Today’s News 7th April 2021

• "A Great Step Forward" – EU Praises Yellen's Global Minimum Tax, Says Deal Could Come Later This Year
  “A Great Step Forward” – EU Praises Yellen’s Global Minimum Tax, Says Deal Could Come Later This Year

  Few, if any, industries are going to love the higher taxes they will soon face in the US and abroad thanks to President Biden and his American Jobs Plan. But big tech has good reason to be particularly unnerved by Treasury Secretary Janet Yellen’s calls for a global minimum corporate tax rate.

  Though it didn’t name its source, Bloomberg reported Tuesday that the EU plans to insist that its long-awaited digital tax on the US tech giants – which Washington (under Trump) had protested – be part of the same package as the global minimum corporate tax in order to secure a deal.

  

  A bevy of European officials have praised Yellen’s call for nations to work together to set a new tax floor, a call that was made during a speech to the Chicago Council on Global Affairs yesterday.

  Paolo Gentiloni, the European Commission’s point man on the economy, responded to Yellen’s plea for G-20 economies to agree on the minimum tax to prevent a “race to the bottom” with praise, saying there could be a breakthrough agreement by the summer.

  He wasn’t the only European official to endorse the idea. German Finance Minister Olaf Scholz also welcomed the idea, calling the minimum corporate tax “a great step forward” in the battle to stem the erosion of government revenues. “The support of the USA gives this initiative a strong tailwind,” Scholz told reporters, adding that he hoped a deal could be achieved this year, according to AFP.

  “It’s very good news,” Gentiloni said in an interview with Bloomberg Television’s Francine Lacqua where he welcomed “this new multilateral atmosphere with the new US administration and the strong possibility of cooperation in the global arena. One of the main results could be finding agreements in global taxation.”

  Finance ministers of the G-20 group of large economies are expected to discuss the proposal during a virtual meeting on Wednesday, where Italy will preside as the current occupant of the G-20’s rotating presidency. 

  A Treasury official told reporters the G-20 goal is to have a proposal on the global minimum tax by July, and President Joe Biden’s administration could if needed change its legislation to bring the US minimum tax into line with the international plan. A G-20 agreement would, in turn, increase the odds that members of the broader OECD agree to the minimum.

  European Commission spokesman Daniel Ferrie said the bloc called “on all global partners to remain engaged in these discussions and to continue work without delay.”

  But if we have learned anything from the past few years, it’s that just because Brussels endorses a plan, doesn’t mean all of the 27 remaining EU member states will go along with it. And as member states prepare to tap the massive EU COVID rescue fund, some might chafe at Brussels’ removing one pathway toward stoking growth and job creation.

  Of course, the EU isn’t the only transnational organization exclaiming the virtues of higher taxes. The IMF has been pushing predistributive and redistributive policies even before the pandemic, though it has since doubled down, as Mike Shedlock explains.

  

  in the meantime, analysts will need to factor in greater odds of a new global tax regime that could arrive before the end of the year.

  Tyler Durden
  Wed, 04/07/2021 – 02:45

• Fallout From Greensill Collapse Splatters British Government, Leaves Taxpayers With Big Losses
  Fallout From Greensill Collapse Splatters British Government, Leaves Taxpayers With Big Losses

  Authored by Nick Corbishley via NakedCapitalism.com,

  Downing Street’s dodgy dealings with Citigroup and Greensill show just how far the British government is willing to go to line the pockets of banks and other financial firms while bleeding taxpayers dry. 

  

  The collapse of UK-based supply chain finance firm Greensill Capital continues to reverberate. In Germany the private banking association has paid out around €2.7 billion to more than 20,500 Greensill Bank customers as part of its deposit guarantee scheme after the bank collapsed in early March. But the deposits of institutional investors such as other financial institutions, investment firms, and local authorities are not covered. Fifty municipalities are believed to be nursing losses of at least €500 million.

  Greensill’s biggest source of funds, Credit Suisse, has seen its share price plunge by almost a quarter. This is due not only to the fallout from Greensill’s collapse but also the impact of losses at its prime brokerage division caused by the stricken U.S. hedge fund Archegos, which are expected to reach €4 billion. The lender has warned of “considerable uncertainty” regarding the valuation of its supply chain finance fund. More than $5 billion of the roughly $10 billion invested in the fund remains outstanding.

  Credit Suisse had assured clients in marketing documents that the debt in the supply chain fund was “low risk”. In one factsheet, it also said: “The underlying credit risk of the notes is fully insured by highly rated insurance companies.” At the beginning of March, that turned out not to be true. Some clients whose money remains trapped in the fund have threatened to sue.

  Greensill’s biggest client, Anglo-Indian steel magnate Sanjeev Gupta, is on the verge of bankruptcy. Gupta’s GFG Alliance reportedly owes Greensill more than €3 billion. It began defaulting on its obligations after Greensill stopped lending to the group at the beginning of March. At the end of March Gupta requested a £170 million emergency loan from the UK government, which was duly rejected. Greensill’s administrator, Grant Thornton, has been unable to verify invoices underpinning some of the loans to Gupta. Companies listed on the documents denied ever having done business with the metals magnate.

  Now the fallout is beginning to splatter the British government, which invited Greensill to participate in its Coronavirus Large Business Interruption Loan Scheme (CLBILS). This is despite the fact the company: a) wasn’t a bank; and b) was quite clearly already in deep financial trouble. Greensill’s participation in CLBILS allowed it to extend even more loans, this time government backed, to Gupta’s empire. Taxpayers will now probably end up holding the bag for those loans.

  Special Treatment, Frantic Lobbying

  Greensill Capital was the only non-bank financial firm to administer the emergency coronavirus loan schemes. The Treasury has admitted that Greensill was exempt from the capital adequacy and stress tests that would safeguard the public from risk when using other lenders. The apparent reason for this special treatment was that former UK Prime Minister David Cameron, who had joined Greensill as an advisor in 2018, was frantically lobbying Chancellor of Exhchequer Rishi Sunak to hand government loans to the embattled financial firm even as it spiralled toward bankruptcy.

  Cameron is believed to have held share options in Greensill Capital worth tens of millions of pounds. Now they’re worth nothing.

  Cameron’s ties with Greensill’s eponymous founder, Lex Greensill, date all the way back to 2011, when Cameron’s then-cabinet secretary, Jeremy Heywood, brought Greensill — then the head of Citi’s supply chain finance division — into 10 Downing Street as a special advisor. Greensill was still on Citi’s payroll when he joined the government. As an expose in The Sunday Times reveals, his brief was to convince ministers and senior civil servants to hire Citi to extend early payment to many of the government’s biggest suppliers.

  Citigroup’s pitch was to pay the state’s suppliers in sectors where it apparently paid late, such as pharmacists awaiting NHS prescription fees.

  [Maurice Thompson, the British boss of Citigroup who would later become chairman of Greensill Capital’s supervisory board] claimed this would help business owners — offering them an alternative to expensive loans — and the government. It would also be a smart investment for Citi: paying tens of billions of pounds in invoices on behalf of the most reliable of clients, the state, and taking a cut along the way.

  This was not about finding a solution to a government problem, but rather a government problem that would fit Citi’s — and later Greensill’s — particular solution. The plan met stiff opposition in certain quarters. Given that government can borrow at ultra-low interest rates, some began asking why it needed to bring in Citigroup, or any investment bank for that matter, to pay its bills. Surely it made more sense to find a way to expedite its payments to suppliers rather than pay an intermediary to do so on its behalf.

  Citi aimed to start small, by paying pharmacists that supplied the NHS, but its ambition was sweeping. It sought to roll out supply chain finance across the UK’s public sector, “paying invoices covering GPs, dentists, opticians, physiotherapists, the Ministry of Defence, Her Majesty’s Revenue and Customs (HMRC), Royal Mail and even the BBC.”

  Dodgy Dealings

  A group of civil servants tried to thwart the plan. But Greensill enjoyed the backing of Heywood, Britain’s “most powerful civil servant” at the time. Heywood gave Greensill his own team and access to any department he wished to address. He also made him a senior advisor and crown representative to Her Majesty’s Government on supply chain finance. 

  What really irked some civil servants was the ambiguity of Greensill’s position. After Greensill had left Citibank, months after joining Downing Street, and set up his own supply chain finance firm (Greensill Capital) “it was unclear whose interests he was advancing: his former employer’s, his own firm’s or, as one would expect, the taxpayer’s.” Even more dubious was the way in which the government assigned projects to Citi (and later Greensill Capital), reports the Sunday Times.

  At the time the pharmacy scheme was announced, there was no detail about who would benefit from it. The government never formally announced or published details of the policy.

  It is only thanks to the legal small print sent to pharmacists that details have emerged. For the first five years the scheme was operated by Citigroup. Then it was awarded to Greensill Capital, which ran it until the company’s collapse last month. The scheme has since been nationalised.

  The precise circumstances in which the work was awarded to Citigroup remain unclear. The law states that unless the government is procuring services in an emergency, such as buying PPE during a pandemic or a helicopter in the middle of a war, it must create open and fair competition for companies that hope to deliver them.

  However, last night the government admitted it did not sign a contract for Citigroup’s services. Nor did it create an open competition so that other banks could bid for the work. Despite the warnings of Peilow, it was handed out directly to Citi via an existing and secretive relationship between the bank and the Government Banking Service.

  This chimes with an email sent by Greensill on November 12, 2012. He wrote: “It is important to note that there is no formal contract with Citibank with respect to the provision of supply chain finance.” He added: “This situation is entirely normal in the private sector as the bank is providing financing to our suppliers, not us.”

  What is not normal is that a Wall Street bank was allowed to handle billions of pounds of NHS cash without a contract. Even by the government’s own standards it was exceptional: in 2018 it created a formal procurement process before handing the scheme to Greensill.

  The evidence points to a stark conclusion: in the face of staunch opposition from civil servants, the government secretly gave a scheme to Citigroup, which came up with the idea, after its former head of supply chain finance, Greensill, drove the policy through Whitehall.

  The only point of this scheme was to create easy money for financiers while bleeding taxpayers dry. As such, this scandal is not just about the losses taxpayers will have to bear as a result of the government’s underwriting of Greensill’s emergency loans to Gupta; it’s about the money that’s already been squandered by the government’s wholly unnecessary use of supply chain finance in the first place. 

  It’s all eerily reminiscent of the disastrous Private Finance Initiative (PFI). Over decades successive Tory and Labour governments signed off on hundreds of debt-financed projects for which the rate of interest could be as much as 2 to 3.75 percentage points higher than the cost of government borrowing. It was a giant cash cow for the government’s corporate and banking partners. In 2018 it was estimated that the government would end up paying private companies £199 billion, including interest, between April 2017 until the 2040s for existing deals, in addition to some £110 billion already paid — for 700 projects worth around £60 billion!

