Yesterday Today Tomorrow

Inseong J Kim: Hello, this is Inseong J Kim from Yesterday, Today and Tomorrow. Freedom of speech is such a healthy thing and it makes you really mentally healthy that we can express what's in our heart. So, I very enjoy coming to the radio station sharing my thoughts.

Today, I want to summarize the program that I've been talking about, the issue that we are dealing with concerning trade with China. Today's title is "Sovereignty Deficit." We're going to talk about why an unmanaged free market, free trade, and globalism collide with national security and self-government.

That's what we are facing today. We were going in one direction with a free trade and free market, and we didn't know that was packaged with globalism. Then we woke up because everybody felt like something was going on. We realized this issue with a free trade and globalism collided with national security and self-government.

Today's program starts differently than usual. Instead of building an argument point by point toward a conclusion, I want to give our audience the conclusion first as an inference, not a proven fact. Then I will spend the rest of the program backing up this inference based on the facts.

Here is the inference: Three separate things that Chinese leader Xi Jinping has said and done, when taken together, suggest an economic model that presents itself as a globalism success story but carries a sharp thorn inside of it. This thorn only surfaces after dependency, market dominance, or cultural absorption is already locked in.

That's my reading of this pattern. I want to walk our audience through these three points, clearly labeled as points of evidence—not a conspiracy theory or speculation—that let each listener judge the inference for themselves. I'm going to list the facts, and our audience can make their own conclusions.

Here are the three points so our audience knows exactly where this was headed before we get into any of them. The first one is the Opium War. That happened way before the 1800s, and it still carries through today's conversations and the historical grievances associated with that background.

Unfortunately, this is not just history from a hundred years ago. To the people who live in China, it is still real. The second point is the Ethnic Unity Law that just passed in July 2026 and what it enforces at home and abroad. This is a very sensitive topic that we're going to talk about using the facts of what happened, rather than opinion.

The third is the deflation remark that President Xi Jinping made himself and what it may reveal about dumping. Let's take them one at a time. We'll start with the Opium War and why it's relevant to what's happening today. Xi Jinping has repeatedly and consistently invoked the Opium Wars of 1839 to 1860 as the origin of what China calls its "century of humiliation."

In his speech marking the Chinese Communist Party's centennial in 2021, Xi described the aftermath as reducing China to a semi-colonial, semi-feudal society that brought intense humiliation for our country and great pain for its people. That was in 2021, right after COVID.

He invoked this same history at the 2012 launch of his Chinese Dream, at the 2017 Party Congress, and in his 2017 speech in Hong Kong marking the 20th anniversary of the handover. Here is why this matters for trade policy and not just history.

The Opium Wars are remembered in China as a moment when foreign powers used military force to open Chinese markets on terms Britain and other Western powers dictated. In that telling, openness is not a neutral economic good. It was arguably a mechanism that nearly cost China its sovereignty.

If we go deeper into history, it's not just the Opium War itself. There was a trade deficit along with the tea exports from China to Britain, and there was an expectation between those countries regarding sovereignty even then. This narrative gives the Chinese their current asymmetric trade posture: an open market for its own exports and a tightly controlled market for foreign imports.

This does not line up with globalism, but yet it's called globalism. There is a built-in historical justification. It isn't necessarily hypocrisy in this frame; it may be China refusing to repeat what it regards as a mistake that cost it a century of subjection. This is a serious matter to them.

There were two ideologies colliding. One is the belief that China must restore itself from this humiliation and grow economically. They realized that poverty doesn't provide power, even though they accepted communism for their country. The West missed that it never carried an equivalent memory to what China has.

No Western power has been forced open at gunpoint the way China was. Where China calculated defensively, the West engaged optimistically. We thought that because we helped China during the Japanese occupation, China was for us and we were for them, especially during those times when Russia's power was growing.

We assumed that trade itself would liberalize China without it guarding its own sovereignty and self-governance in response to history we never experienced. That is the difference between where China came from and where America and other Western countries came from when they met at a certain point. We shared common goods together, but recently things have been changing.

Regarding the Ethnic Unity Law, on March 12, 2026, China's National People's Congress passed a law on promoting ethnic unity and progress. It took effect on July 1, 2026. The law declares "a sense of community for the Chinese nation"—Zhonghua Minzu—to be the foundation of ethnic unity.

It mandates Mandarin language education starting in preschool while directing government and private institutions to give Chinese characters visual prominence over minority languages in public life. "Zhonghua" literally means "central splendor." Unlike "Zhongguo," which is a political name, this term points to shared ethnicity and civilization rather than a state.

This new law enforces not just the Chinese state, but the whole of Chinese unity. This is why Beijing can frame the absorption of Taiwan as reunification rather than conquest. At the same time, Korea, which was never part of the same ethnic lineage, falls under a separate Sinosphere of shared cultural influence rather than a claim to nationhood.

It is different for South Korea, but for Taiwan, they believe they share the same ethnicity as Zhonghua Minzu. What makes this law different from a decade of prior rhetoric is what's missing from it. The 1984 Regional Ethnic Autonomy Law explicitly protected minority language education and warned against majoritarian Han chauvinism.

