The Benefits of Imposed Protectionism

The Russians have learned there is nothing to fear from Western sanctions:

Vladimir Putin ‘doesn’t give a s**t’ about the risk of Western sanctions if it were to invade Ukraine, Russia’s ambassador to Sweden said as US staff began withdrawing from eastern Ukraine amid warnings of an ‘imminent’ invasion.

In an outspoken interview, Viktor Tatarintsev told the country’s Aftonbladet newspaper that ‘the more the West pushes Russia, the stronger the Russian response will be’.

He claimed Russia had become more ‘self-sufficient’ amid the threat of sanctions and accused the West of not understanding his country.

‘We are more self-sufficient and have been able to increase our exports. We have no Italian or Swiss cheeses, but we’ve learned to make just as good Russian cheeses using Italian and Swiss recipes’, he said.

There is nothing that a big, resource-rich country needs from trade. Indeed, every nation large enough to be self-sufficient will be much better off, over time, by refusing to trade with the rest of the world. The USA has been impoverished, and is now debt-ridden, due to its foolish embrace of free trade and the Ricardian lie.

It’s only a matter of time before China and Russia cut economic ties with the USA. And that will harm the USA, and the West, far more than it harms the rising world powers.

DISCUSS ON SG


The End of Free Trade

What is being described as “the heist of the century” is striking fear into every banker and parasite bloating himself on the financial flows of the failing neoliberal world order and the so-called global economy:

Arm is widely regarded as the most important semiconductor IP firm. Their IP ships in billions of new chips every year from phones, cars, microcontrollers, Amazon servers, and even Intel’s latest IPU. Originally it was a British owned and headquartered company, but SoftBank acquired the firm in 2016. They proceeded to plow money into Arm Limited to develop deep pushes into the internet of things, automotive, and server. Part of their push was also to go hard into China and become the dominant CPU supplier in all segments of the market.

As part of the emphasis on the Chinese market, SoftBank succumbed to pressure and formed a joint venture. In the new joint venture, Arm Limited, the SoftBank subsidiary sold a 51% stake of the company to a consortium of Chinese investors for paltry $775M. This venture has the exclusive right to distribute Arm’s IP within China. Within 2 years, the venture went rogue. Technically it has always been legally independent, but Arm still maintained control. Recently, Arm China gave a presentation to the industry about rebranding their own IP, extending it by developing more, and emphasizing that they are striking their own independently operated path.

This firm is called “安谋科技”, but it is not part of Arm Limited.

This is the tech heist of the century….

Despite formally being fired, Allen Wu has remained in power. He ousted executives that were loyal to Arm. He has even hired security paid for by Arm China that reports to him. This security has kept Arm out of the Arm China offices. Allen Wu has aggressively taken over the firm and is operating it how he sees fit. One interesting tidbit is that Allen Wu sued Arm China in order to declare his dismissal illegal. He essentially sued himself as he represented both sides in that specific court case.

Arm has halted the transfer of any IP to entities on export control list. According to Arm, no IP has been stolen. Simultaneously, Arm has also tried to appeal to the government stating that this is bad for the Chinese semiconductor industry.

This leads us to the present day, where Arm China held an event at which they formally declared their independence. They proclaimed that 安谋科技 is China’s largest CPU IP supplier. It was born from Arm, but is an independently operate, Chinese owned company.

This is a fascinating situation, because the gunboat diplomacy to which the multinational corporations have appealed for the last 120 years is simply not an option in this case. There is absolutely nothing that the ARM investors or Softbank or its bankers can do if China decides that it wants to keep ARM China in the hands of the Chinese individuals who presently control it.

Demonstrating, once more, the profound difference between influence and power.


The only way to raise wages

Is to reduce the supply of labor. American workers can only benefit from the elimination of labor visas, increased limits on immigration, and stepped-up deportation, as evidenced by the response of Maine businesses to a “shortage” of H-2B visas:

Businesses in Bar Harbor, Maine are turning to locals to make up for a shortage of foreign guest workers that normally fill summer jobs in the bustling seaside resort town.

Because the H-2B visa program has already reached its annual quota, Bar Harbor’s hotels, restaurants and shops can’t bring in any more foreign workers for the rest of the busy summer tourist season. Like hundreds of similar coastal resort towns, Bar Harbor has for many years depended on the H-2B visas for temporary workers. The program allows non-agricultural companies to bring in foreign labor if they are unable to find suitable employees domestically.

Now they are coming up with creative ways to attract local labor, reports the Bangor Daily News.

