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North Korea: An Analysis

Intelligence reports indicate that North Korea conducted a partial test of components necessary for the development of a hydrogen bomb, which the Pyongyang government seeks to use with its rapidly advancing ICBM technology.

 As the “Hermit Kingdom” obtains ever more dangerous military prowess under the control of a leadership that is, at best, unconventional and at worst irrational, an understanding of this nation becomes more essential.  We have reviewed The Department of Defense’s latest report, the 2015 Report to Congress on  the Military and Security Developments Involving the Democratic People’s Republic of Korea and excerpted the key points.

General Overview 

The Democratic People’s Republic of Korea (DPRK or North Korea) remains one of the most critical security challenges for the United States and the broader international community. In particular, North Korea’s willingness to undertake provocative and destabilizing behavior, including attacks on the Republic of Korea (ROK), its continued development of nuclear weapons and long-range ballistic missiles, and its proliferation of weapons in contravention of United Nations Security Council resolutions (UNSCRs) pose a serious threat to the United States, the region, and the world.

Since assuming control in December 2011, Kim Jong Un has solidified his grip on power by embracing the coercive tools used by his father and grandfather. His regime has used force and the threat of force combined with inducements to quell domestic dissent and strengthen internal security; co-opt the North Korean military and elites; develop strategic military capabilities to deter external attack; and challenge the ROK [Republic of Korea] and the U.S.-ROK Alliance. In April 2013, Kim announced the “byungjin” policy, which emphasizes the parallel development of the country’s economy and nuclear weapons program, to reinforce his regime’s domestic, diplomatic, economic, and security interests.

North Korea fields a large, conventional, forward-deployed military that retains the capability to inflict serious damage on the ROK, despite significant resource shortfalls and aging hardware. The U.S.-ROK Alliance has deterred large-scale conventional attacks by maintaining a robust combined defense posture and strong military readiness. On a smaller scale, however, the DPRK has demonstrated a willingness to use military provocation to achieve national goals. In August 2015, two North Korean landmines exploded in the Demilitarized Zone (DMZ), which seriously wounded two ROK soldiers, raised tensions on the Korean Peninsula for several weeks, and was resolved through high-level inter-Korean talks.

North Korea’s continued pursuit of nuclear technology and capabilities and development of intermediate- and long-range ballistic missile programs underscore the growing threat it poses to regional stability and U.S. national security. North Korea’s pursuit of a submarine-launched ballistic missile capability also highlights the regime’s commitment to diversifying its missile force, strengthening the missile force’s survivability, and finding new ways to coerce its neighbors. Furthermore, North Korea continues to proliferate ballistic missile technology prohibited under [United Nations Security Council Resolutions] UNSCRs 1718, 1874, 2087, and 2094, exacerbating the security challenge for the United States and the international community.

Given the continued and growing threat from North Korea, its nuclear and missile programs, and its proliferation of related technology, the U.S. Department of Defense will continue to manage the North Korean security challenge through close coordination and consultation with the international community, particularly the ROK and Japan. The United States remains vigilant in the face of North Korea’s continued provocations and steadfast in its commitments to allies in the region, including the extended deterrence commitments provided through both the nuclear umbrella and conventional forces.

HIGH TECHNOLOGY

North Korea continues to advance its nuclear program. In September 2015, the DPRK’s Atomic Energy Institute noted that its nuclear facilities in Yongbyon, including the uranium enrichment plant and reactor, have been “adjusted and altered,” and that operations have restarted for the purpose of building its nuclear force.

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ROLE OF THE MILITARY

The North Korean military supports the Kim regime’s use of coercive diplomacy as part of its larger foreign policy strategy. North Korea uses limited provocations — even those that are kinetic and lethal in nature, such as military actions and small-scale attacks — to gain psychological advantage in diplomacy and win limited political and economic concessions.

Closely tied to its coercive diplomatic strategy are North Korea’s nuclear and ballistic missile programs. DPRK leaders see these programs as necessary for a credible deterrent capability essential to its survival, sovereignty, and relevance, and supportive of its coercive military threats and actions.

North Korea remains focused on extracting economic aid and diplomatic concessions from the international community while defending against perceived threats to its sovereignty. Since 2013, North Korea has increased diplomatic overtures to other countries in an attempt to secure foreign investment and improve its economy, but such outreach has failed to produce meaningful gains due to international sanctions and stigmatization related to concerns about its nuclear weapons program and human rights record. North Korea likely believes periodic “charm offensives” will eventually lead to improvements in regional relationships and gradual advancement of its strategic objectives.

INTERNATIONAL RELATIONS

North Korea remains dependent on China as its key economic benefactor, and North Korea’s leaders are conscious that efforts to advance its nuclear and missile capabilities angers China. Nevertheless, the regime likely thinks China prioritizes the preservation of regional stability and will refrain from punishing North Korea too severely or entirely cutting off diplomatic or economic ties.

North Korea also maintains friendly relations with Russia, though the relationship is less robust than North Korea’s relationship with China. Long-stalled plans for the creation of a natural gas pipeline from Russia to South Korea through North Korea — a project that could earn North Korea millions of dollars annually in transit fees — have made little concrete progress in recent years.

North Korean relations with Japan thawed somewhat in 2013 when North Korea accepted a visit by a Japanese delegation and indicated it might be willing to discuss the longstanding issue of Japanese citizens abducted by North Korea in the 1970s and 1980s. In May 2014, the Japanese and North Koreans held official talks in Stockholm, Sweden, which resulted in North Korea agreeing to re-open its investigation into the fate of the Japanese abductees and provide Japan with a report, in exchange for Japan easing some of its unilateral sanctions against North Korea. To date, however, North Korea has not provided Japan with any new substantive information. In August 2015, North Korea claimed to have a report but that the Japanese refused to receive it, a claim Japan denies. Regardless, Japan continues to seek resolution with North Korea on the abductee issue.

