America's Destiny
Russia
China
Germany

World Politics: Is Your Country Well Run? Your Destiny May Depend Upon It!

Why Are Some Countries Rich And Others So Poor?    What Is the Secret of Success?
  • Just as individuals have specific destinies to fulfill, so do countries. Some countries prosper greatly and have an almost magical dynamic quality to them. Their citizens seem to have a common belief system, which allows them to work together towards a specific goal or set of goals. These people have a specific purpose in life and have great initiative and enthusiasm for the future.
  • The opposite situation can also exist, as some countries seem to be mired in poverty and corruption with the majority of that country’s inhabitants living in misery and unhappiness. Even with massive economic assistance from organizations like the United Nations (UN) over the span of many decades, many of these countries seem unable to pull themselves out of their downward economic spiral, much to the concern of donor countries. How can so much money be spent to fix a problem, yet achieve so little results?
  • Many believe that wealthy countries such as the USA and those throughout Europe have much land and resources which is the basis of their wealth. That is not always true, as seen in the incredible economic power generated by Hong Kong (particularly when it was under British rule). Few places in the world have had such incredible economic success and it was available to everyone. It was the hallmark of good government working in combination with a hard working population determined to succeed. Yet Hong Kong (a small island off the coast of China) has so few resources that it has to import its water on a daily basis.
  • So what is the secret to success for countries? Why do some succeed and others fail? The two most important factors to secure a country’s future are: a) good government (i.e. one that is honest, efficient, flexible, and realistic in setting goals) and b) the belief system of a country’s people and the value they place on honesty and hard work.
    • Even thousands of years ago, the importance of good government became evident when it was written: “Where there is no vision [leadership], the people perish”.  An excellent example of this is the country of Venezuela in South America.  Once one of the wealthiest countries in the world, it is now one of the poorest!  

Countries to watch in 2020:

  • United States of America (USA)
  • China
  • Russia
  • Germany
  • Japan
  • Canada

Common Issues (worldwide):

  • How will your country’s politicians handle the economic and social aftermath of the coronavirus (COVID-19) global pandemic?
  • Should your government investigate what role China and the World Health Organization (WHO) had in the COVID-19 global pandemic?
  • Should your government impose a Coronavirus Compensation Tax (CCT) or other financial penalty upon China to help pay for the economic costs for the COVID-19 global outbreak?

1.  Country:  United States of America (USA)

On November 3, 2020, the USA will hold its presidential election. There will be a candidate running for the Democratic Party, Joe Biden, and a candidate for the Republican Party, current President Donald Trump.  Whether you are a Democrat or a Republican, your vote will help determine America’s destiny.  Whoever wins the presidency will have to confront the following issues facing America.

The Top Four (4) Issues Facing America in 2020
Issue #1:  The Coronavirus (COVID-19) Pandemic:  How to stop the virus and get America’s economy back on track

Background

  • Infection – Death Rate:  As of May 28, 2020 over 1.75 million people in the US have been infected with COVID-19, and from that 102,000 have died.
  • Economic Cost:  The preliminary economic cost to the American economy is an estimated $2.14 trillion US.  That is only an estimate for the short-term costs. If the long-term costs are factored in, the cost is even higher.
  • Unemployment:  About 40 million Americans are now unemployed.  The incredibly low unemployment rate of 3.6 % (as of May 2019), the lowest since 1969, has now been erased due to the lockdown measures imposed throughout the USA to stop the spread of the coronavirus (COVID-19).  As of April 2020 the unemployment rate hit 14.7% and is still increasing.
  • A Possible Second Wave: The coronavirus pandemic is still ongoing, and could hit again later this year during the regular flu season.
  • A Balancing Act (Health vs the Economy):  Government leaders both at the national and state level have to balance the need to ensure public health with the need to get people working again. No country can afford to keep its economy on long-term lockdown without risking a severe economic depression (which could be just as bad as the coronavirus itself as it could throw millions of people into being homeless and impoverished).
  • Shortage of PPE:  A major problem has emerged during this pandemic:  the shortage of Personal Protective Equipment (PPE) for workers, especially health care workers (e.g. doctors, nurses, ambulance attendants) and sanitization equipment (e.g. gloves, disinfectants, wipes). 

