Have nothing to do with the [evil] things that people do, things that belong to the darkness. Instead, bring them out to the light... [For] when all things are brought out into the light, then their true nature is clearly revealed...

-Ephesians 5:11-13

Category Archives: Foreign Policy

China’s Economy Taking Massive Hit From Coronavirus Measures

This article appeared online at TheNewAmerican.com on Thursday, March 5, 2020: 

Estimates from the International Monetary Fund (IMF) show the impact of measures mandated by the Chinese communist government to staunch the spread of the COVID 19/Coronavirus. In January, the IMF reduced its growth outlook from 6.4 percent for 2020 to 6.1 percent. On Thursday it reduced that outlook further, to 5.6 percent, thanks to what the IMF’s managing director Kristalina Georgieva called the “sheer geographic spread” of the virus.

And the group’s forecast could be reduced further: “We are already looking at adverse scenarios … in which the impact on growth for China is more significant.… The Chinese authorities themselves are recognizing that there would be lower growth this year.”

The IMF noted, for example, that

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Could the COVID19/Coronavirus End the Communists’ Control of China?

This article was published by The McAlvany Intelligence Advisor on Friday, March 6, 2020: 

The spark could be the “white hot” outrage that followed the death of the whistleblower from Luhan, China who tried to warn people of the virus. On December 30, Dr. Li Wenliang, a local ophthalmologist, typed his warning into a chat group of his former medical school classmates: “A new coronavirus infection has been confirmed and its type is being identified. Inform all family and relatives to be on guard.”

On February 7, he died after catching the virus from a patient he was treating.

By noon, the hashtag “#LiWenliangHasPassedAway” was the number one trending topic on China’s Twitter-like platform Weibo, with 10 billion mentions. Weibo users flooded Wi’s webpage, leaving more than 150,000 comments, many of them critical of local authorities who had punished Li for “spreading rumors.”

China expert Gordon Chang, in an interview at the Conservative Political Action Conference in Washington, D.C., said

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U.S. Lawmakers Are Late to the Game

This article was published by The McAlvany Intelligence Advisor on Monday, February 10, 2020:

Michael Pillsbury, in the Afterward to his monumental The Hundred-Year Marathon: China’s Secret Strategy to Replace America as the Global Superpower, wrote:

As I’ve noted in this book [published in 2015], American intelligence and national security officials have for too long succumbed to wishful thinking about China’s strategy and ignored the obvious evidence of its deliberate challenge to the West….

 

Only now, after a forty-year slumber, are we finally beginning to awaken to China’s detailed and deliberate strategy to surpass us by 2049.

 

We can only hope it is not too late.

The infiltration of the U.S. media is just one of the many battlegrounds China is funding for that purpose, along with the theft of American intellectual property, building its military second to none, and initiating its “Thousand Talents Plan” to insinuate thousands of Chinese nationals into sensitive positions in the U.S.

Thirty-five lawmakers have just become aware of how the Chinese Communists have been publishing “cover” articles – designed to look like legitimate news articles – in major U.S. media for decades. Only last week have they discovered the effort and have sent a letter to Attorney General William Barr to look into it. They sought a response from Barr about reports that the Chinese Communist Party’s China Daily has been violating this country’s Foreign Agents Registration Act (FARA) for years.

The demand in the form of a letter sent last Thursday followed reports from the Washington Free Beacon in December that China Daily has for years been acting as a transmission belt for communist propaganda without complying with FARA. Said the Beacon:

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Congressional Lawmakers Press AG Barr to Investigate China’s Propaganda Mouthpiece, China Daily

This article appeared online at TheNewAmerican.com on Sunday, February 9, 2020: 

Thirty-five lawmakers sought a response from U.S. Attorney General William Barr about reports that the Chinese Communist Party has been violating this country’s Foreign Agents Registration Act (FARA) for years.