The Bar Harbor Chamber of Commerce will hold a job fair Saturday in an effort to recruit significant numbers of workers from the region. Just about every kind of business in the town is looking for help, says chamber executive director Martha Searchfield.

“All types of businesses — retail, restaurants, the tour boats, all the trips, everything. All types of workers are needed,” she told the Daily News.

The shortage is so acute that companies are sweetening incentives for local workers. Searchfield says some businesses are offering flexible schedules that might appeal to older workers who might be interested in working only a day or two each week. And other companies have gone so far as to offer higher wages to entice locals.

That’s not a problem, that’s an indication of a solution. As long as tens of millions of Americans remain unemployed, there is absolutely zero net benefit to the economy or to American workers from immigration. All immigration accomplishes is to increase income inequality to the advantage of very large US corporations and the financial class that caters to them.

Whenever half-educated midwits talk about the economy and “business profits”, one thing you will note that they NEVER mention is that about one-third of all corporate profits go to the financial industry, which is up from three percent in the 1950s.

In other words, all that this failure to protect American jobs in the name of “free trade” has accomplished is to redistribute income from the working and middle classes to the .01 percent. Of course, there is nothing “laissez faire” about it, it is the direct result of government action. And as we’ve seen, even straight-up communism is better for a nation than this unconscientious corporatism.

AA comments: It’s people taking advantage of high-standards, high-trust society in which to produce and sell their goods, while importing low-standards/low-trust/low-quality laborers to provide their goods.


In other words, it is short-term societal arbitrage, which is the equivalent of strip-mining a society.


Reclaiming our heritage

The God-Emperor comes out swinging hard against free trade and anti-American globalism.

My fellow Americans,

On Monday, I signed a Presidential Proclamation declaring this to be “Made in America Week.”

We believe that our country is stronger, safer, and more prosperous when we make more of our goods and our products right here in the USA.  When we purchase products Made in America, the wealth, revenue and jobs all stay in our country – to be enjoyed by our people.

Since we first won our Independence, our Founders and many of our greatest leaders have promoted that we should afford a special level of protection to the products and goods manufactured within our borders.  They understood that as a nation, we have common bonds with our fellow citizens and common obligations to each other.  Making and buying made in America products brings us closer, and strengthens the ties that link us all together.

For too long, our government’s policies have punished production in America while rewarding and encouraging the movement of production overseas, which is totally ridiculous.  The result has been the loss of numerous industries, the decimation of entire communities, and years of sluggish growth and flat wages.

Throughout American history, our nation’s best leaders have believed in the importance of protecting our domestic industry.  This includes every President on Mount Rushmore.

George Washington encouraged Americans to produce their own goods so that our young nation could become truly independent.

Thomas Jefferson wrote that Americans should choose products made in America whenever possible – and by the way, I’m asking you to do that.

Abraham Lincoln warned that abandoning the policies that protect American industry would “produce want and ruin among our people.”

Theodore Roosevelt stated in his First message to Congress that “Reciprocity must be treated as the handmaiden of protection.”

James Monroe called on our nation to “cherish and sustain our manufacturers.”

James Garfield said of our nation’s manufacturers: “To them the country owes the splendor of the position it holds before the world.”

William McKinley believed that when America protects our workers and industries, we “open up a higher and better destiny for our people.”

And Calvin Coolidge stated that protecting American industry “enables our people to live according to a better standard… and receive a better rate of compensation than any people, anytime, anywhere on earth, ever enjoyed.”

We are now, under the Trump Administration, reclaiming our heritage as a manufacturing nation.  We are fighting to provide a level playing field for American Workers and Industries.  Other countries will cease taking advantage of us, believe me.

We are going to build works of beauty and wonder – with American hands, American grit, and American iron, aluminum, and steel.

No longer will we allow other countries to break the rules, steal our jobs, and drain our wealth.  Instead, we will follow two simple but very crucial rules: We will buy American and we will hire American.

Already, we have created over a million new jobs this year – and doing even better than anticipated.  We are just getting started – believe me, we are just getting started.

For every job that comes back to this country, and every factory that reopens, and every town that is revitalized, we aren’t just restoring American wealth, we are restoring American pride.  We are restoring America’s future – a future where millions will be lifted from welfare to work, where children will grow up in safe and vibrant communities, and where our nation will stand stronger than ever before.

And most importantly, it will be a future in which you – our citizens – always come first.

Thank you, God bless you, and God bless America – we are truly making it great again.


