Beijing Slams "Slandering, Arrogant" Pence Speech: "Look In The Mirror" And "Get Your Racist House In Order"

Vice President Mike Pence was called on once again to play the 'bad cop' in Washington's negotiations with China yesterday when he delivered an aggressive speech blasting Beijing's record on human rights. As noted yesterday, in a twice-delayed hawkish speech, Pence defended the pro-democracy protesters in Hong Kong, while slamming both Nike and the NBA for kowtowing to Beijing.

Predictably, Beijing struck back on Friday, blasting the US's endemic racism and other problems that have "cast aside its morality and credibility." Hua Chunying, a spokeswoman for China’s foreign ministry, slammed Pence's "arrogance", and insisted that nothing could halt China's development. She also accused Pence of trying to disrupt China’s "unity or internal stability" and said Hong Kong, Taiwan and the far west region of Xinjiang are "internal affairs" that are none of Washington's business, according to Bloomberg.

"The U.S. has already abandoned and cast aside its morality and credibility," Hua said. "We hope these Americans can look at themselves in the mirror to fix their own problems and get their own house in order."

Meanwhile, the English-language Global Times tabloid, widely seen as a mouthpiece for the Communist Party, accused Pence of "slandering" Beijing and said his speech was boring and unoriginal, relying on many of the same "old gripes" that he articulated during last year's speech.

The speech repeated criticisms made last year that included accusations of intellectual property theft, militarizing the South China Sea, religious persecution, and silencing freedom of speech. Pence also slandered China over Hong Kong, Taiwan and Xinjiang.

But both Pence and Beijing left room for compromise. Pence said the US does not seek confrontation with China or "to decouple" from the world's second-largest economy. He also mentioned the friendship between Chinese President Xi and his US counterpart Donald Trump.

Pence also praised the White House's China policy, emphasizing its effectiveness and the progress that has been made in the trade talks as something that will benefit both Washington and Beijing.

The GT said the US and China "have many reasons to stick with peaceful co-existence and win-win cooperation."

"China and the U.S. have different political systems. It means that it is impossible to change the political foundation of China...However, China and the U.S. have many reasons to stick with peaceful co-existence and win-win cooperation."

Pence’s most stinging criticism of China was indirect, in remarks targeting Nike Inc. and the NBA.

"Nike promotes itself as a so-called 'social-justice champion,' but when it comes to Hong Kong, it prefers checking its social conscience at the door," Pence said.

Whether or not the two sides finally reach even a partial agreement with 'Phase 1' of the trade deal, which will supposedly be finished in the not-too-distant future, Washington will need to keep the pressure on Beijing as it struggles to preserve its military and commercial supremacy in the Pacific.

As for Trump, he also needs to balance the "threat" of an improving trade dialog just so the Fed does not decide that the conflict with China is going better than expected and suddenly surprises markets by ending the "midcycle adjustment" and resumes hiking. As such, expect Pence to take on an increasingly "bad cop" role over the next 12 months.