin, aged 76, also opted for a shorter version. According to SCMP, Xi may have cut back his speech out of concern for the retired elderly party leaders who made a rare appearance to join him on stage. They included his predecessor Hu Jintao, 79, who looked tired and frail throughout the session. At 105, Song Ping was the most senior party elder to appear on stage on the day. However, the two most noticeable absentees were former president Jiang, now 96, and former premier Zhu Rongji, 93. Their names, however, are on the list of an ad hoc group set up to supervise the proceedings of the party congress.
While the influence of party elders varies over time, their appearance this time could be largely symbolic. While Xi had sought their views, the president has a free hand to make all key decisions. Yu Jie, a senior research fellow on China at Chatham House – an independent policy think-tank based in London – is among analysts who see the shortened report as an indication of Xi’s firm hold on power.
“The 20th party congress report speech is significantly shorter than the 19th, a clear indication of Xi’s success in centralising power,” Yu said. “The speech acts as a summary of the party’s achievements and future plans – expressed as the lowest common denominator of consensus between competing factions. A shorter report speech would seem to suggest smaller factional gaps in reaching consensus.”
While Xi did not mention the United States in his speech, he warned against a cold-war mentality – a catchphrase to describe Washington’s attempts to isolate China – as well as Western double standards, as he asserted that the country would not be bullied. Further elaboration of the point came in the full work report released shortly afterwards.
“The attempt to suppress and contain China’s growth could escalate anytime,” the report read. “We are entering a stage where great opportunities and risks coexist. Uncertainties and unpredictability are rising. All kinds of black swans and grey rhinos [unexpected and overlooked risks] could strike any time. We must have a keen sense of crisis and make thorough preparations. Only by doing that can we rise to the challenges ahead.”
To mitigate the risks, Xi said the party needs to strengthen its work on national security and improve the protection of all major infrastructure and networks, as well as data, biosecurity, nuclear and space assets.
“We must improve our capacity to counter foreign sanctions, interference and long-arm jurisdiction,” the report said. Long-arm jurisdiction in party-speak usually refers to the US imposing its own laws and court orders on other countries.
China also needs to increase self-reliance in the food, energy and technology sectors, Xi said, as he listed technological innovation and scientific breakthroughs as key to achieving the development goals outlined in the report.
“We must speed up technological progress and self-reliance. We must pool our resources and focus on key areas to achieve breakthroughs, so that we can win the race in core technologies critical to our national strategy.”
The party must also develop more open, inclusive and efficient talent schemes to groom and attract top talents to China, Xi emphasised.
Xie Maosong, a senior fellow at Tsinghua University’s National Strategy Institute, described the work report as a “galvanising call” to the party and the Chinese people. “This is the party’s first work report after its centennial celebration [in 2021], so it is not just meant [to resonate] for the next five years,” Xie said. “It sets the goal of realising China’s great rejuvenation, and to do so by charting our own path and not following the Western model of political party rotation,” he explained.
“To achieve that, the party needs to address the unique question of how to stay in power and win public trust continuously. It needs to provide a structural and systematic answer on ways to maintain a high-quality decision-making process and fight chronic corruption.”
Xi’s work report was the first highlight of the 20th party congress. The weeklong event is also expected to endorse a revision to the party constitution, which most observers believe will further elevate Xi’s position and governance philosophy.
On Monday, the committee will vote to confirm the line-up of a new 25-member Politburo and seven-member Politburo Standing Committee – the highest decision-making body in Chinese politics. While Xi is set to get a convention-breaking third term as party leader, he will reshuffle many key positions and put together a new supporting cast for the next five years and beyond.
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Below we excerpt from a note by Goldman strategist Andrew Tilron summarizing his main takeaways from Xi's opening remarks:
- The 20th National Congress of the Communist Party of China (NCCPC) convened today in Beijing and will conclude on 22 October. Through the opening remarks, President Xi summarized the achievements over the past five years and set out the blueprint for the Party and the country for the future.
- In summary,
- 1) President Xi’s “Thoughts on Socialism with Chinese Characteristics for a New Era” have been further highlighted;
- 2) national security and social stability appear to have become more important, especially for the security of key supply chains;
- 3) President Xi reiterated the “One Country, Two Systems” principle, and strengthened the stance to secure national sovereignty; and
- 4) economic development remains important, with continued focus on high-quality growth.
- Our textual analysis suggests the adjusted frequency of “security”, “people”, “socialism”, “modernization” and “military” this time increased versus five years ago, that of “growth” and “law-based governance” remained largely stable, while that of “economy”, “market” and “reform” declined somewhat.
