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Westlake Legal Group > United States International Relations

A New Red Scare Is Reshaping Washington

WASHINGTON — In a ballroom across from the Capitol building, an unlikely group of military hawks, populist crusaders, Chinese Muslim freedom fighters and followers of the Falun Gong has been meeting to warn anyone who will listen that China poses an existential threat to the United States that will not end until the Communist Party is overthrown.

If the warnings sound straight out of the Cold War, they are. The Committee on the Present Danger, a long-defunct group that campaigned against the dangers of the Soviet Union in the 1970s and 1980s, has recently been revived with the help of Stephen K. Bannon, the president’s former chief strategist, to warn against the dangers of China.

Once dismissed as xenophobes and fringe elements, the group’s members are finding their views increasingly embraced in President Trump’s Washington, where skepticism and mistrust of China have taken hold. Fear of China has spread across the government, from the White House to Congress to federal agencies, where Beijing’s rise is unquestioningly viewed as an economic and national security threat and the defining challenge of the 21st century.

“These are two systems that are incompatible,” Mr. Bannon said of the United States and China. “One side is going to win, and one side is going to lose.”

The United States and China have been locked in difficult trade negotiations for the past two years, with talks plagued by a series of missteps and misunderstandings. Mr. Trump has responded to the lack of progress by steadily ratcheting up American tariffs on Chinese goods and finding other ways to retaliate. China has responded in kind.

The two sides now appear far from any agreement that would resolve the administration’s concerns about China, including forcing American companies operating there to hand over valuable technology. Even if a deal is reached, the two sides are busy constructing broader economic barriers.

In addition to placing a 25 percent tariff on roughly half of the goods China exports, the United States has restricted the kinds of technologies that can be exported to China, tried to cut off some Chinese companies, like telecom giant Huawei, from purchasing American products and rolled out hurdles for Chinese investment in the United States.

American intelligence agencies have also ratcheted up efforts to combat Chinese espionage, particularly at universities and research institutions. Officials from the F.B.I. and the National Security Council have been dispatched to Ivy League universities to warn administrators to be vigilant against Chinese students who may be gathering technological secrets from their laboratories to pass to Beijing.

The administration paints the crackdown as necessary to protect the United States. But there are growing concerns that it is stoking a new red scare, fueling discrimination against students, scientists and companies with ties to China and risking the collapse of a fraught but deeply enmeshed trade relationship between the world’s two largest economies.

“I’m worried that some people are going to say, because of this fear, any policy is justifiable,” said Scott Kennedy, a China expert at the Center for Strategic and International Studies. “The climate of fear that is being created needs to help generate the conversation, not end the conversation.”

ImageWestlake Legal Group 00dc-redscare-02-articleLarge A New Red Scare Is Reshaping Washington United States International Relations United States Economy International Trade and World Market Economic Conditions and Trends Defense and Military Forces Customs (Tariff) Cold War Era Chinese-Americans

Concern over China’s ambitions as an economic and military power has spread across Washington, fueling what some say could be a new Red Scare.CreditChina Daily/Reuters

Anti-China sentiment has spread quickly, with Republicans and Democrats, labor union leaders, Fox News hosts and others warning that China’s efforts to build up its military and advanced industries threaten America’s global leadership, and that the United States should respond aggressively. Skepticism has seeped into nearly every aspect of China’s interaction with the United States, with officials questioning China’s presence on American stock markets, its construction of American subway cars and its purchase of social media networks.

Yet there is little agreement on what America can or should do. The United States has tried for decades to entice and cajole China to become a more open society, but the Communist Party has steadily tightened its grip over the Chinese people and the economy. American leaders now face a choice of whether to continue down a path of engagement that could leave the country vulnerable to economic and security threats — or embark on a path of disengagement that could weaken both economies and might one day even lead to war.

An increasing number of people in Washington now view the decoupling of the two economies as inevitable — including many of the members of the Committee on the Present Danger. At an inaugural meeting in April, Mr. Bannon, Senator Ted Cruz of Texas, Newt Gingrich, the former House speaker, and others issued paeans to Ronald Reagan — a former member of the group — and were met with standing ovations as they called for vigilance against China.

They praised Mr. Reagan’s Cold War victory over the Soviet Union and his doctrine of “peace through strength,” but there was also an air of inevitability that war might come, only this time with China.

Mr. Bannon was just off the plane from Rome, with a slight shadow of a mustache and his silver hair brushed back. Clad in a black button-down and long black suit jacket, he thumped the podium as he described China as a rising power and the United States as a declining power that would inevitably clash.

“This is the defining event of our time, and 100 years from now, this is what they’re going to remember us for,” he said.

The committee’s two earliest iterations, in the 1950s and again in the 1970s, called for an arms buildup to counter the Soviets. The second iteration, formed over a luncheon table at Washington’s Metropolitan Club in 1976, issued documents warning against Soviet expansionism, with titles like “Is America Becoming Number 2?”

The group reached the height of its influence during the Reagan administration, in which dozens of its members eventually held posts, including as the national security adviser and C.I.A. director. But as the Soviet threat faded, so did the committee.

The group was briefly active again starting in 2004, this time to warn against the threat of Islamic extremism. The committee’s vice chair, Frank Gaffney, is the founder of the Center for Security Policy, a think tank that argues that mosques and Muslims across America are engaged in a “stealth jihad” to “Islamize” the country by taking advantage of American pluralism and democracy.

The group’s activity largely died down until concern over China rekindled interest.

Today’s committee acknowledges that the threat from China is different from Soviet Russia because the American and Chinese economies are much more integrated. But Washington is increasingly reaching back into the Cold War toolbox to confront the threat.

The administration has placed Chinese tech companies on an “entity list,” essentially blacklisting them from doing business with American firms. In keeping with a law passed last year, the administration has increased its checks of Chinese investment, including of minority stakes in American companies. Last June, the administration began restricting visas for Chinese graduate students in sensitive research fields like robotics and aviation. And the United States has begun barring Chinese academics from the United States if they are suspected of having links to Chinese intelligence agencies.

“They’re not the Soviet Union. But this kind of government control, statism, never works for long,” Larry Kudlow, the White House chief economic adviser, said in a July 16 interview with Sinclair Broadcast Group. The possibility that China could collapse like the Soviet Union has “always been an undercurrent” in the trade war, he said.

The new Cold War has not been one-sided. Many of the changes in Washington have been triggered by a darker turn in Beijing.

China has increased its scrutiny of American firms, and many American companies and their employees in China now fear reprisal. In addition to detaining millions of Chinese Muslims, democracy activists and others, Chinese authorities have jailed foreign diplomats, academics and businesspeople — prompting some to cancel or delay trips to China.

China is also projecting its power abroad, funding global infrastructure and constructing an archipelago of artificial islands with giant air bases reaching almost to the shores of Malaysia and Indonesia. Beijing has made it clear that it intends to help its companies dominate the industries of the future, from artificial intelligence and supercomputers to aerospace equipment. Its policies have sought to replace imports of high-tech products with Chinese-made goods, pressuring multinationals to move factories from the United States and resulting in the loss of American jobs.

China has rejected entreaties by the Trump administration to curb these activities, arguing that it is simply pursuing its own economic development. In an interview after trade talks broke down in May, Liu He, China’s top negotiator, said that areas of disagreement between the United States and China focused on “major matters of principle” on which China was unlikely to bend.

The chill in relations has begun to weigh on Chinese investment in the United States, along with Chinese students and tourism. Chinese investment in American residential and commercial real estate has begun to decline. Companies are increasingly diversifying away from China, wary of the president’s ongoing economic war.

The United States and China have been engaged in a protracted trade war, with Washington accusing Beijing of breaking a deal earlier this year.CreditErin Schaff/The New York Times

Nintendo, GoPro, Hasbro and other companies are reconsidering factories in China, choosing to source products from Vietnam, the United States, Mexico and India instead.

Susan Shirk, the chair of the 21st Century China Center at the University of California at San Diego, said the United States is at risk of being gripped by “an anti-Chinese version of the Red Scare” that is driving Chinese talent away and could rupture what little good will is left between the two countries.

