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Crafty_Dog
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« Reply #350 on: December 05, 2010, 09:14:47 PM »

http://www.youtube.com/watch?v=PxymwN7nYQQ
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G M
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« Reply #351 on: December 06, 2010, 10:07:43 AM »

**Rather than admit what happened, the Chinese gov't suppressed information about the HIV spread through the plasma collection, allowing HIV to gain a foothold in China and many more people to become infected. No government official has ever been held to account for this.**

http://www.unicef.org/infobycountry/china_21607.html

China's children affected by HIV/AIDS

HENAN PROVINCE, China, 11 June 2004—"Daddy died three years ago because of the disease called AIDS." Taohua (not her real name) is a skinny 11-year-old girl with a ponytail. She is shy but well spoken. "First he had headaches. Then he got very sick and went to see a doctor, but he just got sicker. My mom wanted to buy some medicine, but our family was too poor. My daddy didn’t want my mom to spend the money."

Remembering this difficult time, her eyes began to fill with tears. "He was sick at home for more than a year. After the funeral, one of my aunts bought some clothes for me. Other relatives and some of our neighbors gave us money and food, so we would have enough to eat."

Taohua’s family grows wheat, peanuts and fruit trees. They can’t afford any chickens or pigs. They live in a sleepy village in the middle of the vast flatland of Henan Province. The massive wave of urbanization in coastal China has not yet reached here.

But HIV/AIDS did.

In the early 1990s, several blood collection centers were set up near Taohua’s village. Many villagers sold blood to supplement their incomes, happy to earn money for each visit. In order to help them recover from blood loss so that they can sell blood again quickly, other plasma was pooled together from various blood sellers and pumped back into all the sellers' veins. The plasma was not tested for HIV viruses. As a result, HIV spread quickly in this conservative rural area where drug use and extramarital sex are rare. According to official statistics, more than 10,000 HIV/AIDS cases were reported in Henan Province in 2003.

"What I’m most worried about is my mommy. She hasn’t been feeling well lately," Taohua says in a small voice. She then adds: "Daddy sold blood twice, but mom has never done it." According to a local official, Taohua does not yet know that her mother is HIV-positive, most likely as a result of secondary transmission from her late husband.

Like Taohua, some 130 children in her village have already lost one or both parents to AIDS. In Henan Province, more than 2,000 children have been orphaned by AIDS, most of them between the ages of six and 15 years. Some of the children are HIV-positive also. If the surviving parent is too sick to take care of his or her children, the youngsters generally live with their grandparents or in a local welfare centre.
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G M
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« Reply #352 on: December 07, 2010, 07:42:12 PM »

http://www.nytimes.com/2010/12/07/education/07education.html?_r=1&pagewanted=all

Top Test Scores From Shanghai Stun Educators
By SAM DILLON
Published: December 7, 2010


American officials and Europeans involved in administering the test in about 65 countries acknowledged that the scores from Shanghai — an industrial powerhouse with some 20 million residents and scores of modern universities that is a magnet for the best students in the country — are by no means representative of all of China.

About 5,100 15-year-olds in Shanghai were chosen as a representative cross-section of students in that city. In the United States, a similar number of students from across the country were selected as a representative sample for the test.

Experts noted the obvious difficulty of using a standardized test to compare countries and cities of vastly different sizes. Even so, they said the stellar academic performance of students in Shanghai was noteworthy, and another sign of China’s rapid modernization.

The results also appeared to reflect the culture of education there, including greater emphasis on teacher training and more time spent on studying rather than extracurricular activities like sports.

“Wow, I’m kind of stunned, I’m thinking Sputnik,” said Chester E. Finn Jr., who served in President Ronald Reagan’s Department of Education, referring to the groundbreaking Soviet satellite launching. Mr. Finn, who has visited schools all across China, said, “I’ve seen how relentless the Chinese are at accomplishing goals, and if they can do this in Shanghai in 2009, they can do it in 10 cities in 2019, and in 50 cities by 2029.”
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DougMacG
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« Reply #353 on: December 08, 2010, 08:32:50 AM »

Well noted in the story is that is Shanghai and not all of China.  A fairer comparison in the US would be a representative sample of 5100 Chinese American students in American schools.  I believe we have some demographic groups (like whites, blacks and Hispanics) that are not testing as well as Asian Americans.