- We believe the ongoing Party congress may not be an inflection point for major policy changes. We maintain our view that a reopening will probably be delayed until at least Q2 2023, and implemented gradually to the extent possible. Policymakers’ reaction function such as “no flooding of easing measures” and the top leadership’s long-term goals are unlikely to change after the Party Congress.
- In terms of equity market implications, we are not changing our views in the absence of any fresh and material policy and political inputs so far from the Congress—We prefer China A over Offshore equities, and would continue to focus on thematic ideas such as “Common Prosperity” and “Little Giants” to trade for sustainable alpha in the stock market. That said, we’d argue that a high level of risk premium is embedded in prevailing equity valuations, and investors should consider option strategies to tactically position in the market.
(Full note available to pro subscribers.)
Finally, courtesy of Bloomberg, here is how global China experts are reacting to Xi's speech:
Neil Thomas, a China analyst at Eurasia Group:
- “Xi changed the structure of the report fairly significantly compared to previous years. There are new sections on science and education, on national security and on the legal system areas that have previously been addressed in other parts of report. Having these new sections means they’re going to be even higher priorities.
- “The new focus on science and education is a reflection on just how much Xi is betting on innovation as a solution to China’s economic problems and its reliance on Western technology. I think that’s super significant.
- “What’s new there is the addition that this would be done by using or done through Chinese-style modernization. That’s a strong sign Xi is sticking to his guns in going his own way toward wealth, power and very much not following the ways of the West.
- “The message for the United States is that China’s going to do its own thing. The message to the rest of the world is that China is going to remain powerful and is going to remain a potential partner, especially for developing countries.”
Scott Kennedy, senior adviser and trustee chair in Chinese business and economics at the Center for Strategic & International Studies:
- “The language of this speech is all about trying to establish a different kind of international system from what we’ve seen since World War II -- one led by the US emphasizing free markets and through the UN system, multilateralism and democracy.
- “And you can see the whole emphasis of this speech an emphasis of a Chinese style everything -- China’s foreign policy, domestic policy, and, in some ways, an acceptance of the fact that the US and China are strategic competitors in the type of world order they’re trying to create. And he was not backing down from that at all.
- “So I think we’re seeing a real effort for the Chinese to say, ‘You know what, we still want to participate in this global society but we want to be rule makers not just rule takers.’”
Peiqian Liu, chief China economist of Natwest Markets:
- “There were two parts that are important to the medium term. First, there was a balanced emphasis on both development and security. This means growth rates will no longer be the only and top priority in coming years, security of development also matters.
- “Second, there was a lot of emphasis on technology and innovation, which means the focus will likely shift away from just lowering financial risks and reducing debt growth to pouring more resources to development of high tech and innovation.
- “Common prosperity is still highlighted. That means the policy goal of redistribution of income and wealth is still a medium term goal.”
Wu Xianfeng, fund manager at Shenzhen Longteng Assets Management Co:
- “The standout of the speech was that Xi emphasized economic development still remaining the priority, contrary to the jitters and misconceptions prior to the meeting that common prosperity would come first.
- “It’s reassuring the leaders say growth still comes first and foremost in the current stage of development, especially as we are faced with economic difficulties from virus curbs and as we are in for challenges from the US over the long term.”
Ding Shuang, chief economist for Greater China and North Asia at Standard Charted Plc:
- “It’s important that he reiterated that development is the first priority, and that modernization can’t be achieved without the material foundation. That means the economy’s size still needs to expand and the quality needs to improve.
- “The speech is mostly an extension of Xi’s previous thoughts on the economy, and there aren’t much new ideas. That’s understandable because he has helmed development in the past decade.
- “The speech itself may not have much impact on the market, because most of the points have already been raised in the past.”
Frank Tsai, lecturer at the Emlyon Business School’s Shanghai campus:
- “Xi’s speech sends a signal that China is serious about its socialist roots. To paraphrase, Xi stated that China offers a ‘new choice for humanity,’ China’s ‘scientific socialism,’ and that ‘Chinese wisdom and capacity’ will make this model work for the benefit of all. This sounds like boilerplate propaganda, but it is serious. China is the last major country standing with Cold War roots in Soviet communism.”
Alfred Wu, associate professor at the National University of Singapore’s Lee Kuan Yew School of Public Policy:
- “From his speech, it’s clear he’s the leader of the world’s number two country; he wants to change the world order. So China’s clash with the US will be intensified. I don’t see any possibility of tensions being lowered.