  The senior politicians and civil servants get rewarded for their loyalty later down the line. The civil servant in charge of all the government’s commercial contracts during Cameron’s administration, Bill Crothers, became a director at Greensill in 2016, a year after leaving government. In 2017 Lex Greensill was awarded the  CBE for services to the British economy in Queen Elizabeth II’s 2017 Birthday Honours. A year later his company won a juicy government contract. 

  Happy Camping With Bin Salman

  As for Cameron himself, he joined Greensill as a a special adviser in 2018, two years after leaving politics. In February 2020 he and Lex Greensill went on a camping holiday with Saudi Crown Prince Mohammed bin Salman, little more than a year after bin Salman had arranged the murder of Washington Post and Middle East Eye columnist Jamal Khashoggi. The holiday appears to have reaped dividends. In June 2020, a senior Greensill Capital executive spoke publicly about the company’s partnership with the Saudi Public Investment Fund, describing it as “part of the family” of the sovereign wealth fund.

  According to most reports Cameron did nothing wrong. Last week he was cleared of breaking lobbying rules after it was concluded that as an employee of Greensill, he was not required to declare himself on the register of consultant lobbyists. But his already tarnished reputation is in tatters and he could face an investigation. Cameron himself refuses to even respond to the lobbying allegations. His ear-splitting silence speaks volumes about the state of British politics today.

  Tyler Durden
  Wed, 04/07/2021 – 02:00

• Goldman Bought $100M Of Deliveroo Shares During "Worst IPO Ever"…And Still Made Money
  Goldman Bought $100M Of Deliveroo Shares During “Worst IPO Ever”…And Still Made Money

  Goldman Sachs managed to avoid billions of dollars in potential losses from the implosion of highly levered hedge fund Archegos Capital Management by breaking ranks with other syndicate banks to dump large blocks of shares representing Archegos’s exposure to a coterie of tech and media names. When the dust settled, the bank told shareholders any losses would be insignificant, while Credit Suisse, the bank with perhaps the biggest exposure, said Tuesday it has booked a nearly $5 billion loss.

  

  But it looks like Archegos’ collapse wasn’t the only disaster to rattle the Vampire Squid. As we previously noted, the bank served as one of the lead underwriters and stabilization agents for Deliveroo’s abysmal London IPO, which has been criticized as the worst IPO in London’s history for the massive drop the shares suffered during their market debut (sliding 31% after pricing at the bottom of their range).

  But amazingly, while 70K retail traders got burned in the IPO after Deliveroo allowed customers and employees to invest in the early allocations via a platform called PrimaryBid (all told, they invested £50 million), Goldman managed to walk away with a modest profit. According to the FT, the Goldman bout about £75 million in Deliveroo on the open market to help prop up the price. That amount was equal to roughly 25% of the shares traded during the first two days of trading last week, according to Bloomberg data. Even though the shares had shed nearly one-third of their value, the FT said Goldman likely booked a profit on the trade, which was tantamount to closing a short position after the bank sold its over-allotment – though some of these profits will be surrendered to Deliveroo.

  So far, Goldman has used roughly half of its overallotment, per the FT.

  The £75m worth of purchases by Goldman Sachs, when used in combination with the “overallotment” reserved for stabilising the IPO, mean the bank should have booked a profit from Deliveroo’s declining share price.

  This is because brokers sell more stock than their allotments at the issue price and then cover their orders either by exercising the overallotment option or, if the shares fall, by buying in the market at below the flotation price. The difference between the 390p issue price and whatever Goldman Sachs paid in the market equates to the profit booked on the trade.

  But these profits will be surrendered to Deliveroo, as part of an agreement between the two companies which was not disclosed in the company’s IPO prospectus, people with direct knowledge of the matter added.

  Goldman Sachs and Deliveroo declined to comment.

  Shares remain well below their IPO price as of Tuesday’s close.

  

  And bankers are bracing for more potential downside as the 70K retail investors mentioned above can start cashing out of their positions tomorrow.

  Advisers working on the deal received roughly £49M in fees from Deliveroo. While Goldman Sachs is the sole stabilisation agent on the deal, it was in charge of the listing process alongside JPMorgan, while the other banks on the deal include Bank of America, Citigroup, Jefferies and Numis. Bankers have sought to blame pernicious short-sellers and concerns about future labor-regulation regarding gig economy workers, as well as Deliveroo’s dual-class share structure (which gives CEO Will Shu control of the boar), for the stock’s troubles. Some also blamed timing, saying the firm debuted too late to catch the wave of spectacular tech offerings last year, but too early for expected changes in British securities laws to allow companies with the dual-class structure to be included as part of the FTSE 100, the UK’s premier index.

  But now, the FT has reported that Goldman, one of the lead underwriters responsible for managing the IPO, also took a massive short position during the company’s debut.

  Bankers are worried that the IPO could dissuade other British tech firms from listing in London, perhaps pushing them to choose the US – or Amsterdam (now Europe’s leading market for IPOs). When bankers look back, how much of the blame for the botched IPO will rest with Goldman?

  Tyler Durden
  Wed, 04/07/2021 – 01:00

• Is The Volunteer Military Too Expensive? Or Is It Global Intervention That's Too Expensive
  Is The Volunteer Military Too Expensive? Or Is It Global Intervention That’s Too Expensive

  Authored by Doug Bandow via AntiWar.com,

  The Napoleonic Wars consumed the lives of between 2.5 million and 3.5 million soldiers, most unwilling draftees. Although defeated, discredited, and exiled after years of brutal conflict, the self-anointed emperor responsible for those deaths today is honored – lionized, actually – in Paris. His tomb is located in the Hotel Les Invalides surrounded by commemorations of his many great but costly victories.

  Aggressive war and mass slaughter obviously look better through the mists of time. And conscription, which Napoleon used to terrorize a continent, is still routinely employed by nations today.

  

  Today millions of people can be dispatched by a few bombs launched from half the world away. A couple people sitting in a missile silo can unleash hell and more by turning a couple keys. However, the tragic propensity of mankind to engage in war obviously goes back to humanity’s beginning. The horror and cruelty of ancient conflict is almost unimaginable. It was mass killing at its most personal. Massacres required many hands and took much time and effort.

  As political control fractured European warfare eventually turned into the far more restricted game of kings. Unless you were unlucky enough to live near a battlefield, you probably wouldn’t be bothered. Indeed, you might not even notice that a war was going on. And reliance on mercenaries helped keep casualties down. They wasted neither their time nor effort, and certainly not their lives, on silly notions like patriotism and loyalty. Protracted conflicts could still be costly, but the numbers of combatants involved look shockingly small compared to modern wars.

  However, the French revolutionary wars and rise of Napoleon moved the supposedly civilized world back toward the older, more brutal era. This change also heralded a shift to militaries that were both professional and mass. Which required a universal draft.

  As the emperor Napoleon carpeted Europe with corpses to Moscow and back, France filled the ranks of La Grande Armee through conscription, The other great continental powers, most notably the kingdoms of Russia, Prussia, and Austria, also drafted men into military service to meet France on the battlefield. A century later the greatest war machines – Wilhelmine Germany, Czarist Russia, French Republic, Austro-Hungary, and even the liberal democracies of America and United Kingdom – fielded considerable armies through a modern levee en masse. The draft, reaching ever further into diminishing manpower pools, was the only way for the combatants’ armies to replace the massive casualties that ravaged an entire generation of young men.

  Government leaders kept the horror of war from the public while demonizing the enemy. The casualty lists were horrible enough. To admit the nature of the fight, raising doubt whether any victory could be worth the price, risked triggering popular revulsion which might force the end of the war. And that, political leaders across countries, ideologies, and parties agreed, could not be allowed to happen.

  A generation later came an even more horrific conflict. In it even the UK and U.S. began the war with conscription, as did the other major combatants. It is impossible to imagine the extraordinary carnage of the Eastern Front if Germany and the Soviet Union did not have the power to draft. That authority was essential for war-making. The world’s worst conflict could not have been prosecuted without an open human spigot for the military.

  After just a year lapse in conscription authority at that war’s end, Washington imposed a “peacetime” draft during the Cold War. With conscription the US fought two more large-scale wars, in Korea and Vietnam. In them America’s peak troop strength was 327,000 and 536,000, respectively. Only conscription made these unpopular wars possible. And allowed them to continue for years, despite rising opposition. War is the health of the state, declared Randolph Bourne; conscription is the health of war.

  

  You will find more infographics at Statista

  And by 2017…

  

  The Vietnam War effectively ended the draft. As Richard Nixon drew down the US military presence, the abundant manpower generated by conscription became unnecessary. He also figured that ending the detested annual lottery ritual would defuse political opposition. The All-Volunteer Force was inaugurated in 1973.

  The AVF survived a rocky beginning, bolstered by warm support from the Reagan administration. A couple decades later under George W. Bush the volunteer military hit an even rougher patch, during which the government over-extended both active and reserve forces in an unnecessary and unpopular war. The armed services – and army in particular – bent, almost breaking as many potential enlistees said no to both active and reserve service, and thus ultimately to war. The volunteer military, in sharp contrast to conscription, allowed people to essentially shut down the system by refusing to join.

  The subsequent drawdown in endless wars eased pressure on the AVF. Yet the propensity to serve in the armed services fell along with the share of the population fit to serve, forcing the Pentagon to lower personnel standards and increase enlistment incentives. Which spurred complaints that voluntarism is no longer sustainable.

  Among the arguments put forth at the AVF Forum’s conference last week against voluntarism is that it is too expensive. Not that the military per se is too expensive – that its size is too big, procurement is too inefficient, deployment is too expansive, bases are too many, commitments are too imperial, or use is too promiscuous. But the recruitment process costs too much. Rather than rely on a slightly more modern and civilized process of impressment, by which the British navy simply grabbed sailors off seaport streets, the US military must induce young men and women to sign up and turn their lives over to Uncle Sam for a number of years. Government must make the case that military service is good for the individual and nation.

  Doing so is inconvenient and costly, but that is a benefit, not a cost, for America. There is no bigger Big Government program than war. There is no greater power in the state than to send the nation into war and its people into combat. There is no more draconian control over an otherwise free man’s or woman’s life than the military. There is no more dangerous occupation than the wartime armed services. So thrusting America into such horror and tragedy should be neither easy nor automatic.

  However, is today’s AVF no longer capable of providing America’s armed forces? At the conference retired Maj. Gen. Dennis Laich worried that America might get to the point where…

  “we just won’t be able to afford it. There just won’t be enough money to go around. When you have a $26 trillion national debt and the Defense Department makes up half of the discretionary spending in the federal government.”

  America is a fiscal wreck. Noted the Congressional Budget Office early last month, before passage of the administration’s $1.9 trillion supposed COVID-19 spending extravaganza, filled with booty unrelated to the pandemic: “By the end of 2021, federal debt held by the public is projected to equal 102 percent of GDP. Debt would reach 107 percent of GDP (surpassing its historical high) in 2031 and would almost double to 202 percent of GDP by 2051. Debt that is high and rising as a percentage of GDP boosts federal and private borrowing costs, slows the growth of economic output, and increases interest payments abroad. A growing debt burden could increase the risk of a fiscal crisis and higher inflation as well as undermine confidence in the US dollar, making it more costly to finance public and private activity in international markets.”

