Ten interesting things we read this week

At Ambit, we spend a lot of time reading articles that cover a wide gamut of topics, including investment analysis, psychology, science, technology, philosophy, etc. We have been sharing our favourite reads with clients under our weekly ‘Ten Interesting Things’ product. Some of the most interesting topics covered in this week’s iteration are related to ‘why employees should feel respected’, ‘unschooling – breaking out from traditional schooling’ and ‘how Trump’s policies are helping China’.

Here are the ten most interesting pieces that we read this week, ended October 5 , 2018.

1) In praise of mediocrity [Source: The New York Times ]
In this piece, Tim Wu, a law professor at Columbia and the author of “The Attention Merchants: The Epic Struggle to Get Inside Our Heads”, talks about how pursuit of excellence has infiltrated and corrupted the world of leisure. Many people don’t have a hobby. Maybe they are afraid of being bad at whatever hobby they wish to pursue. Or rather, they are intimidated by the expectation — itself a hallmark of our intensely public, performative age — that they must actually be skilled at what they do during free time. Our “hobbies,” have become too serious, too demanding, too much an occasion to become anxious about whether you are really the person you claim to be.

Lost here is the gentle pursuit of a modest competence, the doing of something just because you enjoy it, not because you are good at it, the article says. Hobbies are supposed to be something different from work. But alien values like “the pursuit of excellence” have crept into and corrupted what was once the realm of leisure, leaving little room for the true amateur. People are now divided between the semipro hobbyists (some as devoted as Olympic athletes) and those who retreat into the passive, screeny leisure that is the signature of our technological moment. While there are depths of experience that come with mastery, there is also a real and pure joy, a sweet, childlike delight that comes from just learning and trying to get better.

Especially when it comes to physical pursuits, but also with many other endeavours, most of us will be truly excellent only at whatever we started doing in our teens. What if you decide in your 40s that you want to learn to surf? What if you decide in your 60s that you want to learn to speak Italian? The expectation of excellence can be stultifying. A democracy, when it is working correctly, allows men and women to develop into free people; but it falls to us as individuals to use that opportunity to find purpose, joy and contentment. Demanding excellence in all that we do can undermine that; it can threaten and even destroy freedom.
 
2) Do your employees feel respected? [Source: HBR ]
In a recent survey by Georgetown University’s Christine Porath of nearly 20,000 employees worldwide, respondents ranked respect as the most important leadership behaviour. Yet employees report more disrespectful and uncivil behaviour each year. Research also shows that leaders have an incomplete understanding of what constitutes workplace respect—so even well-meaning efforts to provide a respectful workplace may fall short. Employees value two distinct types of respect: 1) Owed respect – accorded equally to all members of a work group or an organization; it meets the universal need to feel included. It’s signaled by civility and an atmosphere suggesting that every member of the group is inherently valuable.

Earned respect – recognises individual employees who display valued qualities or behaviours, distinguishing employees who have exceeded expectations and, particularly in knowledge work settings, affirms that each employee has unique strengths and talents. Earned respect meets the need to be valued for doing good work, the article says.
 
One of the subtler challenges in creating a respectful atmosphere is finding the right balance between the two types of respect. An imbalance can create frustration for workers. For example, workplaces with lots of owed respect but little earned respect can make individual achievement a low priority for employees because they perceive that everyone will be treated the same regardless of performance. By contrast, workplaces with low owed respect but high earned respect can encourage excessive competition among employees. That may serve a purpose in environments such as some sales forces where workers have little interdependence or reason to collaborate. But it could hinder people from sharing critical knowledge about their successes and failures, and it often promotes cutthroat, zero-sum behaviour. A respectful workplace brings enormous benefits to organisations. Employees who say they feel respected are more satisfied with their jobs and more grateful for—and loyal to—their companies. They are more resilient, cooperate more with others, perform better and more creatively, and are more likely to take direction from their leaders.