The 2026 law removes that warning entirely. It also carries extraterritorial reach. Chinese officials have confirmed that individuals and organizations outside China can be held liable if their actions are deemed to undermine ethnic unity.

Regional experts describe the law as providing legal cover for moving the Han population into Tibet, Xinjiang, and Inner Mongolia while relocating minority populations elsewhere for labor programs. There is a different implication here. My inference here is more direct because this is not just rhetoric; it is a binding statute.

It is a state that legally enforces the cultural absorption of its own minority population. It reaches beyond its own borders to punish criticism of that absorption. This arguably demonstrates in practice what unity can mean when the state alone defines the term.

This has a direct bearing on how much trust the rest of the world should place in Beijing's account of what it means by shared prosperity, shared markets, or shared development. How is it going to affect free markets? Because not just individuals, anyone who has a business with China will be accountable under this law, whether they live in China or outside of China.

Their jurisdiction is overarching, not only in China but all over the world. In terms of globalism and the free market, we have to connect the dots. Point three is the deflation remark. In late 2024, as Chinese Communist Party advisors warned of a domestic deflation spiral, Xi Jinping reportedly dismissed the concern.

According to the Wall Street Journal, he asked his advisors, "What's so bad about deflation? Don't people like it when things are cheaper?" Xi Jinping has an engineering degree. He is smart, so he knows what it means. People like cheap items, but behind the cheap items, there is a thorn in deflation.

The topic reportedly became something close to taboo among Beijing policymakers after that. There is a lot of speculation about that statement. Here is the wider context that gives the remark its edge: Western officials, including US Treasury Secretary Janet Yellen and Secretary of State Antony Blinken, have accused China of industrial overcapacity.

They claim China is producing far more in EVs, solar panels, batteries, and steel than the domestic and global markets can sustainably absorb, flooding foreign markets with goods priced below what competitors can match. The Chinese government has flatly denied this.

Xi Jinping himself told French President Macron and European Commission President von der Leyen in 2024 that there is no such thing as a Chinese overcapacity problem. There is a different view of how they view globalism versus how the rest of us view globalism.

My own inference is that this is not just speculation. I want to be direct. The private dismissal of domestic deflation, paired with a policy of sustained, state-subsidized overproduction aimed at export markets, resembles the classic economic definition of dumping.

This involves selling below cost to eliminate competing producers abroad, with pricing power returning once the competition is gone. This is the key. We all like cheap items, but overproducing cheap items can take over the competitor markets. After they're all gone, the price can start going up.

I've shared before about the seeds of a tree. Once it is planted and the roots get bigger and bigger, it can lift the house. Whether the price can go up is the question we have to ask. Intent can be proven from the private remark. What can be shown to our audience is the pattern, leaving each listener to weigh whether it looks coincidental or strategic.

We cannot determine it, but each listener can see the pattern. What does that mean for a US citizen? We have one nation, heavily integrated economically, that has its own agenda and its own view about its historical background and how they perceive overproduction with deflation.

These are three things that we have to consider regarding how we do business in America and overseas in trade. This is not a blank statement; we must calculate what this means to us. What the West missed is the mismatch I flagged in point one. This is worth expanding because it explains why the gap happened, not just what happened.

It's not the fact that we're finding out where we are at. But there's a gap. China entered its modern economic rise carrying a specific historical memory. It repeatedly invoked a narrative of humiliation, forced openness, and the near loss of sovereignty. That memory shaped a defensive strategic posture that guarded the domestic market, controlled the currency, and controlled information.

They never again wanted to let outside powers dictate the terms. That is their mood and the psychology behind their decisions. The West's optimism wasn't just an absence of a matching history; it was an active assumption that no defense of its own institutions was necessary.

Our optimistic view was based on the post-war and post-Cold War consensus that held that openness was the way to ratchet toward convergence. We thought that if we tied ourselves together economically, we would not escalate tensions. In that view, history was already bending in the right direction on its own.

This mismatch between how we viewed things and how China viewed them is the real story behind the sovereignty deficit. One nation has had the experience of war and wants to heavily protect its sovereignty. Meanwhile, the US and Western cultures didn't think about sovereignty when we had free trade.

As long as everybody was profitable, we were all happy. That was a huge gap that we're experiencing today. One side calculated from historical grievances and built accordingly. The other side calculated from historical optimism and didn't feel the need to build much of anything.

The three points I shared lay out what that gap looks like once it's been left open for more than three decades. Historically, how it transitions, even recently in 2006, after 2000, these changes we see are devastating global citizens, not just those in the US. Everyone is experiencing the loss of the job market.

Young people's mental health is affected because they don't have jobs or confidence in their lives. It has changed the whole landscape in England, Europe, and even South Korea. The whole world is facing these issues resulting from a different approach to globalism and the global market.

Our program will be archived on our website at www.inseongkim.org. Please visit our website, where I will post the full article so everyone can read and finish my conclusion. Thank you for listening to Yesterday, Today and Tomorrow. We'll be back next week. Thank you.

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