  Moreover, the Biden administration is pushing a massive infrastructure program, with abundant outlays to enrich other political interests. Some of that spending might be offset by higher taxes, but Congress is unlikely to impose substantial fiscal pain on constituents and supporters. Whatever legislation passes will further inflate the debt burden, likely significantly over time.

  At a time when someone could make “Politicians Gone Wild” videos about the Washington, D.C. budget process, conscription should not be seen as a money-saver let alone a budget miracle. First, conscription would only allow the Pentagon to cut wages for new accessions, of whom there were 155,000 last year. The savings would accrue for just a couple years, since draftees typically serve shorter terms than volunteers. Conscription advocates never suggest slashing the (higher) pay for NCOs, the backbone of the American armed services, and officers – let alone the 653 general officers who top the manpower charts.

  Second, a draft would not cut costs. Rather, it would shift costs by forcing people to work at lower wages. Indeed, coercion increases total social costs, forcing many people to serve who don’t want to and preventing some from joining who wish to – available spots having been filled by conscripts. Moreover, it is morally grotesque for a wealthy society to take advantage of the politically weak to procure cheap labor. Why should the successful and satisfied be able to force the young to bear the disproportionate expense of defending the nation, which benefits everyone?

  Third, conscription is expensive. Enforcement machinery is necessary. Evasion activity is rife. Perverse incentives are inherent. The military would suffer dramatically from the change in incentives, moving from a system in which all those entering want to be in uniform to a situation in which most of them want to be somewhere, anywhere else. In operation, the armed forces would pay dearly for whatever budget savings occurred.

  Fourth, there is no reason that the military alone among federal programs should have to resort to extreme measures to meet expenses. The federal government spent $4.48 trillion in 2019, the last year without massive COVID-19 emergency funding. Is the Pentagon really the lowest priority program, likely to be placed at the rear as Uncle Sam doles out future funding? Is there nothing at the Department of Commerce, Department of Housing and Urban Development, Department of Education, or Department of the Interior which could be trimmed first if the federal government found itself short of cash?

  The obvious answer to a cash crunch would be to cut low priority programs, of which the federal government is full. However, if that is too painful politically, why not apply Laich’s proposed solution of conscription to civilian programs? Why not draft federal civilian workers?

  For example, the Department of Defense employs about 700,000 civilians. Conscript them if the federal government must save money. Pay them a salary comparable to that what military draftees would receive. Do the same for the Department of Veterans Affairs, which has nearly 400,000 workers.

  There is no reason to stop at military-related agencies. The Postal Service employs roughly a half million employees. Why not institute a postal draft, cutting pay for them? Homeland Security has nearly 200,000 on staff. The Justice Department and Department of Agriculture employ around 100,000. Conscript them all! That should save a lot of cash. Of course, doing so wouldn’t be fair, but neither would be a military draft. If the government is going to force someone into service, it would be better to conscript those whose lives would not be at risk. This could be viewed as a form of mandatory “national service” so beloved of social engineers.

  Laich’s concern that Washington won’t put DOD at the front of the very long federal soup line suggests that he recognizes a deeper problem. If the Pentagon stops protecting the nation it no longer deserves preferential treatment over, say, the Departments of Agriculture and Energy. And foolish wars of choice like Iraq and unnecessary welfare for rich friends like NATO do not make Americans safer.

  US military budget requirements are not immutable, set by the stars or other cosmic phenomena. Rather, defense outlays are the price of America’s foreign policy. The latter will, or at least should, vary over time based on changing circumstance. However, as long as Washington implements a frankly imperial foreign policy the cost will be exceedingly high.

  Defending the US is relatively easy, with vast oceans east and west and pacific neighbors north and south. In contrast, most of what the Department of Defense does is offensive, designed to variously coerce and protect other nations. Sometimes doing so is necessary for America’s defense, but not nearly as often as claimed by Washington.

  The forever wars make no sense. The Iraq invasion was an enormous blunder and two decades of nation-building in Afghanistan have been a terrible waste; both were humanitarian catastrophes. The US should spurn, not join, foreign civil wars like Libya and Syria.

  South Korea, which enjoys an economy more than 50 times as large and population twice as that of the North, needs no American garrison. NATO lost its raison d’etre with the collapse of the Soviet Union and dissolution of the Warsaw Pact. Europe vastly outranges Moscow in economic wealth and population size yet prefers to rely on US defense guarantees rather than invest in its own defense. Reducing unnecessary US military commitments would allow a concomitant reduction in force structure.

  Washington’s fiscal irresponsibility is beyond description. Government should set priorities. Congress should spend only for serious purposes and pay for what it spends. Which requires substantial cuts in wasteful programs throughout government.

  At the top of any priority list should be those who take on the always difficult and sometimes dangerous job of serving in the armed services and defending America. Even so, significant budget cuts should be made to the Pentagon as well. The US should drop needless, expensive military commitments. End subsidies for prosperous, populous allies. And stop foolish, counterproductive social engineering abroad, especially fruitless nation-building projects.

  Other important military issues would remain. The AVF Forum rightly worries about fundamental issues including combat effectiveness, citizenship values, and social fairness. The subjects are serious and complex. The solutions won’t come easy. But conscription is not one.

  Uncle Sam has a spending problem. A big one. However, the major challenge is not affording the cost of military manpower. The federal government does far too much and does it far too expensively. The same goes for the military. The solution is for Washington to do less, and to do what it does less expensively. Not to draft young men and women to fight more needless endless wars.

  Tyler Durden
  Tue, 04/06/2021 – 23:45

• Uber Pays Blind Woman $1.1 Million After Stranding Her 14 Times
  Uber Pays Blind Woman $1.1 Million After Stranding Her 14 Times

  Uber is shelling out $1.1 million to a woman that says she missed work, birthdays, Christmas Eve church services and was left in the dark and in the rain because drivers refused to pick up her and her dog on more than a dozen occasions. 

  The customer, Lisa Irving, won against Uber in arbitration recently – about 5 years after the ride-sharing company had already finalized a settlement from being sued in 2014 for discriminating against blind people and their guide dogs, The Verge reported this weekend. 

  That 2016 settlement required Uber to shell out $2.6 million, but apparently the company didn’t quite learn its lesson.

  The more than a dozen times Irving said she was discriminated against occurred after the 2016 settlement. “Uber allowed drivers who discriminated against disabled riders to continue driving without discipline,” an arbitrator ruled this week. 

  

  The arbitrator’s report continued: “When Uber did conduct an investigation, its investigators were trained, in some instances, to coach drivers to find non-discriminatory reasons for ride denials, sometimes even to ‘advocate’ to keep drivers on the platform despite discrimination complaints.”

  Irving claimed she was rejected for rides “at least 60 times”, including one instance where a driver got “vocally angry” about having a dog in the car and threatened to leave her on the side of the ride. 

  Of the $1.1 million Irving won, $805,313 will go to legal costs and $324,000 were awarded in damages. 

  Uber has now implemented a new “Service Animal Policy” with its own dedicated support form for future instances. You can read the full arbitration report at The Verge.

  Tyler Durden
  Tue, 04/06/2021 – 23:25

• Buchanan: For What Should We Fight Russia Or China?
  Buchanan: For What Should We Fight Russia Or China?

  Authored by Pat Buchanan via Buchanan.org,

  Last Monday, in a single six-hour period, NATO launched 10 air intercepts to shadow six separate groups of Russian bombers and fighters over the Arctic, North Atlantic, North Sea, Black Sea and Baltic Sea.

  

  Last week also brought reports that Moscow is increasing its troop presence in Crimea and along its borders with Ukraine.

  Joe Biden responded.

  In his first conversation with Ukrainian President Volodymyr Zelensky, Biden assured him of our “unwavering support for Ukraine’s sovereignty and territorial integrity in the face of Russia’s ongoing aggression in the Donbass and Crimea.”

  Though Ukraine is not a member of NATO, and we have no treaty obligation to fight in its defense, this comes close to a war guarantee. Biden seems to be saying that if it comes to a shooting war between Moscow and Kiev, we will be there on the side of Kiev.

  Last week, Kremlin spokesman Dmitry Peskov answered that if the U.S. sends troops to Ukraine, Russia will respond.

  Again, is Biden saying that in the event of a military clash between Ukrainians and Russians in Crimea, Donetsk or Luhansk, the U.S. will intervene militarily on the side of Ukraine?

  Such a pledge could put us at war with a nuclear-armed Russia in a region where we have never had vital interests, and without the approval of the only institution authorized to declare war — Congress.

  

  Meanwhile, off Whitsun Reef in the South China Sea, which Beijing occupies but Manila claims, China has amassed 220 maritime militia ships.

  This huge Chinese flotilla arrived after Secretary of State Anthony Blinken put Beijing on notice that any attack on Philippine planes or ships challenging Beijing’s claim to rocks and reefs of the South China Sea that are in Manila’s exclusive economic zone will be backed by the U.S.

  Our 70-year-old mutual security treaty with Manila covers these islets and reefs, said Blinken, though some are already occupied and fortified by China.

  Apparently, if Manila uses force to assert its claims and expel the Chinese, then we will fight beside our Philippine allies. This amounts to a war guarantee of the kind that forced the British to declare war on Germany in 1939 over the invasion of Poland.

  Two weeks ago, 20 Chinese military aircraft entered Taiwan’s air defense identification zone in the largest incursion yet by Beijing over the waters between Taiwan and Taiwan-controlled Pratas Islands. As national security correspondent Bill Gertz writes in today’s Washington Times:

  “China is stepping up provocative activities targeting regional American allies in Asia … with an escalating number of military flights around Taiwan and the massing of more than 200 fishing ships near a disputed Philippines reef.

  “China also raised tensions with Japan, announcing last week that Tokyo must drop all claims to the disputed Senkaku Islands, an uninhabited island chain that Japan has administered for decades but that Beijing recently claimed as its territory.

  “The most serious provocation took place March 29. An exercise by the People’s Liberation Army air force that included 10 warplanes flew into Taiwan’s air defense zone is what analysts say appeared to be a simulated attack on the island. It came just three days after an earlier mass warplane incursion.”

  While China appears clear about its aims and claims to virtually all of the islands in the South China Sea and East China Sea as well as Taiwan — it is less clear about its intentions as to when to validate those claims.

  As for the U.S., does the present foggy ambiguity as to what we may or may not do as China goes about asserting its claims serve our vital interests in avoiding war with the greatest power on the largest continent on earth?

  If red lines are to be laid down, they ought to be laid down by the one constitutional body with the authority to authorize or declare war — Congress. And questions need to be answered to avoid the kinds of miscalculations that led to horrific world wars in the 20th century.

  Are the reefs and rocks the Philippines claim in the South China Sea, claims contradicted by China, covered by the U.S. mutual security treaty of 1951? Are we honor-bound to fight China on behalf of the Philippines, if Manila attempts to reclaim islets China occupies?