In all but the most toxic workplaces, building a respectful organisation does not demand an overhaul of HR policies or any other formal changes. Rather, what’s needed is ongoing consideration of the subtle but important ways in which owed and earned respect can be conveyed. The article lists seven small ones leaders and managers can use to make an outsize impact on workers: 1) Establish a baseline of owed respect; 2) Know how to convey respect in your particular workplace; 3) Recognize that respect has ripple effects; 4) Customize the amount of earned respect you convey; 5) Think of respect as infinite; 6) See respect as a time saver, not a time waster; 7) Know when efforts to convey respect can backfire.

3) India: The creation of a mobile phone juggernaut [Source: Financial Times ]
Over the past two years, Mr. Mukesh Ambani, chairman and managing director of Reliance Industries, has built the biggest start-up in India with more than 200mn people flocking to take advantage Reliance Jio. Jio clients are now consuming about three times the amount of data of an average European customer. For the first time, millions of Indians are able to access the internet to register for benefit payments, download school textbooks or simply watch India beat Pakistan at cricket. However, Jio’s aggressive expansion has caused headaches for some of the world’s biggest telecoms groups, including the UK’s Vodafone. The consequences have been more severe for Mr. Ambani’s younger brother Anil, who inherited the family telecoms business Reliance Communications during the 2005 break-up of their father’s conglomerate. Anil is in the process of selling his mobile towers, spectrum and fibre-optic cables to his brother, having been one of the hardest hit by Jio’s entrance into the market.

Jio’s stellar rise has also raised some concerns. Rahul Khullar, former chairman of the Telecom Regulatory Authority of India, feels that the recent judgments made by his former organisation have tipped over into discrimination in favour of Jio. “In my 40 years as a civil servant, I did not see a single instance where a regulator was accused of bias,” he says. “But now there is clear partisanship in favour of Jio.” In June 2010, the government conducted an auction of part of the telecom spectrum. The bandwidth being sold was not particularly attractive to most of the incumbent companies, so they were surprised when a little-known company called Infotel Broadband Services emerged victorious, having bid Rs128bn — then worth $2.7bn — 5,000 times the company’s own net worth. Hours after the auction closed, Infotel made another announcement — it was being bought by Reliance Industries, Mukesh Ambani’s part of the family business, which had agreed to invest Rs48bn for a 95% stake. That wasn’t the end; Mr. Ambani further faced issues pertaining to licences.
 
When Jio services were formally launched on September 1, Mr. Ambani announced he was giving away voice calls for free and data for next to nothing. Three months later, he made small adjustments to the offer and rolled it over. Combined, the offers saw his company attract more than 100mn customers. Rivals accused Jio of violating TRAI’s guidelines by offering six months of giveaways, pointing out that in 2002 the regulator warned companies not to issue promotional offers for more than 90 days and saying it undermined its broader mandate of stopping predatory pricing — low prices offered for so long that rivals pack up altogether. “Jio is providing telecom services below its average variable cost with the sole intention of eliminating competitors,” alleged Bharti Airtel, India’s biggest telecoms company by subscribers, in a complaint to the competition commission in 2017. Neither the competition commission nor the telecoms regulator agreed. The former ruled that, because Jio was not the market’s dominant player, it was not undermining competition. While the issue was taken up, the verdict came in favour of Jio, as they had minutely studied regulatory documents in search of loopholes missed by competitors.

Mr. Ambani’s supporters say he has brought a burst of innovation to the Indian telecoms market, which could have long-term social and economic impact on the country. Jio’s rivals argue, however, that its ruthless approach will leave India with a sector that is financially strained and unable to fund the investment needed to keep up with technological advances. Competition could suffer, with few big international operators likely to risk entering the Indian market, says Rajan Mathews, director-general of the COAI. And as Mr. Narendra Modi promises an end to the era of unaccountable tycoons, the criticism of the regulator threatens to undermine confidence in his agenda. “The regulator and the policymakers haven’t played their role,” Mr. Mathews says. “Clever people will find ingenious ways to thread the eye of the needle, and that’s exactly what has happened.”