“We’ve made this mistake once before, during the Cold War,” Ms. Shirk said. “And I don’t think we should make it again.”

Chinese nationals and Americans of Chinese heritage say they have felt the chilling effects. Some suspect they are being passed over for promotions and grants. Supporters of engagement have been dismissed as apologists or even traitors.

“Chinese Americans feel targeted,” said Charlie Woo, chief executive of Megatoys and a member of the Committee of 100, an organization of prominent Chinese-Americans. “And that’s really hurtful.”

The Trump administration and the Committee on the Present Danger have been careful to say their targets are the Chinese government and the Communist Party, not the Chinese people. But the distinction can be a difficult one to make. In the rush to protect against new threats from China, the line between preparedness and paranoia is sometimes unclear.

At a Senate hearing last year, Christopher A. Wray, the F.B.I. director, said the Trump administration was trying to “view the China threat as not just a whole-of-government threat, but a whole-of-society threat,” adding, “I think it’s going to take a whole-of-society response by us.”

Many Chinese people and their defenders have bristled at the implication that the entire Chinese society poses a national security threat.

Toby Smith, vice president for policy at the Association for American Universities, said that American universities were working hard to remain vigilant to espionage threats, but that they thrive on openness and access to talent and science from around the world — including from China.

“The situation with China is different than the Cold War,” he said. “The concern with the Soviet Union was primarily military. Now it’s a concern about economic competitiveness.”

Real Estate, and Personal Injury Lawyers. Contact us at: https://westlakelegal.com 

U.K. Warns Iran of ‘Serious Consequences’ for Seizing Oil Tanker

LONDON — Britain on Saturday warned Iran that “there will be serious consequences” for seizing a British-owned oil tanker the previous evening as the government warned ships to avoid the crucial shipping lanes of the Strait of Hormuz.

The British defense minister, Penny Mordaunt, said in a television interview on Saturday that the ship had been intercepted in Omani, not Iranian, waters and called the seizure “a hostile act.”

The British government said in a statement earlier on Saturday after an emergency meeting that it had “advised U.K. shipping to stay out of the area for an interim period.” By Saturday afternoon, Britain had summoned the Iranian ambassador to register its protest, and a second emergency cabinet meeting was set to begin.

The capture of the tanker sharply escalates a crisis between Iran and the West after three months of rising tensions that last month brought the United States within minutes of a military strike against targets in Iran. A fifth of the world’s crude oil supply is shipped from the Persian Gulf through the narrow Strait of Hormuz off the coast of Iran, and oil prices spiked sharply on Friday even before the British warning.

But the crisis has also caught Britain at a singularly vulnerable moment, with Prime Minister Theresa May expected to resign on Wednesday. As it seeks to craft a response to the seizure, the British government has been all but paralyzed by a leadership contest within the governing Conservative Party to determine her successor.

What’s more, the favorite in the leadership race, Boris Johnson, a former foreign minister, is famously unpredictable. He has said during his campaign that he stands with the other European powers in their desire to avoid a confrontation with Iran. But Mr. Johnson has also sought closer ties to President Trump, who set the current cycle of confrontation in motion by attempting to squeeze Iran into renegotiating a 2015 nuclear accord with world powers.

Westlake Legal Group scoop-oil-tanker-attack-master-articleLarge U.K. Warns Iran of ‘Serious Consequences’ for Seizing Oil Tanker United States International Relations United States Persian Gulf Oil (Petroleum) and Gasoline Iran Hunt, Jeremy Gulf of Oman Incident (June 2019) Great Britain Embargoes and Sanctions

Why This Narrow Strait Next to Iran Is So Critical to the World’s Oil Supply

Twenty percent of the global oil supply flows past Iran through the Strait of Hormuz.

That has increased speculation that the clash over the tanker may move Britain out of its current opposition to Mr. Trump over his feud with Iran. Britain has so far stood with the other European powers seeking to defy the president and preserve the accord.

“There has to come a moment where the British government, and maybe France and Germany ask, ‘Is it really worth fighting Trump on all these fronts?’” said Robin Niblett, director of Chatham House, a London research institute.

Setting the stage for a prolonged standoff, Iranian news agencies reported on Saturday that all 23 crew members of the British-flagged tanker would be held onboard in Iran’s Bandar Abbas Port during a criminal investigation of the ship’s actions.

None of the crew members is British or American; their nationalities include Indian, Russian, Latvian and Filipino, the ship’s owner said in a statement.

A spokesman for Iran’s powerful Guardian Council, which oversees major foreign policy decisions, sought on Saturday to justify the seizure as “reciprocal action” after British forces had impounded an Iranian tanker near Gibraltar two weeks earlier.

“The rule of reciprocal action is well known in international law,” the spokesman, Abbas Ali Kadkhodaei, said, according to the semiofficial Fars news agency.

But other Iranian authorities on Saturday added different new rationales for the seizure of the ship, saying for the first time that the vessel had been involved in an accident with an Iranian fishing boat and that the tanker had ignored distress calls.

The Islamic Revolutionary Guards Corps, which is in charge of Iranian naval activities in the Persian Gulf, had said on Friday that it had seized the ship for deviating from traffic patterns and polluting the waters. The Revolutionary Guards had not mentioned a fishing boat.

Stena Bulk, the owner of the ship, Stena Impero, said the tanker had been in “full compliance with all navigation and international regulations” when it was intercepted.

In Washington on Friday, President Trump called Iran “nothing but trouble.” Mr. Trump told reporters on the South Lawn of the White House, “We’ll be working with the U.K.” Referring in vague terms to the close American alliance with Britain, he added, “We have no written agreement, but I think we have an agreement that is longstanding.”

United States Central Command, which oversees Middle East operations, repeated in a statement late Friday that it was working on a “multinational effort” under the name Operation Sentinel to police the shipping routes.

The operation “will enable nations to provide escort to their flagged vessels while taking advantage of the cooperation of participating nations for coordination and enhanced maritime domain awareness and surveillance,” the statement said.

ImageWestlake Legal Group merlin_154652511_cf8d9f3b-c400-4399-ae6a-f1642fdc1716-articleLarge U.K. Warns Iran of ‘Serious Consequences’ for Seizing Oil Tanker United States International Relations United States Persian Gulf Oil (Petroleum) and Gasoline Iran Hunt, Jeremy Gulf of Oman Incident (June 2019) Great Britain Embargoes and Sanctions

An anti-United States rally in Tehran in support of Iran’s decision to pull out of some parts of the 2015 nuclear deal.CreditAbedin Taherkenareh/EPA, via Shutterstock

But it emphasized that Washington would not shoulder the burden alone: “While the United States has committed to supporting this initiative, contributions and leadership from regional and international partners will be required to succeed.”

France in a statement on Saturday called on Iran to respect “the principle of freedom of shipping in the Gulf.” Germany strongly condemned Iran’s actions as “unjustifiable.”

“Another regional escalation would be very dangerous” and “undermine all ongoing efforts to find a way out of the current crisis,” the German government warned in a statement.

The back-and-forth between Iran and the West has already included the imposition of sweeping new American economic sanctions. Iran has responded with the calibrated resumption of an Iranian nuclear energy program that the West fears might lead to a nuclear bomb.

The United States and Britain have accused Iran of sabotaging six tankers in a tacit threat to gulf shipping routes. The United States and Iran have each said it had shot down an unpiloted surveillance drone flown by the other side.

In a reminder that each minor collision risks the explosion of a more violent confrontation, Mr. Trump last month ordered a missile strike in retaliation for the Iranian downing of the American drone. He ultimately called the strike off only minutes before the launch.

The USS Boxer in the Arabian Sea off Oman on Tuesday. “We’ll be working with the U.K.,” President Trump told reporters Friday night, referring to the American alliance with Britain.CreditAhmed Jadallah/Reuters

Mr. Trump said the next day that he had concluded the loss of life from a missile strike would have been a disproportionate to the shooting down of a drone. But he later threatened the “obliteration” of parts of Iran if it targeted “anything American.”