  What is our obligation if China moves to take the Senkakus? Would the United States join Japan in military action to hold or retrieve them?

  What, exactly, is our commitment to Taiwan if China attempts to blockade, invade or seize Taiwan’s offshore islands?

  John F. Kennedy in the second debate with Richard Nixon in 1960 wrote off Quemoy and Matsu in the Taiwan Strait as indefensible and not worth war with Mao’s China.

  With its warnings and threats, China is forcing America to address questions we have been avoiding for about as long as we can.

  China is saying that it is not bluffing: These islands are ours!

  Time to show our cards.

  Tyler Durden
  Tue, 04/06/2021 – 23:05

• Where America's Bridges Are Crumbling
  Where America’s Bridges Are Crumbling

  Back in August 2007, the dangerous and decaying state of America’s infrastructure became a shocking reality when the I-35W Mississippi River Bridge in Minneapolis collapsed, sending vehicles crashing into the river below. 13 people were killed while another 145 were injured. In August 2018, a bridge collapse in Genoa, Italy, shocked the world with 43 people losing their lives. After that catastrophe, many countries, including the United States, started to seriously look at the state of their deteriorating infrastructure.

  Last week, as Statista’s Niall McCarthy notes, President Biden unveiled his plans for a $2 trillion investment in American infrastructure, describing it as “a once-in-a-generation effort”. It would involve replacing lead piping, rebuilding 20,000 miles of roads and repairing the country’s 10 most economically important bridges. Biden described the program as “unlike anything we have seen or done since we built the interstate highway system and the space race decades ago”. He added that it would be “the largest American jobs investment since World War II”.

  After the announcement, a report from the American Road & Transportation Builders Association (ARTBA) illustrated the scale of the challenge in overhauling and repairing U.S. infrastructure by finding that more than 220,000 American bridges need repair work. 45,000 of them were deemed structurally deficient and Americans cross them 171.5 million times daily. At the current rate, it would take more than 40 years to fix all of them and cost an estimated $41.8 billion.

  The good news is that the number of structurally deficient bridges has declined for the past five years but that trend has been tempered by more bridges being downgraded from good to fair condition.

  

  You will find more infographics at Statista

  Out of all U.S. states, Iowa has the most structurally deficient bridges, 4,571 or 19.1 percent of its total bridges. Pennsylvania comes second on the list with 3,353 of its bridges falling into the same category, along with 2,374 in Illinois.

  West Virginia has the highest share of bridges classified as structurally deficient at 21 percent while Nevada has the lowest at just 1.4 percent.

  Tyler Durden
  Tue, 04/06/2021 – 22:45

• NY State To Give Up To $2.1 Billion To Illegal Immigrants
  NY State To Give Up To $2.1 Billion To Illegal Immigrants

  Just when you thought things couldn’t get more surreal, New York State’s democratic-party-dominated legislature decides to crank the virtue-signaling ‘equity’ amplifier up to 11.

  

  Embattled Gov. Andrew Cuomo – desperate for any news to distract from his dueling sex abuse and nursing home death scandals (“Hey, want some pot?“) – struck a deal on Tuesday with New York Lawmakers to spend $2.1 billion towards to assist jobless workers who were excluded from unemployment benefits during the pandemic – primarily undocumented immigrants and ex-convicts, after activists launched several hunger strikes.

  Lawmakers justified the stunning addition to the state’s broader $212 billion budget agreement, by claiming – as Lohud.com’s Tifany Cusac-Smith and David McKay Wilson report – many undocumented immigrants have not received aid such as stimulus checks or federal unemployment benefits during the pandemic, even though studies show that they pay billions of dollars in taxes each year.

  The study in question – by The Institute on Taxation and Economic Policy – appears custom-tailored to justify classifying illegal immigrants as qualifying residents, as they claim tax revenues would skyrocket if currently illegal workers were suddenly made legal and paid taxes… legally?

  Here is the table showing that undocumented workers paid $1.108 billion in taxes (which, if our math is correct, is around half what they are about to get from the state).

  

  Like other people living and working in the United States, undocumented immigrants pay state and local taxes. They pay sales and excise taxes when they purchase goods and services (for example, on utilities, clothing and gasoline). They pay property taxes directly on their homes or indirectly as renters. Many undocumented immigrants also pay state income taxes. The best evidence suggests that at least 50 percent of undocumented immigrant households currently file income tax returns using Individual Tax Identification Numbers (ITINs), and many who do not file income tax returns still have taxes deducted from their paychecks.

  Actual details of the bill are not available yet, including whether the handouts from the state would be taxable themselves… like they are for all legal tax-paying residents.

  “The federal government has given trillions of dollars of relief to Americans, the state of New York is getting billions of dollars, but not everybody. We’re here to fix that,” said state Sen. John Liu, D-Queens.

  “Excluded workers may not have a piece of paper, but they’re New Yorkers just as much.”

  …

  In one iteration of the proposal, those who could prove residency for 60 days, had a federal Tax Identification Number, and show they earned less than $26,000, would qualify for $15,000.

  Is it just us, or does “excluded worker” feel like a focus-group phrase designed to gaslight readers into believing that illegal immigrants – whose presence in the country hurts low-income legal residents the most – have suffered “injustice” and “inequity” when it comes to the social safety net that honest taxpayers will have to subsidize for decades to come? Perhaps the term “illegally-employed-worker” would be more appropriate?

  

  After watching near record numbers of immigrants crossing the US-Mexico border to reach Biden’s promised land, some lawmakers expressed fears that the bill would make New York a magnet for illegal immigrants. Others view the pandemic as a humanitarian crisis that illegal immigrants have been caught on the wrong side of.

  Murad Awawdeh, interim co-executive director of the New York Immigration Coalition, said undocumented families in New York deserve a chance at recovery from this pandemic.

  “Undocumented immigrant New Yorkers on the frontlines of this pandemic are still struggling to pay their bills and feed their families because of the injustice of nearly every federal stimulus relief package, which excluded these New Yorkers from all social safety nets just because of their immigration status.“

  Yet, we can’t help but wonder how low-income, law-abiding, tax-paying, legal immigrants and American citizens will feel about their taxes being used to subsidize those who chose to cut in line.

  As a reminder, we detailed yesterday that after years of paying the highest income tax in the country, the privilege of being the most IRS-abused group shifts from virtue-signaling California 1%-ers to New York millionaires, who would pay the highest income tax in the United States under a new budget currently being finalized by embattled NY Governor Andrew Cuomo.

  According to the WSJ, Cuomo and NY state lawmakers are nearing a budget agreement that would increase corporate and income taxes by $4.3 billion a year and would make top earners in New York City pay the highest combined local tax rate in the country.

  Vote woke, go broke.

  Tyler Durden
  Tue, 04/06/2021 – 22:25

• Iranian Spy Vessel Damaged By Israeli Mine Attack, Claims NYT
  Iranian Spy Vessel Damaged By Israeli Mine Attack, Claims NYT

  Update (2217ET): The New York Times alleges Israel is behind the naval mine attack that damaged an Iranian vessel, identified as the Saviz, on Tuesday. 

  An American official told the NYT that the Israelis notified Washington about how its forces mounted a mine to the Saviz. 

  The official, who spoke on condition of anonymity to share private intelligence communications, said that the Israelis had called the attack a retaliation for earlier Iranian strikes on Israeli vessels, and that the Saviz had been damaged below the water line. The vessel’s precise location in the Red Sea was not immediately clear. -NYT 

  A shadowy regional war appears to be playing out between Israel and Iran, as both countries exchange accusations of attacking each other’s vessels.

  Readers may recall The Wall Street Journal revealed last month that Israeli intelligence has been waging its own tanker sabotage campaign against the Iranians over the past two years.

   * * * 

  Update (1557ET): Reuters’ Idrees Ali, who covers foreign policy at the Pentagon, reports US officials did not carry out the Iranian Saviz vessel’s attack earlier on Tuesday. 

  U.S. officials tell Reuters that the United States did not carry out the attack. https://t.co/Hqu0eBkRcN

  — Idrees Ali (@idreesali114) April 6, 2021

  https://platform.twitter.com/widgets.js

  Fellow Elizabeth Tsurkov, of the Newlines Institute for Strategy and Policy, responded to Ali’s tweet by saying: “Israel did.” 

  Israel did

  — Elizabeth Tsurkov (@Elizrael) April 6, 2021

  https://platform.twitter.com/widgets.js

  Tsurkov’s theory is certainly interesting, considering The Wall Street Journal revealed last month that Israeli intelligence has been waging its own tanker sabotage campaign against the Iranians over the past two years. 

  “Israel has targeted at least a dozen vessels bound for Syria and mostly carrying Iranian oil out of concern that petroleum profits are funding extremism in the Middle East, the US and regional officials say, in a new front in the conflict between Israel and Iran,” the WSJ wrote last month.

  It remains to be seen who is responsible for the Saviz attack, but we should note the incident occurred during the Joint Comprehensive Plan of Action (JCPOA) meeting in Vienna today as top world powers began a new effort to bring the US back into the 2015 nuclear deal they signed with Iran. 

   * * * 

  Update (1521ET): Reuters cites another Tasnim report indicating the Iranian Saviz vessel was struck by “limpet mines in the Red Sea.” 

  “The vessel Iran Saviz has been stationed in the Red Sea for the past few years to support Iranian commandos sent on commercial vessel (anti-piracy) escort missions,” Tasnim reported.

  Here’s what a limpet mine looks like 

  

  Refinitiv shipping data shows the vessel has been stationary for at least 180 days. 

  

  * * * 

  Update (1503ET): Iranian news agency Tasnim reports the Iranian Saviz vessel in the Red Sea was struck by a naval mine and sustained damage to its hull. 

  According to the defense correspondent of Tasnim news agency, some sources report an accident for the Iran Saviz ship in the Red Sea.

  According to this report, according to the information obtained by Tasnim reporter, it is said that this accident occurred due to the explosion of landmines in the hull of the ship.

  IranSavis has been stationed in the Red Sea for the past few years to support Iranian commandos who are sent to escort commercial vessels.

  Official sources have not yet commented on this and additional news will be announced later. -Tasnim

  * * * 

  Unconfirmed reports circulating on social media indicate an Iranian spy ship was hit in an attack in the Red Sea, amid increasing tensions between Israel and Iran, according to Israeli newspaper Haaretz. 

  The targeted vessel is a merchant ship but is likely a secret marine spy base operated by the Islamic Revolutionary Guard Corps (IRGC). 

  Saudi-owned television network Al Arabiya reports the vessel affiliated with the IRGC was attacked in the Red Sea off the coast of Eritrea, a northeast African country on the Red Sea. 