North Korea remains willing to disrupt temporarily relations with regional neighbors, including Russia and China, and absorb the associated cost when it believes coercive actions toward South Korea or the United States will advance its strategic objectives.

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Climate Change vs. Key Environmental Concerns

The extraordinary emphasis on the theory of man-made climate change by politicians, pundits, academia, and Hollywood has eclipsed other vitally important environmental concerns.

The general fixation on global warming, which rejects any contrary scientific fact or opinion, takes attention and funding away from more proven and immediate conservation and planetary health matters.

To a significant extent, that is because the actual motivation behind much of the climate change movement has more to do with politics than science.

Chris Baskind, writing for the Mother Nature Network, outlined several more immediate environmental issues. He noted that within a 24 hour period, 214,000 acres of tropical forest disappear. Two billion gallons of sewerage will be dumped into the world’s oceans. 10,800 children will die from drought or the lack of clean drinking water.

Baskind reported that “…beyond the unblinking stare of MTV — far from the well-heeled audiences of London, Hamburg and Giants Stadium — away from the celebrity and speechmaking, humanity’s collective lack of environmental wisdom is already grinding nature underfoot. While some propose spending billions of dollars to combat the uncertain foe of climate change, more pressing matters already threaten to upend our everyday lives.”

In the drive to counter perceived threats from climate change, poor, occasionally irrational, decisions are made. Promises, such as those made by at least one presidential candidate to completely replace all fossil fuels within the next 50 years have little chance to succeed.

Wind and solar present significant and profound problems of affordability, reliability, wildlife destruction and habitat loss that will not be resolved in a fifty year time table.

The concept of building, according to one proposal, tens of thousands of wind turbines ignores the massive resulting kill rates of birds and bats, and that’s just one part of the problem. Wind power problems.org describes key issues:

“Wind plant infrastructure creates an industrial nightmare in wild and natural settings:

  • Construction of 70ft wide access roads
  • Installation of new transmission lines
  • Construction of power substations
  • Excavations and concrete for turbine foundations

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  • 4-6 acres of forest is clearcut for each turbine.
    • Construction of a 25-turbine wind facility clears enough trees to fill 100 football fields.”

Solar panels are another oft-cited panacea.  But they provide substantial environmental damage, as well. A National Geographic  study noted:

“Fabricating the panels requires caustic chemicals such as sodium hydroxide and hydrofluoric acid, and the process uses water as well as electricity, the production of which emits greenhouse gases. It also creates waste. These problems could undercut solar’s ability to fight climate change and reduce environmental toxics.”

American Thinker outlines multiple environmental problems:

“large-scale solar power will create environmental damage over large areas of land.  Solar collectors may manage to convert only about 10% of the sun’s energy into electricity, the rest being reflected or turned into heat.  But the whole solar spectrum is blocked, thus robbing 100% of the life-giving sunshine from the ground underneath, creating a man-made solar desert.  For solar thermal, where mirrors focus intense solar heat to generate steam, birds that fly through the heat beams get fried.  Why would true environmentalists support industrial-scale solar energy collection?… Desertec, the utopian U.S. $560-billion project designed to cover 16,800 square kilometers of the Sahara Desert with solar panels, and then export electricity 1,600 km to Europe, has collapsed.”

There is a clear and important place for wind and solar energy, but the wholesale replacement of existing energy facilities simply replaces one set of problems with another. The use of rooftop solar panels for use in individual buildings is a far different issue than utility-scale solar energy production, for example.

The extraordinary concentration on global warming produces rather odd mandates. The Washington Times recently reported that the Pentagon has “ordered commanders to prioritize climate change in all military actions.”

The directive includes combat commands.  It is difficult to envision leaders of soldiers, sailors, airmen and Marines “prioritizing” global warming as they seek to avoid immediate death and destruction from enemy action. “Dakota Wood, a retired Marine Corps officer and U.S. Central Command planner, said the Pentagon is introducing climate change, right down to military tactics level.”

A bullet strike or a nuclear attack can cause a lot more immediate and drastic problems than theories about climate change.

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Fraudulent Voting Threat Expands

Serious questions concerning potential voter fraud in the Iowa Democrat caucus have reinvigorated claims of ballot and registration misdeeds across the nation. Examples of significant problems with accurate voter registration issues, including the registration of illegal aliens, abound from coast to coast.

From California’s Motor Voter Act, signed into law last year, which automatically registers drivers when they get or renew their license, to New York’s proposed legislation which would actually give illegal aliens in New York City the right to vote in local elections, measures are being planned and emplaced that would allow illegal aliens to vote in numbers that could alter the outcome of the 2016 presidential contest. Last June, Hillary Clinton called for universal automatic voter registration. (Capital Research notes that “The nation’s original motor-voter law was the National Voter Registration Act that President Bill Clinton signed into law a few months after his inauguration in 1993.”)

A Townhall reporter “found 94 illegally registered voters in one small region using one narrow verification method. If you extrapolate his number over Florida’s 67 counties, that’s nearly 6,300 people.”

True the Vote (TTV) has released a report on its recent discovery of thousands of duplicate voter registrations in North Carolina’s ten largest counties and the coordinated attempts by left-leaning political organizations to threaten the NC counties with new litigation and hostile document demands in a failed effort to stall lawful maintenance efforts.