The US stays ahead of China and everyone else because we have a system that fosters innovation, excellence, entrepreneurial spirit, capital formation and productivity...  Whoops. That line of thinking died in about 1963 with John F. Kennedy.

Americans may rank 15th out of the top 15, but they consistently rank first about how they feel about how they performed.
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G M
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« Reply #354 on: December 08, 2010, 08:37:58 AM »

If we were smart, we'd try to get these students to become Americans. Alas, we only care about those who break the law to get here.
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JDN
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« Reply #355 on: December 08, 2010, 10:13:34 AM »

If we were smart, we'd try to get these students to become Americans. Alas, we only care about those who break the law to get here.

I agree, (I am a bit surprised you posted this comment) we should selectively open up, double triple and expand legal immigration attracting the best and brightest from abroad.  Offer easy visa's and paths to citizenship to scientists, computer experts, mathematicians, physicians, engineers, etc. 

America is the land of opportunity.  Because of our openness and entrepreneurial spirit I think many qualified Chinese, Indians, Japanese, etc. would love to come
and help build America.

And you are also right, instead we seem to only concentrate and spend resources on those who break the law to get here.
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Crafty_Dog
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« Reply #356 on: December 08, 2010, 10:26:17 AM »

I too support the best and the brightest coming to the America.
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G M
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« Reply #357 on: December 08, 2010, 03:40:58 PM »


[/quote]

(I am a bit surprised you posted this comment)

[/quote]

Why?
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JDN
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« Reply #358 on: December 08, 2010, 03:52:26 PM »

Perhaps I am mistaken or I am confusing you with CCP but I thought in general you were
against increasing legal immigration.

Also, I thought it was your opinion that we don't care enough about those who
break the law to get here.  You implied that we care too much about this group.
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G M
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« Reply #359 on: December 08, 2010, 11:18:23 PM »

I am and always have been strongly in favor of LEGAL immigration. I am angered at those that encourage illegal immigration.
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Crafty_Dog
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« Reply #360 on: December 09, 2010, 05:42:35 AM »

That's the way I remember it JDN.
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JDN
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« Reply #361 on: December 09, 2010, 08:46:55 AM »

I am and always have been strongly in favor of LEGAL immigration. I am angered at those that encourage illegal immigration.

I too remember you saying that.  You have never objected to "legal" immigration.

But I was suggesting that we double and triple LEGAL immigration; truly open our
gates for the "best and the brightest" to come here.  I had thought that you
were against this, or as I mentioned perhaps it was CCP who I know is against significantly
increasing legal immigration.  There are points on both sides.

I understand and AGREE with your anger at those who encourage illegal immigration. 
For example I don't understand the DREAM bill.  And I really don't understand how these students
attended University throughout America paying only low cost subsidized resident rates.  I have many LEGAL foreign friends
who are attending college and ALL pay a surcharge because they are a foreigner and cannot be classified as a resident
no matter how long they live here full time.  Nor are they eligible for the so called Dream bill. 

However, in your comment I focused on "ALAS, we ONLY care about those who break the law to get here."
As if you have some "sorrow, grief, pity" for those who break the law to get here.

I have no pity, grief, or sorrow.  It was my mistake; I must have misinterpreted you; it seems you too
are simply "angered at those that encourage illegal immigration". 

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Crafty_Dog
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« Reply #362 on: December 09, 2010, 09:23:50 AM »

By JEREMY PAGE
BEIJING—A ceremony Friday to mark the award of the Nobel Peace Prize to Liu Xiaobo, a jailed Chinese dissident, is turning into a global showdown.

China is preventing Mr. Liu, his family and friends from attending the ceremony in Oslo, making it the first time there will be no one at the ceremony to accept the award since 1936, when it went to Carl von Ossietsky, a German journalist held in a concentration camp by Nazi Germany.