Open Brainstorm with Steve Keen

Last night, we held a Brainstorm with Steve Keen and discussed his new book, Can We Avoid Another Financial Crisis? And his answer was clear: that depends upon what you mean by “we”, kemosabe. TL;DR: in a global context, no, we cannot avoid it, but it should be about half as bad as 2008. And we’ll probably get 6-12 months of warning from his model.


As usual, Professor Keen was brilliant, informative, and entertaining. And now that he’s embarked on a paper relating to David Ricardo and free trade, I don’t think he’ll object to me posting the email he sent me a few months ago when I asked him about the implications for free trade of the demand-based break between micro and macro caused by the Sonnenschein-Mantel-Debreu theorem. Or, as I memorably renamed it last night, Sonnensomething-Niederbopp-Whatever.

In this context the key point of the Sonnenschein-Mantel-Debreu theorem is not the failure to derive a demand curve, but the inability to represent the interests of everyone in a single country using a “Community Indifference Curve”, which is an essential part of the Hecksher-Ohlin model of free trade, which has of course supplanted Ricardo’s original model.

Samuelson’s defence of doing so is frankly comical, and also highlights one of the two key weaknesses of the model: it only works if income or wealth is compulsorily redistributed to equalise the “ethical worth” of every dollar earned/possessed, and he thought this was a reasonable assumption. From “Social Indifference Curves”, Paul Samuelson, 1956

  1. It is shown that the various defenses which have been offered for the use of community indifference curves are all open to some serious questioning.
  2. The Scitovsky community indifference contours are shown to be “minimum social requirements” contours of total goods needed to achieve a certain prescribed level of ordinal well-being for all. The dual properties of the Figures Ia and Ib, relating points in the commodity and ordinal-utility spaces, are demonstrated.
  3. By means of mathematical reasoning or by the demonstration of intersections of Scitovsky contours, a fundamental impossibility theorem is proved: Except where income elasticities are all unity and tastes are absolutely uniform for all, it is proved to be absolutely impossible to solve for unique market price ratios in function of market totals; hence, we must lack collective indifference curves capable of generating group demand.
  4. All this is shown to entail the nonoptimality of any shibboleth rule which once and for all and independently of changes in technology and taste data predetermines the initial distribution of income or endowments.
  5. Since most “individual” demand is really “family” demand, the argument can be made that such family demands have been shown to have none of the nice properties of modern consumption theory. However, if within the family there can be assumed to take place an optimal reallocation of income so as to keep each member’s dollar expenditure of equal ethical worth, then there can be derived for the whole family a set of well-behaved indifference contours relating the totals of what it consumes: the family can be said to act as if it maximizes such a group preference function.
  6. The same argument will apply to all of society if optimal reallocations of income can be assumed to keep the ethical worth of each person’s marginal dollar equal. By means of Hicks’s composite commodity theorem and by other considerations, a rigorous proof is given that the newly defined social or community indifference contours have the regularity properties of ordinary individual preference contours (nonintersection, convexity to the origin, etc.).

This is the key problem from the demand side: free trade is only universally of benefit to a given nation if the gains are shared; this requires redistribution mechanisms in addition to the market, which both don’t exist, and contradict the model of free competition if they were to be implemented.

The key problem for the supply side is easily stated: How do you turn a wine press into a spinning jenny (to use Ricardo’s examples). The standard model assumes the costless reallocation of capital between industries in response to a change in relative prices caused by reducing tariffs. But this is impossible. Capital is physical and attuned to specific industries. Free trade therefore makes obsolete some capital in a protected industry, while making that in a benefited industry more expensive, but not more productive.


Will the God-Emperor cuck on trade?

Tyler Durden suspects the globalist faction is winning in an ideological trade battle being waged inside the Trump administration:

Earlier this week, when we discussed Peter Navarro’s jarring op-ed in the WSJ in which he alleged that the persistent US trade deficit “would put US national security in jeopardy”, we said that “a better question than what is Navarro’s purpose by writing it, is why he is writing it, and does his use of a public forum like the WSJ mean that there is friction between him and Trump camp, especially since in recent weeks it appears that a core pillar of Trump’s trade policies, namely the border adjustability, appear to no longer be on the docket of actionable items.”

As it turns out, that was precisely the correct question, because as the FT reports, “a civil war has broken out within the White House over trade, leading to what one official called “a fiery meeting” in the Oval Office pitting economic nationalists close to Donald Trump against pro-trade moderates from Wall Street.”