- “China has always argued that the US made the current world order, but now they are doubling down on how they present a true alternative world.
- “Xi emphasized and boosted the narrative of national security because it is serving as a justification for him to remain in office for as long as possible. He won’t tolerate sensitive issues that could jeopardize his regime.”
Chen Shi, fund manager at Shanghai Jade Stone Investment Management Co.:
- “The report settled my nervousness over the past weeks, and should assuage concerns of those investing in China. The fact that the report is shorter this time says to me that the party is confident and policies are consistent -- it doesn’t feel the need to waste words explaining itself, and that the overall direction in policies remains the same, and iterated in various policy blueprints in the past.
- “The way that development and technology came so high up in the report also is reassuring to me -- this party is not just about ideology, as some were beginning to fear, but development and economic stability stays high on the list. Those words coming out the mouth of the man himself means that China will still be full of investment opportunities.”
- Xi Jinping tells the Communist Party that China’s “power to shape the world” has increased, although “dangerous storms” are ahead.
Drew Thompson, visiting senior research fellow at the Lee Kuan Yew School of Public Policy at the National University of Singapore:
- “It’s interesting how Xi characterizes China’s response to the dynamic international situation as a ‘struggle’ in the Marxist sense for its own national and political security. He is calling on the nation to struggle against international forces that threaten China’s interests.
- “It reflects an adversarial world view that is zero-sum, and likely foretells of continuing tensions between China and developed nations, featuring wolf warriors and coercion in multiple domains -- diplomatic, economic, informational, and military.
- “Xi emphasized the importance of the country gaining in strength, and the need to struggle against challenges and threats to the party and country, which requires not only a modern military, but a ubiquitous domestic security apparatus as well.”
Baohui Zhang, a professor of political science at Lingnan University in Hong Kong:
- “Xi’s speech re-emphasized China’s commitment to ‘openness,’ which was started by Deng Xiaoping. Many have wondered if the strategic rivalry between China and the United States could push them apart and motivate China to pursue autarky. Xi’s message is to assure the world the China remains committed to economic integration with the world.
- “However, this may not impact the Sino-US rivalry in significant ways. Washington is pursuing at least limited decoupling to redefine its relations with China. Recent technology denial measures are the latest evidence. As such, China’s commitment to ‘openness’ does not mean that decoupling will not continue ,as Washington’s choices and strategies also impact their relations.”
Wen-Ti Sung, a political scientist at Australia National University’s Taiwan Studies Program:
- “By giving Taiwan the spotlight early in his speech, Xi is committing the performance of his Taiwan policy to be put under the microscope over the next five years.
- “Xi declared the Chinese military has both the capability and resolve to deter external influence over Taiwan. What he still hasn’t said is if Chinese ‘intent’ to do so.
- “In that sense, China is still preferring peaceful unification to using force, but the focus on military capability will only accelerate an arms race in the Taiwan Strait, and the need to demonstrate resolve through military exercises will both raise tensions and increase risks of accidental escalation.”
Spread & Containment
Four Years Ago This Week, Freedom Was Torched
Four Years Ago This Week, Freedom Was Torched
Authored by Jeffrey Tucker via The Brownstone Institute,
"Beware the Ides of March,” Shakespeare…
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Authored by Jeffrey Tucker via The Brownstone Institute,
"Beware the Ides of March,” Shakespeare quotes the soothsayer’s warning Julius Caesar about what turned out to be an impending assassination on March 15. The death of American liberty happened around the same time four years ago, when the orders went out from all levels of government to close all indoor and outdoor venues where people gather.
It was not quite a law and it was never voted on by anyone. Seemingly out of nowhere, people who the public had largely ignored, the public health bureaucrats, all united to tell the executives in charge – mayors, governors, and the president – that the only way to deal with a respiratory virus was to scrap freedom and the Bill of Rights.
And they did, not only in the US but all over the world.
The forced closures in the US began on March 6 when the mayor of Austin, Texas, announced the shutdown of the technology and arts festival South by Southwest. Hundreds of thousands of contracts, of attendees and vendors, were instantly scrapped. The mayor said he was acting on the advice of his health experts and they in turn pointed to the CDC, which in turn pointed to the World Health Organization, which in turn pointed to member states and so on.
There was no record of Covid in Austin, Texas, that day but they were sure they were doing their part to stop the spread. It was the first deployment of the “Zero Covid” strategy that became, for a time, official US policy, just as in China.
It was never clear precisely who to blame or who would take responsibility, legal or otherwise.