In response to True the Votes efforts, those organizations, according to TTV, attempted to stall or prevent counties from cleaning voter records in accordance with state and federal requirements. TTV founder Catherine Engelbrecht has stated “For generations, leftist political organizations…have bullied our county election offices in order to engineer partisan election outcomes. It should come as no surprise that the same groups who would block simple maintenance efforts are also outspoken critics of North Carolina’s voter ID law. True the Vote holds election integrity above political advantage. Unfortunately, the same can’t be said for these groups.” True the Vote is scheduled to release the results of similar research efforts in other battleground states in the coming weeks.
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The Heritage Foundation notes that 24 million registrations are inaccurate, out of date, or duplicative; 2.8 million people are registered in two or more states, and 1.8 million registered voters are deceased.  Heritage’s figures don’t include the many, perhaps millions, of illegal aliens who are registered to vote.

Heritage also outlines historical nature of the issue.  “Examples abound, from the 135 percent of the eligible voters who turned out for an 1844 election in New York to the infamous Ballot Box 13 in Lyndon Johnson’s 1948 Senate election. The 1997 Miami mayor’s race was overturned because of more than 5,000 fraudulent absentee ballots. A mayoral election in East Chicago, Indiana, in 2003 and a state senate race in Tennessee in 2005 were also overturned because of voter fraud. In 2013, four individuals in Indiana were convicted of forging signatures on the ballot petitions that qualified Barack Obama for the state’s May 2008 primary election. As the Supreme Court of the United States recognized when it upheld the constitutionality of Indiana’s voter identification law in 2008, flagrant examples of voter fraud ‘have been documented throughout this Nation’s history by respected historians and journalists.’ Those examples ‘demonstrate that not only is the risk of voter fraud real but that it could affect the outcome of a close election.”

Judicial Watch adds: “The sad truth is that our nation’s recent history consists of far too many elections which have been called into question due to allegations of incompetence and outright misconduct.  Most notable have been the abuses by ACORN and its state organizations, which in 2008 were implicated in at least 35 well-documented election fraud schemes in 17 states, leading to multiple convictions, fines, and even prison.  And while ACORN activities have become so nefarious it was forced to disband (though, in reality, spinoff groups have survived) Project Vote, an affiliate of ACORN, remains very active…”

National Review reports that “Several well-funded organizations — including the League of Women Voters and the NAACP — are fighting efforts to prevent non-citizens from voting illegally in the upcoming presidential election. And the United States Department of Justice, under the direction of Attorney General Loretta Lynch, is helping them.  On February 12, these groups filed a lawsuit in D.C. federal court seeking to reverse a recent decision by the U.S. Election Assistance Commission (EAC). The Commission’s decision allows Kansas and other states, including Arizona and Georgia, to enforce state laws ensuring that only citizens register to vote when they use a federally designed registration form.”
A Congressional Research Service study noted that “The Help America Vote Act requires that certain voters who had registered by mail present a form of identification from a list specified in the act. States vary greatly in what identification they require voters to present, ranging from nothing beyond the federal requirement to photographic identification for all voters. A number of states enacted laws in recent years to require photo ID to vote, which resulted in a series of state court challenges and rulings. In the 109th Congress, the House passed legislation to require photo identification and proof of citizenship when voting in federal elections, but no further action followed. The U.S. Supreme Court has upheld an Indiana statute requiring photo identification for voting…Given the problems some states have had, the increase in new-voter registration in recent elections, and recent closely contested presidential elections, issues associated with voter registration systems have become more prominent. Among them are questions about the integrity and accuracy of the statewide systems, the validity of new registrations, concerns about various kinds of fraud and abuse, and the impacts of attempts to challenge the validity of voters’ registrations at polling places.”

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Why is the President Travelling to Cuba?

Mr. Obama’s March 21 visit to Cuba will the first by a U.S. president in 88 years. The question is why the President believes it is appropriate to travel there now.

U.S. Cuban relations, already rocky following Fidel Castro’s alliance with the U.S.S.R., took a dramatic turn for the worse when Havana decided to serve as a forward base for Moscow’s nuclear missiles in 1962. A little known postscript to that event, detailed by the World Press  was Castro’s attempts to retain 100 tactical nuclear weapons even after the Soviets were forced to withdraw by a U.S. naval blockade. The Cuban regime wasn’t just a passive host. Havana urged Moscow  to launch an atomic strike against America.

Despite The President’s claims that significant progress has been made, the facts speak otherwise.  The Castro regime continues to oppress its people, and continues to support terrorism. In addition, it has again become an outpost for the Russian military in the western hemisphere.

Amnesty International reports that “Peaceful demonstrators and human rights activists are routinely detained for exercising their rights to freedom of expression, association, assembly and movement. Activists are often detained to stop them from attending public demonstrations or private meetings. Independent journalists reporting on these detentions are themselves harassed by the authorities or put behind bars. Often, the relatives of those detained are never informed of their loved ones’ whereabouts. According to the Cuban Commission for Human Rights and National Reconciliation (Comisión Cubana de Derechos Humanos y Reconciliación Nacional), there were 768 “politically” motivated detentions in August 2015 alone – up from 674 in July 2015. “

The situation, since Mr. Obama’s opening to the Castro regime, has become worse, not better.

It’s not just what the Castro regime does inside its own nation that’s a problem for the U.S.—it’s actions directly endangering America need to be taken into account.

The Congressional Research Service notes that “On April 14, 2015, the President announced his intention to rescind the terrorism designation (Cuba had remained on the State Department’s list of state sponsors of terrorism since 1982) from the government of Cuba, a decision that was fulfilled by the Secretary of State on May 29, 2015.”   This is contrary to the evidence.

