China tells US to stop ‘unreasonable crackdown’ on Huawei

BEIJING — China called on Washington on Tuesday to “stop the unreasonable crackdown” on Huawei after the United States stepped up pressure on the tech giant by indicting it on charges of stealing technology and violating sanctions on Iran.

Beijing will “firmly defend” its companies, a foreign ministry statement said. It gave no indication whether Beijing might retaliate for the charges against Huawei, China’s first global tech brand and the biggest maker of switching gear for phone and internet companies.

Huawei Technologies Ltd., which has spent a decade battling U.S. accusations it is a front for Chinese spying, denied committing any of the violations cited in Monday’s indictment.

The foreign ministry complained Washington has “mobilized state power” to hurt Chinese companies “in an attempt to strangle fair and just operations.”

“We strongly urge the United States to stop the unreasonable crackdown on Chinese companies including Huawei,” said the statement read on state TV. It said Beijing will defend the “lawful rights and interests of Chinese companies” but gave no details.

The charges unsealed Monday by the Justice Department accused Huawei of trying to take a piece of a robot and other technology from a T-Mobile lab that was used to test smartphones. Huawei passed Apple in mid-2018 as the second-biggest global smartphone brand after Samsung.

The U.S. charges included no allegation Huawei worked at the Chinese government’s direction. But Washington has previously accused Beijing of involvement in cyberspying and theft of industrial secrets. It has charged several Chinese hackers and intelligence officials.

Huawei also is charged with using a Hong Kong front company, Skycom, to trade with Iran in violation of U.S. controls. Prosecuters allege Huawei’s chief financial officer, Meng Wanzhou, lied to banks about those dealings.

Meng, the daughter of Huawei founder Ren Zhengfei, was arrested Dec. 1 in Vancouver, a development that set off a political firestorm between China and Canada.

“We urge the U.S. to immediately withdraw the arrest warrant against Miss Meng Wanzhou and stop making such kinds of extradition requests,” said a Foreign Ministry spokesman, Geng Shuang. “We urge Canada to take seriously China’s solemn position, immediately release Ms. Meng Wanzhou and protect her legitimate and legal rights.”

Huawei, headquartered in the southern city of Shenzhen, near Hong Kong, has rejected the U.S. accusations.

“The company denies that it or its subsidiary or affiliate have committed any of the asserted violations of U.S. law set forth in each of the indictments,” a Huawei statement said.

Huawei is “not aware of any wrongdoing by Ms. Meng, and believes the U.S. courts will ultimately reach the same conclusion,” it said.

Meng is out on bail in Vancouver and is due in court Tuesday as she awaits extradition proceedings.

Huawei’s U.S. market evaporated after a 2012 congressional report said it and Chinese rival ZTE Corp. were security risks and told phone companies to avoid them. But Huawei says the scrutiny has had little impact on its business elsewhere.

The company says it serves 45 of the 50 biggest global telecom carriers. It forecasts its 2018 global revenue should exceed $100 billion for the first time despite the tension with Washington.

Huawei said U.S. prosecutors rejected a request to discuss the investigation following Meng’s arrest. It also noted the allegations in the trade secrets charge were the subject of a U.S. civil lawsuit that already has been settled.

The latest charges could dim prospects for U.S.-Chinese trade talks due to start Wednesday in Washington.

President Donald Trump and his Chinese counterpart, Xi Jinping, agreed Dec. 1 to put off any further sanctions against each other’s exports while they negotiated. A breakdown would likely lead to higher tariffs, a prospect that has rattled financial markets for months.

The entirely state-controlled Chinese press has portrayed Huawei as the victim of U.S. government efforts to cripple a potential industrial challenger.

“This is not just the matter of Huawei. It involves the whole nation of China,” said Qin Xiaohua, who works in the finance industry in Beijing. “We have to unite no matter as individuals or as an integrated country.”

While U.S. authorities stress the independence of courts, “ordinary Chinese people all believe it is a deliberate crackdown on Huawei,” said Lu Feng, an economist at Peking University. He said Beijing will see a “link to Chinese-U.S. trade relations.”

“The difference in understanding will bring about complicated problems,” said Lu.

Asked about the possible effect of the Huawei case on trade talks, the foreign ministry spokesman, Geng, said, “as for the China-U.S. trade talks and our position on this, I think the U.S. is also quite clear about that.”

The Justice Department officials provided details from a 10-count grand jury indictment in Seattle, and a separate 13-count case from prosecutors in New York.

The Seattle charges allege that beginning in 2012, Huawei plotted to steal information about T-Mobile’s robot, known as “Tappy.” It says Huawei engineers secretly took photos of the robot, measured it and tried to steal part of it from T-Mobile’s lab, according to prosecutors. T-Mobile declined to comment.