Observations / Possible Courses of Action:

  • PPE Shortages & Free Trade:  Years ago, American businesses closed their factories in the USA and re-opened them in China (to ensure higher profits). This decision put American lives at risk.  Since the factories are in China and the Chinese government needs these supplies for its own people, American requests for supplies have been a low priority.  Americans experienced first-hand a major drawback to so-called Free Trade: American companies that locate their operations to other countries are not there to serve American interests.
  • Employment:  The government should ensure that American companies give higher priority to hiring American workers rather than non-Americans.
  • Economic Compensation:  Given the preliminary evidence that China was responsible for the COVID-19 pandemic, the government could consider imposing a Coronavirus Compensation Tax (CCT) upon all goods entering the USA from China, and from income earned by American companies operating in China.  The CCT could be used to compensate the US government, State governments, and businesses for the negligence of the communist government within China who withheld vital health information from the World Health Organization (WHO) and let the coronavirus spread globally, reaping havoc upon the USA, Canada, Europe, and the rest of the world.  Such a proposal is already under discussion within the USA.
Issue #2:  Restore America’s Manufacturing Sector: “Made in USA” versus “Made in China”

Background

  • For decades America has been systematically losing its manufacturing sector, primarily to countries like China.
  • In the 1950‘s and 1960”s America built everything (e.g. refrigerators, TV’s, cars, airplanes, furniture, etc) and prospered –  it had the greatest economy in the entire world.
  • At the moment if you walk into any store within America, the majority of the products for sale will say “Made in China”, everything from shoes to refrigerators.
  • Around 2018, an American consumer was curious to see how many American products, if any, were being sold in American stores, so he simply walked into a major retail outlet in his home town and recorded where all of its products were made. Apparently, 90% of everything in the store was made elsewhere. This random survey became quite contentious amongst the business community when it was published, as it highlighted just how bad the American manufacturing sector has deteriorated.
American Businesses Are Enriching China’s Manufacturing Sector

Beginning in the early 1980‘s, American businesses started having their products produced overseas (primarily China) for a fraction of the US production cost.  These goods (many of which were sub-standard in quality) were then shipped back into the USA to be resold at full retail prices. For example, if a pair of men’s shoes could be produced in a Chinese factory for $10, it was then resold in the USA for $100. Such a system has benefited American businesses (at the expense of American workers and consumers) and the Chinese economy (i.e. it enriches the factory owners, officers within the Red Army, and Chinese Communist Party officials who work in partnership with the business community). China has grown rich and powerful thanks in part to businessmen and businesswomen from many first-world countries, primarily the USA.

Possible Courses of Action:

  • Implement a “Made in America” manufacturing policy, giving preference to products made in the USA. If an American company imports products into the USA made in other countries, then it should pay an import levy. Revenue earned from products produced and sold within the USA should be favorably taxed (i.e. impose higher rates of income taxes on offshore operations).  (Note:  See the video above of Senator Cotton, Arkansas, addressing this issue.)
  • Use the tax system to reward those companies that are actually located in the USA. If an American company decides to close its factory in the USA, and go overseas, then tax that company at a much higher rate.  If that company received any previous federal, state, or local government financial incentives to operate in the USA, then it should be required to pay back such incentives.
Issue #3. Stop the flow of refugees, asylum seekers, economic migrants, and illegal immigrants into the USA

Background

  • Refugees:  At present the UN’s International Convention on Refugees (passed in 1951) is helping to fuel the mass exodus of refugees world-wide from third-world into first-world countries. Most of these refugees are economic migrants, seeking access to the generous welfare system of places like Europe and North America. Working with these so-called refugees is a highly sophisticated group of organized criminals who specialize in people smuggling (which has now become even more lucrative than the drug trade). The UN has done little to stem the flood of refugees, asylum seekers, economic migrants, and illegal immigrants which threatens to destabilize entire countries and regions.  In 2015, the UN estimated the number of international migrants to be around 244 million people. More than likely the present-day number would be even greater.
  • Inadmissible & Illegal Immigration: According to the US Border Patrol, for the Southwest border (with Mexico), in 2018, the number of people who came to a legal border crossing requesting permission to enter the USA (but were deemed inadmissible) was 124,511 people. For 2019, the number of people was 126,001.  For 2018, a total of 396,579 people tried to enter the US illegally (not by means of a border crossing).  For 2019, the number of people was 851,508 (a 115% increase from the previous year).
  • Misinformation in the News Media:  There is a confusing, but alarming trend in what the mainstream American media reports in regards to news conferences given by President Trump, particularly when he mentions that his administration is against “illegal immigration”.  After the president’s news conference, when you watch the mainstream media such as CNN News, it will be reported that President Trump is against “immigration”.  For some unknown reason, the news media always seems to leave out the word “illegal”.  There is a huge difference between “illegal immigration” and “immigration”.  The latter implies legal immigration, which is something that President Trump has no control over (nor has he tried to ban).  (That situation, however, may change due to the coronavirus causing a huge spike in unemployment.)  Illegal immigration is out-of-control (not legal immigration), and getting worse.  It’s an issue that has to be dealt with.       

Possible Courses of Actions:

  • Refugee Problem:  Withdraw the USA from the International Convention on Refugees (known as the UN 1951 Refugee Convention and the 1967 Protocol). This legislation is outdated. The USA could then implement its own rules and policies on how to treat any potential refugees entering (or trying to enter) the USA.
  • Increase Border Patrol Resources:  The Border Patrol, particularly for the Southwest border (with Mexico) needs more resources:  e.g.  border officers, patrol equipment, etc.
  • Hold Mexico More Accountable:  Mexico has become a depository for people from all over the world trying to enter the USA illegally. The US government should request Mexico to stop allowing people to enter Mexico without a visa or previously granted immigration clearance. 
Issue #4:  Immigration Reform: What to do with so many illegal immigrants already in the USA?

