Trump Thrusts Abortion Fight into Crucial Midterm Elections

The Trump administration acted Friday to bar taxpayer-funded family planning clinics from referring women for abortions, energizing its conservative political base ahead of crucial midterm elections while setting the stage for new legal battles.

The Health and Human Services Department sent its proposal to rewrite the rules to the White House, setting in motion a regulatory process that could take months. Scant on details, an administration overview of the plan said it would echo a Reagan-era rule by banning abortion referrals by federally funded clinics and forbidding them from locating in facilities that also provide abortions.

Planned Parenthood, a principal provider of family planning, abortion services, and basic preventive care for women, said the plan appears designed to target the organization. “The end result would make it impossible for women to come to Planned Parenthood, who are counting on us every day,” said executive vice president Dawn Laguens.

But presidential counselor Kellyanne Conway told Fox News that the administration is simply recognizing “that abortion is not family planning. This is family planning money.”

The policy was derided as a “gag rule” by abortion rights supporters, a point challenged by the administration, which said counseling about abortion would be OK, but not referrals. It’s likely to trigger lawsuits from opponents, and certain to galvanize activists on both sides of the abortion debate going into November’s congressional elections.

Social and religious conservatives have remained steadfastly loyal to President Donald Trump despite issues like his reimbursements to attorney Michael Cohen, who paid hush money to a porn star alleging an affair, and Trump’s past boasts of sexually aggressive behavior. Trump has not wavered from advancing the agenda of the religious right.

Tuesday night, Trump is scheduled to speak at the Susan B. Anthony List’s “campaign for life” gala. The group works to elect candidates who want to reduce and ultimately end abortion. It says it spent more than $18 million in the 2016 election cycle to defeat Hillary Clinton and promote a “pro-life Senate.”

Reagan-era rule

The original Reagan-era family planning rule barred clinics from discussing abortion with women. It never went into effect as written, although the Supreme Court ruled it was an appropriate use of executive power. The policy was rescinded under President Bill Clinton, and a new rule took effect requiring “nondirective” counseling to include a full range of options for women.

The Trump administration said its proposal will roll back the Clinton requirement that abortion be discussed as an option along with prenatal care and adoption.

Known as Title X, the family-planning program serves about 4 million women a year through clinics, costing taxpayers about $260 million.

Although abortion is politically divisive, the U.S. abortion rate has dropped significantly, from about 29 per 1,000 women of reproductive age in 1980 to about 15 in 2014. Better contraception, fewer unintended pregnancies and state restrictions may have played a role, according to a recent scientific report.

Abortion remains legal, but federal family planning funds cannot be used to pay for the procedure. Planned Parenthood clinics now qualify for Title X family planning grants, but they keep that money separate from funds that pay for abortions.

Abortion opponents say a taxpayer-funded program should have no connection to abortion. Doctors’ groups and abortion rights supporters say a ban on counseling women trespasses on the doctor-patient relationship.

The American College of Obstetricians and Gynecologists said the administration action amounts to an “egregious intrusion” in the doctor-patient relationship and could force doctors to omit “essential, medically accurate information” from counseling sessions with patients.

Health care and rights

Planned Parenthood’s Laguens hinted at legal action, saying, “we will not stand by while our basic health care and rights are stripped away.”

Jessica Marcella of the National Family Planning & Reproductive Health Association, which represents clinics, said requiring physical separation from abortion facilities is impractical, and would disrupt services for women.

“I cannot imagine a scenario in which public health groups would allow this effort to go unchallenged,” Marcella said.

But abortion opponents said Trump is merely reaffirming the core mission of the family planning program.

“The new regulations will draw a bright line between abortion centers and family planning programs, just as … federal law requires and the Supreme Court has upheld,” said Tony Perkins, president of the Family Research Council, a key voice for religious conservatives.

Kristan Hawkins of Students for Life of America said, “Abortion is not health care or birth control and many women want natural health care choices, rather than hormone-induced changes.”