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Another issue noted in the 2013 terrorism report that has been mentioned for many years is Cuba’s harboring of fugitives wanted in the United States. The report maintained that Cuba provided such support as housing, food ration books, and medical care for these individuals. U.S. fugitives from justice in Cuba include convicted murderers and numerous hijackers, most of whom entered Cuba in the 1970s and early 1980s.16 For example, Joanne Chesimard, also known as Assata Shakur, was added to the FBI’s Most Wanted Terrorist list on May 2, 2013. Chesimard was part of militant group known as the Black Liberation Army. In 1977, she was convicted for the 1973 murder of a New Jersey State Police officer and sentenced to life in prison. Chesimard escaped from prison in 1979, and according to the FBI, lived underground before fleeing to Cuba in 1984.17 In addition to Chesimard and other fugitives from the past, a number of U.S. fugitives from justice wanted for Medicare and other types of insurance fraud reportedly have fled to Cuba in recent years.

The danger is even greater than terrorism.

The Diplomat reports that “A senior Russian defense official has announced that Moscow is looking to build military bases throughout different countries in Asia and the Western Hemisphere” including Cuba.”

Capital Hill Cubans notes that “Throughout the year, the Castro regime has continued to host and harbor Russian spy ships tasked with monitoring sensitive U.S. defense networks… The Russian research ship Yantar has been tracked from the northern Atlantic near Canada since late August as it makes its way south toward Cuba. Defense officials familiar with reports on the Russian ship say the Yantar is believed to be gathering intelligence on underwater sensors and other equipment used by U.S. nuclear submarines based at Kings Bay, Georgia. The submarines, their transit lanes and training areas stretch from the coastal base through the Atlantic to Europe.”

Fox News reports that Cuban troops are operating in Syria, manning Russian tanks as they attack rebel forces supported by the United States.

Cuba oppresses its own people, supports terrorism, and enthusiastically acts as a forward base for the dangerous and aggressive Putin regime.  President Obama needs to explain why he believes it is appropriate to travel to Cuba, and why he continually and incorrectly states that conditions there have improved.

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Sharp Differences Mark Candidates Tax Ideas

Democrats and Republicans have sharply differing views of the role of the federal government, and that is reflected in the tax policies their presidential candidates advocate.

Generally, Democrats believe that higher taxes provide more revenue to finance anti-poverty and other programs.   They favor a more nuanced tax code that allows Washington to use tax policy for social and ideological goals.

Republicans tend to believe that lower taxes provide a more vibrant economy that  reduces poverty through greater employment, and note that a private sector unburdened by high taxes actually produces more revenue than higher rates. They believe that it is mostly inappropriate to use the tax code for ideological purposes.

Various analyses of the leading candidate’s tax proposals essentially confirm those different views. Here are brief snapshots of their ideas:

These are some of Donald Trumps’ concepts noted by The Tax Policy Center:

“Collapse the current seven tax brackets, which range from 10 to 39.6 percent, into three brackets of 10, 20, and 25 percent.  Increase the standard deduction to $25,000 for single filers and $50,000 for joint filers in 2015, indexed for inflation thereafter.  Leave personal exemptions unchanged at $4,000 per person in 2015, indexed.  Tax dividends and capital gains at a maximum rate of 20 percent.  Limit the tax value of itemized deductions (other than charitable contributions and mortgage interest) and exclusions for employer-provided health insurance and tax-exempt interest.  Increase the phaseout rates for the personal exemption phaseout and the limit on itemized deductions. Repeal the alternative minimum tax. Tax carried interest as ordinary business income.  Repeal the exclusion for investment income on life insurance contracts entered into after 2016. Repeal federal estate and gift taxes. Reduce the corporate tax rate to 15 percent. Limit the top individual income tax rate on pass-through businesses such as partnerships to no more than 15 percent. Repeal most tax breaks for businesses.  Repeal the corporate alternative minimum tax.  Impose up to a 10 percent deemed repatriation tax on the accumulated profits of foreign subsidiaries of US companies on the effective date of the proposal, payable over 10 years. Tax future profits of foreign subsidiaries of US companies each year as the profits are earned.”

The Tax Foundation reports that the Clinton Plan.

“would increase marginal tax rates for taxpayers with incomes over $5 million, enact a 30 percent minimum tax (the Buffett Rule), alter the long-term capital gains tax rate schedule, and limit itemized deductions to a tax value of 28 percent. Her plan would also restore the estate tax to its 2009 parameters and would limit or eliminate other deductions for individuals and corporations.”

Forbes outlines Bernie Sanders tax plan:
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Sanders proposes a top rate on individual income of … 52%, … the top rate on someone earning $250,000 would increase from 33% under current law to 37% under Sanders, while someone earning $500,000 would see his top rate jump from 39.6% to 43%.

In addition, Sanders would do away with the preferential treatment long afforded capital gains and dividends, meaning those types of income would be taxed at the same rates as ordinary income for taxpayers earning in excess of $250,000. Under current law, the top rate on such income is 23.8%; as a result, a taxpayer who, for example, sells a business for $5 million of gain would pay $1.19 million in federal tax under current law, but would pay $2.4 million in federal tax under the Sanders plan (a rate of 48%).

Sanders would also limit the benefit of all itemized deductions to a 28% rate, meaning a taxpayer who earned $500,000, and was thus in Sanders’ 43% bracket would effectively pay a 15% tax on deductions such as mortgage interest, state and local taxes, and charitable contributions.