  

  Israel-based news network Channel 13’s Alon Ben-David, tweeted:

  A spy ship and electronic surveillance of the Revolutionary Guards were attacked in the Red Sea. The ship was damaged, making it difficult for it to continue operating

  The U.S. Naval Institute provides more information on the secret IRGC spy ship: 

  The naval role of ships like the Saviz is hard to prove with open sources, but the inference is clear. There is no legitimate civilian explanation for the action, and uniformed men have been seen onboard. On the ship’s deck are Boston Whaler type launches, a boat type popular with the IRGC and not in keeping with Saviz’s civilian design.

  The ship is anchored off the Yemen coast at the southern end of the Red Sea, near to where Bab el-Mandeb Strait forms a natural choke point. Automated Information System transmissions and analysis of commercial satellite images show the ship has barely moved in the past three years. From its position, the ship can provide constant surveillance of maritime traffic. The narrow waterway just south of its position squeezes tankers to a channel just a couple of miles wide. There have been numerous attacks on tankers in the area.

  

  There has yet to be any confirmation on the attack from Iranian or Israeli officials. 

  As we’ve noted before, Israel has attacked dozens of Iranian ships over the years. 

  Tyler Durden
  Tue, 04/06/2021 – 22:17

• Here's Why Hedge Funds Are Having Another Dismal Year
  Here’s Why Hedge Funds Are Having Another Dismal Year

  It’s shaping up as one of those years for hedge funds. A little over three months into the new year, retail investors (as measured by a basket of retail favorite names) is up almost 20%, the S&P is up a little over 8% while he dge funds have barely managed to generate any returns. In fact, until last week, the average global equity Long/Short fund was down for the year. It was only in the past week when Goldman Prime found that Equity Fundamental L/S hedge funds rose +2.92% globally…

   

  

  … that year-to-date performance finally tipped into the green by a minuscule +0.05%.

  

  And it’s not because hedge funds have “learned” from Archegos’ mistakes and are cutting their use of leverage: on the contrary, Goldman Prime writes that gross leverage fell a modest -1.0 pts to 240.2% (94th percentile) while Net leverage rose +0.5 pts to 88.7% (98th percentile). Overall book L/S ratio rose +0.8% to 2.170 (95th percentile).

  No, there is something else going on here. As Bank of America found, hedge funds have become so accustomed to quick and easy beta gains from buying FAAMG and tech stocks and slapping 3x, 5x, or more leverage, that they no longer have any idea how to do actual value investing.

  As Bloomberg notes, the reason why hedge funds have performed dismally so far in 2021 – even without the help of Archegos – is that while most other investors have been wagering on an economic rebound leading to a surge in value names since November’s presidential election, one group of investors has refused to rotate.

  Indeed, despite a rally of at least 40% in energy and financial shares over the five months, the average hedge fund – which no longer remember what net leverage, EBITDA or Free Cash Flow coverage is – has steadfastly shunned value stocks in the reflation trade, favoring instead companies seen as resilient during an economic slowdown, i.e. tech names that in the past decade have led to quick and easy gains. Indeed, their exposure to cyclical shares sits at one of the lowest levels in a decade relative to defensive ones, as the following BofA chart shows.

  

  It’s not just BofA clients who have forgotten how to do anything but “buy and lever up”: Morgan Stanely client data shows a similar pattern, and after peaking near the end of 2020, the industry’s net exposure to the reflation strategy has retreated to the 78th percentile over the last 12 months, according to the bank’s prime brokerage unit, which most recently has been in the news for dumping its exposure to Archegos ahead of all other prime brokers.

  According to Bloomberg it isn’t obvious what’s driving the aversion to value:

  One theory is that hedge funds aren’t buying the return-to-normal narrative despite the rollout of vaccines. Last year, when retail investors rushed to hunt bargains in beaten-down groups like airlines and hotels, professional speculators were hesitant to chase pandemic-ravaged companies.

  Another explanation holds it may be related to apprehension that economic acceleration, propelled by monetary and fiscal support, will lose steam once the latest federal spending wears out. Mike Wilson, an equity strategist at Morgan Stanley, is an ardent proponent advocating a shift to stocks better positioned to weather potentially disappointing economic data, such as consumer staples.

  “This is the time to upgrade the portfolio and shift toward quality ahead of slowing rates of change in a number of macro indicators,” Wilson wrote in a note to clients Monday.

  We disagree that it “isn’t obvious” what is causing this drift: a decade of Pavlovian “buying the f**king dip” in tech and devastation in value stocks has made an entire industry into the best paid experimental dogs in the world, so much so that when told to do work and find good “value” investments, hedge fund portfolios immediately slink back to buying Tesla, Google and Amazon.

  In any case, whatever reason is behind hedge funds’ cautious stance, Bloomberg is correct that it’s starting to reverberate in the broad market: “over the past month, utilities and consumer staples have taken over leadership from energy shares while a spike in bond yields stalled even as hiring and services-sector data outstripped estimates.”

  Meanwhile, Wall Street strategists find themselves desperately urging hedge funds to do precisely the opposite of what central banks have indoctrinated for the past decade. For example, Canaccord strategist Tony Dwyer, said investors should take advantage of any pullback in the reflation trade to add exposure.

  “The only way to view this, in our view, is as a ‘Capital V’ recovery that is in the early innings, and the only thing that could stand in the way would be another shutdown of the economy to contain new Covid-19 strains or a policy mistake by the Fed,” said Dwyer. “Neither appear imminent.”

  Furthermore, it also appears that the Great Rotation into energy that was predicted by JPMorgan in March never occurred, and when compared to history, hedge funds’ exposure to financial and energy shares now trails all other sectors, BofA data show. Such skepticism bodes well for these stocks that are under-owned and traded at lower multiples relative to earnings or book value, according to the firm’s strategists led by Savita Subramanian.

  “Hedge funds are yet to embrace rotation to value which leaves room for increased positioning in the coming months,” she wrote in a note last week.

  Of course, for that to happen hedge funds need to step away from blindly hoping that doing what worked in the past decade will still work now. Until then, returns in the hedge fund industry will continue to suck.

  Tyler Durden
  Tue, 04/06/2021 – 22:05

• Beijing Accelerating Timeline For Possible Invasion Of Taiwan, Expert Warns
  Beijing Accelerating Timeline For Possible Invasion Of Taiwan, Expert Warns

  Authored by Frank Fang via The Epoch Times,

  The Chinese communist regime is accelerating its plans to invade Taiwan, an expert warns, as Beijing ratchets up military maneuvers against the island.

  

  Twenty Chinese military aircraft – including four nuclear-capable H-6K bombers, 10 J-16 fighter jets, two Y-8 anti-submarine warfare aircraft, and a KJ-500 airborne early warning and control aircraft – entered Taiwan’s air defense identification zone (ADIZ) on March 26, according to Taiwan’s Ministry of National Defense. It was the largest incursion ever reported by the ministry.

  Taiwan’s ADIZ, located adjacent to the island’s territorial airspace, is an area where incoming planes must identify themselves to the island’s air traffic controller.

  The incursion caps off a significant increase in hostility by Beijing against Taiwan since 2020. Taiwan’s President Tsai Ing-wen, re-elected last January, has taken a hard line against threats posed by the Chinese Communist Party (CCP), while the island has deepened its cooperation with the United States—prompting the regime to escalate its warmongering towards the island.

  The CCP sees Taiwan as a part of its territory and has threatened war to bring the island under its fold. The self-ruled island is in reality a de-facto independent country with its own democratically-elected government, military, constitution, and currency.

  The Republic of China (ROC)—Taiwan’s official name—overthrew China’s Qing Dynasty emperor in 1911. After the ROC retreated to Taiwan upon being defeated by the CCP during the Chinese Civil War, the CCP established a communist state called the People’s Republic of China (PRC) in 1949, while Taiwan gradually transitioned to become a democracy. But to this day, the Chinese regime has refused to recognize Taiwan’s sovereignty.

  Last year, the Chinese air force flew about 380 sorties into Taiwan’s ADIZ, the highest number in a given year since 1996. So far this year, the Chinese military has been sending aircraft into the ADIZ on a near-daily basis.

  The island’s coast guard on April 1 announced that Beijing has been flying unmanned drones near Taiwan’s Dongsha Island, located in the northern part of the South China Sea. The authority said it could not rule out that Beijing was using the drones to carry out reconnaissance.

  Alongside military actions, the regime has sharpened its rhetoric towards the island. Earlier this year, a Chinese defense spokesperson threatened war against Taiwan if it declared independence.

  On March 31, Hu Xijin, editor-in-chief of hawkish state-run media Global Times, wrote on his social media, that he would like to order able-bodied men to go blow up bunkers in Taiwan in the event of war.

  An unnamed Chinese pilot, who flew one of the Chinese aircraft crossing into Taiwan’s ADIZ on March 29, said, “This is all ours” after being asked to leave the airspace by the pilot of a Taiwanese interceptor aircraft, according to local media, who obtained a recording of the pilot’s remark from the Facebook page “Southwest Airspace of TW.”

  Preparing to Invade

  Beijing’s incursions are part of a series of dry runs in preparation for an invasion of Taiwan, John Mills, the former director of cybersecurity policy, strategy, and international affairs at the Office of the Secretary of Defense, told The Epoch Times.

  Mills projects that these exercises could culminate in a large-scale dry run in the next two years. These dry runs are necessary, Mills said, given the complexity of amphibious landing operations—as well as how the Chinese military has never conducted a forced landing on a hostile power in a real-life situation before.

  Any amphibious assault on Taiwan may also involve swarms of Chinese civilian merchant vessels and fishing boats, Mills said.

  He believes that an invasion could come in the next three years—much earlier than the six-year estimate given by U.S. Adm. Philip Davidson, head of the U.S. Indo-Pacific Command (INDOPACOM), during a congressional hearing in early March.

  “If they haven’t done in 10 years, I think [Chinese leader] Xi [Jinping] will probably have been removed from office. I think even six years is pushing it,” Mills said. He added that Xi could come under pressure to attack Taiwan to deflect attention away from internal problems, such as an economic crisis.

  U.S. Adm. John Aquilino, the nominee to replace Davidson as head of INDOPACOM, at his confirmation hearing in March declined to endorse Davidson’s six-year estimate, but said the threat of a Chinese invasion is “much closer to us than most think.”

  This point was echoed by former national security advisor H.R. McMaster, who in March said that Xi believes “he has a fleeting window of opportunity that’s closing” in relation to attacking Taiwan. McMaster said the period from 2022 onward marks the time “of greatest danger” to Taiwan, noting that this coincides with after the conclusion of the 2022 Beijing Winter Olympics.

  But right now, the Chinese military is still not ready for an attack against the island, Mills said. The problem is, however, that the longer it waits to invade, the more ready and fortified Taiwan will be.

  “We all need to be aware of and be ready for an acceleration of these timelines,” Mills warned.

  Beijing’s Taiwan ambitions stem primarily from its desire to get its hands on the island’s semiconductor-making capability, according to Mills. Taiwan is home to TSMC, the world’s largest contract chipmaker.