Abortion opponents allege the federal family planning program in effect cross-subsidizes abortions provided by Planned Parenthood, whose clinics are also major recipients of grants for family planning and basic preventive care. Hawkins’ group is circulating a petition to urge lawmakers to support the Trump administration’s proposal.

Abortion opponents say the administration plan is not a “gag rule.” It “will not prohibit counseling for clients about abortion … but neither will it include the current mandate that [clinics] must counsel and refer for abortion,” said the administration’s own summary.

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Trump Thrusts Abortion Fight into Crucial Midterm Elections

The Trump administration acted Friday to bar taxpayer-funded family planning clinics from referring women for abortions, energizing its conservative political base ahead of crucial midterm elections while setting the stage for new legal battles.

The Health and Human Services Department sent its proposal to rewrite the rules to the White House, setting in motion a regulatory process that could take months. Scant on details, an administration overview of the plan said it would echo a Reagan-era rule by banning abortion referrals by federally funded clinics and forbidding them from locating in facilities that also provide abortions.

Planned Parenthood, a principal provider of family planning, abortion services, and basic preventive care for women, said the plan appears designed to target the organization. “The end result would make it impossible for women to come to Planned Parenthood, who are counting on us every day,” said executive vice president Dawn Laguens.

But presidential counselor Kellyanne Conway told Fox News that the administration is simply recognizing “that abortion is not family planning. This is family planning money.”

The policy was derided as a “gag rule” by abortion rights supporters, a point challenged by the administration, which said counseling about abortion would be OK, but not referrals. It’s likely to trigger lawsuits from opponents, and certain to galvanize activists on both sides of the abortion debate going into November’s congressional elections.

Social and religious conservatives have remained steadfastly loyal to President Donald Trump despite issues like his reimbursements to attorney Michael Cohen, who paid hush money to a porn star alleging an affair, and Trump’s past boasts of sexually aggressive behavior. Trump has not wavered from advancing the agenda of the religious right.

Tuesday night, Trump is scheduled to speak at the Susan B. Anthony List’s “campaign for life” gala. The group works to elect candidates who want to reduce and ultimately end abortion. It says it spent more than $18 million in the 2016 election cycle to defeat Hillary Clinton and promote a “pro-life Senate.”

Reagan-era rule

The original Reagan-era family planning rule barred clinics from discussing abortion with women. It never went into effect as written, although the Supreme Court ruled it was an appropriate use of executive power. The policy was rescinded under President Bill Clinton, and a new rule took effect requiring “nondirective” counseling to include a full range of options for women.

The Trump administration said its proposal will roll back the Clinton requirement that abortion be discussed as an option along with prenatal care and adoption.

Known as Title X, the family-planning program serves about 4 million women a year through clinics, costing taxpayers about $260 million.

Although abortion is politically divisive, the U.S. abortion rate has dropped significantly, from about 29 per 1,000 women of reproductive age in 1980 to about 15 in 2014. Better contraception, fewer unintended pregnancies and state restrictions may have played a role, according to a recent scientific report.

Abortion remains legal, but federal family planning funds cannot be used to pay for the procedure. Planned Parenthood clinics now qualify for Title X family planning grants, but they keep that money separate from funds that pay for abortions.

Abortion opponents say a taxpayer-funded program should have no connection to abortion. Doctors’ groups and abortion rights supporters say a ban on counseling women trespasses on the doctor-patient relationship.

The American College of Obstetricians and Gynecologists said the administration action amounts to an “egregious intrusion” in the doctor-patient relationship and could force doctors to omit “essential, medically accurate information” from counseling sessions with patients.

Health care and rights

Planned Parenthood’s Laguens hinted at legal action, saying, “we will not stand by while our basic health care and rights are stripped away.”

Jessica Marcella of the National Family Planning & Reproductive Health Association, which represents clinics, said requiring physical separation from abortion facilities is impractical, and would disrupt services for women.

“I cannot imagine a scenario in which public health groups would allow this effort to go unchallenged,” Marcella said.

But abortion opponents said Trump is merely reaffirming the core mission of the family planning program.

“The new regulations will draw a bright line between abortion centers and family planning programs, just as … federal law requires and the Supreme Court has upheld,” said Tony Perkins, president of the Family Research Council, a key voice for religious conservatives.