___

AP researcher Yu Bing in Beijing and AP writers Christopher Bodeen in Beijing, Michael Balsamo, Eric Tucker and Christopher Rugaber in Washington, Rob Gillies in Toronto and Tali Arbel in New York contributed.

Joe McDonald, The Associated Press

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Ottawa’s avalanche of spending hasn’t helped First Nations

Published on November 19, 2024

Todayville

From the Fraser Institute

By Tom Flanagan

When Justin Trudeau came to power in 2015, he memorably said that the welfare of Indigenous Canadians was his highest priority. He certainly has delivered on his promise, at least in terms of shovelling out money.

During his 10 years in office, budgeted Indigenous spending has approximately tripled, from about $11 billion to almost $33 billion. Prime Minister Trudeau’s instruction to the Department of Justice to negotiate rather than litigate class actions has resulted in paying tens of billions of dollars to Indigenous claimants over alleged wrongs in education and other social services. And his government has settled specific claims—alleged violations of treaty terms or of the Indian Act—at four times the previous rate, resulting in the award of at least an additional $10 billion to First Nations government.

But has this avalanche of money really helped First Nations people living on reserves, who are the poorest segment of Canadian society?

One indicator suggests the answer is yes. The gap between reserves and other communities—as measured by the Community Well-Being Index (CWB), a composite of income, employment, housing and education—fell from 19 to 16 points from 2016 to 2021. But closer analysis shows that the reduction in the gap, although real, cannot be due to the additional spending described above.

The gain in First Nations CWB is due mainly to an increase in the income component of the CWB. But almost all of the federal spending on First Nations, class-action settlements and specific claims do not provide taxable income to First Nations people. Rather, the increase in income documented by the CWB comes from the greatly increased payments legislated by the Liberals in the form of the Canada Child Benefit (CCB). First Nations people have a higher birth rate than other Canadians, so they have more children and receive more (on average) from the Canada Child Benefit. Also, they have lower income on average than other Canadians, so the value of the CCB is higher than comparable non-Indigenous families. The result? A gain in income relative to other Canadians, and thus a narrowing of the CWB gap between First Nations and other communities.

There’s an important lesson here. Tens of billions in additional budgetary spending and legal settlements did not move the needle. What did lead to a measurable improvement was legislation creating financial benefits for all eligible Canadian families with children regardless of race. Racially inspired policies are terrible for many reasons, especially because they rarely achieve their goals in practise. If we want to improve life for First Nations people, we should increase opportunities for Canadians of all racial backgrounds and not enact racially targeted policies.

Moreover, racial policies are also fraught with unintended consequences. In this case, the flood of federal money has made First Nations more dependent rather than less dependent on government. In fact, from 2018 to 2022, “Own Source Revenue” (business earnings plus property taxes and fees) among First Nations bands increased—but not as much as transfers from government. The result? Greater dependency on government transfers.

This finding is not just a statistical oddity. Previous research has shown that First Nations who are relatively less dependent on government transfers tend to achieve higher living standards (again, as measured by the CWB index). Thus, the increase in dependency presided over by the Trudeau government does not augur well for the future.

One qualification: this finding is not as robust as I would like because the number of band governments filing reports on their finances has drastically declined. Of 630 First Nation governments, only 260 filed audited statements for fiscal 2022. All First Nations are theoretically obliged by the First Nations Financial Transparency Act, 2013, to publish such statements, but the Trudeau government announced there would be no penalties for non-compliance, leading to a precipitous decline in reporting.

This is a shame, because First Nations, as they often insist, are governments, not private organizations. And like other governments, they should make their affairs visible to the public. Also, most of their income comes from Canadian taxpayers. Both band members and other Canadians have a right to know how much money they receive, how it’s being spent and whether it’s achieving its intended goals.

Author:

Tom Flanagan

Professor Emeritus of Political Science and Distinguished Fellow, School of Public Policy, University of Calgary

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Musk, Ramaswamy to lead Trump efforts to cut waste, fraud in federal government

Published on November 13, 2024

Todayville

From The Center Square

By Brett Rowland

During his campaign, Ramaswamy proposed cutting 75% of the federal workforce. Musk recently suggested that he could cut $2 trillion from the federal budget, or about one-third of total U.S. spending.

President-elect Donald Trump picked Tesla CEO Elon Musk and businessman Vivek Ramaswamy to lead a newly created Department of Government Efficiency.

The department’s acronym, DOGE, is a nod to Musk’s favorite cryptocurrency, dogecoin. Trump said the new group will pave the way for his administration to “dismantle government bureaucracy, slash excess regulation, cut wasteful expenditures and restructure federal agencies.”