A furious Chinese government has deployed its rapidly expanding global influence to challenge the Nobel Committee's legitimacy and to press other countries to boycott the ceremony, which will feature an empty chair with a photograph of Mr. Liu on it. The ceremony will be followed by a concert hosted by Hollywood stars Denzel Washington and Anne Hathaway.

A newly established Chinese organization has even introduced its own version of the award—the Confucius Peace Prize—which it says will be awarded on Thursday to Lien Chan, a politician from Taiwan who has promoted reconciliation with mainland China.

The Nazis and the Soviets both established their own prizes to rival the Nobels.

A key question for the Communist Party is whether its efforts will backfire by drawing domestic attention to Mr. Liu, who was little known in China until state media launched a vitriolic campaign to demonize him.

Mr. Liu, a former literature professor who took part in the pro-democracy protests in Beijing in 1989, was sentenced to 11 years in prison for "state subversion" over his role in organizing a dissident charter calling for multiparty elections.

For the Nobel Committee, meanwhile, the issue is whether this year's prize—which follows last year's controversial award to President Barack Obama—will promote democratic change in China, as it hopes, or reinforce the party's determination to stifle it.

The committee has, as usual, invited only the ambassadors of the 65 nations that have embassies in Oslo to attend the ceremony. But 20 have declined—double the number last year—including many that either have warming relations with China, or share its resentment of being pushed on human rights and democracy by the West.

The countries that have declined are Afghanistan, Colombia, Cuba, Egypt, Iran, Iraq, Kazakhstan, Morocco, Pakistan, the Philippines, Russia, Saudi Arabia, Serbia, Sri Lanka, Sudan, Tunisia, Ukraine, Venezuela, Vietnam and China itself.

One diplomat from Sri Lanka initially told The Wall Street Journal that its embassy in Oslo was sure to send someone "if nobody had a cold," but later said that no one would attend, saying: "We are a small country and China is now our friend."

China provided crucial economic aid, arms and diplomatic support to Sri Lanka during the final stages of the war against the Tamil Tiger rebel movement in 2009.

China also was outraged when the Dalai Lama, Tibet's exiled spiritual leader, won the prize in 1989, but made no effort to organize a boycott, isolated as it was after the military crackdown on pro-democracy protests around Tiananmen Square earlier that year.

Activist Laureates
See advocates for political change who have received the Nobel Peace Prize.

View Interactive

Reuters
 .."I don't think they held any kind of campaign in 1989—they just stayed away and showed their displeasure. Of course, China is much stronger now," Geir Lundestad, secretary of the Norwegian Nobel Committee, told The Wall Street Journal. "Even the Soviets did not mount a campaign like this."

When the Soviet dissident Andrei Sakharov won the prize in 1975, Moscow also declined to let him collect it, but did permit his wife, Yelena Bonner, to attend the ceremony.

In 1983, Communist authorities in Poland also permitted the wife of Lech Walesa—the dissident trade unionist—to receive his prize.

Aung San Suu Kyi, Burma's opposition leader, was under house arrest when she won in 1991, but her then-18-year-old son accepted the award on her behalf. Ms. Suu Kyi was released from house arrest last month.

The Nobel Committee, Western governments and human-rights activists have repeatedly urged China to free Mr. Liu, as well as his wife, Liu Xia, who has been under effective house arrest since he won the prize.

Vaclav Havel, the former Czech president, and Archbishop Desmond Tutu of South Africa—another Nobel Peace laureate—made a public appeal last week for China to release Mr. Liu and his wife or risk losing its credibility as a world power.

View Full Image

Getty Images
 
Protesters demand the release of jailed Nobel Peace laureate Liu Xiaobo in front of the Chinese Consulate in Los Angeles on Dec. 5, less than a week before the award ceremony in Oslo.
.However, China has gone on the offensive, denouncing the award as part of a Western conspiracy. It has detained scores more dissidents, and prevented dozens of others from leaving China in case they try to attend Friday's ceremony.

It has delayed talks on a trade deal with Norway, even though the government there says it has no influence over the Nobel Committee, and has warned other countries that they will have to "bear the consequences" if they attend the ceremony.