Kristan Hawkins of Students for Life of America said, “Abortion is not health care or birth control and many women want natural health care choices, rather than hormone-induced changes.”

Abortion opponents allege the federal family planning program in effect cross-subsidizes abortions provided by Planned Parenthood, whose clinics are also major recipients of grants for family planning and basic preventive care. Hawkins’ group is circulating a petition to urge lawmakers to support the Trump administration’s proposal.

Abortion opponents say the administration plan is not a “gag rule.” It “will not prohibit counseling for clients about abortion … but neither will it include the current mandate that [clinics] must counsel and refer for abortion,” said the administration’s own summary.

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India, EU Give WTO Lists of US Goods for Potential Tariff Retaliation

India and the European Union have given the World Trade Organization lists of the U.S. products that could incur high tariffs in retaliation for U.S. President Donald Trump’s global tariffs on steel and aluminum, WTO filings showed Friday.

The EU said Trump’s steel tariffs could cost $1.5 billion and aluminum tariffs a further $100 million, and listed rice, cranberries, bourbon, corn, peanut butter, and steel products among the U.S. goods that it might target for retaliation.

India said it was facing additional U.S. tariffs of $31 million on aluminum and $134 million on steel, and listed U.S. exports of soya oil, palmolein and cashew nuts among its potential targets for retaliatory tariffs.

One trade official described the lists of retaliatory tariffs as “loading a gun,” making it plain to U.S. exporters that pain might be on the way.

India said its tariffs would come into effect by June 21, unless and until the United States removed its tariffs.

The EU said some retaliation could be applied from June 20.

Trump’s tariffs, 25 percent on steel and 10 percent on aluminum, came into force in March to strong opposition as many see the measures as unjustified and populist.

There were also objections that the tariffs would have little impact on China, widely seen to be the cause of oversupply in the market.

Trump justified the tariffs by claiming they were for U.S. national security, in a bid to protect them from any legal challenge at the WTO, causing further controversy.

Rather than challenging the U.S. tariffs directly, the EU and India, like China, South Korea and Russia, told the United States that they regarded Trump’s tariffs as “safeguards” under the WTO rules, which means U.S. trading partners are entitled to compensation for loss of trade.

The United States disagrees.

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India, EU Give WTO Lists of US Goods for Potential Tariff Retaliation

India and the European Union have given the World Trade Organization lists of the U.S. products that could incur high tariffs in retaliation for U.S. President Donald Trump’s global tariffs on steel and aluminum, WTO filings showed Friday.

The EU said Trump’s steel tariffs could cost $1.5 billion and aluminum tariffs a further $100 million, and listed rice, cranberries, bourbon, corn, peanut butter, and steel products among the U.S. goods that it might target for retaliation.

India said it was facing additional U.S. tariffs of $31 million on aluminum and $134 million on steel, and listed U.S. exports of soya oil, palmolein and cashew nuts among its potential targets for retaliatory tariffs.

One trade official described the lists of retaliatory tariffs as “loading a gun,” making it plain to U.S. exporters that pain might be on the way.

India said its tariffs would come into effect by June 21, unless and until the United States removed its tariffs.

The EU said some retaliation could be applied from June 20.

Trump’s tariffs, 25 percent on steel and 10 percent on aluminum, came into force in March to strong opposition as many see the measures as unjustified and populist.

There were also objections that the tariffs would have little impact on China, widely seen to be the cause of oversupply in the market.

Trump justified the tariffs by claiming they were for U.S. national security, in a bid to protect them from any legal challenge at the WTO, causing further controversy.

Rather than challenging the U.S. tariffs directly, the EU and India, like China, South Korea and Russia, told the United States that they regarded Trump’s tariffs as “safeguards” under the WTO rules, which means U.S. trading partners are entitled to compensation for loss of trade.

The United States disagrees.

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Conservative Revolt Over Immigration Sinks House Farm Bill

In an embarrassment for House Republican leaders, conservatives on Friday scuttled a bill that combines stricter work and job training requirements for food stamp recipients with a renewal of farm subsidies popular in GOP-leaning farm country.