Background:  In 2017, there was an estimated 10.5 million illegal immigrants living in the USA:  62% overstayed their visa and 38% have crossed the border illegally.  President Donald Trump has threatened to have mass deportations, but that may be easier said than done.

Possible Courses of Action:

  • Reform the System:  The US Congress has to reform the immigration system, so that it’s fair to everyone (if possible).  The government has to ensure that illegal immigrants are not given preferential treatment over legal immigrants. If they don’t, then there is no incentive to move to the USA legally and it would ensure that most people would simply enter the USA illegally (i.e. use the services of a “people smuggler”), and claim either to be a refugee or asylum seeker.  If the government provides a legal loophole to its immigration policies, unscrupulous people will take advantage of it.
  • Implement a Merit-Based Immigration Policy:  Recently President Trump has stated that the USA should move to a merit-based immigration policy, welcoming those who can contribute to the USA, grow the American economy, and assimilate into it with few problems. He wants to move away from taking in poor and unskilled immigrants, especially every time a natural disaster hits somewhere in the world. For decades, the USA seems to be the one country that is supposed to take care of the rest of the world after a natural disaster. Such a policy is no longer realistic, particularly given the increasing number of natural disasters hitting the entire USA (from coast to coast): for example in 2017, wild fires were burning out of control throughout huge areas of California, massive flooding was taking place throughout entire areas of Florida, and widespread damage hit Puerto Rico due to hurricanes. Many Americans are waiting for natural disaster relief themselves. Such Americans, in particular, could argue that It is a bit unrealistic and unfair for the USA to be more concerned with victims of natural disasters outside of the USA at the expense of its own people. Many Americans would argue the motto: “Take care of your family first!”

2.  Country:  China

Background:  A Brief Summary of China’s Modern History

On October 1, 1949 the leader of China’s Communist Party, Mao Zedong, announced to the world the creation of the People’s Republic of China (PRC).  Since then China has been ruled by the Communist Party.

There is absolutely no democracy permitted within China.  Any criticism of the Communist Party is illegal.

Three important events have taken place within China that demonstrate the incredible sense of control that the Communist Party exerts over its people:

Great Leap Forward (1958 to 1962)
  • Communist Party Leader, Mao Zedong, initiated a 5-year plan to turn all of China’s farming areas into gigantic collectives.  He nicknamed this plan the “Great Leap Forward”. 
  • This policy was in effect from 1958 to 1962.  All of China’s farmers had their land, homes, and belongings confiscated by the communist government.  They were then sent to farming collectives and forced to farm the land. 
  • The Great Leap Forward policy was a disaster of unbelievable proportion, as the collectives failed to produce enough food to feed China’s farmers, most of whom were peasants.
  • Even when the obvious failure of his collectivism “experiment” was made evident, Mao Zedong refused to admit defeat.  He knew millions of his own people (he too had once been a peasant) were starving to death, yet he did nothing to help them.
  • According to historian, Frank Dikotter, author of the book “Mao’s Great Famine”, Mao Zedong allowed up to 45 million Chinese peasants to die of starvation, which made Mao the greatest mass murderer in modern history, even surpassing Adolf Hitler and  Joseph Stalin.
  • Out of the 45 million people who died: almost 8% were tortured then killed, 2% committed suicide, and 5% died in labor camps.
  • Historian Frank Dikotter describes the atrocities of the Chinese Communist Party during the Great Leap Forward as an historical blind spot for western countries.  Such countries have concentrated disproportionately on Adolf Hitler and his Holocaust, while ignoring the disaster in China during this period.  
The Great Proletarian Cultural Revolution (1966 – 1976)
  • Communist leader, Mao Zedong, initiated the Great Proletarian Cultural Revolution in May 1966 in order to reassert his control over the Communist Party.
  • For 10 years China underwent continual violence, turmoil, bloodshed, starvation, and a deteriorating economy. 
  • Madness and the rule of the mob reigned, it was as though China went into a period of total anarchy, all fuelled by Mao Zedong:  students murdered their teachers, people were attacked on the streets just for wearing clothes that looked too bourgeois, intellectuals were murdered just for being an intellectual, millions of urban youth were ordered to be relocated to the countryside for “re-education” purposes, and even communist party officials were murdered by the mob for no reason.  Mao vowed to remove anyone within Chinese society who wanted to steer China towards capitalism.
  • The only reason the Cultural Revolution ended in 1976 was due to Mao’s sudden death.
  • Historians estimated that between 500,000 and 2 million innocent people were killed during the Cultural Revolution.
Tiananmen Square Incident (1989)
  • In 1989, thousands of unarmed students gathered in Tiananmen Square in Beijing to protest against China’s one party government.  They wanted a more democratic government.
  • The communist government ordered the students to leave.  When they refused, the government sent in troops and tanks to put an end to the protest.
  • Chinese troops opened fire on unarmed innocent students, killing thousands of them and arresting 10,000 students.
  • The western media followed the protest.  At one very poignant moment a young man stood in front of a tank, preventing it from killing any of the protesters.  He earned international acclaim and was nicknamed the “Tiananmen Square Tank Man”.  After the protest was stomped out, he was arrested and within 14 days  executed by the government.  
Issue #1:  How to Deal with the Coronavirus (COVID-19) Pandemic:  Tell or Hide the Truth?