This Friday evening press conference in Austin was just the beginning. By the next Thursday evening, the lockdown mania reached a full crescendo. Donald Trump went on nationwide television to announce that everything was under control but that he was stopping all travel in and out of US borders, from Europe, the UK, Australia, and New Zealand. American citizens would need to return by Monday or be stuck.
Americans abroad panicked while spending on tickets home and crowded into international airports with waits up to 8 hours standing shoulder to shoulder. It was the first clear sign: there would be no consistency in the deployment of these edicts.
There is no historical record of any American president ever issuing global travel restrictions like this without a declaration of war. Until then, and since the age of travel began, every American had taken it for granted that he could buy a ticket and board a plane. That was no longer possible. Very quickly it became even difficult to travel state to state, as most states eventually implemented a two-week quarantine rule.
The next day, Friday March 13, Broadway closed and New York City began to empty out as any residents who could went to summer homes or out of state.
On that day, the Trump administration declared the national emergency by invoking the Stafford Act which triggers new powers and resources to the Federal Emergency Management Administration.
In addition, the Department of Health and Human Services issued a classified document, only to be released to the public months later. The document initiated the lockdowns. It still does not exist on any government website.
The White House Coronavirus Response Task Force, led by the Vice President, will coordinate a whole-of-government approach, including governors, state and local officials, and members of Congress, to develop the best options for the safety, well-being, and health of the American people. HHS is the LFA [Lead Federal Agency] for coordinating the federal response to COVID-19.
Closures were guaranteed:
Recommend significantly limiting public gatherings and cancellation of almost all sporting events, performances, and public and private meetings that cannot be convened by phone. Consider school closures. Issue widespread ‘stay at home’ directives for public and private organizations, with nearly 100% telework for some, although critical public services and infrastructure may need to retain skeleton crews. Law enforcement could shift to focus more on crime prevention, as routine monitoring of storefronts could be important.
In this vision of turnkey totalitarian control of society, the vaccine was pre-approved: “Partner with pharmaceutical industry to produce anti-virals and vaccine.”
The National Security Council was put in charge of policy making. The CDC was just the marketing operation. That’s why it felt like martial law. Without using those words, that’s what was being declared. It even urged information management, with censorship strongly implied.
The timing here is fascinating. This document came out on a Friday. But according to every autobiographical account – from Mike Pence and Scott Gottlieb to Deborah Birx and Jared Kushner – the gathered team did not meet with Trump himself until the weekend of the 14th and 15th, Saturday and Sunday.
According to their account, this was his first real encounter with the urge that he lock down the whole country. He reluctantly agreed to 15 days to flatten the curve. He announced this on Monday the 16th with the famous line: “All public and private venues where people gather should be closed.”
This makes no sense. The decision had already been made and all enabling documents were already in circulation.
There are only two possibilities.
One: the Department of Homeland Security issued this March 13 HHS document without Trump’s knowledge or authority. That seems unlikely.
Two: Kushner, Birx, Pence, and Gottlieb are lying. They decided on a story and they are sticking to it.
Trump himself has never explained the timeline or precisely when he decided to greenlight the lockdowns. To this day, he avoids the issue beyond his constant claim that he doesn’t get enough credit for his handling of the pandemic.
With Nixon, the famous question was always what did he know and when did he know it? When it comes to Trump and insofar as concerns Covid lockdowns – unlike the fake allegations of collusion with Russia – we have no investigations. To this day, no one in the corporate media seems even slightly interested in why, how, or when human rights got abolished by bureaucratic edict.
As part of the lockdowns, the Cybersecurity and Infrastructure Security Agency, which was and is part of the Department of Homeland Security, as set up in 2018, broke the entire American labor force into essential and nonessential.
They also set up and enforced censorship protocols, which is why it seemed like so few objected. In addition, CISA was tasked with overseeing mail-in ballots.
Only 8 days into the 15, Trump announced that he wanted to open the country by Easter, which was on April 12. His announcement on March 24 was treated as outrageous and irresponsible by the national press but keep in mind: Easter would already take us beyond the initial two-week lockdown. What seemed to be an opening was an extension of closing.
This announcement by Trump encouraged Birx and Fauci to ask for an additional 30 days of lockdown, which Trump granted. Even on April 23, Trump told Georgia and Florida, which had made noises about reopening, that “It’s too soon.” He publicly fought with the governor of Georgia, who was first to open his state.
Before the 15 days was over, Congress passed and the president signed the 880-page CARES Act, which authorized the distribution of $2 trillion to states, businesses, and individuals, thus guaranteeing that lockdowns would continue for the duration.