Hard-right conservatives upset over the party’s stalled immigration agenda opposed the measure, which failed by a 213-198 vote. Some 30 Republicans joined with every chamber Democrat in opposition.

The vote was a blow to GOP leaders, who had hoped to tout its new work requirements for recipients of food stamps. The work initiative polls well with voters, especially those in the GOP political base.

More broadly, it exposed fissures within the party in the months before the midterm elections, and the Freedom Caucus tactics rubbed many rank-and-file Republicans the wrong way.

“You judge each piece of legislation on its own,” said Rep. Tom Cole, R-Okla. “You don’t hold one thing hostage for something that’s totally different and has nothing to do with it. I would say that’s a mistake in my view.”

Key conservatives in the rebellious House Freedom Caucus opposed the measure, seeking leverage to win conservative policies an advantage in a debate on immigration next month. Negotiations with GOP leaders Friday morning failed to bear fruit, however, and the unrelated food and farm measure was defeated.

Conservative Rep. Jim Jordan, R-Ohio, said some members had concerns over the farm bill, but said, “That wasn’t my main focus. My main focus was making sure we do immigration policy right” and “actually build a border security wall.”

House Speaker Paul Ryan, R-Wis., took steps to call for a re-vote in the future but it’s not clear when the measure might be revived. A handful of GOP moderates opposed the bill, too, but not enough to sink it on their own.

Reaction from Democrats

The farm bill, a twice-per-decade rite on Capitol Hill, promises greater job training opportunities for recipients of food stamps, a top priority for House leaders. Democrats are strongly opposed, saying the stricter work and job training rules are poorly designed and would drive 2 million people off of food stamps. They took a victory lap after the vote.

“On a bipartisan basis, the House rejected a bad bill that failed farmers and working families,” said Minority Leader Nancy Pelosi, D-Calif. “Republicans wrote a cruel, destructive farm bill that abandoned farmers and producers amid plummeting farm prices and the self-inflicted damage of President Trump’s trade brinkmanship.”

Currently, adults 18-59 are required to work part-time to receive food stamps, officially called the Supplemental Nutrition Assistance Program, or agree to accept a job if they’re offered one. Stricter rules apply to able-bodied adults 18-49, who are subject to a three-month limit of benefits unless they meet a work or job training requirement of 80 hours per month.

Under the new bill, the tougher requirement would be expanded to apply to all adults on SNAP, with exceptions for seniors, pregnant women, caretakers of children under the age of 6, or people with disabilities.

“It sets up a system for SNAP recipients where if you are able to work, you should work to get the benefits,” said Ryan. “And if you can’t work, we’ll help you get the training you need. We will help you get the skills you need to get an opportunity.”

The measure would have greatly expanded funding for state-administered job training programs, but Democrats and outside critics say the funding for the proposed additional job training would require huge new bureaucracies, extensive record-keeping requirements, and that the funding levels would fall far short of what’s enough to provide job training to everybody covered by the new job training requirements.

“While I agree that there are changes that need to be made to the SNAP program, this is so clearly not the way to do it,” said Rep. Colin Peterson of Minnesota, top Democrat of the Agriculture Committee. “The bill cuts more than $23 billion in SNAP benefits and will result in an estimated 2 million Americans unable to get the help they need.”

He said it “turns around and wastes billions … cut from SNAP benefits to create a massive, untested workforce training bureaucracy.”

Farm safety-net programs

In addition to food stamps, the measure would renew farm safety-net programs such as subsidies for crop insurance, farm credit and land conservation. Those subsidies for farm country traditionally form the backbone of support for the measure among Republicans, while urban Democrats support food aid for the poor.

On Thursday, supporters of the agriculture safety net easily defeated an attempt to weaken the government’s sugar program, which critics say gouges consumers by propping up sugar prices.

The measure mostly tinkered with farm programs, adding provisions aimed at boosting high-speed internet access in rural areas, assisting beginning farmers, and easing regulations on producers. But since the measure makes mostly modest adjustments to farm policy, some lawmakers believe that the most likely course of action this year is a temporary extension of the current measure, which expires at the end of September.