At the core of the confrontation with the West is the Trump administration’s attempt to rip up and renegotiate the 2015 accord, which the United States and other world powers had reached with Iran to limit its nuclear program in exchange for relief from economic sanctions.

Having pulled the United States out of the deal last year, the Trump administration added comprehensive sanctions in May that were intended to block all of Iran’s oil exports, the lifeblood of its economy. Iranian officials denounced the new penalties as “economic warfare.”

Iran has sought to push back against all the major powers, forcing them to feel some cost for their effective default on the promises 2015 accord as a result of Mr. Trump’s sanctions. That set the backdrop for a parallel clash with Britain that led to the seizure of the tanker.

Two weeks ago, the British military helped impound the Iranian tanker off Gibraltar on the suspicion that it was delivering oil to Syria in violation of European Union embargoes.

Iranian officials called the seizure of their ship an act of piracy and accused Washington of masterminding the capture as part of its pressure campaign. Officers of the Revolutionary Guards threatened retaliation against a British ship. Iranian boats sought unsuccessfully to stop one a few days later, but an accompanying British warship drove them away.

The old Grand Bazar in Tehran. At the core of the confrontation with the West is the Trump administration’s attempt to rip up and renegotiate a 2015 accord that the United States and other world powers had reached with Iran to limit its nuclear program in exchange for relief from economic sanctions.CreditAbedin Taherkenareh/EPA, via Shutterstock

Jeremy Hunt, the British foreign secretary, on Saturday charged that Iran’s seizure had violated international law but said that Britain had followed proper legal procedures in stopping the Iranian tanker, Grace 1, near Gibraltar.

“Yesterday’s action in Gulf shows worrying signs Iran may be choosing a dangerous path of illegal and destabilising behaviour after Gibraltar’s LEGAL detention of oil bound for Syria,” Mr. Hunt wrote on Twitter Saturday morning. “As I said yesterday our reaction will be considered but robust,” Mr. Hunt added. “We have been trying to find a way to resolve Grace1 issue but WILL ensure the safety of our shipping.”

He added later that he had “expressed extreme disappointment” in a phone call with Iran’s foreign minister, Mohammad Javad Zarif. Recounting a conversation they had a week earlier, Mr. Hunt said that Mr. Zarif had said he sought de-escalation but that “they have behaved in the opposite way.”

“This has 2 be about actions not words,” Mr. Hunt said on Twitter.

Mr. Hunt is challenging Mr. Johnson in the runoff within the Conservative Party to become Britain’s next prime minister. If Mr. Hunt loses, his role overseeing the standoff with Iran might keep him in the job for the immediate term in the interest of continuity. But the results would also put a question mark over his standing and staying power, further complicating the British response.

The fate of the Iranian tanker impounded near Gibraltar is in the hands of the courts there, and an early release of the ship to mollify the Iranians would “look very weak,” said Michael Stephens of the Royal United Services Institute, an independent research center.

“I don’t think we are in a position where we have the luxury of backing down,” he added.

That, in turn, adds to the pressure on the nuclear accord. Britain has collaborated with the other European powers in seeking to preserve the deal, even joining efforts to set up an alternative trading platform that would allow Iran to evade the American sanctions.

If Britain joins the United States in re-imposing sanctions on Iran, that would all but snuff out any hope of saving the 2015 accord.

Real Estate, and Personal Injury Lawyers. Contact us at: https://westlakelegal.com 

U.K. Warns Tankers to Stay Out of Strait of Hormuz After Iran Seizes Ship

LONDON — Britain on Saturday warned ships to stay out of the Strait of Hormuz, a crucial shipping route for the world’s oil supplies, as the government pressed Iran to release a British-owned oil tanker seized the previous evening, dramatically escalating tensions in the region.

“We have advised U.K. shipping to stay out of the area for an interim period,” the British government said in a statement released early Saturday after an emergency meeting. “There will be serious consequences if the situation is not resolved,” the government warned.

The capture of the tanker is a sharp step up after three months of rising tensions between Iran and the West that last month brought the United States within minutes of a military strike against targets in Iran.

A fifth of the world’s crude oil supply is shipped from the Persian Gulf through the narrow Strait of Hormuz off the coast of Iran, and oil prices spiked sharply on Friday even before the British warning.

Iranian news agencies reported that all 23 crew members of the British-flagged tanker would be held onboard in the Bandar Abbas Port in Iran during a criminal investigation of the ship’s actions. The nationalities of those crew members included Indian, Russian, Latvian and Filipino, the ship’s owner said in a statement.

Westlake Legal Group scoop-oil-tanker-attack-master-articleLarge U.K. Warns Tankers to Stay Out of Strait of Hormuz After Iran Seizes Ship United States International Relations United States Persian Gulf Oil (Petroleum) and Gasoline Iran Hunt, Jeremy Gulf of Oman Incident (June 2019) Great Britain Embargoes and Sanctions

Why This Narrow Strait Next to Iran Is So Critical to the World’s Oil Supply

Twenty percent of the global oil supply flows past Iran through the Strait of Hormuz.

The Iranian authorities also added reasons for the seizure of the ship, saying for the first time on Saturday that the vessel had been involved in an accident with an Iranian fishing boat and that the tanker had ignored distress calls.

The Islamic Revolutionary Guards Corps, which is in charge of Iranian naval activities in the Persian Gulf, said on Friday that it had seized the ship for deviating from traffic patterns and polluting the waters, but it had not mentioned any episode with a fishing boat.

Stena Bulk, the owner of the ship, Stena Impero, said the tanker had been in “full compliance with all navigation and international regulations” when it was intercepted.

In Washington on Friday, President Trump called Iran “nothing but trouble.”

We’ll be working with the U.K.,” Mr. Trump told reporters on the South Lawn of the White House. Referring in vague terms to the close American alliance with Britain, he added, “We have no written agreement, but I think we have an agreement that is longstanding.”

United States Central Command, the division of the military that oversees the Middle East, repeated in a statement late Friday that it was working on a “multinational effort” under the name Operation Sentinel to police the shipping routes.

ImageWestlake Legal Group merlin_154652511_cf8d9f3b-c400-4399-ae6a-f1642fdc1716-articleLarge U.K. Warns Tankers to Stay Out of Strait of Hormuz After Iran Seizes Ship United States International Relations United States Persian Gulf Oil (Petroleum) and Gasoline Iran Hunt, Jeremy Gulf of Oman Incident (June 2019) Great Britain Embargoes and Sanctions

An anti-United States rally in Tehran in support of Iran’s decision to pull out of some parts of the 2015 nuclear deal.CreditAbedin Taherkenareh/EPA, via Shutterstock

The operation “will enable nations to provide escort to their flagged vessels while taking advantage of the cooperation of participating nations for coordination and enhanced maritime domain awareness and surveillance,” the statement said.

But it emphasized that Washington would not shoulder the burden alone: “While the United States has committed to supporting this initiative, contributions and leadership from regional and international partners will be required to succeed.”

France on Saturday called on Iran to respect “the principle of freedom of shipping in the Gulf,” according to a statement on the website of the Ministry of Foreign Affairs. The German government strongly condemned Iran’s actions in a statement on Saturday, calling the seizure “unjustifiable.” “Another regional escalation would be very dangerous,” the statement said, adding it would “undermine all ongoing efforts to find a way out of the current crisis.”

Both countries urged Iran to free the ship and its crew as soon as possible.

The back-and-forth between Iran and the West has already included the imposition of sweeping new American economic sanctions followed by the calibrated resumption of an Iranian nuclear energy program that the West fears might lead to a nuclear bomb. The United States and Britain have accused Iran of sabotaging six tankers in a tacit threat to gulf shipping routes. Both United States and Iran have said it had shot down an unpiloted surveillance drone flown by the other side.

In a vivid reminder that each minor collision risks the explosion of a more violent confrontation, Mr. Trump initially ordered the missile strike last month in retaliation for the Iranian downing of an American surveillance drone. He called the strike off only minutes before the launch.

The USS Boxer in the Arabian Sea off Oman on Tuesday. “We’ll be working with the U.K.,” President Trump told reporters Friday night, referring to the American alliance with Britain.CreditAhmed Jadallah/Reuters

Mr. Trump said the next day that he had concluded the missile strike would have been a disproportionate response. Then he later threatened the “obliteration” of parts of Iran if it targeted “anything American.”