The demand in the form of a letter sent last Thursday followed reports from the Washington Free Beacon in December that China Daily has for years been acting as a transmission belt for communist propaganda without complying with FARA. Said the Beacon: “China Daily, an official mouthpiece of the Chinese Communist Party, has published hundreds of propaganda articles designed to look like ordinary news stories in some of America’s most influential newspapers…. The propaganda outlet has repeatedly violated [FARA] by failing to provide full disclosures about its purchases.”

For example,

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This Time Senator Chuck Schumer May Be Right: Phase One is Worthless

This article was published by The McAlvany Intelligence Advisor on Friday, January 17, 2020:  

In response to the signing of the Phase One trade deal, liberal New York Democrat Senator Chuck Schumer called the deal “an extreme disappointment.” He said the agreement “concedes our leverage” over China for “vague, unenforceable promises” that China “never intends to fulfill. I fear that Xi [China’s communist leader] is laughing at us behind our backs for having gained so much at our expense.”

What Xi gained was the signing of an agreement in exchange for a reduction in tariffs – an agreement that is so flawed that it is practically worthless. But the communist Chinese leader gained much favorable national and international credibility just for showing that he is Trump’s equal.

Skeptics scouring the 94-page agreement aren’t finding much to cheer about. The centerpiece of Phase One is the pledge China made to purchase at least $200 billion worth of additional American products over the next two years. In addition it allegedly puts in place enforcement mechanisms to keep China from stealing American companies’ trade secrets and advanced technology.

First, from a practical point of view,

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China Won’t Let Phase One Stand in Its Way

This article was published by The McAlvany Intelligence Advisor on Wednesday, January 15, 2020:

China isn’t about to let a piece of paper like Phase One stand in its way to global hegemony. It has spent the last 30 years manipulating its currency, attracting American capital, and stealing American technology in its quest to become the world’s largest economy. As is becoming more widely known, it seeks unprecedented global power and influence in another 20 years. This is how the communists plan on celebrating their 100 th anniversary of capturing China in 1949.

As an example, it demanded a “condition precedent” before agreeing to sign Phase One scheduled for Wednesday in Washington. The president, in full reelection mode, acquiesced. It was a victory for China and an indicator that much more work needs to be done in “Phase Two” and future additional agreements to have any chance of reining in China’s hunger and thirst for American capital and technology through deceit and manipulation. Its war on the West won’t be stymied in the slightest, even after “Phase One” is signed.

Mnuchin tried to make the deal sound attractive:

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To Get Trade Deal Signed, U.S. Says China No Longer “Currency Manipulator”

This article appeared online at TheNewAmerican.com on Tuesday, January 14, 2020:

Two days before “Phase One” of a U.S.-China trade deal is to be signed, Treasury Secretary Steven Mnuchin announced that his department was removing China from its list of “currency manipulators.” This was a “condition precedent” in order to get the deal done. It was a victory for China and an indicator that much more work needs to be done in “Phase Two” and future additional agreements to rein in China’s hunger and thirst for American capital and technology, often acquired through deceit and manipulation. Its war on the West won’t be stymied in the slightest even after “Phase One” is signed.

Mnuchin tried to make the deal sound attractive: “The Treasury Department has helped secure a significant Phase One agreement with China that will lead to greater economic growth and opportunity for American workers and businesses. China has made enforceable commitments to refrain from competitive devaluation [of its currency, the yuan], while promoting transparency and accountability.”

The underlying assumption is false:

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“Made in China” Is Becoming “NOT Made in China”

This article was published by The McAlvany Intelligence Advisor on Friday, January 10, 2020:

With so many companies leaving China for more favorable business climes, the ubiquitous slogan “Made in China” is slowly turning into a pejorative, being increasingly replaced with “NOT Made in China!”

The number of companies moving some, most, or all of their manufacturing operations out of China, or making plans to do so, is turning from a trickle into a flow, and likely to become a flood.

In July, the Nikkei Asian Review listed just a few of those companies, including Apple, Nintendo, Sketchers USA, Komatsu, Sumitomo Heavy Industries, Mitsubishi Electric, Ricoh, Citizen Watch, Panasonic, HP, Dell, Kyocera, Sharp, Nintendo, GoPro, and Samsung. Each of them is facing rising labor and environmental costs in China, an ever-changing crazy-quilt regulatory system, not to mention the tariff wars that will likely continue long after the highly-touted “Phase One” agreement has been signed.

