GOOD MORNING FROM LONDON
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WHATEVER HAPPENED TO S.W.O.T.?
S.W.O.T. stands for Strengths, Weaknesses, Opportunities, and Threats and is a strategic planning tool used to assess a project or organization. It helps identify internal factors (strengths and weaknesses) and external factors (opportunities and threats) that develop future strategies.
It is the absolute Number One Item on the agenda for any business, any enterprise, any initiative involving any subject of importance. It is essential, unavoidable and the object of considerable scrutiny in the early stages. Business Schools across the world adopt the S.W.O.T approach on Day One of every MBA course.
Any S.W.O.T analysis of the U.S. would quickly reveal the considerable vulnerability of the country’s almost complete dependence on Rare Earths. And let us remind ourselves about Rare Earths and the U.S. What Are They? How Important Are They? Where Is the U.S. going to locate them?.
The answer is short. The U.S. would have concluded – “We do not have Rare Earths. We are going to have to import them. Where can we find them? The answer is China – identified by successive U.S. Governments including Trump in his first term as the #1 Geo-Political Threat to the U.S..
What do we conclude? The U.S. went to sleep. Remarkable when you consider the smugness of the narrative from every U.S. Business School that they are the best at Strategy, Forward Planning and Threat Assessment.
The U.S. will conduct its own post mortem – Where did we go wrong? How could we miss our #1 Vulnerability? Why did we fail so completely and so decisively to see the danger that surrounded our economy on so many fronts? So let’s remember the reach and importance of Rare Earths. This is Ed Conway of Sky News writing in the Sunday Times;-
“There are tonnes of rare earths to be found in submarines, in fighter jets, in tanks and frigates, not ED to mention nuclear reactors… So, securing a supply of rare earths matters enormously for everything from the tech sector to energy to the military. And right now about 70% of the world’s rare earth elements are mined in China. Roughly 90% of the finished products (including magnets) are made in China…If China decided to stop all its exports, it would cause economic destruction of a kind that it is hard to comprehend”.
The U.S. did not see it coming. A Big Heavy Boulder rolling down Fifth Avenue in New York and no one saw it. It remains quite incredible. The information was there. Scientists had done their research. They knew where the world’s deposits of Rare Earths were deposited around the world. The Economists knew where the deposits were being shipped. And the Politicians knew where the deposits were being processed. Connecting the dots led to one conclusion – China’s bargaining strength had zoomed to the top of the scale.
And it is no coincidence that of all the countries in the world, only one stood up to Trump – not from Europe, not from South America or Canada or the Middle East. Each of the countries – bar one – beat a path to Washington in craven indulgence and begged Trump to relent. The one country was China and that is why the meeting in South Korea satisfied all international observers and commentators that China had come out on top.
It is a moment in time. Historians in the years ahead – centuries ahead – will look back at the hurriedly assembled airport meeting in Seoul and note that it marked a change in the balance of power. The U.S. knew China had arrived.
The change will not be dramatic. It will not lead to any immediate rewriting of past deals but the evidence will be there. China will play along with the U.S. and buy some soyabeans from the U.S. China will resume purchases of some semiconductors from the U.S. China knows its relationship is for the long term because the U.S, is large. It is world wide. The U.S. will not fold up its deckchair and leave the beach. But the balance has changed. The U.S. knows something quite significant happened in South Korea in 2025. China came of age.
At the same time the U.S. will be conducting a searching self-examination. Where did we go wrong? There are answers.
- COMPLACENCY – this is a human condition. It is difficult to be sharp, alert, on the ball with eyes wide open when you are winning. You lose something when you are ahead. I don’t want to minimise the topic but look at sport and every Champion will say that it is hard to get to the Top but even harder to stay at the Top.
- ARROGANCE – the U.S. success in building a world wide economic power from the destruction of its mid-1860’s Civil War convinced leading Americans that the American way was the only way. Entrepreneurial Capitalism – that drove the railway expansion from New York in the East to San Francisco in the West and from Maine in the North to Texas in the South – convinced the U.S. that Their Way Was The Only Way.
- NO COMPETITION – this is the essential third element of the U.S. Big Stumble. Marxism had been defeated. The 1848 Communist Manifesto and the 1917 Soviet Revolution collapsed between 1989 and 1991. Capitalism had triumphed over Socialism. And this was underlined by Professor Fukiyama whose book The End of Ideology announced to the world that the Capitalist Liberal Democratic System had consigned Authoritarian Marxism to the rubbish dump. Capitalism had triumphed and it had no rival. Or so it thought.
- CHINA – The U.S. – its politicians, its statesmen, its academics, its military, its media collectively failed to see that China was rising. They were convinced China would go the same way as the USSR. Deng Hsiaoping was the new Gorbachev. Capitalism would be adopted in China and liberal democracy would soon follow and the Communist Party of China would be relegated to the margins soon to be overtaken by a multiplicity of parties and leaders with a liking for the Western Democratic system. They were wrong but even today they do not see their mistake.