4) How we reached peak liberal resistance? [Source: Financial Times ]
In this article the author talks about how British and US liberals are disappearing. Going through the way the UK’s Conservative party is handling Brexit, the whole thing might never happen. American liberals are rooting for the torpedoing of Brett Kavanaugh, Donald Trump’s nominee for the Supreme Court. The liberal dream is that Anglosphere populism, an old people’s movement, will fade away. But we may be hitting peak liberal resistance. It’s still very likely that Brexit happens next March, and highly plausible that Trump will get re-elected in 2020. Longer term, it could be the liberals who fade away, to populist cries of “good riddance”.
 
Brexit is likely to happen because the leaders of both main British parties intend to deliver it. Either Britain strikes a deal on the EU’s terms, or it initially gets no deal, but then probably crawls back to Brussels and agrees to whatever the Europeans are willing to offer. Trump, despite his unpopularity, could easily win in 2020. If the economy is still growing by then, the 11-year expansion would be the longest ever measured in the US. Democrats could win the most populous liberal states of California, New York and Massachusetts by even larger margins than in 2016, piling up millions more essentially useless votes, and still lose the electoral college.
 
If Trump and the Brexiters can find the competence to establish long-term populism, liberal Britons and Americans will have to choose a response. Most will stay put. In 2016, over a quarter of Americans polled by Vox said they would consider moving to Canada if Trump won, but in the event hardly anyone left. It turns out that well-off urban liberals can live well under Trump. British urban liberals will suffer relatively more from Brexit. If freedom of movement with Europe ends, their passports will be downgraded. Brexit will also devalue one of their favourite career paths, the civil service: the fresh graduates who traditionally flood into Whitehall each year are exactly the cohort who despise Brexit and won’t want to spend years trying to make it work. Still, educated people will continue to find good jobs in London. But they risk being politically sidelined post-Brexit. Liberal debates in universities, media, political parties and think-tanks will feel irrelevant.
 
If Trump and Brexit establish themselves, educated urban liberals will go into internal exile, cultivating their roof gardens, getting their kids into the right schools, hunting for the perfect coffee and doing the odd spot of local activism. They will detach from populist relatives in the heartland, and, gradually, from a sense of shared nationhood. “Not my government,” will be the attitude.
 
5) Walmart turns to Flipkart for tech [Source: FactorDaily ]
Walmart buying 77% of Flipkart for over $16 billion was the world’s largest ecommerce deal. But, Walmart didn’t wanted to just get an upper hand on its biggest rival Amazon in India, the world’s second largest internet market by users, it also wanted to take advantage of Flipkart’s technology. It would have taken years for Walmart to build that kind of technology. Flipkart’s growing presence inside the Walmart universe was evident at the Indian subsidiary’s recent town hall. Judith McKenna, president and CEO of Walmart International, told a houseful audience that Flipkart’s tech is where the parent will look at collaborating on. Some of the technology that Flipkart has is difficult to find elsewhere. McKenna’s words are to be taken seriously. She stitched the Flipkart deal and now sits on its board. Also, Walmart International is bigger than Boeing, Coca-Cola, Facebook, and even Alphabet – Google’s parent – in total sales.

“Flipkart is the only company in the world (except in China) that has taken Amazon head-on,” said Siddhant Ujjain, co-founder of SwiftAce, a provider of enterprise solutions based on artificial intelligence and computer vision. “There is something that Flipkart figured out that others couldn’t.” Technology is one of Flipkart’s strong points. “That was the only way it could have survived Amazon’s rivalry,” said a Flipkart executive. Every stage of a purchase made on Flipkart has software, often automated, at work on personalisation, recommendations, logistics, and even anti-fraud. Flipkart has dealt with diverse sets of data – from handling rich customers in Indian cities to reaching deep into the hinterland. “While we are still at early days, we are impressed by what Flipkart has built and we hope to leverage over time,” said a Walmart spokesperson over email, praising the Indian unit’s entrepreneurial culture. “Flipkart’s talent, technology, customer insights, and agile and innovative culture will benefit Walmart in India and across the globe.”