Jiang Yu, a Chinese Foreign Ministry spokeswoman, Tuesday called the Nobel Committee "clowns" and accused the Norwegians of "orchestrating an anti-China farce by themselves."

She said more than 100 countries and organizations have expressed explicit support for China's opposition to this year's Peace Prize.

The Nobel Committee countered by saying that ambassadors from 44 of the 65 countries invited would attend the ceremony—along with about 30 to 40 of Mr. Liu's supporters from around the world. But only one of those was on a list of 143 that Liu Xia invited to attend, as most have been unable to leave China. He is Wan Yanhai, an AIDS activist who moved to the U.S. last year. "The ceremony is really important—it's a symbolic event for the Chinese democratic movement," Mr. Wan said in an interview. "This will be like a catalyst in a chemical process. What the Communist Party is doing now is to show how ugly authoritarian government is."

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DougMacG
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« Reply #363 on: December 09, 2010, 10:44:36 AM »

The accusation that GM changed his mind has turned out to be unfounded.   wink
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G M
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« Reply #364 on: December 09, 2010, 10:45:46 AM »

I was being sarcastic. Whenever in doubt, it's pretty safe to assume that's what I'm doing.  grin
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G M
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« Reply #365 on: December 10, 2010, 07:36:52 PM »

http://news.yahoo.com/s/csm/20101209/wl_csm/348667

Shanghai test scores have everyone asking: How did students do it?
The Christian Science Monitor

   
By Ariel Zirulnick Ariel Zirulnick – Thu Dec 9, 5:14 pm ET

When the results of an international education assessment put Shanghai and several other Asian participants ahead of the US and much of Western Europe, many Americans were shocked. “Top test scores from Shanghai stun educators” read the headline in The New York Times.

Meanwhile, many education and Asia experts felt vindicated. After years of saying that China was rapidly catching up or surpassing the US and the rest of the West in education, here was hard proof.

The assessment, released Tuesday and conducted by the Programme for International Student Assessment (PISA), measures academic capabilities in math, science, and reading among OECD member nations and a few dozen other countries and what it calls economic partners, such as Shanghai. The scores come from the results of a test taken by 15-year-olds in these countries. There was no evaluation of China as a whole. Shanghai, Hong Kong, and Macao were all assessed separately.

RELATED: US students halt academic 'free-fall,' but still lag in global testing

Shanghai trounced the OECD average: in reading, it got a 556, versus a 493 OECD average; in science, the score was 575 versus 501; and in math, there was a difference of more than 100 points – a 600 in Shanghai versus a 496 average. For a country that emerged only 30-plus years ago from the Cultural Revolution – when education was saturated with politics and many children lost years of schooling – the results left many observers with one question: How did they do it?

Experts ascribe Shanghai’s success to China's assessment that academic achievement is foremost the result of hard work rather than a good teacher or innate talent.

“Students not only work harder, but they attribute their academic success to their own work,” says James Stigler, a professor of psychology at UCLA who has conducted research on the Chinese educational system. “Chinese students say the most important factor is studying hard. They really believe that’s the root of success in learning.”

That emphasis on hard work is complemented by several other key practices: active engagement by parents, early efforts to build up attention spans, and families' emphasis on spending long hours in school and on homework while doing little else. Parents and students alike believe that buying in has a payoff – future success.
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Crafty_Dog
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« Reply #366 on: December 13, 2010, 09:51:03 AM »

Pravda on the Hudson is now starting to say things I have been saying here:

For nearly two years, China’s turbocharged economy has raced ahead with the aid of a huge government stimulus program and aggressive lending by state-run banks.

But a growing number of economists now worry that China — the world’s fastest growing economy and a pillar of strength during the global financial crisis — could be stalled next year by soaring inflation, mounting government debt and asset bubbles.

Two credit ratings agencies, Moody’s and Fitch Ratings, say China is still poised for growth, yet they have also recently warned about hidden risks in its banking system. Fitch even hinted at the possibility of another wave of nonperforming loans tied to the property market.

In the late 1990s and early this decade, the Chinese government was forced to bail out and recapitalize these same state-run banks because a soaring number of bad loans had left them nearly insolvent.