There was never a stated exit plan beyond Birx’s public statements that she wanted zero cases of Covid in the country. That was never going to happen. It is very likely that the virus had already been circulating in the US and Canada from October 2019. A famous seroprevalence study by Jay Bhattacharya came out in May 2020 discerning that infections and immunity were already widespread in the California county they examined.
What that implied was two crucial points: there was zero hope for the Zero Covid mission and this pandemic would end as they all did, through endemicity via exposure, not from a vaccine as such. That was certainly not the message that was being broadcast from Washington. The growing sense at the time was that we all had to sit tight and just wait for the inoculation on which pharmaceutical companies were working.
By summer 2020, you recall what happened. A restless generation of kids fed up with this stay-at-home nonsense seized on the opportunity to protest racial injustice in the killing of George Floyd. Public health officials approved of these gatherings – unlike protests against lockdowns – on grounds that racism was a virus even more serious than Covid. Some of these protests got out of hand and became violent and destructive.
Meanwhile, substance abuse rage – the liquor and weed stores never closed – and immune systems were being degraded by lack of normal exposure, exactly as the Bakersfield doctors had predicted. Millions of small businesses had closed. The learning losses from school closures were mounting, as it turned out that Zoom school was near worthless.
It was about this time that Trump seemed to figure out – thanks to the wise council of Dr. Scott Atlas – that he had been played and started urging states to reopen. But it was strange: he seemed to be less in the position of being a president in charge and more of a public pundit, Tweeting out his wishes until his account was banned. He was unable to put the worms back in the can that he had approved opening.
By that time, and by all accounts, Trump was convinced that the whole effort was a mistake, that he had been trolled into wrecking the country he promised to make great. It was too late. Mail-in ballots had been widely approved, the country was in shambles, the media and public health bureaucrats were ruling the airwaves, and his final months of the campaign failed even to come to grips with the reality on the ground.
At the time, many people had predicted that once Biden took office and the vaccine was released, Covid would be declared to have been beaten. But that didn’t happen and mainly for one reason: resistance to the vaccine was more intense than anyone had predicted. The Biden administration attempted to impose mandates on the entire US workforce. Thanks to a Supreme Court ruling, that effort was thwarted but not before HR departments around the country had already implemented them.
As the months rolled on – and four major cities closed all public accommodations to the unvaccinated, who were being demonized for prolonging the pandemic – it became clear that the vaccine could not and would not stop infection or transmission, which means that this shot could not be classified as a public health benefit. Even as a private benefit, the evidence was mixed. Any protection it provided was short-lived and reports of vaccine injury began to mount. Even now, we cannot gain full clarity on the scale of the problem because essential data and documentation remains classified.
After four years, we find ourselves in a strange position. We still do not know precisely what unfolded in mid-March 2020: who made what decisions, when, and why. There has been no serious attempt at any high level to provide a clear accounting much less assign blame.
Not even Tucker Carlson, who reportedly played a crucial role in getting Trump to panic over the virus, will tell us the source of his own information or what his source told him. There have been a series of valuable hearings in the House and Senate but they have received little to no press attention, and none have focus on the lockdown orders themselves.
The prevailing attitude in public life is just to forget the whole thing. And yet we live now in a country very different from the one we inhabited five years ago. Our media is captured. Social media is widely censored in violation of the First Amendment, a problem being taken up by the Supreme Court this month with no certainty of the outcome. The administrative state that seized control has not given up power. Crime has been normalized. Art and music institutions are on the rocks. Public trust in all official institutions is at rock bottom. We don’t even know if we can trust the elections anymore.
In the early days of lockdown, Henry Kissinger warned that if the mitigation plan does not go well, the world will find itself set “on fire.” He died in 2023. Meanwhile, the world is indeed on fire. The essential struggle in every country on earth today concerns the battle between the authority and power of permanent administration apparatus of the state – the very one that took total control in lockdowns – and the enlightenment ideal of a government that is responsible to the will of the people and the moral demand for freedom and rights.
How this struggle turns out is the essential story of our times.
CODA: I’m embedding a copy of PanCAP Adapted, as annotated by Debbie Lerman. You might need to download the whole thing to see the annotations. If you can help with research, please do.