More notably, the person at the center of this “civil war” is none other than Navarro, who as we expected is now said to be losing influence, and as a result he resorted to using the WSJ as a means to appeal directly to the general public. It may have been a prudent gamble: the WSJ op-ed may have helped Navarro salvage some of his credibility with Trump, according to the FT:

The officials and people dealing with the White House said Mr Navarro appeared to be losing influence in recent weeks. But during the recent Oval Office fight, Mr Trump appeared to side with the economic nationalists, one official said.

Facing off the “hardline group” of Navarro, and other “nationalists” such as Steve Bannon, is a a “faction” led by former Goldman COO Gary Cohn, a career globalist, who leads Mr Trump’s National Economic Council.

But what is just as important, is that if the FT is right, then allegations that Trump has “sold out” to his Goldman advisors may be premature: in fact, if anything, Trump appears to be playing off one camp, the “nationalists”, against its polar opposite, the “Goldman globalists”:

The battle over trade is emblematic of a broader fight on economic policy within the Trump’s administration. It comes ahead of a visit to Washington next week by Ms Merkel, the German chancellor, and amid preparations for a meeting of G20 finance ministers in Germany next week at which allies’ concerns over protectionism are likely to be high on the agenda.

While the White House was non-committal, providing the FT with the following brief statement:


“Gary Cohn and Peter Navarro are both valued members of the president’s economic team. They are working together to enact the president’s economic agenda, protect American workers and grow American businesses.”

… the “globalists” led by Cohn and others “have seized on Mr Navarro’s public comments — and widespread criticism by economists of his stand on trade deficits and other matters — to try and sideline him.”


That has led to discussions over moving Mr Navarro and the new National Trade Council he leads out of the White House and to the Commerce Department, headed by another Wall Street veteran, Wilbur Ross.

And, if the FT is correct, it appears that the Goldman-led faction is winning.

Can you spot the potential flaw in Durden’s reasoning. There is an alternative explanation. Isn’t it at least possible that the Financial Times is spinning things in Cohn’s favor for precisely the same reason it claims Navarro published his Wall Street Journal op/ed? It’s not as if the FT isn’t openly on the side of the globalists and free traders, after all.

And what are two things we know SJWs always do? They lie and they project. Aside from academia, what field is more SJW-converged than the media? I would not consider the FT to be either a reliable or an impartial source in this matter. You’d think people would have learned by now. Don’t ever count the God-Emperor out until he is actually, confirmably, undeniably, out.


Darkstream: free trade part 1

I’ll be doing a Darkstream tonight at 7 PM Eastern on the subject of free trade. This is part 1, and it will focus on David Ricardo and the comparative advantage theory that is the primary economic justification for free trade.

UPDATE: The replay is here. For those who want to prepare for Part 2, read Chapter 11 of Economics in One Lesson by Henry Hazlitt.

For those who want to do a little preparation, here is a partial transcript of an interview I did with Ian Fletcher, the author of Free Trade Doesn’t Work, which played a major role in my reassessment of free trade.

When most people think of opposition to free trade, they think of three things. They think of the 18th century mercantilists that were supposedly routed by Adam Smith and David Ricardo. They think of the UAW opposing cheap Japanese cars in the 1970s. And they think of Pat Buchanan and his pitchfork populism in the 1988 presidential campaign. How are the arguments you put forward in Free Trade Doesn’t Work distinguished from those three things? 

You’ve got to remember that those three examples you gave all consist of people who are, for one reason or another, disreputable in some way and in some currents of opinion but they are also people who did have a point. Mercantilism for example is not just something from the 18th century. It goes back to the very dawn of modern capitalism and the renaissance.

You have to remember that global trade is not something that was invented in 1990. It can go back hundreds of years back to the era when it was conducted with sailing ships. And very shortly after international capitalism began to take shape, various nations and their governments began to learn there were enormous advantages to be derived gaming the system. And surprise, surprise this is still going on it’s what China is doing today it’s what Japan has done for decades.

To some extent, it’s what the United States itself used to do for most of its history.  For most of its history the United States was very exclusively a tariff protected economy. The Founding Fathers were protectionists. The economist among the Founding Fathers is Alexander Hamilton, the guy on the ten dollar bill. And he wrote a report entitled “The report on manufacturers” which he submitted to congress in 1791, in which he layed out a rationale for protectionism that still holds good today. Hamilton was a very smart guy. Among other things you might be surprised to learn that he is the inventor of the R&D tax credit, which he proposed in 1791.


I had no idea. I knew he was big on central banks. I didn’t realize he was up on tax credits as well.