National Review  outlined the Rubio tax plan. He would reduce the corporate tax rate from 35 to 25%, establishing a 25% tax rate on all business income and a maximum 25 percent maximum rate on all small businesses that file using Schedule C as part of a 1040 tax return. The proposal eliminates the capital gains tax, the double tax on dividends, and the second layer of tax on interest. The proposal alters depreciation rules to encourage new business investment. The rule mandating that businesses pay a second layer of tax on income that is earned and already subject to tax in other nations. The death tax would be eliminated entirely. The plan eliminates the state and local tax deduction.

The Tax Foundation outlines the Cruz tax plan as follows:

“Senator Cruz’s (R-TX) tax plan would enact a 10 percent flat tax on individual income and replace the corporate income tax and all payroll taxes with a 16 percent “Business Transfer Tax,” or subtraction method value-added tax. In addition, his plan would repeal a number of complex features of the current tax code. Consolidates the current seven tax brackets into one bracket at 10 percent on all personal income (wages, salaries, interest, capital gains, dividends, and business income). Increases the Standard Deduction from $6,300 ($12,600 married filing jointly) to $10,000 ($20,000 married filing jointly) while retaining the personal exemption. Eliminates all itemized deductions except for the home mortgage interest deduction and the charitable deduction. Places a tighter cap on the home mortgage interest deduction. Eliminates the Alternative Minimum Tax. Eliminates the Net Investment Income Tax of 3.8 percent and the Medicare surtax of 0.9 percent, which were passed as part of the Affordable Care Act. Eliminates all individual tax credits except for the Child Tax Credit and the Earned Income Tax Credit. Expands the Earned Income Tax Credit by 20 percent. Preserves the exclusions from income of pension contributions, employer-provided health premiums, and imputed rent, similar to current law. Creates a new “universal savings account” that allows up to $25,000 of tax-deductible saving. Eliminates the payroll tax. Eliminates the corporate income tax. Provides a temporary tax holiday at a 10 percent rate (instead of a full 35 percent rate) on any deferred foreign profits that are repatriated.”

Again, these are snapshots, and greater details can be found on each of the candidates’ websites.

 

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China attacks U.S. Steel Industry

In a rare display of bipartisanship not only on Capitol Hill but between labor and management, action against China’s harmful against the American economy is taking place.

The U.S. Department of Commerce has found that Beijing is “dumping” (a term indicating that  nation is selling a product at less than normal value or the cost of production Typically, the goal of this is to destroy the local industry and establish a monopoly for the foreign source.) steel products in the United States.

The Department of Commerce has concluded Chinese dumping has occurred in several areas, including:

  • Producers/exporters of steel nails from China have sold steel nails in the United States at up to 118.04 percent less than normal value. As a result of the affirmative final determination in the China investigation, Commerce will instruct U.S. Customs and Border Protection (CBP) to continue to collect a cash deposit or bond on entries of steel nails from China based on the final rates.
  • Imports of corrosion resistant steel products from China. A dumping margin of 255.80 percent was noted.

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Currency manipulation is another area in which Beijing wages economic warfare against other nations. AFL-CIO President Richard Trumka notes:

“China’s currency manipulation lowers the wages of Chinese workers and lowers manufacturing costs in China, creating an unfair trade advantage that has already cost millions of American jobs and closed thousands of American factories. This latest move, which will act as a tax on our exports and a subsidy for Chinese imports, further exacerbates the existing problem….The failure to address currency manipulation and undervaluation…has been a major cause of the U.S. trade deficit and manufacturing decline. It has turned trade agreements into trade tragedies and made the trade deficit a major drag on economic recovery.”

A Forbes Review noted that “Chinese steel exports rose roughly 25% year-over-year in the first ten months of 2015…The rising penetration of imported steels has driven down both shipments and realized prices of domestic steel producers. U.S. Steel reported year-over-year declines of 27% and 8% in shipments and average realized prices respectively for its U.S. Flat-rolled Steel division in the first nine months of 2015.  ArcelorMittal’s NAFTA division reported year-over-year declines of 3% and 13% in shipments and average realized prices respectively in the first nine months of 2015. Domestic steel mills have idled nearly 38% of their total production capacity in response to the increase in steel imports.The imposition of anti-dumping duties on Chinese steel imports will make them prohibitively expensive, which should boost both demand and pricing for domestically produced steels. The final determination of duties on imports is expected by mid-2016.”

Unlike private companies, government-owned concerns can engage in extensive dumping practices without worrying about the bottom line. The American Manufacturing Organization, citing a Wall Street Journal study, noted that “most of these companies [engaging in dumping] were government-owned or closely linked to local governments — and given their role as employers and providers of tax revenue, those mills are ‘unlikely to close or cut production even if running losses.‘ Major state-owned steelmakers also continue to have their loans rolled over or refinanced. And on top of all that, the Chinese government manipulates its currency, giving Chinese steelmakers a major economic advantage… As a result, more than 12,000 steelworkers have been laid off in recent months. Steel plant activity is operating below 70 percent of its capacity, and major steelmaking facilities have closed. If things don’t change, additional layoffs and closures are expected.”

Concern over China’s practices led to the introduction of the American Trade Enforcement Effectiveness Act, H.R. 2523,  sponsored by Rep. Bost, Mike [R-IL. ] The legislation aims to ease the way for U.S. companies and workers to seek redress against unfair practices. The bipartisan measure currently has 46 co-sponsors. A companion bill, S1269,  was introduced into the U.S. Senate by Senator Orrin Hatch (R-Utah.)