Trump laid out lofty goals for the group in his announcement this week.

“It will become, potentially, ‘The Manhatten Project,’ of our time,” Trump’s announcement said. “Republican politicians have dreamed about the objectives of ‘DOGE’ for a very long time.”

It won’t be an official government agency, which will likely allow Musk and Ramaswamy to avoid public financial disclosures.

Trump said the change he’s looking for won’t come from within the existing federal government.

“To drive this kind of change, the Department of Government Efficiency will provide advice and guidance from outside the government, and will partner with the White House and Office of Management & Budget to drive large scale structural reform and create and entrepreneurial approach to government never seen before,” the announcement noted.

Trump said he looks forward to what Musk and Ramaswamy can accomplish.

“Importantly, we will drive out the massive waste and fraud which exists throughout our annual $6.5 trillion of government spending,” he said.

Trump also gave them a deadline: July 4, 2026.

“A smaller government, with more efficiency and less bureaucracy will be the perfect gift to America” on the 250th anniversary of the Declaration of Independence, according to the announcement.

Ramaswamy, who dropped out the race for the GOP nomination to endorse Trump in January, has previously proposed significant cuts. During his campaign, Ramaswamy proposed cutting 75% of the federal workforce.

Musk recently suggested that he could cut $2 trillion from the federal budget, or about one-third of total U.S. spending. He’s been tossing out ideas on X, previously Twitter before Musk bought the company and changed the name.

“The world is suffering slow strangulation by overregulation. Every year, the noose tightens a little more,” Musk wrote in a post on X on Wednesday. “We finally have a mandate to delete the mountain of choking regulations that do not serve the greater good.”

Musk also said he isn’t a threat to democracy, but a threat to bureaucracy.

DOGE already has an X account. It’s first post: “Working overtime to ensure your tax dollars will be spent wisely!”

Some budget experts have called Musk’s pledge to cut $2 trillion a pipe dream, noting that many of the problems DOGE wants to address have proven intractable.

Brian Riedl, a senior fellow at the Manhattan Institute think tank, called Musk’s proposal “a random number unattached to reality.”

Marc Goldwein, the senior vice president and senior policy director for the Committee for a Responsible Federal Budget, said it could be done with 10 aggressive policies, mostly focused on Medicare and Medicaid.

“The government can legitimately save trillions over a decade by reducing waste and improving efficiency – and I hope we do,” Goldwein wrote on X. “Achieving these savings requires major changes to how and how much we pay for health care.”

Medicare (annual cost of about $1 trillion) is a federal health insurance program for people 65 or older, and some people younger than 65 with certain disabilities or conditions. Medicaid (annual cost of about $558 billion) is a joint federal and state program that helps cover medical costs for some people with limited income and resources.

The Government Accountability Office, which serves as the research arm of Congress, estimated annual fraud losses cost taxpayers between $233 billion and $521 billion annually, in a report in April. The fraud estimate’s range represents 3% to 7% of average federal obligations. The Office of Management and Budget publicly questioned that estimate, calling it “not plausible.”

“OMB has significant concerns that this report will not further efforts to prevent and reduce fraud, but rather will create confusion and promote misleading generalizations that have no factual connection to specific federal programs,” Jason Miller, the deputy director for management at the Office of Management and Budget, wrote of OMB concerns in a three-page letter to officials with the Government Accountability Office.

On the campaign trail, Ramaswamy detailed his plan to reduce the federal workforce by 75% during an event at the America First Policy Institute in Washington in 2023.

Ramaswamy said he would shutter the FBI (about 35,000 employees); the Bureau of Alcohol, Tobacco, Firearms a nd Explosives (5,099 employees); the U.S. Department of Education (about 4,200 employees); the Nuclear Regulatory Commission (about 3,000 employees); and the Department of Agriculture’s Food and Nutrition Services (about 1,500 employees).

Under Ramaswamy’s campaign plan, some 15,000 FBI employees would be moved to other agencies such as the U.S. Marshals Service, U.S. Secret Service, Treasury’s Financial Crimes Enforcement Network, Drug Enforcement Administration, Defense Intelligence Agency, and Commerce’s Bureau of Industry and Security.

Some groups called the Department of Government Efficiency goals a stretch. Others had more pointed things to say.

Lisa Gilbert, co-president of Public Citizen, a progressive consumer advocacy organization founded by Ralph Nader, said the government agencies and regulations Ramaswamy proposed cutting are in place to protect people.

“The purpose of government regulations is to protect the American people,” she said in a statement. “We all depend on these regulations to protect our air, water, workers, children’s safety, and so much more. ‘Cutting red tape’ is shorthand for getting rid of the safeguards that protect us in order to benefit corporate interests.”