The World is at the early stages of a new system. Many do not see it. People do tend to be myopic but development will bring them face-to-face with the changes now underway. Seoul in 2025 will be marked by future historians as a Big Moment In Time.
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CHINA AND JACK PERRY
PART 20. DR JI CHAOTING WAS THE KEY MAN
Part 19 concluded with Jack describing his first tour of China in 1953 in the company of Dr Ji Chaoding;-
I recall being taken to a building site just outside Beijing very early one morning. Dawn was breaking at 4am. As we came over the brow of a hill I could see what seemed to be ants. As we drew closer, I realised that they were people at least 40,000. Some were digging up the ground with spades, putting the earth into bamboo carriers and running a quarter of a mile to dump the soil in an area where more people were compressing it with their feet. They were building a dam, I was told, for hydro-electric power. I couldn’t believe it. This was 1953. I didn’t see a single piece of engineering equipment not even a drill. This was the first dam to be built in China after the revolution, across the Yangtze and they were doing it with 40,000 untrained people. It was an unbelievable sight and something I remember quite vividly.”
In the course of his 1953 China travels, Jack learned much about Dr Ji Chaoding. He was a significant man in China at the time. He was educated at a leading China University – Tsinghua University in Beijing – and he then studied Economics in the U.S. at the University of Chicago and at Columbia University. He was an undisclosed member of the Communist Party of China and formed a close association in later years with Premier Zhou Enlai. It has been suggested that he had “secretly” joined the U.S. Communist Party while living in the U.S. but this is doubtful. Ji’s membership of the Chinese CP only became public knowledge after his death in 1963 and it is unlikely that he would have put that secrecy in jeopardy by joining the U.S. Communist Party which was known to be riddled with leaks and penetration by the State Department and the CIA.
Picking up on the career of Dr Ji, his father became friends with Lu Xun the most prominent Chinese writer of the time. The two shared progressive views about the future of China. The father, Ji Gongquan, told his son – Ji Chaozhu, half-brother of Ji Chaoding, and subsequently a China Ambassador to the U.K in the 1980s – that in the 1930s he (the father) calculated that “if I were to join the ‘Preserve The Empire Party’ I might lose face. If I were to join the Revolutionary Party (the Communist Party of China) I might lose my head. I decided it was wisest to keep both”
In 1916 Ji Chaoding entered Tsinghua University – a school supported by funds from the Boxer Uprising Rebellion and where classes were taught mainly in English. In the aftermath of the 1919 May 4th Movement and the awakening of patriotic spirit in China, Ji Chaoding pursued radical nationalist activities along with two well known classmates – Luo Longji and Wang Zaoshi.
Luo Longji was a prominent Chinese liberal politician and intellectual who advocated for human rights and democracy, playing a leading role in the May Fourth Movement and the China Democratic League He died in December 1965 in political disgrace but has since been the subject of political rehabilitation.
Wang Zaoshi was born on 2 September, He was a Chinese lawyer and activist for human rights and constitutional government under both the Nationalist Government and the PRC. He was educated at Tsinghua University, the University of Wisconsin and at London School of Economics under Harold Laski. He was arrested in 1936 by Chiang Kaishek’s government for advocating a United Front between the KMT (Chiang Kaishek’s Kuomintang Party) and the CPC (Mao’s Communist Party of China) in order to fight Japan during the lead up to the Second Sino-Japanese War. Wang suffered during the Cultural Revolution – a topic that will be addressed in later Chapters of China and Jack Perry.
In the U.S. Ji became prominent as an economist and became familiar with the works of John Maynard Keynes which facilitated a lifelong friendship with Joan Robinson of Cambridge University. Joan had worked closely with Keynes in the development of his General Theory of Employment, Interest and Money. Fast forwarding, briefly to 1950-51 it was to Joan Robinson, later Professor of Economics at Cambridge, that Dr Ji turned for recommendations of businessmen with whom China could establish links following the establishment of the People’s Republic of China in 1949. Ji was reporting directly to Premier Zhou Enlai who had instructed Ji to identify Western business men with whom the new China could develop long term relations, Joan recommended my father – Jack Perry.
Dr Ji also came to know Joseph Needham, author of Science and Civilisation in China. Needham called Dr Ji a “learned and brilliant writer” and praised Ji’s authorship of Key Areas with the words “perhaps the most outstanding book on the development of Chinese History among Western books in those days”.
In the summer of 1927 Dr Ji met Harriet Levine an American from New York whom he had met on a ship travelling to Europe. They married and had two sons: Emile (born 1936) became a mathematician, and Carl (born 1940) became a neuro-physiologist. Harriet went to China for the first time in 1947. She and Ji separated in Shanghai, and she returned to New York.
PART 21 – DR JI’S LINKS WITH THE KUOMINTANG MAKE HIM A DOUBLE AGENT.
