Biden and Xi meet in California in attempt to thaw relations.
Senate to vote on continuing resolution to avoid government shutdown.
Biden and Xi meet in California in attempt to thaw relations
President Biden met today in San Francisco with Chinese leader Xi Jinping with an agenda of ironing out some differences between the two rival nations. The meeting has been described as “high-stakes” given the increased military tensions in the Middle East. China has considerable influence with Iran and Biden likely wants to convince Xi to dissuade Hamas ally Iran from involving itself in the conflict.
It’s unclear what exactly Xi hopes to gain from the talks. Some of it is optics, but Xi may also be hoping for a reset in trade relations with the US. Both might help Xi fend off critics at home who hold him responsible for several crises that have arisen in China.
Trade and economic cooperation
China’s once booming economy has hit a brick wall, thanks in part to Xi’s controversial “Zero COVID” policy. COVID controls brought China’s commerce to a virtual standstill for over a year. After Zero COVID ended earlier this year, China’s economy saw an initial bounce but has since fallen flat. Youth unemployment has skyrocketed (to the point that the government no longer publishes the statistics) and consumer confidence has also cratered.
China’s construction and property sector, once a chief economic driver, is also facing a massive debt crunch due to slowing growth. In addition to the massive ripple effects to other sectors of China’s economy, the property crisis has also created a massive housing shortage.
These crises have shaken faith in Xi’s leadership. The abrupt disappearance of several high-level Chinese government and military officials over the past year have also fed speculations of palace intrigues within the Chinese Communist Party.
Chinese and foreign business leaders have also been subject to crackdowns and arrests. As a result, many foreign businesses are reconsidering their cooperation with Chinese entities and are seeking opportunities elsewhere in Asia. This trend has only grown since the US imposed controls on sensitive technologies exported to China. The controls have hampered Xi’s ambitions for China to lead the world in technological development.
Nevertheless, China remains one of America’s most crucial trading partners, and Xi wants it to stay that way. Chinese state media, which has been pushing hawkish anti-US headlines for the last 5 years, is now switching gears to call for greater “engagement and cooperation”.
One key item on Biden and Xi’s agenda today was resuming normal communication between the two militaries. With US presence building up in the Pacific and South China Sea, there have been a growing number of confrontations and close calls, especially between Chinese and US fighter air craft. These encounters increase the possibilities of miscalculation and misunderstandings that could elevate hostilities.
The US remains committed to supporting the independence of Taiwan, which China regards as a breakaway Chinese province. For the last several years, the US has been authorizing huge weapons sales to Taiwan, to China’s great annoyance.
Biden also wants Xi to clamp down on the flow of precursor materials used in making Fentanyl from China to Latin America. The materials are brought to numerous cartel-controlled labs throughout in Mexico and elsewhere. The process to create Fentanyl from these materials is relatively simple. It’s then trafficked through regular checkpoints into the US, where it has been responsible for hundreds of thousands of deaths in recent years.
The production of these materials in China is actually illegal, but enforcement is almost non-existent. China also has little to show for its previous commitments to the US to crack down on the production and trafficking of the materials.
Senate to vote on continuing resolution to avoid government shutdown
The House has passed a bifurcated continuing resolution that funds the government at current levels but with two different budget deadlines for different agencies. The vote in the House was 336 votes to 95. Many hardline Republicans, including members of the Freedom Caucus, voted against it and protested Speaker Mike Johnson getting the bill through with Democratic votes. The revolt from the Freedom Caucus could spell trouble for Johnson later since they still have the ability to call for his ouster as they did for Rep. Kevin McCarthy last month.
The Senate now has the bill and it is expected to pass once again with bipartisan support. Biden must then sign it before current funding runs out this Friday to avoid a partial government shutdown.
The dual deadlines for certain agencies may increase uncertainly and the possibility of two shutdown fights within weeks of each other in January and February. The first bundle, expiring Jan. 19, 2023, includes: military construction, veterans’ benefits, transportation, housing, urban development, agriculture, the Food and Drug Administration and energy and water programs. The second bundle, expiring Feb. 2, 2023, contains all other federal operations, including defense.
Speaker Johnson has said that this approach will give Republicans more time to come up with budget cuts (a major priority for the GOP’s hardline budget hawks) that could actually be achieved given the reality of a Democratic-controlled Senate and White House. The Freedom Caucus seems unconcerned with this reality or even with the possibility of shutting down large parts of the government on which many people rely.