Flipkart can also handle and process tons and tons of shipments in just days. During its flagship Big Billion Day sale the company is expected to do Rs11,000 crore of business in just five days, shipping millions of products. The company’s algorithms help it predict, plan and stock accordingly. Flipkart already has more than 50 data scientists and is training another 100 of them. Hiring, too, is on. It is expected to have more than 250 data scientists and AI experts in the next couple of years.
 
Some believe that Walmart tapping into Flipkart is no surprise. “This was bound to happen. Talent is incredibly expensive and really hard to come by in the US when you compare it with the way a company as huge as Flipkart has organised, trained, and built its teams,” said Ashwini Asokan, co-founder and CEO of Mad Street Den, an AI company serving the retail industry with its image recognition platform Vue.ai.

6) Unschooling – The joy of walking out [Source: Livemint ]
A few families have been rejecting or walking out of the traditional education models and favouring the “unschooling” model with no lessons, no grades and no rules. John Holt, an American educator, has rightly said, “To a very great degree, school is a place where children learn to be stupid." But, traditional schooling inculcates fear and damages the self-esteem of students. It is designed to teach children how to fit in with and succeed within authoritarian system. On the other hand, “Unschoolers” receive no formal lessons, not even in reading, writing or basic arithmetic. Instead, unschooling parents believe that we underestimate, and at times suppress, a child’s natural ability to learn by supplying them with regimented doses of information. Unschooling gives freedom to learn whatever we want to learn and however we want to learn. Unschooling parents take on the role of learning facilitators, supplying information and resources—books, DVDs, even private tutors and formal classes—based on their child’s interests and choices. This can include normal schooling, if the child demands it. Despite its uncertainties, unschooling is a philosophy that’s finding more takers in India and around the world and, in many cases, by those with a background in education.

Unschooling parents are typically questioned on three counts. 1) How will their child attain basic literacy? The answer to this often comes as a surprise to the parents themselves. Many can’t pinpoint the exact moment their child learnt how to read or write, and the process is often described as “magical” and “unexpected”. They learn from observation, pretend games, interactions with people, sometimes from necessity. But it does demand alertness to the child’s interests, and the financial ability to supplement these interests. And since for millions, a formal degree is still a necessary entry point into stable careers, unschooling remains a safer bet for the elite. If unschoolers decide to opt for degrees through distance learning institutes like the National Institute of Open Schooling and the Indira Gandhi National Open University, they might have to account for knowledge gaps in their learning.

2) Employability – can unschoolers be absorbed into the workforce? There are no clear answers here, but you get the sense that an anti-capitalist world view threads through the community. These parents are aware that their children might never obtain six-figure incomes, and are more likely to find a calling in the arts or in fields relating to sustainability. This is a frequent area of discussion at unschooler meetings. “There are challenges, like when my son goes to meet someone for an internship, he feels like he will not get a certain kind of job,” says Sumi Chandresh, an Ahmedabad -based unschooling parent whose 18-year-old son, Qudrat, wants to pursue film-making. “There are pros and cons in both the system and in unschooling. But the system has brainwashed us so we can’t see anything beyond a degree.” On the other hand, companies like Google, Apple and Intel have made announcements about hiring candidates without college degrees. In 2016, IBM revealed that 10-15% of new hires in the company did not have formal education.
 
3) What about socialisation? There is an emphasis on forming relationships outside of classrooms. Children interact with people of diverse ages and class backgrounds. John Holt’s view was that qualities like kindness, patience, and generosity were better learnt in intimate relationships and smaller groups. “By and large, human beings tend to behave worse in large groups, like you find in school. There they learn something quite different—popularity, conformity, bullying, teasing,” he wrote.