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Jeffrey Tucker is the author of the excellent new book 'Life After Lock-Down'
International
Red Candle In The Wind
Red Candle In The Wind
By Benjamin PIcton of Rabobank
February non-farm payrolls superficially exceeded market expectations on Friday by…
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By Benjamin PIcton of Rabobank
February non-farm payrolls superficially exceeded market expectations on Friday by printing at 275,000 against a consensus call of 200,000. We say superficially, because the downward revisions to prior months totalled 167,000 for December and January, taking the total change in employed persons well below the implied forecast, and helping the unemployment rate to pop two-ticks to 3.9%. The U6 underemployment rate also rose from 7.2% to 7.3%, while average hourly earnings growth fell to 0.2% m-o-m and average weekly hours worked languished at 34.3, equalling pre-pandemic lows.
Undeterred by the devil in the detail, the algos sprang into action once exchanges opened. Market darling NVIDIA hit a new intraday high of $974 before (presumably) the humans took over and sold the stock down more than 10% to close at $875.28. If our suspicions are correct that it was the AIs buying before the humans started selling (no doubt triggering trailing stops on the way down), the irony is not lost on us.
The 1-day chart for NVIDIA now makes for interesting viewing, because the red candle posted on Friday presents quite a strong bearish engulfing signal. Volume traded on the day was almost double the 15-day simple moving average, and similar price action is observable on the 1-day charts for both Intel and AMD. Regular readers will be aware that we have expressed incredulity in the past about the durability the AI thematic melt-up, so it will be interesting to see whether Friday’s sell off is just a profit-taking blip, or a genuine trend reversal.
AI equities aside, this week ought to be important for markets because the BTFP program expires today. That means that the Fed will no longer be loaning cash to the banking system in exchange for collateral pledged at-par. The KBW Regional Banking index has so far taken this in its stride and is trading 30% above the lows established during the mini banking crisis of this time last year, but the Fed’s liquidity facility was effectively an exercise in can-kicking that makes regional banks a sector of the market worth paying attention to in the weeks ahead. Even here in Sydney, regulators are warning of external risks posed to the banking sector from scheduled refinancing of commercial real estate loans following sharp falls in valuations.
Markets are sending signals in other sectors, too. Gold closed at a new record-high of $2178/oz on Friday after trading above $2200/oz briefly. Gold has been going ballistic since the Friday before last, posting gains even on days where 2-year Treasury yields have risen. Gold bugs are buying as real yields fall from the October highs and inflation breakevens creep higher. This is particularly interesting as gold ETFs have been recording net outflows; suggesting that price gains aren’t being driven by a retail pile-in. Are gold buyers now betting on a stagflationary outcome where the Fed cuts without inflation being anchored at the 2% target? The price action around the US CPI release tomorrow ought to be illuminating.
Leaving the day-to-day movements to one side, we are also seeing further signs of structural change at the macro level. The UK budget last week included a provision for the creation of a British ISA. That is, an Individual Savings Account that provides tax breaks to savers who invest their money in the stock of British companies. This follows moves last year to encourage pension funds to head up the risk curve by allocating 5% of their capital to unlisted investments.
As a Hail Mary option for a government cruising toward an electoral drubbing it’s a curious choice, but it’s worth highlighting as cash-strapped governments increasingly see private savings pools as a funding solution for their spending priorities.
Of course, the UK is not alone in making creeping moves towards financial repression. In contrast to announcements today of increased trade liberalisation, Australian Treasurer Jim Chalmers has in the recent past flagged his interest in tapping private pension savings to fund state spending priorities, including defence, public housing and renewable energy projects. Both the UK and Australia appear intent on finding ways to open up the lungs of their economies, but government wants more say in directing private capital flows for state goals.
So, how far is the blurring of the lines between free markets and state planning likely to go? Given the immense and varied budgetary (and security) pressures that governments are facing, could we see a re-up of WWII-era Victory bonds, where private investors are encouraged to do their patriotic duty by directly financing government at negative real rates?
That would really light a fire under the gold market.
Spread & Containment
Trump “Clearly Hasn’t Learned From His COVID-Era Mistakes”, RFK Jr. Says
Trump "Clearly Hasn’t Learned From His COVID-Era Mistakes", RFK Jr. Says
Authored by Jeff Louderback via The Epoch Times (emphasis ours),
President…
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Authored by Jeff Louderback via The Epoch Times (emphasis ours),
President Joe Biden claimed that COVID vaccines are now helping cancer patients during his State of the Union address on March 7, but it was a response on Truth Social from former President Donald Trump that drew the ire of independent presidential candidate Robert F. Kennedy Jr.
During the address, President Biden said: “The pandemic no longer controls our lives. The vaccines that saved us from COVID are now being used to help beat cancer, turning setback into comeback. That’s what America does.”