Misinformation: The new coronavirus (later nicknamed COVID-19) began in Wuhan, China in November 2019 which led to the first recorded case appearing on December 1, 2019. China’s ruling communist party has had problems at times even acknowledging that basic fact.  They have begun to spread misinformation, at one point blaming the US military for bringing the coronavirus into Wuhan, and later even blaming Europe for spreading the virus and starting the pandemic.

WHO Involvement:  Preliminary investigations have alleged that the communist government hid the severity of the new coronavirus not only from their own people but also from the World Health Organization (WHO) and the rest of the world.  

SARS Epidemic:  In 2003, according to the WHO, China’s communist leaders covered up the previous coronavirus pandemic (the SARS epidemic), which would give little credibility to any denial on the part of the current communist government in the COVID-19 crisis.  

Compensation:  For the first time, some Western countries such as the USA are pushing back and refusing to accept the misinformation issued by China’s communist government.  The USA has even hinted at demanding that China reimburse the American government for all of its expenses in fighting COVID-19.  This could easily amount to over $2.1 trillion US for the USA alone.  If other countries follow suit, it could be very expensive for China.

Issue #2:  Is it Safe for Foreigners to do Business in China?

Until recently, the communist government could promise foreign businessmen (and businesswomen) that it was safe to do business in China: as a western investor you could come and go without worry. That situation has now changed, as according to recent news media (e.g. CBC News) reports, western businessmen have begun to be arrested arbitrarily by China’s secret police, and effectively held for ransom. 

If you are a businessman or businesswoman, you must consider the following before you decide to do business with China, particularly if you want to invest in its manufacturing sector (e.g. factories).  The opportunity to make higher profits can come with a very high price, even affecting your safety and well-being such as:

Arbitrary Arrest:  China has no individual rights.  Unlike the USA, there is no Bill of Rights. The Chinese Communist Party decides what is right and wrong.  No one can question their decisions nor their authority.  If you are in China (e.g. conducting business), you or any members of your company or family can be subject to arbitrary arrest by Chinese secret police. Such an event happened to two Canadian businessmen who were in China both conducting routine business. On December 10, 2018, Michael Kovrig was arrested in Beijing and Michael Spavor was arrested in Dandong.  Both were arbitrarily arrested, accused of breaking China’s national security laws, and thrown in prison where they have had no contact with the outside world since their arrest.  

Asset Confiscation:  Your company’s assets can be confiscated at any time without any recourse (i.e. the government can nationalize your company at any time).  

Bribes:  There have been ongoing allegations for years that foreign businesses will need to pay “administrative fees” (i.e. bribes) to conduct business in China. These fees are then paid to communist party officials, which enables that foreign company to undertake its business affairs. In 2017 a news media report stated that the typical annual salary of a communist party official was roughly $25,000 US; yet such communist party officials (or their families) are able to purchase luxury properties, particularly abroad.  

Possible Future Criminal Charges:  At some point in the future, if China does become a democracy, you could be charged by the new democratic Chinese government of “aiding and abetting” the communist regime. Even if that event does not happen for some time, the current communist regime could charge you with trying to bribe a government official (even though such a practice is apparently quite common).  Corruption within the communist government is an ongoing issue for its leaders.  The division between rich and poor is getting wider, and that does not look good for a so-called communist government (whose basis is supposed to be equality amongst everyone in society).    

Poor Quality Control: The goods that your company wants manufactured in China will more than likely be of poor quality, as there is little quality control. For example, years ago when steel was imported into the USA from China it was found to be substandard, easily fracturing which made it a poor building material.  Even products not manufactured such as fresh seafood have had quality control problems, riddled with contaminants such as antibiotics.  

Health Concerns: If you spend time in China, your physical health can be comprised due to high levels of air and water pollution. The lack of environmental controls is part of the reason why China is able to cheaply manufacture products.  

Issue #3:  What to do about Hong Kong?

Former British Colony:  Hong Kong used to be a colony of the British Empire.  This city (and its surrounding territory) was returned to China in 1997 where it became a special administrative region, retaining a separate government and economic system from that of mainland China.

Wealthy City:  Before its return, Hong Kong had become one of the world’s most wealthy and successful capitalist cities.  It was truly “the jewel in the crown” for China to have added this city to its territory.  The Chinese communist government recognized Hong Kong’s tremendous economic worth, and promised to retain Hong Kong’s way of life, so that it could continue to generate huge revenue from international trade.  Chinese government officials even used the slogan “One country, two systems” to demonstrate their commitment to Hong Kong’s special status.