  China is heavily dependent on foreign semiconductors—tiny chips that power everything from cellphones to missiles. According to Bloomberg, China imported $380 billion-worth of chips in 2020, accounting for about 18 percent of all its imports.

  The regime is now struggling to secure foreign semiconductors following a series of sanctions slapped on Chinese companies by the Trump administration. U.S. sanctions have crippled the smartphone business of Chinese tech giant Huawei. Chinese chipmaker SMIC has also been put on a trade blacklist.

  Hitting Back at US

  Soong Hseik-wen, a professor at the Institute of Strategic and International Affairs (ISIA) of Taiwan’s National Chung Cheng University (NCCU), told The Epoch Times that the Chinese regime was making a statement with its incursion on March 26, in response to actions by the U.S. government in March.

  These events included President Joe Biden’s first summit with Quad leaders from Australia, India, and Japan; the meeting in Tokyo between Secretary of State Antony Blinken, Pentagon chief Lloyd Austin, and their Japanese counterparts; and the Sino-U.S. talks in Anchorage, Alaska, according to Soong.

  “These three events showed that there are structural conflicts between China and the United States, and they cannot be resolved through diplomatic negotiations,” he said.

  The two-day talks in Anchorage were marked by heated exchanges on March 18, during which the CCP’s top diplomat Yang Jiechie lashed out at U.S. foreign and trade policies, and over what he said was the United States’ struggling democracy and poor treatment of minorities.

  The meeting highlighted how far apart the Chinese regime and United States are on critical issues, as the Chinese delegation rejected U.S. concerns about Beijing’s human rights abuses in Xinjiang, its crackdown on freedoms in Hong Kong, and its intimidation of Taiwan, on the grounds that they were China’s “internal affairs.”

  Viewing U.S. actions as escalating efforts to confront the regime, Beijing decided to flex its military muscle by sending a large aircraft squadron into Taiwan’s ADIZ on March 26, Soong said.

  A bilateral agreement on coast guard cooperation between Taiwan and the United States—signed the day before the incursion—may have played into Beijing’s plan to take military action against Taiwan on March 26, Soong added. The agreement, he said, was a clear attempt to push back against Beijing after it passed a law in January to allow its coast guard to fire on foreign ships if needed.

  With the agreement, the U.S. government was “explicitly saying” that the coast guard would also be a part of its maritime strategy to secure peace and stability in the region, Soong said.

  China’s coast guard law has drawn widespread concern from its neighbors, including Japan, the Philippines, Taiwan, and Vietnam.

  On March 28, U.S. Ambassador to Palau John Hennessey-Nilan arrived in Taiwan as part of a Palau delegation headed by President Surangel Whipps. Palau is one of Taiwan’s 15 diplomatic allies.

  Soong suggested that Beijing could have received intelligence of the U.S. ambassador’s visit to Taiwan, which would have prompted Beijing to show its disapproval, since the visit marked the first time a sitting U.S. diplomat has traveled to Taiwan since Washington ended diplomatic ties in favor of Beijing in 1979.

  Kelly Craft, former U.S. Ambassador to the United Nation, was originally going to visit Taiwan in mid-January, before her trip was canceled at the last minute.

  Defending Taiwan

  In the face of an escalating military threat from China, Mills said the Biden administration should adopt an unambiguous policy of deterrence towards the CCP. Specifically, Mills said the United States should have a visible navy and air force presence around Taiwan, as well as in the East China Sea and the South China Sea.

  Boosting Taiwan’s self-defense capability is also important, and the Biden administration should sell the island any weapons that it asks for, in accordance with the Taiwan Relations Act, according to Mills. Under the legislation, the United States is obliged to supply the island with weapons needed for its self-defense.

  Finally, the Pacific Deterrence Initiative (PDI) created under the fiscal 2021 Pentagon spending bill, would also be vital for U.S. forces in defending the region, Mills added. The PDI, akin to the European Deterrence Initiative, is aimed at securing advanced military capabilities to deter China’s military threats in the Indo-Pacific region.

  To defend against a possible invasion, Taiwan “can never have enough ammunition,” Mills said, adding that the island’s recent move to begin producing long-range missiles that could reach deep into mainland China was a “big deal.”

  Taiwan’s missiles are “a clear message that they’re going to reach out and inflict cost,” according to Mills.

  Soong suggested that the Biden administration could support Taiwan in two ways: assisting Taiwan to participate in international organizations and welcoming Taiwan to become a part of a “trusted industry alliance.”

  In February, Biden signed an executive order to begin a 100-day review of U.S. supply chains in several key sectors, including semiconductors, pharmaceuticals, and rare-earth minerals.

  The American Institute in Taiwan, the de-facto U.S. embassy in Taiwan, announced on April 1 that a virtual forum was held on Wednesday between high-level Taiwanese and American officials, to discuss the effort to expand Taiwan’s participation in “U.N. organizations and other international fora,” including the World Health Organization (WHO).

  Taiwan is currently not a member of the WHO because of Beijing’s objections.

  The Biden administration could also take active steps to enforce several pieces of pro-Taiwan legislation that were signed into law by former President Donald Trump, Soong said. The legislation includes the Taiwan Travel Act, the TAIPEI Act, and the Asia Reassurance Initiative Act.

  Taiwan, located on the first island chain, would be among the first targets of any Chinese military aggression in Asia. The first island chain is an arbitrary demarcation from the southern Japanese island of Kyushu, Taiwan, the Philippines, to Indonesia. For decades, the CCP’s military strategists have seen the first island chain as a barrier to the regime’s air and naval power, leaving the second island chain and beyond out of its reach.

  As a result, Soong said that some European and Asian countries, in particular Japan and Australia, are observing Taiwan closely to see whether cooperation between Taipei and Washington is solid.

  “These countries are watching how the U.S. government will enact these legislation, questioning whether it will pay lip service [about U.S. commitment to allies’ security] under certain situations,” explained Soong.

  The Biden administration has said its commitment to Taiwan is “rock-solid.” But according to Soong, how serious the administration is in defending the island remains to be seen, especially given that Biden himself has never used the word “threat” to describe the CCP.

  Biden has instead framed the regime as America’s “most serious competitor.”

  Soong said he foresees the United States and China engaging in small-scale military conflicts in the near future, especially at two Taiwan-controlled islands in the South China Sea—Dongsha and Taiping.

  “I believe the United States and China are in a new cold war,” Soong said.

  Tyler Durden
  Tue, 04/06/2021 – 21:45

• Michael "Big Short" Burry Quits Twitter Amid Speculation About SEC Probe
  Michael “Big Short” Burry Quits Twitter Amid Speculation About SEC Probe

  A few weeks ago, we reported that Michael Burry, the hedge fund manager who shot to international fame thanks to the “Big Short”, had once again deleted all of his tweets and announced that he would be taking a break from twitter after receiving some kind of warning from the SEC (he claimed agents had “paid us a visit”).

  

  Over the past year or so, Burry has attained a new level of financial-industry stardom after becoming a closely followed figure among the army of retail traders coalescing on and around Wall Street Bets. He made the bullish case for Gamestop and took a stake in the company long before anybody had heard of “RoaringKitty”, and under his familiar user name “Cassandra” he attracted hundreds of thousands of followers on Twitter often thanks to his gloomy takes – often only to delete his tweets and threads, much to the consternation of many of his fans.

  But instead of merely deleting tweets, it appears the Scion Asset Management founder has deleted his entire account. The webpage for the @michaeljburry account that used to show Burry’s musings on the dangers of Bitcoin and the bubble around the current retail trading wave now displays a message saying, “This account doesn’t exist.”

  

  Speculation immediately turned to the SEC and whether Burry had deleted his account for some kind of compliance-related reason. In recent weeks, Burry has become even more aggressively skeptical of the non-stop equity rally, murmuring about how he is bracing for a massive drawdown as the reflation trade forces the market to recalibrate its rate-hike projections.

  Has the SEC come to visit you yet, like Burry?

  — Tom Wells (@tomwellsjr) April 5, 2021

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  What’s more lame: that the SEC visited Burry, or that he caved? https://t.co/WdwwWNcoxE

  — 𝔻🦩𝕃𝔸ℕ 𝔾ᚱ𝔸₿🌐💚§𝕂𝕀 (@GrabowskiDylan) April 6, 2021

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  @MaddowBlog why does Dr. Burry’s account no longer exist? @michaeljburry He was trying to warn people again. SEC told him to stop. He tried to put his warning in a background image. Seriously! The guy who told us the economy was collapsi g last time has to use secret messages!

  — A fox in space (@woundedkarma) April 6, 2021

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  Others brought up Burry’s infamous Tesla short (Tesla shares this week have reversed some of their earlier losses from the past two months).

  @michaeljburry Twitter no longer exists, huh?

  RIP: Michael Burry (aka “Cassandra”), last seen touting his Tesla short position or being interviewed by SEC over market manipulation. Either way, be well Michael! We’ll get Mark Spiegel to play you in the next film!$tsla $tslaq pic.twitter.com/SE6VwBXh1W

  — equilibrium (@Equilibrium_420) April 6, 2021

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  To be sure, as at least one twitter user pointed out, this isn’t the first time Burry has deleted his twitter account, and it’s entirely possible he just did it on a whim.

  Burry has deleted his Twitter about 10 times in 10 years. Sec didn’t make him do that.

  — King Kahn (@KingKahn23) April 6, 2021

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  Tyler Durden
  Tue, 04/06/2021 – 21:25

• China's Digital Currency Has Nothing To Do With Bitcoin
  China’s Digital Currency Has Nothing To Do With Bitcoin

  Authored by Peter Earle via The American Institute for Economic Research,

  China’s digital currency has left the testing stage and is set for a full rollout to the entire country and region.

  China is only the second country and the first major economy to officially launch a blockchain version of its own currency. According to Bloomberg, the sand dollar of the Bahamas Central Bank launched last year and was already being accepted in stores in the capital Nassau.

  

  You will find more infographics at Statista

  For some reason, the major media stories on the topic circle around the issue of Bitcoin, invented in 2009 as an alternative to government paper money. 

  

  Just because a money has the word “digital” in the title doesn’t mean it is a form of Bitcoin. It is not. It is nothing more than a government currency with a different delivery system. 

  • The digital Yuan does not live on a public ledger. It is controlled centrally by Chinese authorities, to be changed if, as, and when political whims require such. 

  • The digital Yuan is not a peer-to-peer currency but rather requires the use of officially regulated financial intermediation. 

  • The digital Yuan does not have a market-based valuation independent of the old version of the currency. They are tied together. 

  • The digital Yuan does not have an algorithmic protocol dictating the production of new assets (akin to money creation), much less an end date at which point no more will be created. It is a currency with a discretionary money supply controlled by the government.

  • The digital Yuan is programmable to the point that the currency can be made to expire, thus forcing consumers to use it up by a certain date. This is a twist on an obscure, unconventional monetary policy innovation known as a Gesell currency: expiring money, which gives the issuing government a heightened degree of control over money velocity. 