And the flow is likely to turn into a flood, according to Dan Harris, head of an international law firm that works extensively in China: “For every foreign company that left China in 2019 there are two or three more seriously contemplating doing so. We expect more companies to leave China in 2020 than in 2019.”

As a direct result of those trade war tariffs, China has now fallen behind Mexico and Canada, and is now the U.S.’s third largest trading partner. Before the tariff wars began in July 2018, China was number one.

Compared with June 2018, the month before the trade war began, U.S. imports of goods from Vietnam have soared by more than 50 percent, Thailand nearly 20 percent, Malaysia by 11 percent, Indonesia over 14 percent, Taiwan 30 percent, and Mexico nearly 13 percent.

The ripple effect is showing up in car sales in China, which have dropped for the second consecutive year, dropping 5.8 percent in 2018 and 7.4 percent last year. December car sales were down, the 18th down month out of the last 19.

As China’s consumers face food price increases that are the highest in eight years, they are paring back elsewhere, slowing the country’s economy to its lowest pace seen in three decades. Official numbers from China’s public agencies are increasingly being ignored in favor of more realistic, and much lower, numbers coming from more reliable outside sources. The Federal Reserve Bank of St. Louis has expressed its skepticism about those government estimates:

One way to assess the quality of Chinese economic data is to look at the difference between the growth rate of real GDP reported by the government and the estimated growth from 1992 to 2006 using the night-lights [luminosity] data. Reported real GDP growth in China over this period is about 122 percent, while predicted growth using the night-lights data is only 57 percent.

 

This sizable gap suggests cumulative Chinese growth over the years could be overstated by as much as 65 percent. [Emphasis added.]

Here’s the question: if the Chinese economy was growing at six percent a year or more over the last decade, why has the Shanghai Composite Index (made up of more than 1,000 Chinese companies) failed to show any growth whatsoever over that same period?

John Evans, managing director for marketing and consulting firm Tractus Asia, said that the companies that have left China for places like Vietnam, Malaysia, Taiwan, Indonesia, and elsewhere where conditions are much more favorable are only the “first wave,” which started about 12 to 18 months ago. “The second wave started mid-2019,” he added.

The trade war isn’t going away anytime soon, according to Evans: “For companies exporting to the U.S., the entire time span of the trade war has sent the message that this isn’t going to go away and that they need to rethink things.”

That’s especially true of the communists ruling the country who are seeing their dream of overtaking the U.S. economically by 2030 and having an economy triple the size of the U.S. by 2050 slowly turning to ashes. Their “Hundred-Year Marathon” (Michael Pillsbury’s expression) to replace America as the global superpower is happily coming unglued as the economy staggers under Trump’s America First foreign policy initiatives.

It’s just a matter of time. “Made in China” will disappear from clothing labels, digital devices, and shipping containers in favor of the celebratory “NOT Made in China!”

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An Ivy League graduate and former investment advisor, Bob is a regular contributor to The New American primarily on economics and politics. He can be reached at badelmann@thenewamerican.com.

Sources:

McAlvany Intelligence AdvisorStocks Making Up the Shanghai Composite Index Are Cheap, and Likely to Get Cheaper

McAlvany Intelligence AdvisorThe China Threat Is Real, Says Oxford Scholar

South China Morning PostChina’s manufacturing exodus set to continue in 2020, despite prospect of trade war deal

The Wall Street JournalChina’s Car-Sales Slump Extends Into Another Year

The Wall Street JournalChinese Inflation at Eight-Year High Poses a Policy Dilemma

The New York TimesChina Moves to Steady Its Slowing Economic Growth

The New York TimesChina Injects $126 Billion Into Its Slowing Economy

The Nikkei Asian ReviewChina scrambles to stem manufacturing exodus as 50 companies leave

Keep reading…

More and More Companies Moving Out of China

This article appeared online at TheNewAmerican.com on Thursday, January 9, 2020: 

The number of companies moving some, most, or all of their manufacturing operations out of China, or making plans to do so, is growing from a trickle to a flow and likely to a flood.