The United States is not alone in its concern over China’s practices. The Financial Times reports that European states oare demanding that the European Union take action against Beijing as well.  According to the report, “Europe’s steel industry has lost a fifth of its workforce since 2009…European steel industry executives have accused China of using its massive overcapacity at steel mills to dump products on the European market, selling them beneath the cost of production.”

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The 2017 Federal Budget: More Deficit, Hiked Taxes

The President has released his 2017 proposed budget. At the unveiling, White House Press Secretary Josh Earnest noted:

“Budgets are important because they enumerate priorities.  And when you have something that’s this detailed, there’s no fudging.  It becomes quite clear when you look at the numbers what you believe rates.  And that’s the importance of this exercise.  I readily acknowledge, as I have on many occasions, that there are some priorities that we have that are deeply held that Republicans in Congress do not share.  And there will be differences of opinion about the priorities that are laid out in here.”

The New York Analysis of Policy & Government has reviewed the White House’s statements,  information from the Office of Management and Budget,  and the Congressional Budget Office (CBO)   as well as comments from those both favoring and disagreeing with his general direction, such as the National Priorities Project,  the Heritage Foundation,  and other sources.

Total spending comes to about $4.2 trillion, an increase of approximately 4% over 2016 levels. The President anticipates taking in about $3.6 trillion in revenue, leaving a vast gap of $398.4 billion to add to America’s current debt of over $19 trillion. Analyzing the current budget shortfall, the Congressional Budget Office reports, “At 2.9 percent of gross domestic product (GDP), the expected shortfall for 2016 will mark the first time that the deficit has risen in relation to the size of the economy since…2009.”

CBO notes:

“In 2016, the federal budget deficit will increase, in relation to the size of the economy, for the first time since 2009, according to the Congressional Budget Office’s estimates. If current laws generally remained unchanged, the deficit would grow over the next 10 years, and by 2026 it would be considerably larger than its average over the past 50 years, CBO projects. Debt held by the public would also grow significantly from its already high level… The deficit projected by CBO would increase debt held by the public to 76 percent of GDP by the end of 2016, the agency estimates—about 2 percentage points higher than it was last year and higher than it has been since the years immediately following World War II.”

According to Office of Management and Budget, spending is divided as follows:

Social Security, Unemployment, & Labor, $1.39 trillion, 33% of all federal spending

Medicare & Health, $1.17 trillion, 28% of all federal spending

Defense, $632 billion, 15% of all federal spending

Interest on the National Debt, $303 billion, 7% of all federal spending

Veterans Benefits, $179 billion, 4% of all federal spending

Agriculture & Food, $138 billion, 3% of all federal spending

Transportation, $109 billion, 3% of all federal spending

Housing & Community Development, $90 billion, 2% of all federal spending
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Education, $85 billion, 2% of all federal spending

Environmental and Energy, $51 billion, 1% of all federal spending

International relations, $45 billion, 1% of all federal spending

Science, $32 billion, 1% of all federal spending

Government expenses, $8 billion, less than 1% of all federal spending

As noted above, there will not be adequate revenue to pay for the proposed spending. The heaviest burden of providing payments comes from Individual income, payroll, and corporate taxes. The projections are based on an assumption that the economy will grow at an average rate of 2.5 percent, a continuation of the weak rate that the nation has endured over the past several years.

Here’s where the anticipated revenue is expected to come from:

Individual income taxes, $1.79 trillion, 49% of all federal revenue

Payroll taxes, $1.14 trillion, 31% of all federal revenue

Corporate income taxes, $419 billion, 11% of all federal revenue

Miscellaneous & legislative proposals , $146, (approximately) 4%+ of all federal revenue

Excise taxes, $110 billion, 3% of all federal revenue

Customs Duties, $40 billion, 1% of all federal revenue

A controversial revenue enhancer contained in the President’s budget is a $10 per barrel tax on oil, which observers estimate would result in 22 cent per gallon tax passed down to consumers of gasoline, diesel fuel, home heating oil, jet fuel, and other petroleum liquids.

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Socialism’s False Hope

For the first time, Americans face the prospect of an openly socialist candidate potentially ascending to the Presidency.

Voter angst has given rise to interest in Bernie Sanders’ platform of a socialist system, in which production is controlled by the government. The U.S. economy faces a dearth of middle income employment. Students are deeply indebted due to sky-high college tuition.  There is a strong belief that substantial, perhaps radical, change is needed.

The feeling is understandable, but the solution is a proven failure. The “most pure” socialist nations, the Soviet Union and the nations it held in captivity, all suffered inferior economies and ill-served citizenry.  Others are exceptionally impoverished. Most feature dictatorial governments. Some semi-socialist nations have weakened economies that, ironically, could not survive without help from, or access to, the markets of capitalist economies.  China’s vaunted (but now faltering) economy would collapse if access to U.S. consumers vanished.

Some will point to the economies of European nations as an example of socialist or semi-socialist economies that have not collapsed. Once again, however, the support of the capitalist American economy proves indispensable. Both as a market, and as the major financier of the enormous cost of providing defense for the Continent, the capitalist U.S. essentially underwrites its semi-socialist allies.

Not surprisingly, Thomas Donohue, president of the U.S. Chamber of Commerce, has opposed the rising acceptance of socialism, noting:

“Socialism is a wrong and dangerous path for America. It’s failed everywhere it’s ever been tried, bringing shared misery instead of shared prosperity. It undermines personal initiative and responsibility, stunts innovation and growth, makes people serve government—not vice-versa—and robs individuals of the dignity of earning their own success and charting their own course.”