At the core of the confrontation with the West is the Trump administration’s attempt to rip up and renegotiate a 2015 accord that the United States and other world powers had reached with Iran to limit its nuclear program in exchange for relief from economic sanctions.

Having pulled the United States out of the deal last year, the Trump administration added comprehensive sanctions in May that were intended to block all of Iran’s oil exports, the lifeblood of its economy. Iranian officials denounced the new penalties as “economic warfare.”

Iran has sought to push back against all the major powers, forcing them to feel some cost for their effective default on the promises 2015 accord as a result of Mr. Trump’s sanctions. The conflict with Washington has set the backdrop for a parallel clash with Britain that led to the seizure of the tanker.

This is a delicate moment for Britain. Its governing Conservative Party this coming week will pick a new prime minister — either Boris Johnson or Jeremy Hunt — and is set to leave the European Union on Oct. 31.

The old Grand Bazar in Tehran. At the core of the confrontation with the West is the Trump administration’s attempt to rip up and renegotiate a 2015 accord that the United States and other world powers had reached with Iran to limit its nuclear program in exchange for relief from economic sanctions.CreditAbedin Taherkenareh/EPA, via Shutterstock

The current confrontation began this month, when the British military helped impound an Iranian tanker off the coast of Gibraltar on the suspicion that it was on its way to deliver oil to Syria in violation of European Union embargoes.

Iranian officials called the seizure of their ship an act of piracy and accused Washington of masterminding the capture as part of its pressure campaign. Officers of the Revolutionary Guards threatened to retaliate against a British ship, and Iran appears to have done so on Friday.

Mr. Hunt, the British foreign secretary, on Saturday charged Iran with violating international law but asserted that Britain had followed proper legal procedures in stopping the Iranian tanker, Grace 1, near Gibraltar.

“Yesterday’s action in Gulf shows worrying signs Iran may be choosing a dangerous path of illegal and destabilising behaviour after Gibraltar’s LEGAL detention of oil bound for Syria,” Mr. Hunt wrote on Twitter Saturday morning.

“As I said yesterday our reaction will be considered but robust,” Mr. Hunt added. “We have been trying to find a way to resolve Grace1 issue but WILL ensure the safety of our shipping.”

Britain has so far joined the other world powers in seeking to preserve the nuclear deal with Iran despite Mr. Trump’s opposition. European states have even attempted to set up an alternative trading platform that would allow Iran to evade the American sanctions.

But of all the European powers, Britain is the most dubious toward Iran. If Britain chooses to join the United States in re-imposing sanctions on Iran, that would all but completely snuff out any hope of saving the 2015 accord.

Real Estate, and Personal Injury Lawyers. Contact us at: https://westlakelegal.com 

House Votes to Block Arms Sales to Gulf Nations, Setting Up Trump’s Third Veto

Westlake Legal Group 17dc-saudi--facebookJumbo House Votes to Block Arms Sales to Gulf Nations, Setting Up Trump’s Third Veto Yemen War and Emergency Powers (US) Vetoes (US) United States Politics and Government United States International Relations United Arab Emirates Trump, Donald J Saudi Arabia Mohammed bin Salman (1985- ) Law and Legislation Human Rights and Human Rights Violations House of Representatives Arms Trade

WASHINGTON — The House gave final passage on Wednesday to a series of measures that would block the sale of billions of dollars of arms to Saudi Arabia and the United Arab Emirates, sending to President Trump a fresh rebuke of his administration’s efforts to circumvent Congress to help Persian Gulf allies prosecute a disastrous war in Yemen.

A scattering of Republicans and the House’s lone independent, Justin Amash of Michigan, joined Democrats in three back-to-back votes, submitting for the record their stewing anger at Mr. Trump’s resolute support of Saudi Arabia and his use of emergency powers to sidestep Congress, this time with a declaration of an emergency over Iran.

“If the administration wants to sell these weapons, they should follow the law — not misuse it — and come to Congress,” said Representative Eliot L. Engel, the New York Democrat who is the chairman of the Foreign Affairs Committee. The Iran emergency, he continued, was “phony” and devised “to trample on this body’s constitutional duties.”

It is the second time in recent months that Congress has passed bipartisan legislation condemning the administration’s relationship with Saudi Arabia. Lawmakers in both parties have been incensed that the president has done nothing to punish the kingdom for the grisly killing of Jamal Khashoggi, a Saudi dissident and Virginia-based Washington Post columnist, even after the Central Intelligence Agency concluded that Crown Prince Mohammed bin Salman ordered the killing.

In April, lawmakers voted to end American military involvement in Saudi Arabia’s war in Yemen by invoking the rarely used War Powers Act of 1973, only to see Mr. Trump veto the resolution.

No other foreign policy issue has created as large a rift between the president and Congress, and the vote to block the arms sales deepens the divide. But the outrage on Capitol Hill has limits, particularly in the president’s own party. The measures approved on Wednesday, and already passed by the Senate, are likely to meet the same fate as the resolution to end military support to the war in Yemen: death by veto. Republicans are unlikely to provide enough votes to override what would be Mr. Trump’s third veto of his presidency.

The White House announced the munitions sales in May, invoking an emergency provision in the Arms Export Control Act to allow American companies to sell $8.1 billion worth of munitions in 22 pending transfers. Saudi Arabia and the United Arab Emirates are waging an air war in Yemen that has come under sharp criticism from Congress and human rights organizations. A State Department official, R. Clarke Cooper, testified before the Senate last week that the munitions had yet to be delivered, nearly 50 days after the emergency had been declared.

Members of Congress from both parties had been holding up arms sales from American companies to Persian Gulf nations and trying to end United States military support for the Saudi-led coalition that is fighting the Houthi rebels in Yemen, which has resulted in what the United Nations calls the world’s worst man-made humanitarian disaster. But by declaring an emergency over Iran, a move that Secretary of State Mike Pompeo pushed hard for, the administration was able to blow through lawmakers’ holds and the 30-day review period Congress normally receives to examine a sale.

Representative Michael McCaul of Texas, the top Republican on the Foreign Affairs Committee, urged his colleagues to vote down the resolutions even though he had previously described the use of emergency authority “unfortunate” and argued that not all 22 sales necessitated emergency certifications.

“The decision to move forward with these arms sales is part of a larger effort to deter Iran,” Mr. McCaul said. “A key part of that effort is to empower greater burden sharing by enhancing the defense capabilities of our allies. These sales provide more options for deterring Iran that do not all depend on U.S. intervention.”

Lawmakers have never successfully blocked an arms sale, but presidents historically have worked with Congress to make concessions after legislators voice opposition. Administrations have also seldom used the emergency provision in the Arms Export Control Act.

When President Ronald Reagan notified Congress in 1984 of the administration’s intent to sell Saudi Arabia the stinger missile system, citing Iraqi attacks on Iranian oil facilities and Iranian attacks on Kuwaiti and Saudi ships, the legislative opposition was so swift that Mr. Reagan withdrew the sales from consideration. Two years later, when his administration announced its intent to make the sale a second time, Congress moved to block it, spurring a veto.

With the threat of Mr. Trump’s vetoes looming large — and apparently little appetite to override them — some lawmakers have been casting about for an alternative the president might accept.

This month, Senator Jim Risch, an Idaho Republican and Trump loyalist who is the chairman of the Foreign Relations Committee, introduced legislation that would seek to reset the United States’ relationship with Saudi Arabia. It would also punish members of the royal family, denying visas to those in the Saudi government up to the minister level until the administration can certify that the country has made progress on broad human rights issues.

That legislation is expected to be considered by the committee next week. But underscoring how divided lawmakers are on how to respond, Senator Lindsey Graham, a South Carolina Republican who is one of the president’s closest congressional allies, and Senator Robert Menendez of New Jersey, the top Democrat on the panel, will most likely push to amend the legislation to match their harsher legislation that would place sanctions on the crown prince and suspend arms sales to the country.