In the Senate, the chamber’s filibuster rules require a bipartisan process for a bill to pass. There, Agriculture Committee Chairman Pat Roberts, R-Kan., promises a competing bill later this month and he’s signaling that its changes to food stamps would be far more modest than the House measure.

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Canada’s Trudeau Talks Tech at MIT Gathering

Canadian computer scientists helped pioneer the field of artificial intelligence before it was a buzzword, and now Prime Minister Justin Trudeau is hoping to capitalize on their intellectual lead.

Trudeau has become a kind of marketer-in-chief for Canada’s tech economy ambitions, accurately explaining the basics of machine learning as he promotes a national plan he says will “secure Canada’s foothold in AI research and training.”

“Tech giants have taken notice, and are setting up offices in Canada, hiring Canadian experts, and investing time and money into applications that could be as transformative as the internet itself,” Trudeau wrote in a guest editorial published this week in the Boston Globe.

Trudeau has been taking that message on the road and is likely to emphasize it again Friday when he addresses a gathering of tech entrepreneurs at the Massachusetts Institute of Technology. His visit to the MIT campus headlines an annual meeting of the school’s Solve initiative, which connects innovators with corporate, government and academic resources to help them tackle world problems.

Trudeau isn’t the only head of state talking up AI — France’s Emmanuel Macron and China’s Xi Jinping are among the others — but his deep-in-the-weeds approach has caught U.S. tech companies’ attention in contrast to President Donald Trump, whose administration “got off to a little bit of a slow start” in expressing interest, said Erik Brynjolfsson, an MIT professor who directs the school’s Initiative on the Digital Economy.

“AI is the most important technology for the next decade or two,” said Brynjolfsson, who attended the Trump White House’s first AI summit last week. “It’s going to completely transform the economy and our society in lots of ways. It’s a huge mistake for countries’ leaders not to take it seriously.”

Facebook, Google, Microsoft, Uber and Samsung have all opened AI research hubs centered in Montreal, Toronto and Edmonton, drawn in large part by decades of academic research into “deep learning” algorithms that helped pave the way for today’s digital voice assistants, self-driving technology and photo-tagging services that can recognize a friend’s face.

Canada’s reputation as a welcoming place for immigrants is also helping, as is Trudeau’s enthusiasm about the AI economy, Brynjolfsson said.

“When a national leader says AI is a priority, I think you get more creative, smart young people who will be taking it seriously,” he said.

AI is an “easy and recognizable shorthand” for the digital economy Trudeau hopes to foster, said Luke Stark, a Dartmouth College sociologist from Canada who studies the history and philosophy of technology.

A former schoolteacher, Trudeau is “smart enough to know when to learn something so he can talk about it intelligently in a way that helps educate people,” Stark said.

Stark said that also allows Trudeau to “push into the background some of the less high-tech, less fashionable elements of the Canadian economy,” such as the extraction of oil and gas.

The visit comes amid talks between Canada, the U.S. and Mexico over whether to renew the North American Free Trade Agreement. Negotiators have now gone past an informal Thursday deadline set by U.S. House Speaker Paul Ryan, increasing the likelihood that talks could drag into 2019.

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Canada’s Trudeau Talks Tech at MIT Gathering

Canadian computer scientists helped pioneer the field of artificial intelligence before it was a buzzword, and now Prime Minister Justin Trudeau is hoping to capitalize on their intellectual lead.

Trudeau has become a kind of marketer-in-chief for Canada’s tech economy ambitions, accurately explaining the basics of machine learning as he promotes a national plan he says will “secure Canada’s foothold in AI research and training.”

“Tech giants have taken notice, and are setting up offices in Canada, hiring Canadian experts, and investing time and money into applications that could be as transformative as the internet itself,” Trudeau wrote in a guest editorial published this week in the Boston Globe.

Trudeau has been taking that message on the road and is likely to emphasize it again Friday when he addresses a gathering of tech entrepreneurs at the Massachusetts Institute of Technology. His visit to the MIT campus headlines an annual meeting of the school’s Solve initiative, which connects innovators with corporate, government and academic resources to help them tackle world problems.