Ongoing Protests: As time has progressed, the Chinese communist government has forgotten its promise to Hong Kong, and tried to subordinate it to the governance of the mainland communist government.  The end result has been ongoing protests from Hong Kong residents who do not want to see their way of life destroyed and assimilated into the communist system.  

National Security Law:  In May 2020 the Chinese communist government imposed a National Security Law, which basically removes Hong Kong’s autonomy and the civil liberties of its residents. If China proceeds with its assimilation plans, it will more than likely destroy Hong Kong as we know it, effectively “killing its golden goose”!  This should not be surprising as the hallmark of China’s communist government has always been to ensure control and conformity to its policies, no matter what the cost.  In protest, the American government has threatened to end Hong Kong’s special trade status, a move that will cost China billions of dollars in lost revenue.  

3.  Country:  Russia

 Russia has been ruled by President Vladimir Putin since May 7, 2000 (now over 20 years).  As former head of Russia’s notorious secret service (the KGB), he has ruled Russia with an iron fist, strengthening Russia and ensuring that it remains a world power.  However, it has come at a huge cost, especially economically and politically to most Russians.  

Issue #1:  How to handle the coronavirus (COVID-19) Pandemic?

No COVID-19:  Until fairly recently, Russian government officials claimed that there was no problem with the coronavirus (COVID-19).  Putin himself assured the world that Russia had been “lucky” and was spared from the epidemic.

Epidemic:  As of May 25, 2020 Russia has had 353,427 people who have become infected with COVID-19 with 3,633 deaths.  It now has the world’s third largest number of COVID-19 cases.

Questionable Statistics:  The official infection and death rate numbers are already been questioned by health officials outside Russia, particularly Russia’s remarkably low death rate.  According to some news media reports, Russian doctors have been instructed by the government to classify coronavirus deaths as being due to pneumonia, not the coronavirus (so as conceal the true extent of the epidemic spreading throughout Russia).

Issue #2:  What to do about Putin?  Is he Russia’s Mugabe?

Putin’s Rule:  Putin has ruled Russia as its president for over 20 years.  He is now 67 years old.  He refuses to step down and make way for a younger leader.  

President for Life:  In May 2020 Russia’s State Duma approved changes to Russia’s constitution so that Putin could stay on as president to 2036 (at which time Putin will be 83 years old).  

Dictatorship:  Putin has turned Russia into a dictatorship:  elections are meaningless (as the successful candidates have already been selected); all of the major news media companies are controlled by the government (so you only hear what the government wants you to hear); and anyone who stands up to Putin is either sent to prison or mysteriously murdered (such as Boris Nemtsov).

Issue #3:  What to do about the Wealth Inequality?

Russia’s GDP:  Since 2008, the GDP of Russia has stayed the same.  Many Russians have seen a continual drop in their standard of living.  The average monthly pension, for example, is now only $210 US per month, which is not enough to live on. Many Russian seniors are starving, as they don’t have enough money to buy food or pay for heating.

The Oligarchs:  Russia’s wealth (e.g. its vast oil reserves) are siphoned off by Putin and his oligarchs (businessmen who have been given monopolies by Putin).  They live in total luxury while the rest of Russia lives in misery and poverty.

Personal Wealth of Putin:  Apparently Putin is one of the world’s most richest men. In 2019, the US Senate Judiciary Committee was informed that Putin’s personal fortune is estimated at $200 billion US.  Putin believes that what belongs to Russia, belongs to him.

Income Inequality:  The distribution of wealth within Russia is so stark that Putin and his oligarchs have basically re-created the society that existed before the 1917 Russian Revolution with Putin acting as Czar Nicholas II and his oligarchs acting as Russia’s aristocracy (the dukes, counts, and princes).  The czar and his aristocrats all lived in splendour while the masses slowly starved to death.  It was this vast disparity in income that eventually turned the Russian people to revolt in 1917; and it may be the catalyst to foment revolution again at some point in the very near future.   

Secret Police:  To maintain his hold on Russia’s citizens, Putin uses his secret police, the Federal Security Service (FSB). The FSB is the successor to the infamous KGB (of which Putin was its head).  Apparently Czar Nicholas II did the same thing:  his secret police arrested, tortured, and murdered anyone opposing the rule of the czar.  History appears to be repeating itself.  

4.  Country:  Germany

Issue #1: How long will Germany continue to “bankroll” the European Union?  

Greek Debt: Since 2010, the Greek government, a member of the European Union (EU), has borrowed 320 billion euros, primarily from the EU and individual EU countries. The amount of loans to Greece has been the biggest financial rescue of a bankrupt country in mankind’s history.  As of 2015, Greece owed individual countries such as Germany 56 billion euros, France 42 billion euros, Italy 37 billion euros, and Spain 25 billion euros.