In July, the Nikkei Asian Review listed just a few of those companies, including Apple, Nintendo, Sketchers USA, Komatsu, Sumitomo Heavy Industries, Mitsubishi Electric, Ricoh, Citizen Watch, Panasonic, HP, Dell, Kyocera, Sharp, Nintendo, GoPro, and Samsung. Each of them is facing rising labor and environmental costs, an ever-changing crazy-quilt regulatory system, not to mention the tariff wars that will likely continue long after the highly-touted “Phase One” trade agreement has been signed with the United States.

And the flow is likely to turn into a flood, according to Dan Harris, head of an international law firm that works extensively in China:

Keep reading…

Stocks Making Up the Shanghai Composite Index Are Cheap, and Likely to Get Cheaper

This article was published by The McAlvany Intelligence Advisor on Monday, January 6, 2020:  

As this writer noted here in November, the art of war according to Sun Tzu consists of deceiving the enemy. China’s deceptions extend to the manipulation of its GDP numbers, and have for decades. If China can be perceived to be stronger than it really is, then Washington may be fooled into making mistakes in dealing with its enemy.

At least one portfolio manager is deceived. Eric Moffett, who works in Hong Kong for T. Rowe Price, told the Wall Street Journal on Saturday that he thinks investors should now consider investing in China “because we’re at a sentiment low [and] we think it creates a lot of opportunities.”

It’s no wonder that investor sentiment is low: investors in the Shanghai Composite Index for the last 10 years have made nothing. Zero. Nada. And this while China’s economy was allegedly growing at better than 6 percent a year.

They suffered through government manipulations of that index, watching their accounts quintuple from the summer of 2005 to November 2007 and then lose two-thirds of their value in the following 12 months. And what did they gain for all that suffering? Nothing. The index trades today at the same level it did 10 years ago.

Manipulation was made easy

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U.S. Officials Say North Korea’s Promise of a “Christmas Gift” Could Be Missile Launch

This article appeared online at TheNewAmerican.com on Monday, December 23, 2019: 

North Korea’s “engine test” on December 8 — described by North Korean military officials as “crucial” in its development of long-range missiles — has U.S. officials worried. They worry that it’s a sign that all further negotiations over the denuclearization of the Korean peninsula are off the table. They worry that North Korea’s “rocket man,” Kim Jong-un, will light off a missile to test President Trump’s resolve, perceiving Trump to be vulnerable while under pressure from his impeachment threat and his reelection chances next year.

On December 3, Ri Thae Song, North Korea’s minster of foreign affairs, said that recent calls by Washington for another round of talks between President Trump and Kim are “nothing but a foolish trick hatched to keep [North Korea] bound to dialogue and use it in favor of the political situation and election in the U.S.… What is left is entirely up to the U.S. [as to] what Christmas gift it will select to get.”

North Korea first detonated a nuclear device in 2006. During the early months of the Trump administration, the North Korean dictator decided to test the mettle of the new president by

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World Trade Organization Becomes Irrelevant on Wednesday, Thanks to Trump

This article appeared online at TheNewAmerican.com on Monday, December 9, 2019: 

The supreme court of world trade, otherwise known as the “appellate body” of the World Trade Organization, will cease functioning on Wednesday. The court is supposed to have seven members but it currently has four vacancies, with two more members retiring on Tuesday. That leaves one active judge, two short of the number required to rule on international trade disputes.

Those vacancies haven’t been filled thanks to the Trump administration’s war on the WTO. The president has criticized the WTO for allowing China to retain its special status as a developing nation (though it’s now number two in the world economically) while looking the other way when it violates WTO rules. Instead of sanctioning China for subsidizing many of its products to gain a special advantage over its global competitors, the supreme court has instead ruled against Trump’s tariffs, which were enacted in part to deal with such subsidies. Accordingly, the Trump administration has refused to allow those vacancies to be filled.