Trudeau isn’t the only head of state talking up AI — France’s Emmanuel Macron and China’s Xi Jinping are among the others — but his deep-in-the-weeds approach has caught U.S. tech companies’ attention in contrast to President Donald Trump, whose administration “got off to a little bit of a slow start” in expressing interest, said Erik Brynjolfsson, an MIT professor who directs the school’s Initiative on the Digital Economy.

“AI is the most important technology for the next decade or two,” said Brynjolfsson, who attended the Trump White House’s first AI summit last week. “It’s going to completely transform the economy and our society in lots of ways. It’s a huge mistake for countries’ leaders not to take it seriously.”

Facebook, Google, Microsoft, Uber and Samsung have all opened AI research hubs centered in Montreal, Toronto and Edmonton, drawn in large part by decades of academic research into “deep learning” algorithms that helped pave the way for today’s digital voice assistants, self-driving technology and photo-tagging services that can recognize a friend’s face.

Canada’s reputation as a welcoming place for immigrants is also helping, as is Trudeau’s enthusiasm about the AI economy, Brynjolfsson said.

“When a national leader says AI is a priority, I think you get more creative, smart young people who will be taking it seriously,” he said.

AI is an “easy and recognizable shorthand” for the digital economy Trudeau hopes to foster, said Luke Stark, a Dartmouth College sociologist from Canada who studies the history and philosophy of technology.

A former schoolteacher, Trudeau is “smart enough to know when to learn something so he can talk about it intelligently in a way that helps educate people,” Stark said.

Stark said that also allows Trudeau to “push into the background some of the less high-tech, less fashionable elements of the Canadian economy,” such as the extraction of oil and gas.

The visit comes amid talks between Canada, the U.S. and Mexico over whether to renew the North American Free Trade Agreement. Negotiators have now gone past an informal Thursday deadline set by U.S. House Speaker Paul Ryan, increasing the likelihood that talks could drag into 2019.

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China Ends US Sorghum Anti-Dumping Probe, OKs Toshiba Deal

China has dropped an anti-dumping investigation and given long awaited approval for the sale of Toshiba’s memory chip business, in gestures that could suggest a thaw between Beijing and the U.S. as trade talks resumed in Washington.

The Commerce Ministry said Friday ended the probe into imported U.S. sorghum because it’s not in the public interest. A day earlier, Beijing cleared the way for a group led by U.S. private equity firm Bain Capital to buy Toshiba Corp.’s computer memory chip business.

The moves signaled Beijing’s willingness to make a deal with Washington amid talks between senior U.S. and Chinese officials aimed at averting a trade war between the world’s two biggest economies, analysts say.

“I think China is willing to make concessions,” said Wang Tao, chief China economist at UBS. “The Chinese stance has been very clear, that China wants to mute any trade dispute. But of course it doesn’t mean China would heed to all the demands the U.S. would place.”

A White House official said China had offered to work to cut the trade deficit with the U.S. by $200 billion, while stressing that the details remained unclear. But China’s Foreign Ministry denied it.

“It’s untrue,” said spokesman Lu Kang. “The relevant discussion is still underway, and it is constructive.”

The Commerce Ministry said it was ending the anti-dumping probe and a parallel anti-subsidy investigation because they would have raised costs for consumers.

The U.S. is China’s biggest supplier of sorghum, accounting for more than 90 percent of total imports. China’s investigation, launched in February, had come as a warning shot to American farmers, many of whom support the Trump administration yet depend heavily on trade. They feared they would lose their largest export market for the crop, which is used primarily for animal feed and liquor.

The Commerce Ministry said that, “Anti-dumping and countervailing measures against imported sorghum originating in the United States would affect the cost of living of a majority of consumers and would not be in the public interest,” according to a notice posted on its website.

It said it had received many reports that the investigation would result in higher costs for the livestock industry, adding that many domestic pig farmers were facing hardship because of declining pork prices.