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Trump Backs Away From Barriers on Foreign Uranium

WASHINGTON — President Trump said he would not impose quotas on imports of uranium, backing away from one of many trade confrontations the administration has threatened as it tries to protect American industry.

Mr. Trump, in an announcement late Friday night, said that he did not agree with the commerce secretary’s findings that foreign uranium poses a threat to national security. It was a rare dissent for a president who has determined that foreign metals, autos and auto parts are a threat to America’s national security and should be restricted.

After several months of deliberation, the commerce secretary determined that the high volume of uranium imports do pose a threat to national security. Mr. Trump rejected that finding.

“Although I agree that the secretary’s findings raise significant concerns regarding the impact of uranium imports on the national security with respect to domestic mining, I find that a fuller analysis of national security considerations with respect to the entire nuclear fuel supply chain is necessary at this time,” the president said in a statement.

The potential for trade barriers on foreign uranium stemmed from an investigation into whether imported uranium ore and related products, which are essential components for the United States’ nuclear arsenal, submarines, aircraft carriers and power plants, were a security threat.

Mr. Trump’s decision means that the United States will not impose the quotas that the domestic uranium industry had requested, which would have limited imports to guarantee that American miners supply one-quarter of the uranium used domestically. Instead, the president said he would establish a working group to develop recommendations in the next 90 days for reviving and expanding domestic nuclear fuel production.

The announcement was a rare instance in which the Trump administration chose not to exercise the full extent of its powers to give American companies a trade advantage over foreign competitors.

The Trump administration has used similar national security-related investigations to levy tariffs on foreign steel and aluminum, and it has threatened to do the same with imported automobiles and auto parts. Foreign leaders from Canada, Mexico, Europe and elsewhere have bristled at being branded a national security threat and imposed retaliatory tariffs on American products in return.

Image<img alt="Mr. Trump took the rare step of disagreeing with his Commerce Department’s findings that imports of uranium pose a threat to national security.

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Mr. Trump took the rare step of disagreeing with his Commerce Department’s findings that imports of uranium pose a threat to national security.CreditErin Schaff/The New York Times

Unlike the investigations in foreign metals and cars, which the Trump administration initiated on its own, two American uranium mining companies, Ur-Energy and Energy Fuels, had requested the inquiry into uranium. Both businesses claimed that subsidized foreign products had flooded the American market, putting them at a competitive disadvantage, forcing them to cut jobs and putting the domestic supply of uranium at risk.

But in seeking protection, Ur-Energy and Energy Fuels found themselves at odds with American nuclear power plants and the utilities that depend on that power, which would face higher material prices and operating costs if quotas were put into place. Nuclear plants generate about one-fifth of the country’s electricity, but they are rapidly losing market share to cheaper electricity from shale gas and wind turbines.

The United States is the world’s largest consumer of uranium. But it imported 93 percent of the uranium it used in 2017, with the vast majority coming from Australia, Canada, Kazakhstan and Russia. In its report, the Commerce Department said that imports had risen from satisfying 85.8 percent of the domestic market in 2009 as a result of increased production by foreign state-owned enterprises that distorted global prices and made it difficult for American miners to compete.

“We are down to where we are effectively producing nothing when it comes to newly mined uranium,” said Mark Chalmers, the president of Energy Fuels. “That should shock people.”

“We’re basically chucking our car keys at the Chinese and the Russians and saying go ahead and produce our uranium for us,” he said.

Energy Fuels and Ur-Energy say they have had to cut their work force because of falling global prices. They claim that Russia and Kazakhstan have heavily subsidized their production, and China has been buying up uranium mines around the world, threatening the supply of uranium from the United States and close allies like Canada and Australia.

But those who criticized the petition — including foreign uranium miners and domestic utilities — viewed the request as a transparent grab for protection of a struggling domestic industry. They say mining uranium has not been economical in the United States for a decade, and note that the country maintains a strategic reserve of uranium that can supply the military for many years.

The Ad Hoc Utilities Group, which runs a majority of the nuclear generators in the United States, said in comments submitted to the Trump administration last September that restricting imports would endanger the viability of nuclear plants and the entire industry. The quota that the petitioners had requested would effectively tax nuclear generators by $500 million to $800 million a year, the utilities group said, risking thousands of jobs in the industry.

“Maintaining nuclear plants is a cornerstone of the present administration’s policy,” the utilities company said. “However, this investigation’s potential impact on restricting nuclear fuel imports would do just the opposite.”

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As Nations Look to Tax Tech Firms, U.S. Scrambles to Broker a Deal

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WASHINGTON — For most of the 21st century, wealthy nations have engaged in a race to the bottom on corporate taxes, cutting rates in an effort to poach business activity across borders. Very quickly, that script has flipped.

Developed countries are now moving to impose new taxes on technology companies, like Facebook and Google, that have large presences in their citizens’ daily lives but pay those countries little tax on the profits they earn there.

France moved on Thursday to become the first country to impose a so-called digital tax of 3 percent on the revenue companies earn from providing digital services to French users. It would apply to large companies, numbering more than two dozen, with robust annual sales in France, including United States-based Facebook, Google and Amazon. British leaders also detailed plans on Thursday to impose a similar tax, of 2 percent, on tech giants. And the European Union has also been mulling a digital tax.

The digital revenue grab is pitting traditional allies against one another, threatening to set off a cascade of tax increases and tariffs unless political and economic leaders work out a multinational agreement to avert them. Late Wednesday, the Trump administration said it would pursue an investigation into whether France’s tech tax amounted to an unfair trade practice that could be punishable with retaliatory tariffs. Administration officials, including Treasury Secretary Steven Mnuchin, have also raised concerns about Britain’s move.

The French tax, which would exact a bigger toll on foreign companies than French ones, has been denounced by the American tech industry, along with Democratic and Republican leaders, who are looking for ways to avoid such one-off decisions by more closely coordinating international digital tax arrangements.

Administration officials have tried to shape an effort being led by the Organization for Economic Cooperation and Development to broker an international system for taxing digital profits. A lobbying flurry has broken out in Washington to influence the negotiations.

And in its attempts to show international leadership — and not go it alone, as Mr. Trump has in his trade wars with China and other partners — the administration is pushing the Senate to vote next week on a package of long-foundering updates to international tax treaties, which could demonstrate to allies that it is serious about leading the effort to broker a digital armistice.

Countries have competed to reduce corporate tax rates, and attract business activity both physically and on paper, for two decades. The average rate tracked by the Organization for Economic Cooperation and Development has fallen seven percentage points since 2000, to just over 21 percent today. France and the United States both cut rates substantially for 2018, with Mr. Trump’s signature tax cuts bringing the American rate of 21 percent right to the international average.

Technology companies’ revenue has surged worldwide, but not their tax payments, prompting many wealthy governments to complain that digital businesses are not paying their fair share. The European Union calculates that digital company revenue is growing more than four times as fast as revenue for other multinational companies, partly from ad sales to European consumers.

Because the firms have relatively light physical presences in Europe, they benefit from the current system, which taxes companies based on where their operations and assets are — and not where their sales are generated. The European Union has said this has allowed tech companies to pay less than half the effective tax rate of other multinationals, and European leaders want to tax them in a way that takes into account where their users are.

Mr. Mnuchin has spent much of his time discussing the issue at international forums with finance ministers from around the world.

During meetings of the International Monetary Fund and the World Bank in April, Mr. Mnuchin said it was a “priority” to find an international solution, and he pressed France and Britain to abandon their own tax plans once a compromise is reached.

At the Group of 20 finance ministers meeting in Japan in June, Mr. Mnuchin underscored his concerns, and the finance ministers agreed in their communiqué to work toward finding a common set of rules to close loopholes that global technology companies have been using to reduce their tax bills.

“I’m not in favor of the current digital tax that has been proposed by France and the U.K.,” Mr. Mnuchin said, warning a system of unilateral digital taxes would not work. “We have significant concerns with both of those.”

The United States has called for a tax that is based on companies’ income, not sales, and said specific industries should not be singled out with a different standard. The Treasury secretary has dispatched his deputy, Justin Muzinich, to help broker an agreement. The Organization for Economic Cooperation and Development released a “road map” in May, agreed to by nearly 130 countries, toward finding agreement on a global digital tax plan.