President Trump wrote: “The Pandemic no longer controls our lives. The VACCINES that saved us from COVID are now being used to help beat cancer—turning setback into comeback. YOU’RE WELCOME JOE. NINE-MONTH APPROVAL TIME VS. 12 YEARS THAT IT WOULD HAVE TAKEN YOU.”
An outspoken critic of President Trump’s COVID response, and the Operation Warp Speed program that escalated the availability of COVID vaccines, Mr. Kennedy said on X, formerly known as Twitter, that “Donald Trump clearly hasn’t learned from his COVID-era mistakes.”
“He fails to recognize how ineffective his warp speed vaccine is as the ninth shot is being recommended to seniors. Even more troubling is the documented harm being caused by the shot to so many innocent children and adults who are suffering myocarditis, pericarditis, and brain inflammation,” Mr. Kennedy remarked.
“This has been confirmed by a CDC-funded study of 99 million people. Instead of bragging about its speedy approval, we should be honestly and transparently debating the abundant evidence that this vaccine may have caused more harm than good.
“I look forward to debating both Trump and Biden on Sept. 16 in San Marcos, Texas.”
Mr. Kennedy announced in April 2023 that he would challenge President Biden for the 2024 Democratic Party presidential nomination before declaring his run as an independent last October, claiming that the Democrat National Committee was “rigging the primary.”
Since the early stages of his campaign, Mr. Kennedy has generated more support than pundits expected from conservatives, moderates, and independents resulting in speculation that he could take votes away from President Trump.
Many Republicans continue to seek a reckoning over the government-imposed pandemic lockdowns and vaccine mandates.
President Trump’s defense of Operation Warp Speed, the program he rolled out in May 2020 to spur the development and distribution of COVID-19 vaccines amid the pandemic, remains a sticking point for some of his supporters.
Operation Warp Speed featured a partnership between the government, the military, and the private sector, with the government paying for millions of vaccine doses to be produced.
President Trump released a statement in March 2021 saying: “I hope everyone remembers when they’re getting the COVID-19 Vaccine, that if I wasn’t President, you wouldn’t be getting that beautiful ‘shot’ for 5 years, at best, and probably wouldn’t be getting it at all. I hope everyone remembers!”
President Trump said about the COVID-19 vaccine in an interview on Fox News in March 2021: “It works incredibly well. Ninety-five percent, maybe even more than that. I would recommend it, and I would recommend it to a lot of people that don’t want to get it and a lot of those people voted for me, frankly.
“But again, we have our freedoms and we have to live by that and I agree with that also. But it’s a great vaccine, it’s a safe vaccine, and it’s something that works.”
On many occasions, President Trump has said that he is not in favor of vaccine mandates.
An environmental attorney, Mr. Kennedy founded Children’s Health Defense, a nonprofit that aims to end childhood health epidemics by promoting vaccine safeguards, among other initiatives.
Last year, Mr. Kennedy told podcaster Joe Rogan that ivermectin was suppressed by the FDA so that the COVID-19 vaccines could be granted emergency use authorization.
He has criticized Big Pharma, vaccine safety, and government mandates for years.
Since launching his presidential campaign, Mr. Kennedy has made his stances on the COVID-19 vaccines, and vaccines in general, a frequent talking point.
“I would argue that the science is very clear right now that they [vaccines] caused a lot more problems than they averted,” Mr. Kennedy said on Piers Morgan Uncensored last April.
“And if you look at the countries that did not vaccinate, they had the lowest death rates, they had the lowest COVID and infection rates.”
Additional data show a “direct correlation” between excess deaths and high vaccination rates in developed countries, he said.
President Trump and Mr. Kennedy have similar views on topics like protecting the U.S.-Mexico border and ending the Russia-Ukraine war.
COVID-19 is the topic where Mr. Kennedy and President Trump seem to differ the most.
Former President Donald Trump intended to “drain the swamp” when he took office in 2017, but he was “intimidated by bureaucrats” at federal agencies and did not accomplish that objective, Mr. Kennedy said on Feb. 5.
Speaking at a voter rally in Tucson, where he collected signatures to get on the Arizona ballot, the independent presidential candidate said President Trump was “earnest” when he vowed to “drain the swamp,” but it was “business as usual” during his term.
John Bolton, who President Trump appointed as a national security adviser, is “the template for a swamp creature,” Mr. Kennedy said.
Scott Gottlieb, who President Trump named to run the FDA, “was Pfizer’s business partner” and eventually returned to Pfizer, Mr. Kennedy said.
Mr. Kennedy said that President Trump had more lobbyists running federal agencies than any president in U.S. history.