Greek Bailout: So far, Greece has had 3 major bailouts from the EU.  No doubt more bailouts will be necessary.  Financial analysts have described Greece as a bottomless money pit, draining financial resources from the EU with no end in sight.  During the last bailout, German Chancellor, Angela Merkel had the opportunity to correct this dire situation; instead she agreed to continue the EU’s financial support of Greece and allow Greece to stay on the euro currency.  It is common knowledge, however, that Greece will never be able to re-pay the massive amounts of monies that it has been borrowing.  Given this situation, Germany will need to write off all of Greece’s bad loans, and charge everything to German taxpayers.

European Central Bank:  Germany contributes almost 21.5% of the capital of the European Central Bank, but has negligible authority on its Governing Council as to how the money should be spent.  

EU Budget:  In 2018, Germany’s contributed 20.78% to the EU’s budget, the highest of any EU member state, more than Italy (11.74%) and Spain (8.31%) combined.  

EU Budget Increase:  In 2020, Germany’s net annual EU budget contribution (i.e. the amount of money Germany pays in excess of what it receives back) is 15 billion euros. The EU wants to steadily raise Germany’s annual net contribution so that by 2027 it will be paying up to 33 billion euros (over a 100% increase in its budget payments to the EU).  Apparently a major reason is that the EU needs Germany to help make up the budget shortage caused by the United Kingdom (UK) leaving the EU in 2020. 

Corona Bonds:  Several EU member states are in financial trouble, particularly Spain and Italy.  As of 2020, Italy, for example, has a debt of 2.5 trillion euros due to the Italian government overspending in the 1980’s and 1990’s.  Italy’s debt is now 130% of its GDP (second only to Greece).  Even before the coronavirus (COVID-19) pandemic, Italy’s banks (as well as Spain’s) were on the verge of bankruptcy.  Italy, Spain, and France have requested the EU to issue common debt financial instruments known as Corona Bonds.  These countries want the massive debt that would need to be repaid on the books of the EU, not individual countries.  In other words, Italy’s debt would become part of Germany’s debt, not its own. At the moment, Italy is kept financially afloat due to the European Central Bank buying its debt in the financial markets.

Coronavirus Financial Damage:  All EU member states have been financially hit by the coronavirus (COVID-19) pandemic, even Germany.  The German government has had to spend billions of euros propping up its own businesses and banks as well as providing financial support to its own people.  To date, these payments have amounted to 7% of Germany’s GDP, and there is no end yet to the coronavirus pandemic.  

Issue #2: Is Germany’s Financial Contributions to NATO too Little?

NATO Contributions:  All member states of the North American Treaty Organization (NATO) agreed many years ago to spend a minimum 2% of their Gross Domestic Product (GDP) on national defence. American President, Donald Trump, has emphatically stated that it’s not the USA’s responsibility to be the world’s policeman. He wants to reduce the USA’s financing of everyone else’s protection, particularly with NATO (which is responsible for Europe’s defence).

American Contributions:  Even though there are 28 member states, it was reported in 2017 that the USA contributes 22% of the NATO budget. Also, in 2017 the American president stated that the USA was spending 3.61% of its GDP towards national defence while Germany was only spending 1.2% (a little more than Canada’s 1.02%).

NATO Budget Targets:  Again all member states of NATO are supposed to be equal, but as of 2017 only 5 member states were meeting the 2% target. The German government under Chancellor Angela Merkel has denied that Germany is not contributing its fair share towards defence spending, yet the statistics prove otherwise. The USA will not continue the status quo, so Germany will have to reluctantly devote more financial resources to its own national defence and not rely so heavily upon the USA (which it has done since the end of World War II).  Apparently Germany will not be able to meet’s its NATO defence spending goal until 2031.  That may not be acceptable to the USA and other allies, as many would argue that Germany is not taking its NATO responsibilities serious.

Observation: It does not help Germany’s case when by all observations Germany seems to have no problem allocating massive amounts of extra funds (hundreds of billions of euros) to willingly take in over 1.3 million refugees, giving them access to German’s generous welfare system (many of these refugees were living in Turkey and were not living in war-like conditions), yet it can’t find the money to pay its fair share of NATO costs.

Issue #3: Germany’s New Political Landscape: The Rise of Nationalism and the AfD

Germany had a national election on September 24, 2017 and its results were quite shocking, particularly for its longtime chancellor, Angela Merkel. Even though she was re-elected as chancellor for a 4th term, her policies allowed a right-wing pro-nationalist political party to enter the German Parliament (the Bundestag) for the first time since World War II. The AfD (Alternative for Germany) party won 94 seats in Parliament, and is now the third largest political party.

Interestingly, support for the AfD was highest amongst those aged from 35 to 44 years and lowest amongst those age 70 and older. Afd has vowed to rein in Angela Merkel to prevent her from allowing refugees and migrants indiscriminately into Germany (where they can gain access to Germany’s welfare system). The Afd is not a fan of the euro and wants Germany to return to its previous currency, the Deutschmark.

