Earlier this week, I was invited to give a lecture at Tsinghua University in Beijing, China to discuss US President Trump and the changing world order. The school is well-recognized as the “Harvard University of China,” boasting of the nation’s smartest students, who come from the most privileged backgrounds.
They represent the future generation of the elites and considering their circumstances, they lean in support of not only patriotism for China, but also embrace the globalist ideals, such as DEI (diversity, equity and inclusion), UN (United Nations) Climate Change ‘Net Zero’ sustainability goals and Open Borders trade.
A young Chinese student told me that Chinese exporters are helping American consumers by lowering inflation rates and even if President Trump tries to restore US manufacturing, he will confront insurmountable challenges, such as the transition to automated manufacturing that will reduce the requirement for human laborers.
Although it’s a valid argument, this should not deter President Trump from boosting domestic manufacturing and rebuilding the country. Additionally, let’s address the dramatic reforms that President Trump is pushing forward on.
In recent times, the US stock market indexes have been crashing and it looked like President Trump might pivot away from his calls to raise tariffs and to slowdown reforms in order to restore confidence for investors. But Trump said he wasn’t worried, and believes that Americans must pay more attention to long-term strategic economic planning.
His comments caused the stock markets to dive further as it appears that he won’t back down, nevertheless that’s good news for many Americans. In reality, Wall Street bankers were creating an economic order in alignment with the globalist elites and California’s Silicon Valley’s tech moguls, while shattering a pathway to riches for many American families in the middle class and ‘working poor’ communities.
Those succeeding in ‘Wall Street’ and ‘Silicon Valley’ are brilliant in the fields of STEM (Science, Technology, Engineering and Math) but what about everyone else? Unless you are a superstar athlete or entertainer, outside the STEM industries, Americans have few opportunities in today’s business climate to succeed in “rags to riches” dreams.
And that’s why Trump’s endorsement for a “real economy” over a “Wall Street finance fiefdom” can turn the tables in favor of the overburdened, over-taxed and over-looked middle class and working poor. The “real economy” is about placing priority on Main Street over ‘Big Business’ behemoths.
Hence, American families can enter a level economic playing field. Additionally, Asians and Americans hold different perspectives on education. Many Asian parents are ambitions and want their children to succeed in academics to improve the child’s chances to work in white collar jobs as adults.
Meanwhile, many Americans are not much interested in pursuing wealth by getting employed in office positions that they perceive as boring. Many young Americans prefer adventure over job stability, to work with their hands rather than sit at a desk all day.
The good people of the working poor don’t seek charity or government welfare checks and would rather work in dangerous and dirty jobs to provide for their families, instead of being lazy or getting subsidized as unemployed.
Whereas in Asian countries, parents deem their children disappointments if they don’t excel in academia and don’t get hired as an office worker. Most Americans are happy with an ordinary life, while many Asians stay ambitious.
Meanwhile, there are rising concerns over the transition to automated manufacturing, which will have huge impact on the US economy. Even if Chinese manufacturers open up new factories in the USA, they will likely make them automated.
We will see robots replacing human laborers in factory floors, inside warehouses and throughout logistics services. There will soon be a day when driver-less trucks become the new normal and human truck drivers will get edged out.
How can working poor families and those from the middle class adapt to such changing circumstances? Chinese manufacturers and investors should pour more funds into setting up vocational education programs and technical training projects.
The Trump administration, local governments and local communities should support public- private-partnerships (PPPs) to teach young people and the unemployed to learn new job skills. Members of the blue collar workforce can still work with their hands but they will have to get more educated about integrating into automation.
The idea that all manufacturing will have no human laborers will never happen. But, we will witness an era when more robots are replacing human workers and this will lead to rising unemployment rates. By promoting vocational education, Americans can adapt and succeed in their professional careers.
Additionally, the power brokers in Wall Street and Silicon Valley have amassed too much wealth and that’s not sustainable for a prosperous US economy. The widening income equality gaps also concern many Trump supporters and registered Republican voters.
A rising number of publicly-shared companies are going for private-financed and funded. They will sell off their public-shares to become a private company again. They are moving in this direction, since Wall Street investment bankers have inflicted tremendous harm to their businesses.
In former times, companies had aspired to go public, so that the founder of the firm and their senior executive could score a big-time pay day with its IPO (initial public offering). But in the aftermath, Wall Street investment bankers had seized control of those companies and would only focus on the balance sheets.
In 2014, I met a senior executive from Johnson & Johnson after she read my article criticizing Wall Street, which was posted on an obscure Website. She complained that Wall Street bankers were controlling all major companies and destroying them.
She added that in former times, companies, such as Johnson & Johnson were successful, because they stayed on mission in the healthcare sector, invested heavily into R&D (research and development) and promoted employees who cared about the company’s mission.
But Wall Street investment bankers has taken over by placing more accountants, lawyers representatives on its board of directors, while firing long-time employees of J&J and cutting investments into R&D in order to increase profit margins and share prices.
Accordingly, many other companies have undergone similar changes after going public or from an M&A (mergers and acquisitions). Therefore, finance has usurped the real economy and President Trump is cracking that system.
President Trump’s reforms are necessary to ensure a more sustainable US economy.
(Tom Pauken II., author of US vs. China: From Trade Wars to Reciprocal Deal, AFAI Senior Fellow, Geopolitical Consultant based in Beijing, China)
X: @tmcgregochina
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