Those banks are much stronger now, after a series of record public stock offerings in recent years that have raised billions of dollars from global investors.

But last week, an analyst at the Royal Bank of Scotland advised clients to hedge against the risk that a flood of cash into China, coupled with soaring inflation, could result in a “day of reckoning.”

A sharp slowdown in China, which is growing at an annual rate of about 10 percent, would be a serious blow to the global economy since China’s voracious demand for natural resources is helping to prop up growth in Asia and South America, even as the United States and the European Union struggle.

And because China is a major holder of United States Treasury debt and a major destination for American investment in recent years, any slowdown would also hurt American companies.

Aware of the risks, Beijing has moved recently to tame its domestic growth and rein in soaring food and housing prices by raising interest rates, tightening regulations on property sales and restricting lending.

At the end of the Central Economic Work Conference, a high-level annual economic policy meeting that concluded on Sunday, Beijing promised to combat inflation and stabilize the economy. Those pledges came just days after the central bank ordered banks to set aside larger capital reserves in a bid to slow lending, the sixth time it has done so this year. And the government reported on Saturday that the consumer price index had climbed 5.1 percent in November, the sharpest rise in nearly three years.

Analysts say more tightening measures are expected in the coming months but that the challenges are mounting.

“There are so many moving pieces,” said Qu Hongbin, the chief China economist for HSBC in Hong Kong. “It wouldn’t be honest to say things aren’t complicated.”

Optimists say China has been adept at steering the right economic course over the last decade, ramping up growth when needed and tamping it down when things get too hot.

But this time, Beijing is not just struggling with inflation, it is also trying to restructure its economy away from dependence on exports and toward domestic consumption in the hopes of creating more balanced and sustainable growth, analysts say.

China is also facing mounting international pressure to let its currency, the renminbi, rise in value. Some trading partners insist China is keeping its currency artificially low to give Chinese exporters a competitive advantage.

Beijing contends that raising the value of its currency would hurt coastal factories that operate on thin profit margins, forcing them to lay off millions of workers.

The most immediate challenge appears to be inflation, which some analysts say may be even more serious than the new figures suggest. Housing prices have skyrocketed. And prices for milk, vegetables and other foods have soared this year.

“The money supply is too large,” said Andy Xie, an economist based in Shanghai who formerly worked at Morgan Stanley. “They increased the money supply to stimulate the economy. Now land prices have jumped 20 times in some places, 100 times in others. Inflation is broad-based. Go into a supermarket. Milk is more expensive in China than it is in the U.S.”

In Shanghai, where the average monthly wage is about $350, a gallon of milk now costs about $5.50.

Wages have also risen sharply this year in coastal provinces amid reports of labor shortages and worker demands for higher pay. Many analysts expect more wage increases next year.

That may be good for workers, analysts say, but it will also change the dynamics of the Chinese economy and its export sector while contributing to higher inflation.

Beijing is now under pressure to mop up excess liquidity after state banks went on a lending binge during the stimulus program that got under way in early 2009. Analysts say a large portion of that lending was diverted to speculate in the property market.

=======

In addition to restricting lending at the big state banks, Beijing recently moved to close hundreds of underground banks and attempted to restrain local governments from borrowing to build huge infrastructure projects, some of which may be wasteful, according to analysts.

Some economists say the real solution is for Beijing to privatize more industries and let the market play a bigger role. After the financial crisis hit, the state assumed more control over the economy.
Now, state banks and big state-owned companies are reluctant to surrender control over industries where they have monopoly power, analysts say.

“Inflation is not the most serious problem,” says Xu Xiaonian, a professor of economics at the China Europe International Business School in Shanghai. “The most fundamental problem we have to resolve is structural. We need more opening up and reform policies. Look at the state monopolies in education, health care, telecom and entertainment. We need to break those up. We need to create more jobs and make the economy more innovative.”

Zhiwu Chen, a professor of finance at Yale, agrees.

“The state economy and the local governments will be where the future problems occur,” Professor Chen said in an e-mail response to questions on Sunday. “They will be the sources of real troubles for the banks and the financial system.”