France has said that it will repeal its tax once a group agreement is reached. The subject will come up again when finance minsters gather in Chantilly, France, for the summit of the Group of 7 industrialized nations next week. Bruno Le Maire, the French finance minister, has suggested that France’s tax will help accelerate an international pact.

“We are willing, especially with Steven Mnuchin, to give new impetus during the G7 in Chantilly on the very specific topic of minimum taxation,” Mr. Le Maire said in an interview last month.

The Treasury Department said in a letter to the Senate Finance Committee on Thursday that it is considering a range of responses to the French tax.

“We have and will continue to urge France to forbear from such unilateral actions and join with us in an intensive effort to reach a comprehensive, multilateral solution,” wrote Kimberly J. Pinter, deputy assistant secretary in Treasury’s office of legislative affairs.

As negotiations persist, administration officials and Republican Senate leaders have worked together to break a decade-long logjam on updating international tax treaties, some of which were negotiated in the early years of the Obama administration.

Senator Mitch McConnell of Kentucky, the majority leader, moved on Thursday to set up a vote on the quartet of treaties next week, in what would be a bipartisan victory for multinational companies. The package is expected to succeed in garnering the support of two-thirds of senators voting on the issue.

The so-called tax protocols would update existing tax treaties with Spain, Japan, Luxembourg and Switzerland. They would allow companies with operations in those countries to avoid some previous tax penalties for transferring money to their operations abroad, in a provision proponents say would encourage multinationals to invest more in the United States. They would also update the existing treaties to allow for more detailed sharing of information among countries on individual and corporate taxpayers.

The treaties were held up for years by Senator Rand Paul, Republican of Kentucky, who objected to that information sharing. But the Senate Foreign Relations Committee overrode his complaints and voted to advance the treaties last month.

A host of large and powerful trade groups, including the Semiconductor Industry Association and the Business Roundtable, has been urging Senate leaders to approve the measures. “Tax treaties help the U.S. economy by allowing U.S. companies to more efficiently conduct their businesses abroad and by making the U.S. more hospitable to foreign investment,” the groups wrote this spring in a letter to Senator Jim Risch, the Idaho Republican who leads the Foreign Relations Committee.

One of the companies that stands to benefit is a Spanish-owned steel maker with a large plant in Kentucky, North American Stainless, which has been pushing Mr. McConnell and other senators to schedule a vote.

North American Stainless is the subsidiary of Acerinox, and employs more than 1,300 workers in Kentucky. A company executive told a Senate panel in 2014 that ratifying the tax protocol with Spain could boost Acerinox’s investments in Kentucky, by ending a 10 percent tax on dividend payments from the American subsidiary to the parent company.

In pushing for the tax treaties, Treasury officials have argued that they would promote fair and efficient taxation by the United States and treaty partners, reduce the risk of double taxation and help combat tax evasion by improving the flow of information among tax authorities.

A Treasury spokeswoman said the tax treaties were a priority for Mr. Mnuchin and Mr. McConnell and that the Senate’s bipartisan work on the issue would fuel economic growth.

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China and U.S. Differ Over Agricultural Purchases Trump Boasted About

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WASHINGTON — President Trump emerged from a June meeting in Japan with Xi Jinping, the Chinese president, saying that China would immediately begin purchasing American farm products in return for a trade truce that would forestall more United States tariffs on Chinese goods.

China did not see it that way. People familiar with the negotiations say China has denied making any explicit commitment to buy American farm products during those discussions and instead saw large-scale purchases as contingent on progress toward a final trade deal that is still nowhere in sight.

That is raising questions among trade experts about whether the United States gave up more than it got during Mr. Trump’s recent efforts to de-escalate the trade war.

Mr. Trump agreed to delay imposing tariffs on another $300 billion worth of Chinese imports and said he would ease restrictions on Huawei, the Chinese telecom giant blacklisted in May by the Commerce Department. In exchange, Mr. Trump said China would snap up American farm products.

“China is going to be buying a tremendous amount of food and agricultural product, and they’re going to start that very soon, almost immediately,” Mr. Trump said on June 29. “We’re going to give them lists of things that we’d like them to buy. Our farmers are going to be a tremendous beneficiary.”

But Beijing has yet to engage in any large purchases of American farm goods since the meeting. Two people familiar with Chinese economic policymaking said China did not believe that an explicit agreement had been struck for specific farm purchases.

On Tuesday, Larry Kudlow, a chief White House economic adviser, said the United States expected China to begin making purchases of soybeans, wheat and potentially energy products, but acknowledged they had yet to materialize.

“The president, in a good-faith showing, has indicated that we will cease any new tariffs, any new tariffs,” Mr. Kudlow said. “Now, President Xi is expected — or we hope, in return for our accommodations — to move immediately, quickly, while the talks are going on, on the agriculture front. It’s good faith, but it would be real transactions.”

“Haven’t seen them yet, by the way,” Mr. Kudlow added. “But, yes, that was part of the conversation.”

It appears to be just the latest misstep in a drawn-out negotiation between the United States and China. And it suggests that, despite descriptions of progress by American officials, a protracted trade war that has rocked global markets and clamped down on trade between the world’s two largest economies is likely to continue for the foreseeable future.

Beijing continues to push for the United States to remove the tariffs it has placed on $250 billion worth of Chinese products up front and let China carry out changes to its intellectual property laws and other regulations more gradually, people with knowledge of the talks say. The Trump administration has insisted that its tariffs remain while China makes the promised changes, but it is also eager to find a solution where China will move ahead with large purchases of agricultural goods.

Negotiators from the two countries are continuing to work toward a deal, and large-scale purchases could still happen. On Tuesday, Robert Lighthizer, the United States trade representative, and Treasury Secretary Steven Mnuchin spoke with China’s vice premier, Liu He, and its commerce minister, Zhong Shan, to continue talks, according to a senior administration official.

In a statement on Wednesday, China’s Ministry of Commerce said the two sides “exchanged views on implementing the consensus reached in Osaka” by Mr. Trump and Mr. Xi.

American officials also said on Tuesday that they were already going ahead with part of what Mr. Trump described as his concession: relaxing a ban on Huawei, the Chinese telecom giant that the United States cut off from buying American technology amid national security concerns. The administration will issue licenses for American companies that want to do business with Huawei “where there is no threat to national security,” Commerce Secretary Wilbur Ross said.

The United States has moved to cut the company off from access to American suppliers by placing it on the so-called entity list, which restricts sales of American technology for national security reasons. But companies can apply for licenses to sell specific products, circumventing the ban.

It remains unclear exactly which types of products could be exempted. The American technology industry has been lobbying the administration, saying the restrictions could cut it off from a valuable source of revenue. The ability to continue selling to Huawei could offer a reprieve to American companies like Qualcomm, Intel, Broadcom and Google, which sell Huawei microchips, software and other specialized parts that go into its smartphones and telecom equipment.

Some critics have described the administration’s decision to allow more sales to Huawei as a significant concession — and say it remains unclear what the United States will obtain in return.

“If President Trump has in fact bargained away the recent restrictions on #Huawei,” Senator Marco Rubio, Republican of Florida, said on Twitter on June 29, “then we will have to get those restrictions put back in place through legislation.”

Trade talks with China came to a halt in early May, when Chinese negotiators said they could not accept some provisions that had tentatively been agreed to in a draft pact. The United States accused Beijing of backtracking. Both sides immediately escalated their trade war, with Mr. Trump raising tariffs on $200 billion worth of goods and threatening to tax nearly all Chinese imports. China retaliated with higher tariffs on American goods.

The prospect of a prolonged trade conflict has shaken stock markets and Mr. Trump’s political base heading into the 2020 election. So hopes were high when Mr. Trump emerged from a meeting with Mr. Xi in late June with a temporary truce.

The president has been eager to reduce the trade war’s pain on American farmers, who send about one-third of their crops to China. Farmers are an important source of political support for the president, but they have been battered by the conflict in which the United States has ramped up tariffs on China.