So what’s the future of unschooling? “Unschooling” is not a universally accepted term, though it is the catchiest. Some believe its negative prefix shifts focus from what the movement embraces (child-led learning) to what it rejects (traditional schools). As a concept, self-directed learning has found vocal proponents like Sugata Mitra, a professor of educational technology at Newcastle University, who conducted the famous Hole In The Wall experiments in 1999. By placing a public computer in a slum in Delhi, Mitra found that groups of children with access to the internet have the capacity to learn by themselves. But self-directed learning can involve extensive screen use, which is a divisive subject for all parents. Last month, Beyond Millennials: The Next Generation of Learners, a survey of 2,587 14- to 40-year-olds by the market research firm Harris Poll, found that nearly 60% of Gen Z respondents prefer YouTube for learning, while 47% prefer printed books. For the older cohort of millennials, the numbers were 60% for printed books, and 55% for YouTube.

7) Demand for MBAs in US falls for the first time [Source: Financial Times ]
The body responsible for administering MBA entrance tests has for the first time since the financial crisis reported a fall in global demand for business masters degrees. Applications for places on courses that started last month were down just 0.02% YoY. But this was driven by a fall of nearly 7% in the US, the birthplace of the MBA. Demand for business school courses in the US has been falling for five years. But previously this had been offset by strong growth in the fast growing Asia Pacific region and Europe, where courses are generally shorter and less expensive. Degree courses in Asia Pacific had an 8.9% increase in applications, demand in Europe rose 3.2% and in Canada growth was 7.7%, according to data compiled by the Graduate Management Admission Council (GMAC). But this was insufficient to offset the US malaise.

Sangeet Chowfla, GMAC president and chief executive, blamed the US decline on the country’s “disruptive” political atmosphere, dissuading overseas students from applying to American schools as well as increasing competition from schools in Asia and Europe. “Non-US programmes continue to thrive,” Mr. Chowfla said, adding that recent growth in the US jobs market had made Americans more reluctant to return to full-time study because they might forgo opportunities to further their career. “One can begin to understand in part why demand in the US has dropped from previously record high application volumes at some schools,” Mr. Chowfla said. GMAC surveyed 1,087 graduate courses at 363 universities in 44 countries. In contrast to the US, overseas students have bolstered application numbers at business masters degree courses in Europe and Canada.

Homegrown applications fell 11.2% in Canada and rose only 1.1% in Europe. But applications from overseas students rose 16.4% and 3.4%, respectively, giving both these markets healthy growth in their aggregate numbers. Applications to Toronto’s Rotman School of Management are up 7% this year, following a 28% increase in 2017. These increases are almost entirely due to growth in overseas applications, according to Maria Rivera, managing director of the full-time MBA programme. Half the current class of 335 students came from outside Canada, but few of these are Americans. The aim is to draw in a broad range of people who can offer varied perspectives on business strategy because so much of the learning on the course is achieved through classroom discussion, Ms. Rivera explained. “We are trying to build a global school, where students can learn from people from across the world,” she said.
 
Applications to Duke University’s Fuqua School of Business, in North Carolina, were down 6% this year. Bill Boulding, Fuqua’s dean, warned that maintaining economic growth would be hard without a new generation of people trained in business leadership, adding that more needed to be done to attract a broad range of applicants. “Access is a critical issue facing higher education,” Mr. Boulding said. “We need to make it possible for people from all different regions and backgrounds to study and work in the location they desire.”
 
8) Masayoshi Son, SoftBank, and the $100 Billion Blitz on Sand Hill Road [Source: Bloomberg ]
The founder and CEO of Softbank, Masayoshi Son’s principle is ‘Life’s too short to think small’. This can be gauged by his plans for the US$100bn ‘Vision Fund’. Softbank’s Vision Fund gathered US$100bn, including US$45bn from Saudi Arabia’s Public Investment Fund, as well as capital from Apple Inc., the government of Abu Dhabi, and others. The fund has moved aggressively in its Silicon Valley investments, committing US$65bn to acquire big stakes in Uber, WeWork, Slack and GM Cruise. Son now plans to raise a new US$100bn fund every 2-3 years and will spend US$50bn a year! This compares with US$75.3bn that the entire US Venture Capital Industry invested in 2016. His large bets have astonished and confused Silicon Valley’s incumbent VC firms, which have followed an approach of making small, speculative investments in early-stage start-ups and adding funds in follow-on rounds as those start-ups grow.
 