Though no economist is forecasting the end to China’s decades-long bull run, many have turned more cautious. And Fitch Ratings recently released a study it conducted with the forecasting consultancy Oxford Economics that examined the effect a slowdown in China would have on the rest of the world.

Fitch expects China’s economy to grow at an annual rate of 8.6 percent next year, down from about 9.7 percent this year. But the report, which was released a few weeks ago, said that if growth slowed to 5 percent, the economies of many other Asian nations would suffer seriously. Steel, energy and manufacturing industries around the world would also be hard hit, it said.

Fitch analysts are careful not to forecast a sharp slowdown in China. But if one comes, they say, it is “most likely to stem from a combination of property crash and banking crisis.”
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Crafty_Dog
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« Reply #367 on: December 15, 2010, 09:55:14 AM »

HONG KONG — The United States is too reliant on China for minerals crucial to new clean energy technologies, making the American economy vulnerable to shortages of materials needed for a range of green products — from compact fluorescent light bulbs to electric cars to giant wind turbines.

Molycorp, an American company, stopped mining for rare earths in Mountain Pass, Calif., in 2002, but expects to reopen the mine in 2012.
So warns a detailed report to be released on Wednesday morning by the United States Energy Department. The report, which predicts that it could take 15 years to break American dependence on Chinese supplies, calls for the nation to increase research and expand diplomatic contacts to find alternative sources, and to develop ways to recycle the minerals or replace them with other materials.

At least 96 percent of the most crucial types of the so-called rare earth minerals are now produced in China, and Beijing has wielded various export controls to limit the minerals’ supply to other countries while favoring its own manufacturers that use them.

“The availability of a number of these materials is at risk due to their location, vulnerability to supply disruptions and lack of suitable substitutes,” the report says, which also mentions some concerns about a few other minerals imported from elsewhere, such as cobalt from the Congo.

The Energy Department report is being released the same morning that cabinet officials from China and the United States will meet in Washington to discuss economic and commercial issues.

While no detailed agenda has been released, the talks are expected to include American objections to China’s tightening restrictions on rare earth exports — like a two-month halt this autumn on shipments to Japan, and a shorter-lived slowdown of exports to the United States and Europe.

And on Tuesday, China’s finance ministry announced on its Web site, and the official Xinhua news agency later reported as well, that China plans to increase its export taxes on some rare earths next year. The ministry did not say how much the taxes would increase. Although World Trade Organization rules ban export taxes, China has imposed them on rare earths for the last four years.

David Sandalow, the assistant secretary of energy for policy and international affairs, who oversaw preparation of the Energy Department report, said in a telephone interview that the timing of the report’s release and the American-China cabinet meetings was coincidental.

But the report reflects an emerging view within the American government that domestic sources of rare earths are needed, in addition to suppliers in many other countries, to ensure the viability of clean energy manufacturing in the United States.

“We can build a new industry and put our clean energy future on a sound footing, creating many new jobs in the process,” Mr. Sandalow said.

Still, the report presents a fairly gloomy assessment of the United States’ ability to wean itself from Chinese imports. For as long as the next 15 years, the supplies of at least five minerals that come almost exclusively from China will remain as vulnerable to disruption as they are absolutely vital to the manufacture of small yet powerful electric motors, energy-efficient compact fluorescent bulbs and other clean energy technologies, the report said.

The five minerals are medium and heavy rare earth elements of which China mines an estimated 96 percent to 99.8 percent of the world’s supply: dysprosium, terbium, neodymium, europium and yttrium.

China also increasingly dominates the manufacture of clean energy technologies that require such minerals, including the production of million-dollar wind turbines. Chinese export restrictions have added up to $40 a pound to world prices, which makes a big difference particularly for some of the less expensive rare earths, like lanthanum, that sell for several dollars a pound in China.

That is among the reasons, along with cheap labor and extensive Chinese government subsidies, that many clean energy manufacturers have found it cheaper to shift production to China.

Mr. Sandalow said that wind turbine manufacturers were capable of building very large turbines without rare earths. But using rare earths could reduce the per megawatt cost of wind energy and improve its competitiveness through savings on other materials, like steel and copper.