Should Germany abandon the euro and the European Union?

Net Contributor Status:  The German economy is the strongest in Europe. Given that fact, Germany could easily abandon the euro and return to the Deutschmark. It will be interesting to see how much longer the average German taxpayer is willing to fund (and basically prop up) many of the poor economies within the European Union (EU) such as Italy, Greece, Portugal, Spain, and Ireland.  It is making less and less economic (business) sense for Germany to fund the EU. It’s financial contributions are steadily increasing with no end in sight.  It is officially classified as a “net” contributor, which is a nice way to say that it pays more into the EU than it receives back.  (The United Kingdom was also a net contributor for many years, and this fact became the major reason why the United Kingdom decided to leave the EU.)  

High Health Care Costs:  In many ways, Germany does not need the European Union as much as the European Union needs Germany. New political parties such as AfD can easily argue that German taxpayers funds should be spent on such initiatives as trying to reduce the amount that Germans have to pay each month for their ever increasing health care costs (which on average can be between 400 to 700 euros – $440 to $769 US – per month with 50% of that cost covered if you have an employer) as opposed to Germany spending its tax revenue trying to endlessly prop up other EU countries (many of which are mismanaged and have little incentive to change, especially since Germany is basically bankrolling the EU).  

5.  Country:  Japan

Issue #1: The Threat of Nuclear Weapons Launched from North Korea

National Security:  Prime Minister Shinzo Abe of Japan has warned that North Korea’s threat to launch nuclear weapons upon Japan is the greatest threat to Japan since the end of World War II. Since 1945, Japan has solely depended upon the USA for its national security. In 2017, American President, Donald Trump, informed the Japanese government that it has to take more responsibility for its national security, and cannot rely solely upon the USA to protect it from other hostile countries. This is a huge shift for Japan to make, as it has a pacifist constitution, preventing it from re-arming.

Missile Attacks:  Since 2017, North Korea has launched the following missiles towards Japan:

  • First missile:  August 29, 2017
  • Second missile:  September 15, 2017 (missile went over Hokkaido Island)
  • Third missile:  late September 2019 (possibly launched from a submarine – landed off Japan’s west coast)
  • Fourth missile:  On April 14, 2020 multiple cruise missiles were fired towards the Sea of Japan

Given the fact that since 2017 North Korea has continued its pattern of aggression towards Japan, the Japanese government may not have any other option but to re-arm its country. North Korea has embarked on a dangerous arms race creating nuclear weapons and threatening to use them against other Asian countries as well as the USA.

Security analysts have speculated that either Communist China or Russia has been secretly assisting North Korea with its nuclear weapons program, which would explain how such a poor and backward country like North Korea could suddenly have unlimited funds to develop an expensive and technologically sophisticated nuclear weapons program.

National Defence Options for Japan include:
  • Install American anti-missile systems to destroy any incoming missiles from North Korea
  • Install nuclear weapons to counter any aggression from North Korea or Communist China (a long-term ally of North Korea)
  • Re-build Japan’s army, navy, and air force to be proactive and monitor any outside threat.
Issue #2:  The Threat from Communist China

Threat to National Security:  In 2019, for the first time in Japan’s modern history, Japan has placed communist China as a bigger threat to national security than North Korea.

China’s Belt and Road Initiative (i.e. the building of railways, roads, ports, etc.) has been singled out by the Japanese government as a potential threat.  So far more than 130 countries worldwide have either signed agreements with China or expressed an interest in the Initiative.  Critics view such an Initiative as a “debt trap”, especially for emerging countries.  These expensive construction projects can leave a host country with massive unpaid debt, and give the Chinese government influence over the host country’s government (e.g. allow China’s military to set up a military base in that host country).  

Japan is worried that China may use its Belt and Road Initiative to place its army throughout Asia and the rest of the world.  

First Overseas Military Base:  The country of Ethiopia in Africa is a recipient of China’s Belt and Road Initiative and has now allowed China to set up its first overseas military base for the People’s Liberation Army (PLA) in Djibouti.  

Military Spending:  China’s military spending is increasing each year.  For 2019 it was $177 billion US.  It has expressed the desire to obtain stealth fighter aircraft and aircraft carriers.  The latter would suggest that China has definite imperialist ambitions.  In comparison, for 2019 Japan’s military spending was only $48.6 billion US.

 6. Country:  Canada

Issue #1:  How to Handle Canada’s Out-of-Control Debt?

Balanced Budget Promise:  In 2015, newly elected Prime Minister Justin Trudeau held a press conference and re-iterated his campaign pledge to balance the federal government’s “books” within 4 years.  This promise, he swore, was “very” cast in stone.  The only problem with making such a promise was the fact that he and his fellow liberals had made billions of dollars of campaign promises.  