Yeah. The point is that mercantilism is not something that was brought out of the water by Adam Smith who was in many ways, although he was  brilliant guy, he was also the servant of various economic interests in his own time, particularly the economic interests of the Scots who had their own quarrels with the English.  Adam Smith is not a fully reliable guide in the sense that everything he said was true.

And you mentioned David Ricardo. One of the interesting things about Ricardo is if you actually go back and read his original book in which he enunciated for the first time the theory of comparative advantage, you discover that he says things like well, I have this theory, and one of the provisos to this theory is that if you have international mobility of capital, then my theory that free trade is always your best move ceases to be true.

Joseph Schumpeter is extremely harsh on Ricardo’s manner of constructing arguments. He said that Keynes and Ricardo had a lot in common in that way.

There are any number of problems with Ricardo; you have to remember that Ricardo was writing in the early nineteenth century, and his main book came out in 1817. So, to some extent I can forgive him, but the fact that a lot of his reasoning is, by present day standards, exceedingly primitive.  Among his other great discoveries was the so-called Iron Law of wages. According to which, you can never help working class peoples, so you might as well not try. There’s a lot in Ricardo to object to if you actually dig into all the economic theories and the constructs that supposedly given to us to prove that free trade is always our best move, under all circumstances. It just isn’t true.  That’s just not what these ideas actually say if you dig into them.

That leads into my next question. You’ve taken econ 101, and I’ve taken econ 101. Everyone who has is familiar with the theory of comparative advantage. And the example that Ricardo provided using the cloth and wine trade between Portugal and England.  But how has it persisted and remained dominant so long, considering that it contains, as you noted, no less than seven dubious assumptions? 

The theory of comparative advantage, which basically comes down to the idea that nations trade for the same reason people do. And the reason that you buy your coffee in the coffee shop rather than making it for yourself is not that you can’t make it for yourself. It’s not even that you might not even be more efficient at making it yourself than the guy in the coffee shop. It’s just that you have other things to do with your time.

And to fully elaborate, you can understand why it’s advantageous not just to import products, but to import products from nations that are less efficient producers than we are. I mean, we import a huge quantity of goods from China, but China is not a more efficient industrial machine than the United States. In fact, by any of the standard measures they are much less efficient.

Now, the problem with the theory of comparative advantage is that, although it does tell you a lot of good things which are true, and it’s a useful analytical construct for dealing with a lot of economic realities, it was never intended by its own inventor and its own intrinsic logic will not support its being turned into a blank check for 100 percent free trade with 100 percent of the world 100 percent of the time.  That’s just not what the theory actually says.  As opposed to what the US Chamber of Commerce and multinational corporations attempting to corrupt the congress with direct and indirect bribery would like you to believe that it says.

But why is it persistent and been so dominant and for so long, considering that not only does it have those seven dubious assumptions, but that it’s quite clear that it can’t possibly be applied in the manner that it usually is applied?

Because it is advantageous to powerful special interests. That’s the main reason. I mean it gives the answer that these guys want to hear, which is that America should practice free trade towards the rest of the world. Which means that multinational corporate interests can produce in China, lay off their American workforce, bring those goods to the United States, and sell them here at an enormous profit which you get when using slave labor. There’s no secret.

The subsidiary reason why the theory has remained more popular than it deserves to be is it gratifies the desire of academic economists to have one simple formula that explains the whole world. I mean, if you’ve dealt with academics. It’s a beautiful ivory tower construct because once you master the mathematics of this one simple formula you’ve got a magic wand that tells you just about everything about international trade without your even needing to consult any empirical facts or statistics on the matter. Let alone actually visit a factory or a dockyard or a shop to see what’s really going on.


Labor mobility destroying nations

The map above demonstrates what has happened as a result of the European Union’s establishment of a free trade zone throughout Europe. Notice that despite the absence of the promised economic growth throughout the EU, the increase in the international mobility rate has increased considerably in the last decade, even in the wealthier countries such as Germany, Switzerland, and the UK. Incredibly, some of the Balkan states have seen more than one-third of their populations abandon the country!

This conclusively proves what I have concluded with regards to the way that free trade inevitably destroys nations. The freer the trade, the more endangered the nation. How can you have a nation when its people are scattered all throughout the world, trying to find employment? It is evidence that confirms what I’d first warned about in a free trade post back in 2012. As Dr. James Miller admitted in our debate, later published as On the Question of Free Trade, labor mobility, and its societal costs, are something that no free trade-advocating economist has ever taken into account

In the former EU15, only about 0.1% of the working age population changes its country of residence in a given year. Conversely, in the US, about 3% of the working age population moves to a different state every year, These institutional and cultural differences suggest comparing internal geographical mobility in the US with the situation within EU Member States rather than between Member States.