He cautioned that the United States had been putting far fewer resources than China into exploring ways to use the powerful magnetic and other properties of rare earths.

“There are thousands of rare earth researchers in China and dozens in the United States, and that underscores both the challenge and the opportunity,” he said. “Their expertise in this area is significant.”

China’s finance ministry, in announcing plans to raise export taxes on some rare earths, did not indicate which minerals might be affected.

=================

Page 2 of 2)



Since 2006, China has imposed an export tax of 15 percent on light rare earths like lanthanum and cerium, which are needed for oil refining and glass manufacturing, and 25 percent on heavy rare earths like dysprosium and terbium.

China mines about 92 percent of the world’s light rare earths.
Dysprosium, which helps rare earth magnets preserve their magnetism at high temperatures, is mined almost exclusively in southern China and sells for $95 a pound in China and $135 a pound outside, including the export tax.

Dysprosium has emerged as the mineral most vital to clean energy industries yet most vulnerable to supply disruptions, the report said.

Dudley Kingsnorth, a prominent rare earth mining consultant in Perth, Australia, said he agreed that a dysprosium shortage was likely. He added that he expected that a rare earth shortage would slow the overall adoption of new rare earth technologies by clean energy industries for at least the next five years.

American and Japanese officials have said that they might file a legal challenge at the World Trade Organization to China’s taxes on rare earth exports, as well as on quotas that China imposes on rare earth exports.

Until this autumn, Chinese officials had portrayed their rare earth policies as an effort to force high-tech companies to move their factories to China and retain supplies for domestic industries. The Chinese government has recently shifted to describing the export restrictions as an environmental measure, noting that extracting and processing the minerals can be a highly toxic process that has also resulted in leaks of radioactive mining waste into the groundwater in northern China.

But while W.T.O. rules allow export restrictions for environmental reasons, that is only if a country also restricts domestic consumption, which China has not done.

Demand for rare earths and China’s virtual chokehold on supplies have prompted some overseas companies to enter, or re-enter, the field.

Molycorp, an American company that in August made an initial public offering of its shares on the New York Stock Exchange, plans to open in 2012 a large rare earth mine at Mountain Pass, Calif., that closed in 2002 after prices were undercut by Chinese competitors. Molycorp announced on Monday that it had received the last of the construction permits needed to proceed.

The Lynas Corporation of Australia plans to open at the end of next year a large rare earths mine at Mount Weld, Australia.

But both the Molycorp and Lynas mines will produce mostly light rare earths and relatively little of the medium and heavy rare earths needed for magnets and other significant clean energy applications.

Dozens of small mining companies hope to open new mines in the United States and elsewhere that could tap reserves of medium and heavy rare earths. But these small companies face formidable legal, financial, marketing and management obstacles, the Energy Department report said.
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G M
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« Reply #368 on: December 17, 2010, 10:25:15 AM »

http://news.yahoo.com/s/ap/20101217/ap_on_re_as/as_china_japan

Beijing says Japan making irresponsible remarks


– Fri Dec 17, 4:22 am ET

BEIJING – Beijing is accusing Japan of making irresponsible remarks in its new defense guidelines targeting China.

Foreign Ministry spokeswoman Jiang Yu says China is a force for peace and development in Asia and threatens no one.

**Let's see, China and Russia threaten Japan, now China protests when Japan recognizes the looming threats.**
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Crafty_Dog
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« Reply #369 on: December 29, 2010, 12:58:08 PM »

By SHAI OSTER, NORIHIKO SHIROUZU And PAUL GLADER
BEIJING—Foreign companies have been teaming up with Chinese ones for years to gain access to the giant Chinese market. Now some of the world's biggest companies are taking a risky but potentially rewarding second step—folding pieces of their world-wide operations into partnerships with Chinese companies to do business around the globe.


General Electric Co. is finalizing plans for a 50-50 joint venture with a Chinese military-jet maker to produce avionics, the electronic brains of aircraft. The deal with Aviation Industry Corp. of China would give GE access to a Chinese government project aimed at challenging Boeing Co. and Airbus in the civilian-aircraft market.