The Canadian federal government’s budget deficits (on an annual basis) since 2015 are as follows:

  • For Fiscal Year 2015 – 2016 the previous Conservative government had estimated a surplus of $1.4 billion CDN.  This estimate was re-calculated in March 2016 by the new Liberal government to be a deficit of $1 billion CDN.
  • For Fiscal Year 2016 – 2017:  $17.8 billion CDN deficit
  • For Fiscal Year 2017 – 2018:  $19 billion CDN deficit
  • For Fiscal Year 2018 – 2019:  $14 billion CDN deficit
  • For Fiscal Year 2019 – 2020:  $19.8 billion CDN deficit, but then in mid-December 2019 revised to:  $26.6 billion CDN deficit
  • For 2020 (due to coronavirus and oil price drop):  an estimated $252 billion CDN deficit

Observation:  Ever since Justin Trudeau became Prime Minister, he has not kept his promise to balance the federal governments “books”.  Even though Canada’s economy was booming, his government had record high budget deficits every fiscal year.  

Issue #2:  How to Handle Canada’s Record High Unemployment Rate?

During the coronavirus (COVID-19) pandemic, Prime Minister Trudeau has isolated himself in his Ottawa mansion.  Each morning he stands in front of his mansion and tells the media what financial support his government will give Canadians.  The government’s lockdown measures have imposed a huge financial cost to Canadian workers and businesses.  So far he has not detailed how his government intends to kickstart the Canadian economy nor how to get it back on a stable financial footing.

Number of Lost Jobs:  Due to Canada’s lockdown measures against the coronavirus (COVID-19) Canada lost a total of 3 million lost jobs by the end of April 2020.  

Jobs Made Part-Time:  According to Statistics Canada, in addition to the 3 million lost jobs the number of workers who worked less than half of their usual hours increased by 2.5 million.

Job Summary:  In summary, by mid-April 2020 the number of Canadians who were either unemployed or working substantially reduced hours was 5.5 million.  

City Unemployment Rates:  In metro Montreal (Quebec) the unemployment rate in April 2020 was 18.2%.  In comparison, the city of Toronto (Ontario) was 11.1% and in the city of Vancouver (British Columbia) it was 10.8%.  

Student Unemployment Rate:  For students aged 15 – 24 years old  in April 2020 the unemployment rate was 31.7%.

National Unemployment Rate:  According to Statistics Canada, the national unemployment rate for April 2020 was 17.8%.  In comparison, the national unemployment rate for January 2020 was 5.5% (before the coronavirus pandemic).  

Issue #3:  What to do About the Detained Canadian Businessmen (the “two Michaels”) in China?

Trudeau and China:  For the past several years, Canadian Prime Minister Justin Trudeau has encouraged Canadian businesses to do business with China.  He has even personally led teams of Canadian businessmen to China in order to cement business relationships between Canada and China.

Unlike the American President, Donald Trump, Canada’s Prime Minister has never adhered to a “Made in Canada” stance.  Prime Minister Trudeau is a firm believer in Free Trade and is not concerned that much of Canada’s manufacturing sector (primarily from Quebec and Ontario) has moved overseas.

Not Safe for Business (or Travel):  As reported above in the case study of China, it is no longer safe for western businessmen (and businesswomen) to do business in China.  China’s secret police has started arresting Canadian businessmen for no reason and throwing them in prison (on false charges).  Canadians in particular (and more than likely any foreign nationals) travelling to China as tourists also run the risk of being arbitrarily arrested and imprisoned.    

Kovrig & Spavor:  Such an event happened to two Canadian businessmen who were in China both conducting routine business. On December 10, 2018, Michael Kovrig was arrested in Beijing and Michael Spavor was arrested in Dandong.  Both were arbitrarily arrested, accused of breaking China’s national security laws (which they denied doing), and thrown in prison where they have had no contact with the outside world ever since.  To date there has been no trial. 

Observations / Suggestions:

Trudeau’s Response:  When questioned by the press, Prime Minister Trudeau has refused to answer what he is doing to obtain the release of these Canadian businessmen.  It would appear that Trudeau has done nothing, and does not want to deal with this “delicate” situation, since he does not want to offend the Chinese communist government.  (As Prime Minister, Trudeau has lavished public praise on China’s communist government, even saying how much he admires their efficiency.)

Arbitrary ArrestForeign Nationals:  These two incidents should make those in the business community (as well as the tourism industry) take notice.  If you enter China even for legitimate reasons, you run the risk of arbitrary arrest.  This can easily happen to anyone regardless of their nationality, i.e. China’s secret police can easily arrest American or German businessmen (or tourists) for no valid reason and imprison them.

Asset Seizures:  Even if you don’t personally visit China, your company’s assets can be seized at any time by the Chinese government or your Chinese-based factory can be ordered to make what the Chinese government wants.  (This has recently happened to those companies making Personal Protection Equipment – PPE.)

Do Business Elsewhere:  Your company may want to look elsewhere to do business. China does not have a manufacturing monopoly.  Other countries can easily produce your products without the unsafe business conditions (e.g. Canada, USA, Europe, Vietnam, Thailand, Taiwan, India, etc).