The Foundation for Economic Freedom delivered a similar message:

Curt’s first point was that change is difficult, because it involves a great deal of sacrifice viagra fast respitecaresa.org and struggle. However, they know little about how to manage the stress in their lives, how to decompress, and ultimately viagra online how to ‘de-stress.’ It is not just a goal, for many it has become a necessity, a matter of survival. These new versions of the Kamagra tablets endeavors to manage the cause of ED symptoms and deliver a stiffer penile pfizer viagra achat erection. They have years of experience in the same compositions/dosages as the original medication, with the same benefits – but at a cheaper price. cialis stores also comes in the convenient jelly form as already mentioned. “Socialism is the Big Lie of the twentieth century. While it promised prosperity, equality, and security, it delivered poverty, misery, and tyranny. Equality was achieved only in the sense that everyone was equal in his or her misery.

“In the same way that a Ponzi scheme or chain letter initially succeeds but eventually collapses, socialism may show early signs of success. But any accomplishments quickly fade as the fundamental deficiencies of central planning emerge. It is the initial illusion of success that gives government intervention its pernicious, seductive appeal. In the long run, socialism has always proven to be a formula for tyranny and misery. A pyramid scheme is ultimately unsustainable because it is based on faulty principles. Likewise, collectivism is unsustainable in the long run because it is a flawed theory. Socialism does not work because it is not consistent with fundamental principles of human behavior. The failure of socialism in countries around the world can be traced to one critical defect: it is a system that ignores incentives.

“In a capitalist economy, incentives are of the utmost importance. Market prices, the profit-and-loss system of accounting, and private property rights provide an efficient, interrelated system of incentives to guide and direct economic behavior. Capitalism is based on the theory that incentives matter! Under socialism, incentives either play a minimal role or are ignored totally. A centrally planned economy without market prices or profits, where property is owned by the state, is a system without an effective incentive mechanism to direct economic activity. By failing to emphasize incentives, socialism is a theory inconsistent with human nature and is therefore doomed to fail. Socialism is based on the theory that incentives don’t matter!”

Even socialist nations endowed with exceptional inherent wealth cannot long remain prosperous. CATO describes how Venezuela, which possesses the world’s largest oil reserves, has become impoverished under socialist leadership.

“Despite receiving over $1 trillion in oil revenues since 1999, the government has run out of cash and now relies heavily on printing money to finance itself. The result is the highest inflation rate in the world: officially 56 per cent last year, although according to calculations by Steve Hanke of Johns Hopkins University, the implied annual inflation rate is actually 330 per cent.”

The economic failures of socialism are matched by its detrimental effect on individual freedom. Ronald Reagan noted the inherent socialist tendency to attack personal liberty: “A government can’t control the economy without controlling people.” In its raw essence, socialism depends on force.

Ironically, the very problems socialists describe as a justification for their philosophy are caused by socialist-like federal programs.  The Great Recession was the result of federal mandates to financial institutions to provide loans to borrowers that were poor risks for repayment. The heavy taxes and regulations imposed on U.S. corporations have led them to be uncompetitive with their international rivals, resulting in sharply diminished employment.

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Does Obama have Hidden Goals for Cuba and Guantanamo?

Did the President make a secret deal with Havana to first close the Guantanamo Bay prison, then return the entire naval base to Cuba?

By now, it’s obvious that Mr. Obama has difficulty even saying “Islamic terrorism.”  But his dangerously inept policies are far worse than mere semantics.  There continues to be no viable reason why the Guantanamo facility, off American shores and therefore keeping U.S. citizens safe from attempted attacks to free the hazardous inmates, should be closed. There is equally no viable reason for the President to open relations with the Castro regime when it continues to oppress its own population, sponsor terrorism abroad, and allow the Russian Navy to use the island nation’s facilities. In April 2015, the President withdrew the terror-sponsor designation from Cuba, despite Havana’s ongoing offenses.

It’s long past time to ask the President very difficult questions concerning his bizarre stance on terrorism, and his views on relations with Cuba.

The President’s actions in prematurely withdrawing from Iraq, and encouraging the various Moslem Brotherhood-supported “Arab Spring” movements which expanded the influence of terrorists, were terrible mistakes. His refusal to respond to the Benghazi attack or to seriously assault ISIS call into question whether he takes the terrorist threat seriously at all. Similarly, his announcement of a withdrawal date from Afghanistan repeats the mistake he made in Iraq.

The White House response to the Paris attacks was ridiculous. Jack Kelly, writing in realclearpolitics, notes: When 44 world leaders joined 1.6 million Parisians to condemn Islamist terror… Barack Obama and Vice President Joe Biden were watching football. Secretary of State John Kerry was in India (where it’s been unseasonably cold), to give a speech on global warming. Attorney General Eric Holder was in Paris but didn’t attend because he was in “high-level meetings,” aides said. With whom? Nearly every prominent French official was at the rally.