The smallest deals of Softbank are over US$100mn in size, whilst its biggest deals are in billions. This has pushed up valuations. Even long-time VC firms like Sequoia Capital are now scrambling; the firm is raising US$12bn to stay competitive when bidding on big, late-stage deals. That’s up from US$1.7bn five years ago. Son’s first major investment was in Yahoo. A month after offering a US$2mn cheque to Yahoo co-founder, Jerry Yang, Son offered a US$100mn investment, far more than Yang was willing to accept at first. The shock-and-awe move would become Son’s go-to-move. Son continued making deals and briefly became the world’s richest man in the dotcom mania of 2000. That bubble burst with Son losing US$70bn in a year!

But Son never stopped making deals. In 2006, Son struck a deal to buy Vodafone Japan and then landed an exclusive deal to distribute the iPhone, which turned around the company. By 2010, Son had created a reputation of being a consummate deal maker. But he shocked investors with a two-hour speech at a shareholders meeting that attempted to articulate a plan for the next 300 years. Son said he was creating a “strategic synergy group”—an extended family of companies, in which SoftBank would buy stakes of from 20% to 40%. The companies would have a common mission: “Information revolution—happiness for everyone,” as he put it. Opinion was divided on whether the presentation was an inspiring display of Son’s brilliance, or an amusing demonstration of his kookiness.

The Vision Fund is being run by nine managing partners – five at the fund’s Silicon Valley office, two in Japan and two in London. Son has personally trained these ‘hunters’ on how to find the best investments and plans to increase the number of dealmakers to 300 over the next few years. Managing partners filter potential investment ideas and hold a weekly call to discuss progress. In June 2018, Son said he’d spent 97% of his time on SoftBank operations. In his interview with Businessweek, he said that figure is down to 3%, with the vast majority of his time spent on dealmaking. Despite a reputation for throwing money around, Son’s investment approval isn’t a rubber stamp. Decisions can take months.
 
In describing the vision behind the Vision Fund, Son sometimes uses the term gun-senryaku, a Japanese expression that describes the way a flock of birds flies together. His hope, he says, is that portfolio companies will help one another and head off copycats. In Southeast Asia, for instance, SoftBank has encouraged Grab to form joint ventures with a handful of portfolio companies to help those start-ups break into the region. Grab CEO Anthony Tan is in charge of the effort. Son says similar partnerships are in the works around the world. “You don’t want to go into every little country and try to fight,” Son says, addressing prospective competitors. “You should go there and partner with Grab and the Vision Fund will invest.”

9) Quantum politics and a world turned upside down [Source: Financial Times ]
When Donald Trump boasted of his achievements at the UN, he was greeted with a ripple of derision. But he may be one of the first leaders to have grasped the essence of quantum politics. ‘Quantum politics’, the phrase was developed by the president of Armenia, Armen Sarkissian (also a theoretical physicist), to explain how politics now works. Mr. Sarkissian has been studying this phenomenon in practice and in theory. Since being elected president in March, he tried to calm political turmoil in Armenia. The 65-year-old was a winner of the Lenin prize for science back in Soviet times and a former colleague of the late Stephen Hawking at Cambridge University.
 
In his view, our interpretation of how politics traditionally works should be updated to reflect the way that physics has been reimagined. The classical world of post-Newtonian physics was linear, predictable, and even deterministic. By contrast, the quantum world is highly uncertain and interconnected and can change depending on the position of the observer. “A lot of things in our lives have quantum behaviour. We are living through a dynamic process of change,” he says. “I think we have to look at our world in a completely different way.” Mr. Sarkissian explains that the way that pandemics spread, with one case popping up in Hong Kong and then a second in Argentina, exhibits quantum characteristics.
 
