I'm John Dutch with Gordon Chang, my colleague and co-host, and Steve Yates, our colleague,

senior research felt the Heritage Foundation has just returned from East Asia.

And I lay before him a revelation from London reporting in these last days.

Xi Jinping, and the leadership in the Forbidden City have found an answer to the unfortunate downturn in the Chinese economy just when they wanted

to maintain a strong opening move for the arrival of President Trump.

The answer to their downturn is this.

They're going to subsidize industries that concentrate in chips, EV, and wind.

They're going to subsidize them through the municipalities.

They're going to give away land and electricity.

They're going to provide workers at much below wages, lots of them,

and they're going to subsidize anybody who shows up who has the word robotics in their title.

Okay, there's the answer. Steve, are you shocked? They're going

to manufacture their way out of what happened when they manufactured their way into the same

hole. Well, John, I think the shock for me is that there was a journalist who felt like this

was actually news. As best I could tell, this has been the playbook for quite some time. So this is

sort of rediscovering and re-reporting of the obvious, almost painfully obvious. And it in fact is the

model that has put them in this dilemma where they assert that they have this big role, but you only

have this role as the manufacturing hub of the world if you have

the easy access to the other markets. And if you're able to sustain this model of vastly distorting

the price of capital, vastly distorting the price of resources, when I say distorting, basically using

public funds to hide true costs and then dump

the value back onto international partners. That has led to liquidity problems that Gordon could

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