In doing so, the figures narrow the ‘mobility gap’ between Europe and the US. Between 2000 and 2005, about 1% of the working age population had changed residence each year from one region to another within the EU15 countries, compared to an overall interstate mobility rate of 2.8%-3.4% in the US during the same period of time.”

What this means is that US workers are about 3x more willing to change their state of residence than European workers are willing to change their region of residence within national borders, and 30x more inclined to change their state of residence than Europeans are inclined to change their country of residence, even though the US state-to-state change likely involves a bigger geographic move than the EU country-to-country one.

It should be noted that increasing this country-to-country labor mobility rate within the EU is not only a major goal of the EU economic advisers, but the explicitly stated reason for this goal is their belief that increased labor mobility is required in order to increase economic growth.

Now, let’s look at what that annual 3 percent intra-US mobility translates to in terms of the overall population. The statistics are as follows for Americans between the ages of 25 and 44:

  • East 54.3 percent
  • Midwest 65.0 percent 
  • South 47.3 percent
  • West 40.2 percent

This is why the Midwest has changed much less over the last 40 years than either the East Coast or the West Coast; more Midwesterners stay in the Midwest and maintain their laws and cultural traditions. But more importantly, note what this signifies for the USA if the apostles of free trade were ever able to achieve their goal of permitting international trade to take place on the same terms as American domestic trade in a manner that realized the anticipated economic benefits: very nearly half of all American workers would be expected to leave the USA by the average age of 35!

This vast exodus of young Americans would say nothing, of course, of the hundreds of millions of non-American workers who would be expected to enter the USA, with all of the various consequences to be expected as a result of immigration that is an order of magnitude larger than the current wave.

The logic of free trade is inescapable. It amounts to a choice between a steadily declining living standard if free trade is limited to goods and capital versus the total destruction of the nation and the replacement of a majority of its population within a single lifetime if it is pursued to the full “beneficial extent” of the concept.


Darkstream: exclamation point

Tonight, at 6 PM Eastern, I’ll be discussing the God-Emperor’s speech today and the Mexican gambit. It’s an hour earlier than usual because I’m on with Stefan later tonight.

By the way, from July 20, 2009 to January 17, 2017, Barack Obama never enjoyed as high a Presidential Approval Rating, at 59 percent, that Donald Trump presently has. Obama peaked at 67 percent on January 25, 2009, and it was literally all downhill from there.

UPDATE: the replay is here.


Mexico runs away

The President of Mexico doesn’t dare to face the God-Emperor:

Mexico’s president on Thursday scrapped a planned summit with Donald Trump in the face of insistent tweets from the U.S. president demanding Mexico pay for a border wall, a spat that threatens Mexican efforts to salvage trade ties. Taking a page out of Trump’s playbook, President Enrique Pena Nieto fired the salvo on Twitter, after Trump’s call for Mexico to foot the bill for his planned wall prompted a groundswell of calls in Mexico for next week’s meeting to be called off.

Trump said in a Twitter message earlier on Thursday that his Mexican counterpart should cancel his scheduled visit to Washington if Mexico refuses to pay for the wall that he has ordered constructed along the border. Trump views the wall, a major part of his election campaign, as part of a package of measures to curb illegal immigration.

Trump, who took office last Friday, signed an executive order for construction of the wall on Wednesday, the same day that Mexico’s foreign minister held talks with Trump aides in the White House aimed at healing ties.

I won’t try to guess at the President’s objectives, but what are the odds that this move on Mexico’s part wasn’t anticipated and doesn’t play right into the God-Emperor’s hands? Trump is adroit at setting up the heads-I-win, tails-you-lose play; merely showing up meant Mexico had to commit to funding the wall. If things continue on this track, Trump may well run Mexico out of NAFTA without having to talk Congress into doing anything or even having to issue an executive order.

And the Deep State is being cleaned out as well:

At least three senior U.S. diplomats at the State Department have left their posts, State Department officials told Reuters on Thursday. It was not immediately clear whether their departure was part of the normal transition process when a new administration starts or whether it was a coordinated walkout by diplomats who had served in Democrat Barack Obama’s administration.

Who cares why they left? The important thing is that they won’t be in place to play their usual whispering games.

UPDATE: They were kicked out. The swamp, she is draining!