“You can’t reform them when you’ve got the swamp creatures running them, and I’m not going to do that. I’m going to do something different,” Mr. Kennedy said.
During the COVID-19 pandemic, President Trump “did not ask the questions that he should have,” he believes.
President Trump “knew that lockdowns were wrong” and then “agreed to lockdowns,” Mr. Kennedy said.
He also “knew that hydroxychloroquine worked, he said it,” Mr. Kennedy explained, adding that he was eventually “rolled over” by Dr. Anthony Fauci and his advisers.
MaryJo Perry, a longtime advocate for vaccine choice and a Trump supporter, thinks votes will be at a premium come Election Day, particularly because the independent and third-party field is becoming more competitive.
Ms. Perry, president of Mississippi Parents for Vaccine Rights, believes advocates for medical freedom could determine who is ultimately president.
She believes that Mr. Kennedy is “pulling votes from Trump” because of the former president’s stance on the vaccines.
“People care about medical freedom. It’s an important issue here in Mississippi, and across the country,” Ms. Perry told The Epoch Times.
“Trump should admit he was wrong about Operation Warp Speed and that COVID vaccines have been dangerous. That would make a difference among people he has offended.”
President Trump won’t lose enough votes to Mr. Kennedy about Operation Warp Speed and COVID vaccines to have a significant impact on the election, Ohio Republican strategist Wes Farno told The Epoch Times.
President Trump won in Ohio by eight percentage points in both 2016 and 2020. The Ohio Republican Party endorsed President Trump for the nomination in 2024.
“The positives of a Trump presidency far outweigh the negatives,” Mr. Farno said. “People are more concerned about their wallet and the economy.
“They are asking themselves if they were better off during President Trump’s term compared to since President Biden took office. The answer to that question is obvious because many Americans are struggling to afford groceries, gas, mortgages, and rent payments.
“America needs President Trump.”
Multiple national polls back Mr. Farno’s view.
As of March 6, the RealClearPolitics average of polls indicates that President Trump has 41.8 percent support in a five-way race that includes President Biden (38.4 percent), Mr. Kennedy (12.7 percent), independent Cornel West (2.6 percent), and Green Party nominee Jill Stein (1.7 percent).
A Pew Research Center study conducted among 10,133 U.S. adults from Feb. 7 to Feb. 11 showed that Democrats and Democrat-leaning independents (42 percent) are more likely than Republicans and GOP-leaning independents (15 percent) to say they have received an updated COVID vaccine.
The poll also reported that just 28 percent of adults say they have received the updated COVID inoculation.
The peer-reviewed multinational study of more than 99 million vaccinated people that Mr. Kennedy referenced in his X post on March 7 was published in the Vaccine journal on Feb. 12.
It aimed to evaluate the risk of 13 adverse events of special interest (AESI) following COVID-19 vaccination. The AESIs spanned three categories—neurological, hematologic (blood), and cardiovascular.
The study reviewed data collected from more than 99 million vaccinated people from eight nations—Argentina, Australia, Canada, Denmark, Finland, France, New Zealand, and Scotland—looking at risks up to 42 days after getting the shots.
Three vaccines—Pfizer and Moderna’s mRNA vaccines as well as AstraZeneca’s viral vector jab—were examined in the study.
Researchers found higher-than-expected cases that they deemed met the threshold to be potential safety signals for multiple AESIs, including for Guillain-Barre syndrome (GBS), cerebral venous sinus thrombosis (CVST), myocarditis, and pericarditis.
A safety signal refers to information that could suggest a potential risk or harm that may be associated with a medical product.
The study identified higher incidences of neurological, cardiovascular, and blood disorder complications than what the researchers expected.
President Trump’s role in Operation Warp Speed, and his continued praise of the COVID vaccine, remains a concern for some voters, including those who still support him.
Krista Cobb is a 40-year-old mother in western Ohio. She voted for President Trump in 2020 and said she would cast her vote for him this November, but she was stunned when she saw his response to President Biden about the COVID-19 vaccine during the State of the Union address.
“I love President Trump and support his policies, but at this point, he has to know they [advisers and health officials] lied about the shot,” Ms. Cobb told The Epoch Times.
“If he continues to promote it, especially after all of the hearings they’ve had about it in Congress, the side effects, and cover-ups on Capitol Hill, at what point does he become the same as the people who have lied?” Ms. Cobb added.
“I think he should distance himself from talk about Operation Warp Speed and even admit that he was wrong—that the vaccines have not had the impact he was told they would have. If he did that, people would respect him even more.”
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