China has placed retaliatory tariffs on American products, including soybeans. And Beijing has directed its state-owned companies to start and stop purchases of American products as a lever in the conflict. Its huge state-owned agricultural trading companies, which handle food imports, have been shifting their orders to other countries, like Brazil.

In the days leading up to the meeting between Mr. Trump and Mr. Xi in Osaka, China made large purchases of soybeans as an apparent good-will gesture. On June 28, the United States Agriculture Department announced that Chinese importers had bought 544,000 tons of soybeans, the largest sale to China since late March.

But no unusually large purchases have been reported since then, and it remains unclear whether China will continue making significant purchases.

Chinese officials have maintained that any further purchases would be made only as part of a trade deal rather than as a unilateral concession, said Eswar Prasad, a professor of international trade at Cornell University and the former head of the International Monetary Fund’s China division.

“China has made a commitment in principle to purchase more American goods, including agricultural products, but it is a commitment conditional on some progress in the trade talks,” Mr. Prasad said. “China has no intention of following through on its commitment if the trade talks founder.”

When questioned directly about Mr. Trump’s statement on farm purchases last week, a spokesman from the Chinese Ministry of Commerce avoided giving a specific answer.

“China and the United States have strong complementarities in the field of agricultural products trade, and there is huge space for cooperation,” said the spokesman, Gao Feng, adding that China did not want to see agricultural trade affected by trade frictions between the countries.

“Agricultural trade is an important issue that needs to be discussed by both sides,” Mr. Gao said.

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Trump Administration Will Allow Some Companies to Sell to Huawei

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WASHINGTON — The Trump administration is following through with plans to allow American companies to continue doing business with Huawei, the Chinese telecom equipment giant, just weeks after placing the company on a Commerce Department blacklist.

On Tuesday, Commerce Secretary Wilbur Ross said the administration will issue licenses for American companies that want to do business with Huawei “where there is no threat to national security.” And another top official suggested the move would allow chip makers to continue selling certain technology to Huawei.

The comments confirm President Trump’s surprise announcement last month, after a meeting with Chinese President Xi Jinping, that the United States would relax restrictions on Huawei as part of an effort to restart stalled trade talks with China. Weeks earlier, the Commerce Department said it had placed the company and its dozens of affiliates on a list of firms deemed a risk to national security, effectively barring it from buying American parts and technologies without seeking United States government approval.

Larry Kudlow, the director of the White House National Economic Council, said at a CNBC event on Tuesday that the United States has “opened the door — relaxed a bit, the licensing requirements from the Commerce Department” for companies that sell to Huawei.

“We are opening that up for a limited time period,” Mr. Kudlow said.

That could offer a reprieve to American companies like Qualcomm, Intel, Broadcom and Google, which sell microchips to Huawei and other specialized parts that go into its smartphones and telecom equipment.

American technology companies have been lobbying the administration, saying that the ban will cut them off from a major source of revenue, while doing little to hold back Huawei’s technological advancement, since Huawei will merely purchase some less-advanced components from competitors in Japan, South Korea or elsewhere instead.

Mr. Kudlow also said negotiations with China, which fell apart in May and seemed on the brink of collapse, are set to resume.

“The most important thing, the headline, is that talks and negotiations will resume, after a couple months of hiatus,” he said.

On Tuesday, Robert Lighthizer, the United States trade representative, and Treasury Secretary Steven Mnuchin spoke with Chinese Vice Premier Liu He and Minister Zhong Shan to continue negotiations aimed at resolving the outstanding trade disputes between the United States and China, according to a senior administration official. Both sides will continue these talks as appropriate, the official said.

Whether those talks can result in a trade deal is not yet clear. Deep differences remain, including whether China will agree to codify changes to its trade practices in Chinese law, as the administration has demanded. And the United States has not yet committed to lifting any of the tariffs it has placed on $250 billion worth of goods.

And while Washington is relaxing its restrictions on Huawei, a broader effort to crack down on China’s ability to buy American technology is continuing.

Mr. Ross, speaking at an export control conference in Washington, said the administration would continue efforts to protect America’s development of advanced technologies, including potentially curbing the ability of other countries to buy sensitive technology.

He said the administration was updating its export control policies to reflect a “fusion” between China’s military and its civilian businesses, which Mr. Ross called a threat to America. And he warned companies not to sacrifice intellectual property and other trade secrets in order to gain access to growing markets like China.

“The future prosperity of the United States depends on our strategic advantage in advanced technologies,” Mr. Ross said. “It is wrong to trade sensitive I.P. or source codes for access to a foreign market,” he said, “no matter how lucrative that market might be.”

Mr. Ross stopped short of announcing long-expected additions to the list of products subject to American export controls, but said the Commerce Department would continue to review which technologies might need protection.

“If new export controls seem necessary, the department seeks public input and strives for multilateral agreements, so that important controls are universally adopted,” he said.

Mr. Ross said that the department would soon announce members of an “emerging technology technical advisory committee to help review those technologies,” whose members would be announced shortly, and who would help “modernize” the department’s export control list.

Commerce was tasked with creating new rules for protecting sensitive American technologies from foreign incursions by a defense bill that Mr. Trump signed into law last August. But the department has found creating the list of sensitive technologies to be a difficult task.

Rules that are too restrictive could weigh heavily on businesses that depend on freely trading components around the world, and ultimately hamstring their ability to design and manufacture products in the United States. Companies could be forced to move their research sites abroad, potentially putting the position of the United States as a hub for research and development at risk.

“This is the dilemma,” said William Reinsch, who led what now is called the Bureau of Industry and Security under the Clinton administration. “You have to constantly walk this line between controlling too loose and letting stuff you want out, and controlling too tight and incentivizing other people to make it.”

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Leaked British Cables Critical of Trump Lead to Diplomatic Uproar

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WASHINGTON — President Trump celebrates his bond with Queen Elizabeth II. He is less charitable about those who serve her.

On Monday, Mr. Trump said the White House would no longer deal with the British ambassador to the United States after the envoy described the Trump administration as “clumsy and inept” in confidential cables that were leaked. The president also accused Prime Minister Theresa May of botching Britain’s negotiations to leave the European Union, reviving a critique he first leveled against her a year ago.

Mr. Trump’s criticisms, delivered in a pair of midday tweets, were a rude farewell to Mrs. May and a British leadership that is likely to be replaced in the coming weeks by harder-line, pro-Brexit forces more to the president’s liking. In his rebuke of the ambassador, Sir Kim Darroch, Mr. Trump came close to declaring him persona non grata — an extraordinary breach between the United States and one of its closest allies.

The British government scrambled to repair the damage, dispatching its trade minister to Washington to apologize to the president’s elder daughter, Ivanka Trump. The sudden rupture of the so-called special relationship came barely a month after the queen feted Mr. Trump with a 41-gun salute and a lavish state banquet at Buckingham Palace.

It was a reminder of the fact that underneath the pageantry, the ties between Britain and the United States have been fraying for some time.

“What a mess she and her representatives have created,” Mr. Trump said of Mrs. May. “I told her how it should be done, but she decided to go another way.” Of Mr. Darroch, he said, “I do not know the Ambassador, but he is not liked or well thought of within the U.S. We will no longer deal with him.”

Mr. Trump’s threat left Mr. Darroch’s status uncertain, though the British government stoutly defended his right to send home “honest, unvarnished assessments” of the political situation in Washington. In a statement on Monday, the government lamented the leaking of the cables, which, it said, “do not reflect the closeness of, and the esteem in which we hold, the relationship.”

The diplomatic uproar came at an awkward moment for Britain, which has been isolated and paralyzed by its looming deadline to leave the European Union. After failing to win support in Parliament for a negotiated exit, Mrs. May announced she would step down as leader of the Conservative Party and relinquish the prime minister’s post as soon as the party elects a new leader.

Boris Johnson, a pro-Brexit former foreign secretary and former mayor of London, is the odds-on favorite to replace her — a prospect that clearly delights Mr. Trump, who all but endorsed him last month during his visit to Britain. Mr. Johnson has pledged to pursue a “no deal” exit from the European Union.