China’s U.S. sorghum imports surged from 317,000 metric tons in 2013 to 4.76 million tons last year while prices fell by about a third in the same period.

The ministry said any deposits for the preliminary anti-dumping tariffs of 178.6 percent, which took effect on April 18, would be returned in full.

The announcement came after President Donald Trump met at the White House with Chinese Vice Premier Liu He, the leader of China’s delegation for talks with a U.S. team headed by Treasury Secretary Steven Mnuchin.

Trump had told reporters earlier that he had doubts about the potential for an agreement. He also raised fresh uncertainty about resolving a case involving Chinese tech company ZTE, which was hit with a crippling seven-year ban on buying from U.S. suppliers, forcing it to halt major operations. Trump said the company “did very bad things” to the U.S. economy and would be a “small component of the overall deal.”

Song Lifang, an economics professor and trade expert at Renmin University, said haggling is currently underway.

“It’s time for both to present their demands, but it’s also a time to exhibit their bargaining chips,” said Song, adding that approval for the Toshiba deal, worth $18 billion, was “an apparent sign of thaw” amid a U.S. investigation into Chinese trade practices requiring U.S. companies to turn over their technology in exchange for access to China’s market.

The Trump administration has proposed tariffs on up to $150 billion in Chinese products to punish Beijing while China has responded by targeting $50 billion in U.S. imports. Neither country has yet imposed tariffs.

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China Ends US Sorghum Anti-Dumping Probe, OKs Toshiba Deal

China has dropped an anti-dumping investigation and given long awaited approval for the sale of Toshiba’s memory chip business, in gestures that could suggest a thaw between Beijing and the U.S. as trade talks resumed in Washington.

The Commerce Ministry said Friday ended the probe into imported U.S. sorghum because it’s not in the public interest. A day earlier, Beijing cleared the way for a group led by U.S. private equity firm Bain Capital to buy Toshiba Corp.’s computer memory chip business.

The moves signaled Beijing’s willingness to make a deal with Washington amid talks between senior U.S. and Chinese officials aimed at averting a trade war between the world’s two biggest economies, analysts say.

“I think China is willing to make concessions,” said Wang Tao, chief China economist at UBS. “The Chinese stance has been very clear, that China wants to mute any trade dispute. But of course it doesn’t mean China would heed to all the demands the U.S. would place.”

A White House official said China had offered to work to cut the trade deficit with the U.S. by $200 billion, while stressing that the details remained unclear. But China’s Foreign Ministry denied it.

“It’s untrue,” said spokesman Lu Kang. “The relevant discussion is still underway, and it is constructive.”

The Commerce Ministry said it was ending the anti-dumping probe and a parallel anti-subsidy investigation because they would have raised costs for consumers.

The U.S. is China’s biggest supplier of sorghum, accounting for more than 90 percent of total imports. China’s investigation, launched in February, had come as a warning shot to American farmers, many of whom support the Trump administration yet depend heavily on trade. They feared they would lose their largest export market for the crop, which is used primarily for animal feed and liquor.

The Commerce Ministry said that, “Anti-dumping and countervailing measures against imported sorghum originating in the United States would affect the cost of living of a majority of consumers and would not be in the public interest,” according to a notice posted on its website.

It said it had received many reports that the investigation would result in higher costs for the livestock industry, adding that many domestic pig farmers were facing hardship because of declining pork prices.

China’s U.S. sorghum imports surged from 317,000 metric tons in 2013 to 4.76 million tons last year while prices fell by about a third in the same period.

The ministry said any deposits for the preliminary anti-dumping tariffs of 178.6 percent, which took effect on April 18, would be returned in full.

The announcement came after President Donald Trump met at the White House with Chinese Vice Premier Liu He, the leader of China’s delegation for talks with a U.S. team headed by Treasury Secretary Steven Mnuchin.

Trump had told reporters earlier that he had doubts about the potential for an agreement. He also raised fresh uncertainty about resolving a case involving Chinese tech company ZTE, which was hit with a crippling seven-year ban on buying from U.S. suppliers, forcing it to halt major operations. Trump said the company “did very bad things” to the U.S. economy and would be a “small component of the overall deal.”

