Sunday links: Disruption edition

1) Cars (“The big sleeper issue in the U.S.-China relationship”):

Senior White House officials are quietly preparing to confront China over what they consider unfair handling of automobiles, one of the world’s largest industries. It’s a move that could profoundly disrupt relations between the superpowers.

Watch for the issue to pop in President Trump’s talks [this] month with China’s Xi Jinping.

What you need to know:

  • When U.S. automakers sell in China, they are met with import tariffs of 25%. That’s why 96% of the 27.5 million vehicles sold in China last year were built there.
  • When U.S. automakers like GM build in China, they are required by law to form joint ventures with Chinese companies. Those Chinese companies must own 50% or more of the venture.
  • By contrast, the U.S. imposes tariffs of just 2.5% and lets foreign car companies own their entire U.S.-based operations.

The US has a lot of leverage to bring about a more balanced automobile trade with China.

2) South Korean ructions:

Former South Korean President Park Geun-hye, who was removed from office earlier this month, was arrested Friday on charges related to abuse of power and accepting bribes. […]

Prosecutors announced Monday that they were seeking to arrest Park on charges relating to abuse of power, accepting bribes and leaking important information.

Would be interested to read Michael Breen’s latest take on this. The eminent Korea guru wrote on March 6:

Had the Constitutional Court hearings and the parallel, 70-day investigation by the special prosecutorial team produced clear evidence of presidential wrongdoing, the decision would be a foregone conclusion. Park would be out of the Blue House and into jail.

But they didn’t. There’s no evidence of Swiss bank accounts. There’s no report that the President was partying while the Sewol ferry went down. As time has gone by, it has become apparent that Park is innocent. This doesn’t mean she is a great President. What it means is that the impeachment was a move too far.

This situation is bewildering. Ask any diplomat and I am sure they will tell you the most commonly asked question in foreign embassies these days is, “What exactly has she done wrong?”

3) Also, human life as we know it is over (Economist article via Marginal Revolution):

Frictionlessness encourages bad habits. For those who resent the time suck of 1-click ordering, Domino’s has pioneered “zero-click” pizza-buying. Simply open the app and, after ten seconds, it automatically places a pre-set order. Domino’s competitors are working on a “direct-to-mouth” drone-delivery service that will send individual slices of pizza into your home via an electronic flap. Pizza experts are seeking ways around the “chewing bottleneck”.

Payments are also subject to facile externality. Three in five Britons say they spend more with a wave of the plastic than they would with cash. Ordering goods using Alexa, a voice-activated assistant, is as easy as saying its name. Tech firms are working on gesture-controlled devices that could enable payments with just a furtive glance of desire.

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