  • The digital Yuan permits a new method for surveilling the population, creating new data which can be tracked by authorities. Bitcoin has pseudonymous protections for user privacy. 

  The value of Bitcoin and other uncensorable, trustless, decentralized cryptocurrencies and assets was to no small extent based upon the interlocking relationship between the distribution of new currency units and the processing power needed to drive transactions. 

  Cryptographic security gave the blockchain actual use value. That market-derived valuation – seen in the live, ticking price of coins or other mining rewards for public blockchains – provided an incentive for miners to compete in the packaging of blocks. The robustness of a large number of competitive miners contributes pivotally to the security of the ledger, through a form of node “diversification” and the inability of one miner to dominate the hashrate.

  Chinese Yuan spot (5 yr)

  

  (Source: Bloomberg Finance, LP)

  No such thing exists in a state-issued digital asset, which would more accurately be termed a pseudo-crypto or a government digital currency. 

  The assertion that a central bank-issued digital currency would reduce certain transaction costs and be less error prone is likely accurate. But at what cost? Other assertions – for example, that they would necessarily reduce real interest rates – hinge critically upon how exactly the digital currency in question is structured, and the purposes for which the currency is used. (One should also be suspicious of the ceteris paribus assertion that lowering interest rates is necessarily a positive outcome and not highly context-driven.)

  Diem (Libra), Facebook’s proposal for a multi-asset backed (but still centrally-managed) currency, was far from an authentic crypto. Nevertheless, political entities from states to regulatory agencies around the world leapt to quash it. The issue is not even decentralization vs. centralization, but government-centralization. Every political incentive is directed toward monolithic control, which is evident in the design of the digital Yuan. 

  In short, everything that makes Bitcoin what it is is absent from this thing. Bitcoin was a fantastic revelation in the modern age because it demonstrated that government is not necessary for the existence of money. It needs no issuing authority or technocratic management. 

  Bitcoin demonstrated that money can be both private and live on a decentralized ledger that is unowned by anyone: it solved the Byzantine generals problem. It can be both a currency unit and a means of payment in one unified package. To see it come to life in real time and then gradually develop a $1.1 trillion market cap was remarkable – especially in the face of intellectual incredulity and unrelenting government attacks. 

  Governments who attempt to create their own crypto now are merely seeking to bathe in the warmth of one of our epoch’s greatest creations even while they eschew everything that made Bitcoin and other tokens so wonderful. The market itself is now in a position to decide. In the long term, the market will choose its friends over its enemies.

  Tyler Durden
  Tue, 04/06/2021 – 21:05

• Biden Builds Annex At Texas Border Facility As Overcrowding Continues
  Biden Builds Annex At Texas Border Facility As Overcrowding Continues

  So many migrants have been caught illegally crossing into the United States that the Biden administration is constructing a temporary annex facility for unaccompanied minors next to the Texas border patrol processing center which made headlines after photos and videos revealed giant rooms full of mylar-wrapped migrants packed into plastic pens. In some instances, over 300 migrants have been crammed into pods intended to hold just 48 people. 

  

  The Donna, Texas annex will allow officials to release children from the Customs and Border Protection facility faster – where they’ll sit in another building on CPB-owned land, according to Axios, which notes that the new unit, dubbed Delphi, will be overseen by the Department of Health and Human Services.

  

  More via Axios:

  • The administration has been focused on getting minors out of border stations and into HHS supervision as soon as possible.
  • The Rio Grande Valley sector, which includes Donna, has been receiving some of the largest numbers of migrants over the past few months.

  Between the lines: Border officials told Republican members of Congress and a handful of staffers about the new facility during a tour of Donna‘s temporary tent-like structures on Tuesday morning.

  • The officials said they were sending more than 300 migrant minors to the new facility on Tuesday— the first day it was open, according to two people who were briefed.
  • From one parking area of the border station, construction work could be seen through a fence.
  • The facility will be able to hold as many as 1,500 13-17 year-old boys and girls, HHS said in a statement provided to Axios. Minors will be tested for COVID-19 before and during their stay at Delphi, according to an HHS fact sheet.

  *  *  *

  According to the most recent agency data, the Biden administration has reduced the number of migrant children in CPB custody to 4,699 as of Sunday.

  Tyler Durden
  Tue, 04/06/2021 – 20:45

• Supreme Court Could Greenlight Warrantless Gun Seizures
  Supreme Court Could Greenlight Warrantless Gun Seizures

  Submitted by Sovereign Man Blueprint

  What happened:

  Last week the Supreme Court heard arguments in Caniglia v. Strum on whether police can enter a home without a warrant under a “community caretaking” exemption to the Fourth Amendment right against unreasonable search and seizure. The case stems from a 2015 incident in Rhode Island in which police entered an innocent man’s home, without his permission, and confiscated his firearms.

  Police had been called by Edward Caniglia’s wife, who claimed she feared her husband might be suicidal after they had an argument. Edward spoke calmly to police when they showed up, told them he would never kill himself, and displayed no reason to believe he may be suicidal. Police bullied him into visiting a psychiatric care facility, and lied that they would not confiscate his firearms while he was away. The facility immediately released Edward, because in their assessment, his mental health was fine.

  Police then lied to Edward’s wife, saying her husband gave police permission to enter the home and remove his firearms, which they did.

  After Edward sued, his firearms were returned. But the court ruled the police had acted properly in seizing the guns based on “community care.” Edward’s appeal made it to the Supreme Court.

  At last week’s arguments in front of the Supreme Court, the Biden administration sent a representative of the United States to argue on the officers’ behalf. In other words, the Biden administration is in favor of a court decision which would allow police to enter homes and confiscate firearms without a warrant in the name of “community care.”

  What this means:

  Lawyers for the police officers argued that a precedent for the “community care” exemption to the Fourth Amendment, which applied only to impounded vehicles, should also apply to the home.  While other exceptions to the Fourth Amendment require an immediate emergency, this one does not. If the Supreme Court ultimately agrees, it would weaken the Fourth Amendment protection against unreasonable search and seizure, especially as it applies to firearms.

  This would essentially force a “red flag law” on the entire country.

  Red flag, or ERPO (Extreme Risk Protection Order) laws have been passed in 19 states (plus DC). They allow police to seize firearms from an innocent person, with the permission of a judge.

  This is a “pre-crime”— the court decides, without the subject present, if their non-criminal behavior suggests they pose a threat to themselves or the community. But at least under red flag laws the cops need a judge to go along. If the Supreme Court rules in favor of the police in Caniglia v. Strum, it means police across the country will have free reign to serve as judge and jury, to convict someone of a pre-crime.

  What you can do about it:

  It’s pretty ironic that the same people who want to restrict the ability to defend yourself claim that the police are all racist and cannot be trusted to keep communities safe.

  The reality is that self defense is a personal responsibility.

  Guns can absolutely be misused, and in some cases needlessly escalate situations.

  But it’s hard to deny that firearms are sometimes an important part of a Plan B for self and home defense in a worst case scenario.

  The following 19 states (plus DC) have some version of red-flag laws on the books— which again, means police could confiscate your firearms with a court order, even if you have never committed, or even been accused, of a crime.

  • California

  • Colorado

  • Connecticut

  • Delaware

  • District of Columbia

  • Florida

  • Hawaii

  • Illinois

  • Indiana

  • Maryland

  • Massachusetts

  • New Jersey

  • New Mexico

  • New York

  • Nevada

  • Oregon

  • Rhode Island

  • Vermont

  • Virginia

  • Washington

  Oklahoma is the only state with an anti-red flag law. The law passed in May 2020 says the state, nor local governments, may enact a law that allow confiscating firearms from innocent people. No state agencies may accept funds to implement such a law either.

  Here is a basic overview of gun ownership legality in a few common Plan B destinations.

  Canada: It is legal to own firearms in Canada with training, a background check, and a permit. Canada issues different permits based on the type of firearms you wish to acquire. Shotguns and rifles commonly used for hunting are considered non-restricted, which is the easiest type of firearm license to acquire. These firearms do not have to be registered.

  Handguns are considered restricted, and require a different permit, and registration of each individual firearm. To carry handguns outside the home, you must acquire another special permit based on your occupation, or an imminent danger to your life.

  Mexico: It is legal for citizens and legal residents to own firearms in Mexico provided they are registered with the government and only kept in the home.

  To carry a firearm outside the home, a special permit is required. You must prove an occupational or special need, and meet other requirements including previous military service. Other exceptions exist for certain farming, hunting or sporting reasons.

  Panama: Legal residents and citizens of Panama can own firearms after obtaining a permit. Requirements include a psychiatric evaluation, to submit DNA, a background check, and a drug test in order to obtain the permit.

  Firearms must already be registered with the government, or go through the registration process if it is imported, which includes ballistic “fingerprinting” of the firearm.

  Keep in mind that states and countries have different standards for when you are allowed to use a firearm in self defense.

  Of course guns should always be a last resort, to save your life or the life of a loved one. In those circumstances, when faced with the choice of death or having to prove self-defense in court, most people would choose the latter.

  Again, there can be parts of a Plan B that you hope you will never have to use. But as the saying goes, better to have it and not need it, than need it and not have it.

  Tyler Durden
  Tue, 04/06/2021 – 20:25

• In Biden Change Of Tune, US Mulling Boycott Of 2022 Beijing Olympics
  In Biden Change Of Tune, US Mulling Boycott Of 2022 Beijing Olympics

  As if US-China relations weren’t bad enough at this moment, things are about to escalate further – potentially taking the Biden White House past even beyond the low-point of the trade war during the Trump presidency. 

  State Department spokesman Ned Price told reporters during a daily briefing on Tuesday that the US and its allies are discussing a joint boycott of the 2022 Winter Olympics in Beijing. 

  It’s not the first time the issue has been addressed, and previously it was mainly Republicans pressuring action regarding the Olympics and China’s egregious human rights record. In early February the White House had indicated it “had no plans” for a boycott, with Jen Psaki asserting at the time, “We’re not currently talking about changing our posture or our plans as it relates to the Beijing Olympics.”

  

  But “plans” have clearly changed, especially following the March 22 coordinated sanctions slapped on top Beijing officials over the Uighur crackdown by the US, UK, EU and Canada. The Canadians in particular have been the most vocal in parliament for urging an international boycott of the 2022 games, which has riled China. 

  Here’s what the State Department’s Ned Price said in the Tuesday afternoon comments: 

  “It [a joint boycott] is something that we certainly wish to discuss,” …he told reporters when asked about the Biden administration’s plans ahead of the international games.

  “A coordinated approach will not only be in our interest but also in the interest of our allies and partners,” he added.

  Price said that the United States has not yet made a decision but was concerned about China’s egregious human rights abuses. The Olympic Games are due to take place between Feb. 4 to Feb. 20.

  When pressed over a possible timeline of when such a decision would be reached, Price added: “We’re talking about 2022, and we are still in April of 2021, so these Games remain some time away.” 

  “I wouldn’t want to put a time frame on it, but these discussions are underway.” 