Song Lifang, an economics professor and trade expert at Renmin University, said haggling is currently underway.

“It’s time for both to present their demands, but it’s also a time to exhibit their bargaining chips,” said Song, adding that approval for the Toshiba deal, worth $18 billion, was “an apparent sign of thaw” amid a U.S. investigation into Chinese trade practices requiring U.S. companies to turn over their technology in exchange for access to China’s market.

The Trump administration has proposed tariffs on up to $150 billion in Chinese products to punish Beijing while China has responded by targeting $50 billion in U.S. imports. Neither country has yet imposed tariffs.

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EU Mulls Direct Iran Central Bank Transfers to Beat US Sanctions

The European Commission is proposing that EU governments make direct money transfers to Iran’s central bank to avoid U.S. penalties, an EU official said, in what would be the most forthright challenge to Washington’s newly reimposed sanctions.

The step, which would seek to bypass the U.S. financial system, would allow European companies to repay Iran for oil exports and repatriate Iranian funds in Europe, a senior EU official said, although the details were still to be worked out.

The European Union, once Iran’s biggest oil importer, is determined to save the nuclear accord, that U.S. President Donald Trump abandoned on May 8, by keeping money flowing to Tehran as long as the Islamic Republic complies with the 2015 deal to prevent it from developing an atomic weapon.

“Commission President Jean-Claude Juncker has proposed this to member states. We now need to work out how we can facilitate oil payments and repatriate Iranian funds in the European Union to Iran’s central bank,” said the EU official, who is directly involved in the discussions.

The U.S. Treasury announced on Tuesday more sanctions on officials of the Iranian central bank, including Governor Valiollah Seif,. But the EU official said the bloc believes that does not sanction the central bank itself.

European Energy Commissioner Miguel Arias Canete will discuss the idea with Iranian officials in Tehran during his trip this weekend, the EU official said. Then it will be up to EU governments to take a final decision.

EU leaders in Sofia this week committed to uphold Europe’s side of the 2015 nuclear deal, which offers sanctions relief in return for Tehran shutting down its capacity, under strict surveillance by the U.N. nuclear watchdog, to stockpile enriched uranium for a possible atomic bomb.

Sanctions-blocking law

Other measures included renewing a sanctions-blocking measure to protect European businesses in Iran.

The Commission said in a statement it had “launched the formal process to activate the Blocking Statute by updating the list of U.S. sanctions on Iran falling within its scope,” referring to an EU regulation from 1996.

The EU’s blocking statute bans any EU company from complying with U.S. sanctions and does not recognize any court rulings that enforce American penalties. It was developed when the United States tried to penalize foreign companies trading with Cuba in the 1990s, but has never been formally implemented.

EU officials say they are revamping the blocking statute to protect EU companies against U.S. Iran-related sanctions, after the expiry of 90- and 180-day wind-down periods that allow companies to quit the country and avoid fines.

A second EU official said the EU sanctions-blocking regulation would come into force on August 5, a day before U.S.

sanctions take effect, unless the European Parliament and EU governments formally rejected it.

“This has a strong signaling value, it can be very useful to companies but it is ultimately a business decision for each company to make [on whether to continue to invest in Iran],” the official said.

Once Iran’s top trading partner, the EU has sought to pour billions of euros into the Islamic Republic since the bloc, along with the United Nations and United States, lifted blanket economic sanctions in 2016 that had hurt the Iranian economy.

Iran’s exports of mainly fuel and other energy products to the EU in 2016 jumped 344 percent to 5.5 billion euros ($6.58 billion) compared with the previous year.

EU investment in Iran, mainly from Germany, France and Italy, has jumped to more than 20 billion euros since 2016, in projects ranging from aerospace to energy.

Other measures proposed by the Commission, the EU executive, include urging EU governments to start the legal process of allowing the European Investment Bank to lend to EU projects in Iran.

Under that plan, the bank could guarantee such projects through the EU’s common budget, picking up part of the bill should they fail or collapse. The measure aims to encourage companies to invest.

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