Not only do WTO rulings against Trump’s tariffs violate the U.S. Constitution, they also

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Trump Sends Message to Beijing by Signing Hong Kong Bills

This article appeared online at TheNewAmerican.com on Thursday, November 28, 2019: 

When he was considering whether or not to sign two bills passed nearly unanimously by Congress strengthening a long-term trade agreement with Hong Kong dating back to 1992, President Trump admitted it was complicated. On Fox News he said, “Look, we have to stand with Hong Kong. But I’m also standing with President Xi. He’s a friend of mine. He’s an incredible guy.”

Xi is also facing a complicated situation at home, as explained in a book that is now influencing American foreign policy with China. That book,

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Will China’s Slowing Economy Force a Trade Deal With the U.S.?

This article appeared online at TheNewAmerican.com on Friday, November 22, 2019: 

The underlying assumption in U.S. foreign policy seems to be that by applying pressure economically, China will be forced to agree to a trade deal. Richard Koo, chief economist at Nomura Research Institute, Japan’s largest economic research firm, thinks that policy is working: “I suspect the increasingly pronounced slowdown in China’s economy, coupled with recent employment data pointing to continued strength in the US economy, are putting heavy pressure on China to settle sooner rather than later.”

Koo assumes that the numbers coming out of China are reflective of reality there. At six percent growth per year, China’s economy (using the mathematical Rule of 72) will double every 12 years. If the U.S. economy is growing at two percent annually, its economy will double every 36 years. Simple math dictates that at some reasonably short time in the future, China’s economy will equal that of the United States, with all manner of political ramifications following.

As Michael Pillsbury pointed out in his monumental Hundred-Year Marathon: China’s Secret Strategy to Replace America as the Global Superpower, the communists running China expect their economy to be

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Sun Tzu Was Right: the Way to Defeat an Enemy Is to Keep Him Ignorant that There’s a War

This article was published by The McAlvany Intelligence Advisor on Wednesday, November 20, 2019: 

Five hundred years before the birth of Jesus Christ, a Chinese military genius named Sun Tzu (or “Master Sun”) arose from obscurity to write “The Art of War.” His military strategies, and proverbs attending them, remain relevant today.

Michael Pillsbury, author of “The Hundred-Year Marathon: China’s Secret Strategy to Replace America as the Global Superpower,” exposed the communists’ (currently ruling the Chinese mainland) reliance upon Tzu’s strategies in confronting its temporarily superior enemy, the United States. In essence, wrote Pillsbury, the way to defeat a superior enemy is to invite him to help you become his superior without giving away the game.

It may be called the Kissinger strategy, and Pillsbury, a member of the Council on Foreign Relations (CFR) since the Nixon administration, worked diligently to promote it. In his book, he referred to himself as a “panda hugger.”

But Pillsbury, to his credit, came in from the cold, repented, and in 2015 wrote what some are calling a 300-page apology to the American people for deceiving them. He wrote:

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Tech Companies Accelerating Their Exodus From China

This article appeared online at TheNewAmerican.com on Tuesday, October 22, 2019: 

In July, CNBC reported that more than 50 companies had moved some, most, or all of their manufacturing facilities out of China in response to President Trump’s tariffs. Combined with rising wages in China, the business environments in Vietnam, India, Korea, and elsewhere in Asia are looking more and more attractive to companies caught in the crossfire.

At the time, personal computer makers HP and Dell were reportedly considering moving up to 30 percent of their notebook production out of China to Southeast Asia. Others, including Apple and Nintendo, are accelerating their plans to exit China in favor of Vietnam and Thailand.

As the pressure of mounting tariffs and increasing Chinese reluctance to strike a comprehensive deal with the Trump administration mounts, Fitbit, Samsung, GoPro, and Crocs are joining the exodus. Ron Kisling, chief financial officer at Fitbit, said,

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China’s Economy Continues to Falter Ahead of October Trade Talks

This article appeared online at TheNewAmerican.com on Monday, September 16, 2019: 

New admissions from China’s National Bureau of Statistics (NBS) on Monday reveal continuing and accelerating weakness in the world’s second-largest economy. Heading into trade talks scheduled for October, such weakness further erodes the bargaining power of China’s communist negotiators in dealing with President Trump’s top people.