Mr. Obama’s Oval Office remarks in response to the San Bernardino attack, falsely claiming wide-scale bias against Moslems and calling for more domestic gun control, were astounding. USNews wrote: “The shooters in San Bernardino were no more deterred by the gun control laws on the books when they modified the weapons they used than they were by the prohibition on the construction and use of the pipe bombs which, in this case at least, were fortunately duds. He doesn’t understand, and as a consequence, he’s fighting the wrong war.”
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A House Armed Services Committee release reports that “Section 1222 of the National Defense Authorization Act for FY16 require[d] the Administration to deliver a strategy for the Middle East and countering violent extremism no later than February 15, 2016.  It requires the Administration to lay out a number of elements needed to defeat terrorist groups like ISIS and al Qaeda, including a description of the role the U.S. military will play in such a strategy, a description of the coalition needed to carry out the strategy, and an assessment of efforts to disrupt foreign fighters traveling to Syria and Iraq. The White House has failed to comply.  Reacting to the the Administration’s failure to submit the strategy, Rep. Mac Thornberry (R-TX), Chairman of the House Armed Services Committee, made the following statement: ‘Unsurprisingly the Administration cannot articulate a strategy for countering violent extremists in the Middle East.  Time and again, the President has told us his strategy to defeat extremist groups like ISIS and al Qaeda is well underway; yet, months after the legal requirement was established, his Administration cannot deliver that strategy to Congress.  I fear the President’s failure to deliver this report says far more about the state of his strategy to defeat terrorists than any empty reassurance he may offer from the podium.”

Information first obtained by the Washington Free Beacon indicates that the Presidents’ plan to close the Guantanamo Bay facility may force the Pentagon to release suspected terrorists.

In a letter to Defense Secretary Carter, Rep. Duncan Hunter (R-Ca) notes the high rate of recidivism of terrorist prisoners already released from Guantanamo Bay, and questions the disposition of future captured terrorists.

The President’s action are even raising eyebrows among his staunchest supporters. Several New York Democrats, led by Senator Charles Schumer, have been outraged by Mr. Obama’s move to cut anti-terror funds from America’s top target of Islamic extremists, New York City.

Mr. Obama has provided little explanation for its policy, or lack thereof, on terrorism. Nor has there been a convincing explanation about its stance towards Guantanamo Bay in particular, or Cuba in general. The hard questions need to be asked. Are the two issues related?

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The Reality of Voting Fraud

The key issue of this year’s presidential contest may not be who the candidates are, the weak economy, or the hazardous condition of America’s national security. Increasingly, it appears that the integrity of the election process itself may be the most contentious topic to arise in the 2016 race.

Recently, as reported in the Free Beacon Ann Ravel, the former chair and current member of the Federal Election Commission stated (at a conference in Canada, interestingly enough) that the “United States political system benefits wealthy white men,” and “criticized the system by saying it is set up in such a way that makes it difficult for women and minorities to succeed.”

FEC member Ravel’s comments are not isolated words. They are part of an overall strategy to create a smokescreen for attempts to alter election results through a combination of election day antics, registration fraud, and opposition to voter id. Commissioner Ravel’s comments are designed to give cover to a bevy of approaches that seek to overcome the advantage Republicans have demonstrated in recent elections, and that the GOP is expected to have in response to anger over the dismal results of the Obama Administration’s policies at home and abroad, as well as (if Hillary is the candidate) dismay over rampant ethical issues or (if Sanders is the candidate) a rejection of a blatant socialist message.

Many factors in illegal voting and registration are in play, particularly with the increase in illegal immigration, allowing noncitizens to obtain driver’s licenses and “motor voter” rules in many states that offer voter registration when applying for a license.

The NOLO legal website notes:

“Due to the Motor Vehicle Act of 1993 (also known as the ‘Motor Voter Act’), states are required to provide people with the opportunity to register to vote when they apply for or renew their driver’s licenses. However, while a minority of states ask for proof of citizenship at the time of voter registration, employees in most states may not inquire about citizenship status before asking noncitizens if they desire to register to vote… some noncitizens are misinformed about their eligibility to vote. For example, a campaign worker may tell you that permanent residents (green card holders) may register to vote, even when they are not eligible, or a canvasser may knock on your door to ask you to register and give you incorrect information.”

Legitimate questions continue to go unanswered. Some proficiency in English is required for citizenship, but some states print ballots in numerous languages. Why?
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Intelligentuspolitics.com reports:

“Dozens of lawsuits have been filed by the Obama Justice Department, the Democrat Party, the Clinton campaign and various other groups … Their primary and continuing objective has been to convince the electorate that there is no voter fraud, an objective with which they have had moderate success. To understand the magnitude of this effort, perform a Google exact-match search for the phrase ‘voter fraud is a myth.’ Google has 3,940 articles in their index that use that exact phrase. What are the odds? That is a great deal of content with the exact same phrase and message.

Their secondary goal has been to convince voters that voting rules of any kind constitute Republican voter suppression… Again looking at search trends, in the last eight years, ‘Republican voter suppression’ produces 11,500 exact-match Google search results and ‘GOP voter suppression’ produces 15,100 exact-match search results. Their most aggressive efforts are dedicated to opposing maintenance of voter registration rolls and opposing voter ID laws. These initiatives pose a very real threat to successful voter fraud. Democrats combine media bombardment with a mind boggling assortment of frivolous lawsuits to oppose voter ID laws.”

Reason.comreports:

“In a 2015 study that is currently under review, Lindsay Nielson—a political scientist at the University of San Diego—parses the effects of stricter voter ID laws on the voting patterns of the young, the elderly, the poor, and racial minorities [in general elections]. …Nielson finds that “there is little evidence that racial minorities are less likely than whites to vote when states institute voter identification requirements.” … There is also “no statistically significant gap in estimated turnout [between high-income and low-income voter] when the identification law becomes stricter.”

The U.S. Supreme Court, in its 2008 upholding of the constitutionality of Indiana’s voter identification law, stated that obvious examples of voter fraud exist throughout U.S, history.  The Heritage Foundation notes that the “Nonpartisan Commission on Federal Election Reform, chaired by former President Jimmy Carter and former Secretary of State James Baker, found that our ‘electoral system cannot inspire public confidence if no safeguards exist to deter fraud or to confirm the identity of voters.”