  Quickly following the comments Price attempted a little damage control…

  As I said, we don’t have any announcement regarding the Beijing Olympics. 2022 remains a ways off, but we will continue to consult closely with allies and partners to define our common concerns and establish our shared approach to the PRC.

  — Ned Price (@StateDeptSpox) April 6, 2021

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  Of course, the administration might want to consult the US Olympic committee as well as the hundreds of elite athletes now training and working toward their 2022 Olympic dreams – as it would mean them having to sit on the sidelines, missing a once in four year opportunity. 

  In prior reactions particularly to Canadian and other Western politicians calling for the boycott, China’s foreign ministry has slammed the human rights abuse allegations as based purely on “lies and fabrications”. 

  Tyler Durden
  Tue, 04/06/2021 – 20:05

• California's Failed Response To COVID
  California’s Failed Response To COVID

  Authored by Dr.Jayanta Bhattacharya and Dr.Martin Kulldorff via The American Institute for Economic Research,

  Now that we’ve “celebrated” the first anniversary of COVID-19 in California, it’s a good time to take stock of the state’s response.

  

  From the beginning, the Golden State has taken an aggressive stance toward the epidemic, including imposing the earliest shelter-in-place order in the nation; ceasing in-person schooling for the vast majority of public-school kids; shuttering churches, parks, and playgrounds; mandating masks, with hefty fines for violators; and forcing the closure of “non-essential” businesses that cannot operate using distancing technologies, such as videoconferencing. Even Disneyland has been closed since March 2020. In short, California has followed one of the strictest lockdowns in the country.

  Though the state’s response received high marks in July from the “covidian” high priesthood, including Dr. Anthony Fauci, the state has seen exploding coronavirus cases and deaths. Through March 28, 2021, 8.9 percent of all Californians have been identified as COVID cases – 3.6 million cases. Since most infections are not recognized as cases, a much larger fraction of the population has been infected with COVID. Through March 29 this year, nearly 57,800 people have died in California with COVID.

  To put these numbers in perspective, it helps to have a comparison state that has followed a very different policy. For that, we should consider Florida, which partially lifted its lockdown in May 2020 and then further relaxed restrictions in September (based in part on focused protection ideas advocated by us).

  

  In sharp contrast to California, in Florida most schools and universities have been open for in-person instruction since the fall, normal human activities—sports, church going, visits to the park—occur with regularity, and businesses have been open for in-person activities.  Local ordinances can recommend masks and social distancing and impose indoor-capacity limitations but cannot mandate closures, as is the case in California. Disneyworld has been open since July. At the same time, Florida increased testing and protection within its nursing homes to reduce the risk of COVID among its most vulnerable residents.

  The Florida policy has drawn sharp criticism from Fauci, who said it “opened up too quickly” in July. However, the infection control results to date look remarkably similar to California’s, and in some ways better. Through March 28, 9.5 percent of Floridians have been identified as COVID cases. Once we account for the fact that Florida has one of the oldest populations in the country and California has one of the youngest, the death rates with COVID through March 28 are lower in Florida than in California. In fact, the COVID death rate for the under-65 population and the over-65 population are both lower in Florida than in California.

  Some think of lockdowns as the only possible way to protect the population from exposure to COVID risk. In reality, the lockdowns in California and elsewhere have served to protect only a portion of the population—the rich.

  Data from Los Angeles County, where a large fraction of COVID cases in California has happened, put this fact in stark relief. Through March 28, in the wealthiest parts of LA County (those with less than 10 percent of households in poverty), the age-adjusted death rate with COVID-19 was 119 people per 100,000 population. As we look in poorer and poorer areas, the death rate mounts: areas with more than 30 percent of households in poverty have faced a death rate of 394 people per 100,000—a death rate more than three times higher. Hispanics in LA have borne the worst of the pandemic, with a death rate of 338 per 100,000. By contrast, Black, Asian, and White residents have experienced 188, 143, and 119 deaths per 100,000, respectively. The California lockdowns are a form of trickle-down epidemiology. In Florida, by contrast, there is little difference among races in COVID-related death rates throughout the epidemic, with the Black and Hispanic populations dying at lower rates than the White population.

  While anyone can get infected, there is more than a thousandfold difference in COVID-19 mortality between the oldest and youngest. According to a report by analysts at the University of Southern California, a strategy that prioritizes the elderly for the first vaccinations would result in a 70 percent increase in the number of lives saved, even with the same number of doses distributed. From the beginning of the epidemic, mathematical epidemiologists have touted the benefits of protecting the vulnerable to reduce COVID-related deaths. While the vaccine is a scarce resource, vulnerable populations should receive it first.

  Through December and January, California failed to rapidly distribute the vaccine to the elderly, who are at the highest mortality risk after infection. Governor Newsom did not make the vaccine available to the elderly until January 13, and California ranked dead last in the country in the pace of vaccine distribution in late January. One of the authors’ 80-year old mother, who lives in LA County and does not drive, was directed to a vaccination site at Dodger Stadium, 30 miles away, for inoculation and only received her first dose during the third week of February. By contrast, Florida offered the vaccine to every single resident and staffer in the state’s nursing homes, as well as in hundreds of assisted-living facilities, by the end of January. Though California has eventually caught up, it lagged behind Florida in its vaccine rollout through the crucial early winter months.

  That California and Florida have had similar COVID outcomes despite disparate policies would matter less if the lockdowns were costless.  However, this is very far from the case. The harms of the lockdowns are manifold and devastating wherever they have been implemented, including plummeting childhood vaccination, worsened cardiovascular disease outcomes, less cancer screening early in the epidemic, and deteriorating mental health, to name a few. According to a CDC estimate, one in four young adults in the United States seriously considered suicide, as reported this past June. For children, the cessation of in-person schooling since spring 2020 has led to severe learning losses, with adverse consequences projected throughout affected students’ life spans.

  On January 25, Governor Newsom lifted the statewide shelter-in-place order he had imposed on California in early December. This order returned the state to the regional color-coded lockdown regime that had been in place before the even more draconian shelter-in-place order. While this will permit some businesses to operate again, most state public schools remain closed to in-person instruction. As of March 28, California ranks last in the United States in access to in-person instruction for K–12 students. The lockdowns of varying stringency in place since March 2020 have evidently failed to protect Californians—especially poor Californians—from COVID and have inflicted enormous harm.

  It is far past time to try a better strategy.

  Tyler Durden
  Tue, 04/06/2021 – 19:45

• Virtue Un-Signaled? Biden Admin Mulls Restarting Border Wall Construction
  Virtue Un-Signaled? Biden Admin Mulls Restarting Border Wall Construction

  Less than 90 days after President Biden signaled his immense virtue by halting construction on Trump’s border wall and canceling future contracts, Biden’s beleaguered Department of Homeland Security is exploring whether to restart border wall construction in order to ‘plug gaps’ in the current barrier, according the Washington Examiner, citing DHS Secretary Alejandro Mayorkas.

  

  This of course would make Biden a xenophobic tyrant, if we’re playing by the Trump-era media guidebook.

  In a conversation with Immigration and Customs Enformcement employees last week Mr. Mayorkas was asked about his plans for the wall and he said that while President Biden has canceled the border emergency and halted Pentagon money flowing to the wall, “that leaves room to make decisions” on finishing some “gaps in the wall.”

  Mr. Mayorkas, according to notes of the ICE session reviewed by The Washington Times, said Customs and Border Protection, which oversees the wall, has submitted a plan for what it wants to see happen moving forward. -Washington Examiner

  “It’s not a single answer to a single question. There are different projects that the chief of the Border Patrol has presented and the acting commissioner of CBP presented to me,” said Mayorkas, adding “The president has communicated quite clearly his decision that the emergency that triggered the devotion of DOD funds to the construction of the border wall is ended. But that leaves room to make decisions as the administration, as part of the administration, in particular areas of the wall that need renovation, particular projects that need to be finished.”

  According to Mayorkas, the work would cover “gaps,” “gates,” and areas “where the wall has been completed but the technology has not been implemented.”

  Former President Trump’s acting commissioner of CBP, Mark Morgan, said Mayorkas’ comments were “more spin and misdirection,” and that the agency has always given the administration options on how to proceed with the wall.

  When Trump left office, around 460 miles of border wall was completed – most of which being improvements in areas with existing wall and/or outdated designs, or vehicle checkpoints that people could simply walk around.

  The new wall is more than just the steel slats. Officials describe it as a system, one that includes technology to allow agents to detect incursions and high-speed roads to allow them to reach trouble spots faster so that agents can interdict anyone who does make it over.

  That a question about the wall came from employees at U.S. Immigration and Customs Enforcement, which handles interior enforcement and deportation rather than border matters, shows just how deeply the wall has penetrated the psychology of Homeland Security.

  It’s sparked fierce devotees — including Border Patrol agents themselves — and rabid opponents. -Washington Examiner

  Biden’s border blunders have not inspired confidence. According to a recent poll conducted for the Senate Opportunity Fund, 53% of those surveyed now favor construction. 

  Read the rest of the report here.

  Tyler Durden
  Tue, 04/06/2021 – 19:25

• Pentagon Publishes Photos Of Syrian Kurds Training To Call In Airstrikes
  Pentagon Publishes Photos Of Syrian Kurds Training To Call In Airstrikes

  Authored by Dave DeCamp via AntiWar.com,

  Last month, US Air Force Joint Terminal Attack Controllers (JTACs) trained members of the Kurdish-led Syrian Democratic Forces (SDF) during live-fire attack helicopter exercises. JTACs direct military aircraft during combat and pictures published on a Pentagon website show the JTACs training SDF members to call in airstrikes, which appears the first time the US is giving non-state actors such training, at least publicly.

  

  Above: A person wearing an SDF patch speaks into radio during training with JTACs (Sgt. Torrance Saunders/Army).

  According to a report from Air Force Times, the pictures might be the first time JTAC training with the SDF is publicized, but the training is nothing new. SDF fighters have had the ability to call in US airstrikes for years now.

  The report said the SDF fighters were not trained to be JTACs themselves but relayed coordinates to US JTACs who would then order the airstrikes. During the campaign against ISIS in the Syrian city of Raqqa, which was decimated by US bombs in 2017, some SDF members were given an app for their tablets that they could put GPS coordinates into, which they would share with JTACs through encrypted messaging.

  

  

  The Biden administration has made it clear it will continue occupying northeast Syria and supporting the SDF. While this support is framed as part of the fight against ISIS, it is more about keeping the oil resources in the region out of the hands of the Syrian government in Damascus.

  On top of the occupation of the oil fields, the US maintains crippling economic sanctions on Syria that specifically target reconstruction, preventing Syria from rebuilding after a decade of war.

  Meanwhile, Syria’s army recently published combat training footage of its own:

  The sanctions have had a devastating impact on the civilian population. According to the UN, 12.4 million Syrians are facing starvation.

  Tyler Durden
  Tue, 04/06/2021 – 19:05

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