Even the way we understand politics depends on who is viewing what and when. We all receive individualised newsfeeds on Facebook serving up different interpretations of events. The very act of observation changes our reality. One doubts that Mr. Trump has as good an understanding of quantum politics as Mr. Sarkissian. But the US president seems intuitively to grasp its implications. In this new world, political parties, institutions, and reason-based processes appear less important than popular movements, beliefs, emotional connectivity, and social media impact. Mr. Trump largely bypasses formal institutions and operates via Twitter, projecting his own version of reality to his 54.7mn followers.

Recent events in Armenia are a good example of how quantum politics works in practice. Just weeks into Mr. Sarkissian’s presidency, the Caucasian nation of 3mn people was rocked by political crisis. Serzh Sargsyan, the former president, who had switched offices to become prime minister, was forced to resign after mass protests against his “power grab”. Many of the demonstrators were what he calls “arbitrary soldiers” mobilised on Facebook, rather than members of an organised opposition. Armenia’s 10mn-strong diaspora also influenced events from abroad by pitching into the social media maelstrom. “Armenia is a small state and a global nation,” Mr. Sarkissian says. “Those living in California can see what is happening in their beloved country and react. This is another example of a new quantum quality.”
 
The concept of quantum politics is certainly intriguing. But not all are convinced it is valid. While Jim Al-Khalili, physics professor at the University of Surrey, is sceptical of the parallels being drawn between quantum theory and modern politics, he does agree with Mr. Sarkissian that our world is becoming so hyper-complex that it is increasingly difficult to manage. One way to deal with hyper-complexity, as Mr. Al-Khalili suggests, is to use artificial intelligence systems. AI can deal with complexity that humans struggle to get our heads around. “There is nothing uniquely magical about humans,” says Mr. Al-Khalili. “Ultimately if AIs know enough about us they will be able to make decisions for us without any of our irrational human biases.”

10) How Trump’s policies are helping China [Source: Foreign Affairs ]
In this piece, Yadong Liu, former Chief Executive Officer of CEFC Global Strategic Holdings, a New York-based firm that invests in energy and energy technologies, states that the steps taken by President Trump has been in favour of China. For the first year of Donald Trump’s presidency, most Western commentators on US-Chinese relations saw the Trump administration’s approach to China as a strategic failure; some even concluded that Chinese President Xi Jinping had duped Trump. Recently, however, a different narrative has emerged in Western media. According to this view, Trump’s pressure on China is working, and Chinese leaders are worried. Trump’s 25% tariffs on $50 billion of Chinese imports are hurting the Chinese economy at a time when China is overleveraged and growth is slowing down, advocates of this view assert.

Meanwhile, they say, Trump’s July meeting with European Commission President Jean-Claude Juncker was a brilliant tactical feint: by negotiating a “cease-fire agreement” over trade with the EU, Trump united the West against China. In September, Trump showed his resolve by imposing tariffs on an additional $200 billion worth of Chinese imports. At the same time, according to some reports, dissent over Xi’s one-man control of Chinese strategy is growing within China, and Chinese leaders are looking for ways to mollify Trump.

Yet this narrative is almost the exact opposite of the truth. The fact is that, despite escalating trade tensions, Beijing should still see Trump as the ideal U.S. president for China. Trump’s withdrawal from the Trans-Pacific Partnership, his tough approach to trade with Japan, and his talk of removing US troops from South Korea all served China’s interests by accelerating the decline of US influence in Asia, opening space for China to expand its influence even faster than it had ever thought possible. China could hardly hope for a more cooperative occupant of the White House. There’s also good reason to think that China remains confident in its ability to manage Trump. Based on the conversations Yadong have had with a person close to the Chinese leadership, Beijing does still see Trump as a much better US president for China’s interests than the alternatives.