“The good news for the wonderful United Kingdom is that they will soon have a new prime minister,” Mr. Trump said. “While I thoroughly enjoyed the magnificent State Visit last month, it was the Queen who I was most impressed with!”

Mr. Trump praised the queen as a “spectacular woman” and claimed that during their meetings, her staff said she had not had so much fun in 25 years. By contrast, he and Mrs. May joked uneasily about their differences over how Britain handled its negotiations with the bloc.

“I seem to remember the president suggested that I sue the European Union,” Mrs. May said. “Which we didn’t do. We went into negotiation, and we came out with a good deal.”

“I would have sued, but that’s O.K.,” Mr. Trump replied. “I would have sued, and settled, maybe.”

In his cables, Mr. Darroch described the White House as a “uniquely dysfunctional environment” and said Mr. Trump was an unpredictable character. “There is no filter,” he wrote. He also said the president faced the prospect of further disclosures that could lead to “disgrace and downfall.”

The cables were obtained by a British tabloid, The Mail on Sunday, which published them over the weekend. The leak prompted theories about whether pro-Brexit forces were less interested in harming Mr. Darroch, whose tenure in Washington is nearing an end, than in torpedoing a likely successor: Mrs. May’s national security adviser, Mark Sedwill. Mr. Sedwill is viewed by some in London as having maneuvered to prevent the government from pursuing a no-deal Brexit.

For all of his private criticism, Mr. Darroch has cultivated close ties with people in Mr. Trump’s orbit. He hosted lavish diplomatic parties at the ambassador’s baronial residence that drew a parade of prominent officials, including Ms. Trump and her husband, Jared Kushner; a former Trump White House chief of staff, John F. Kelly; the former White House chief strategist, Stephen K. Bannon; and Mr. Trump’s senior adviser Kellyanne Conway.

In London on Monday, former diplomats debated whether Mr. Trump had effectively made Mr. Darroch persona non grata in Washington, a step that generally leads to a diplomat’s removal.

“I think Sir Kim is done in Washington,” said Lewis A. Lukens, who served as deputy chief of mission at the American Embassy in London from 2016 to 2019. “It’s a shame because he has been an extraordinarily effective ambassador for the U.K. in Washington. And he was just doing his job — providing the government in London with his candid, honest assessment of the dynamics in Washington.”

Sir Christopher Meyer, who was ambassador in Washington from 1997 to 2003, said it was too early to know what the president’s tweet meant for Mr. Darroch’s status.

“Does he mean that Kim will never be able to meet him again?” he asked. “Does he mean access to the White House staff, like the chief of staff, is blocked? Does he mean that Kim is denied access to the National Security Council?”

Mr. Meyer said Mrs. May’s support seemed unshakable, but that when a new prime minister takes office in two weeks, the situation may change. A new prime minister, he said, could select a political appointee who could “take a strong partisan position,” instead of a career diplomat like Mr. Darroch.

He said he doubted it would be Nigel Farage, the Brexit Party leader, whom Mr. Trump has repeatedly recommended for the job.

“Farage? Well, Darth Vader could be appointed, if that was the wish of the British government,” Mr. Meyer said. “But now he’s sitting on top of a burgeoning political party. I think his larger ambition would be there, rather than in Washington.”

Whatever the motivation, analysts agreed that the leak was particularly destructive, given the fragility of Britain’s diplomatic position. The British government has parted company with the United States over the Iran nuclear deal, the Paris climate accord and Mr. Trump’s attacks on the NATO alliance.

“The overall relationship is in bad shape,” said Thomas Wright, an expert on Europe at the Brookings Institution. “There are so many things that Trump has done to irk or undermine the U.K. government.”

Mr. Trump’s state visit, he said, was choreographed to paper over those differences, reflecting how dependent on the United States British officials believe they will be once Britain leaves Europe. So did Britain’s panicky reaction to the leaked cables. Britain’s trade minister, Liam Fox, said he planned to apologize to Mr. Trump’s daughter when the two meet this week during his visit to Washington.

“Either our Civil Service or elements of our political class have not lived up to the expectations that either we have or the United States has about their behavior, which in this particular case has lapsed in a most extraordinary and unacceptable way,” Mr. Fox said Monday on BBC Radio.

His act of contrition with Ms. Trump speaks equally to her rising status in the administration and Britain’s dwindling status as it faces a post-Brexit future.

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Trump Says He Will No Longer Deal With British Ambassador Whose Critical Cables Were Leaked

Westlake Legal Group 08dc-prexy-facebookJumbo Trump Says He Will No Longer Deal With British Ambassador Whose Critical Cables Were Leaked United States Politics and Government United States International Relations Trump, Donald J May, Theresa M Great Britain Withdrawal from EU (Brexit) Great Britain Darroch, Kim (1954- )

WASHINGTON — President Trump lashed out on Monday at Britain’s ambassador to the United States, saying the White House would no longer deal with him after the publication of confidential cables in which the ambassador, Sir Kim Darroch, disparaged Mr. Trump’s administration as “clumsy and inept.”

Mr. Trump’s criticism, delivered in a pair of midday tweets, escalated the tensions between the United States and Britain that erupted after the cables were published on Saturday by a British tabloid, The Mail on Sunday. The president broadened his criticism to include Prime Minister Theresa May, whom he accused of botching Britain’s negotiations to leave the European Union.

“What a mess she and her representatives have created,” Mr. Trump tweeted. “I told her how it should be done, but she decided to go another way.”

Of Mr. Darroch, the president said, “I do not know the Ambassador, but he is not liked or well thought of within the U.S. We will no longer deal with him.” Mr. Trump’s statement came close to declaring Mr. Darroch persona non grata — an extraordinary breach between the United States and one of its closest allies.

British officials scrambled to contain the damage from Mr. Darroch’s unvarnished private assessments of the president and his administration. Britain’s trade minister, Liam Fox, said he planned to apologize to Mr. Trump’s eldest daughter, Ivanka Trump, for the leaking of the cables at a meeting this week during his visit to Washington.

“Either our Civil Service or elements of our political class have not lived up to the expectations that either we have or the United States has about their behavior, which in this particular case has lapsed in a most extraordinary and unacceptable way,” Mr. Fox said Monday on BBC Radio.

Mr. Fox’s gesture of contrition speaks equally to Ms. Trump’s rising status in the administration and Britain’s dwindling status as it faces a post-Brexit future. But it is not clear that it will be enough to mollify the president. On Sunday, Mr. Trump told reporters he would not bother to criticize Mr. Darroch beyond saying, “We are not big fans of that man.”

A day later, however, Mr. Trump made clear that he took the ambassador’s criticism personally, and he used it as an occasion to renew his past critique of Ms. May.

The diplomatic row comes at a deeply awkward moment for Britain, which has been paralyzed and increasingly isolated by its looming deadline to leave the European Union. After failing to win support in Parliament for a negotiated exit, Ms. May announced she would step down as leader of the Conservative Party and relinquish the prime minister’s post as soon as the party elects a new leader.

Boris Johnson, a pro-Brexit former foreign secretary and mayor of London, is the odds-on favorite to replace Ms. May. That prospect clearly delights Mr. Trump, who all but endorsed him during a visit to Britain last month, and celebrated the coming change in leadership on Monday.

“The good news for the wonderful United Kingdom is that they will soon have a new prime minister,” Mr. Trump tweeted. “While I thoroughly enjoyed the magnificent State Visit last month, it was the Queen who I was most impressed with!”

In his cables, Mr. Darroch described the White House as a “uniquely dysfunctional environment” and said Mr. Trump was an unpredictable character. “There is no filter,” he wrote. He also said that the president faced the prospect of further disclosures that could lead to “disgrace and downfall.”

For all of his private criticism, Mr. Darroch has cultivated close ties with people in Mr. Trump’s orbit. He hosted lavish diplomatic parties at the ambassador’s baronial residence that drew a parade of prominent officials, including Ms. Trump and her husband, Jared Kushner; the former chief of staff, John F. Kelly; the former chief strategist, Stephen K. Bannon; and Mr. Trump’s senior adviser, Kellyanne Conway.

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