The report from the Chinese government’s economic mouthpiece was startlingly candid: The nation’s industrial production hit its lowest level in 17 and a half years, while retail sales, auto sales, and investment measures worsened as well. Industrial exports declined by 4.3 percent last month compared to a year ago. Factory output shrank for the fourth straight month.

China’s economy could be facing a “vicious cycle” of decline, said Li Wei, an economist at Standard Chartered Bank. He warned that

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Trump’s Tweet is Laughable: Only the Communists Will Be Celebrating the 70th Anniversary of Their Oppression of the Chinese People

This article was published by The McAlvany Intelligence Advisor on Friday, September 13, 2019:

On the surface, Donald Trump’s reason for delaying by two weeks the increase in tariffs on Chinese imports is laughable: the only people celebrating the 70th anniversary will be the communists themselves.

Beneath the surface, however, is the negotiating war taking place between the Chinese communists and Mr. Trump. And both know the rules.

They come from the Harvard Law School’s Program on Negotiation (PON).

Tweeted the President:

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Trump’s “Order” Backed by Power Congress Gave Up to the Executive Branch in 1977

This article appeared online at TheNewAmerican.com on Monday, August 26, 2019: 

Following President Trump’s “order” that U.S. companies doing business in China find “an alternative” place, he received pushback from much of the mainstream media that he once again was overstepping his bounds and turning his administration in a dictatorship.

Here’s what the president tweeted on Friday:

Our Country has lost, stupidly, Trillions of Dollars with China over many years. They have stolen our Intellectual Property at a rate of Hundreds of Billions of Dollars a year & they want to continue. I won’t let that happen! We don’t need China and, frankly, would be far better off without them.

 

The vast amounts of money made and stolen by China from the United States, year after year, for decades, will and must STOP.

And then he added:

Our great American companies are hereby ordered to immediately start looking for an alternative to China, including bringing your companies HOME and making your products in the USA.

When the media jumped all over him, claiming he was assuming powers he didn’t have, Trump responded:

For all of the Fake News Reporters that don’t have a clue as to what the law is relative to Presidential powers, China, etc., try looking at the Emergency Economic Powers Act of 1977. Case closed!

It was the New York Times that took the lead in accusing the president of overreach:

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The New York Times Accuses Trump of an Audacious Assertion of Power in Ordering U.S. Companies to Move Out of China

This article was published by The McAlvany Intelligence Advisor on Monday, August 26, 2019: 

The New York Times even got its headline wrong: “Trump Asserts He Can Force U.S. Companies to Leave China.” The Times declared that Trump’s tweet storm on Friday “represented the latest audacious assertion of power by a president who has repeatedly crossed lines his predecessors did not. While he took office criticizing President Barack Obama for exceeding his authority, Mr. Trump has gone even further in finding creative ways to take action on his priorities.”

None of this is remotely accurate. The truth of the matter is that the president is restraining his use of powers Congress gave up to the Executive branch decades ago! Rather than “asserting” powers that he doesn’t have, or finding “creative ways” to expand his powers, the president is restraining the use of powers residing in the office of the Presidency when he arrived in January 2017.

Here’s what the president tweeted on Friday:

Our Country has lost, stupidly, Trillions of Dollars with China over many years. They have stolen our Intellectual Property at a rate of Hundreds of Billions of Dollars a year & they want to continue. I won’t let that happen! We don’t need China and, frankly, would be far better off without them.

 

The vast amounts of money made and stolen by China from the United States, year after year, for decades, will and must STOP.

And then he added:

Our great American companies are hereby ordered to immediately start looking for an alternative to China, including bringing your companies HOME and making your products in the USA.

When the media jumped all over him, claiming he was assuming powers he didn’t have, Trump responded:

Keep reading…

Many of the articles on Light from the Right first appeared on either The New American or the McAlvany Intelligence Advisor.
Copyright © 2020 Bob Adelmann