General Motors Co. established a joint venture this year with SAIC Motor Corp., its longtime partner in China, to produce and sell their no-frills Wuling-brand microvans in India, and eventually in Southeast Asia and other emerging markets as well.

The two deals show China Inc.'s growing international ambitions, as well as its increasing leverage over foreign partners. To make the GE deal happen, GE Chief Executive Jeffrey Immelt made an extraordinary concession, agreeing to fold into the venture all of GE's existing world-wide business in nonmilitary avionics. GM, in its deal, contributed technology, its manufacturing facilities in India and use of its Chevrolet brand name in that market.

Several forces are motivating China's foreign partners to strike global deals that would have been unthinkable a few years back. China's big government-backed companies now have enormous financial resources and growing political clout, making them attractive partners outside China. In addition, the Chinese market has become so important to the success of multinational companies that Beijing has the ability to drive harder bargains.



Joint Flight
Western companies working on China's C919 jet mostly through joint ventures

General Electric Co.
Avionics, cockpit-display systems, on-board maintenance systems and flight recorders.

Rockwell Collins Inc. Communication, navigation and surveillance systems.

Eaton Corp.
Fuel and hydraulic systems, cockpit-panel assemblies and dimming-control system.

Hamilton Sundstrand Corp.
Electrical power systems.

Honeywell International Inc. Flight-control systems, auxiliary-power unit, wheels and brakes.

Liebherr-Aerospace Toulouse SAS
Landing gear and air-management systems.

Parker Hannifin Corp.
Hydraulics, flight-control and fuel-tank systems.

But such deals also carry risk. Several earlier joint ventures inside China have soured over concerns that Chinese partners, after gaining access to Western technology and know-how, have gone on to become potent new rivals to their partners.

"Foreign partners are seeing they will have to sometimes sacrifice or share the benefits of the global market with the Chinese partner," says Raymond Tsang, a China-based partner at consultancy Bain & Co. "Some of the [multinational corporations] are complaining. But given the changing market conditions, if you don't do it, your competitors will."

Big energy companies, too, have been pursuing international deals with Chinese companies. China has supplanted the U.S. as the world's biggest energy consumer, making access to its market vital for global companies. Foreign firms hope that teaming up with Chinese companies abroad will help on that front. Foreign companies supply technology and experience, and their Chinese partners provide geopolitical clout, low-cost labor, and easy access to credit that China's government-backed companies enjoy.

State-owned China National Petroleum Corp. was one of the first foreign oil companies to sign a major contract in Iraq. BP PLC teamed up with it last year for a $15 billion investment to increase output at the giant Rumaila field. Over the summer, Royal Dutch Shell PLC joined with PetroChina Co., a publicly traded subsidiary of China National Petroleum, on a $3.15 billion acquisition of assets from Australian energy company Arrow Energy Ltd.

China has been gaining clout in some resource-rich parts of the developing world where U.S. companies don't have strong footholds, partly by spending lavishly on infrastructure projects, and it can help broker deals in places like Venezuela and Myanmar, where it has good relations.

In financial services, foreign banks long have coveted access to China's fast-growing securities business. China has allowed a number of companies into the market in recent years through joint ventures, with their stakes capped at about 33%. Chinese regulators also restrict which parts of the securities business they can do.

Crédit Agricole SA already is involved in such a joint venture through its Asian brokerage arm, called CLSA Asia-Pacific Markets, but it is a minor player in China. In May, its investment-banking unit announced a preliminary deal with China's government-owned Citic Securities Co. to form a joint venture beyond China's borders. The French company plans to contribute CLSA and other pieces of its international operation. Citic Securities would throw in its small international unit, based in Hong Kong. Crédit Agricole hopes that helping Citic Securities realize its international ambitions will enable the French bank to expand its business in China.


But talks have gone slower than expected. The two companies said this month that they had agreed on certain key terms, but extended a year-end deadline for a final deal to June 30, without explaining the delay.

Some joint ventures in China have stumbled because of spats with local partners or because the partnerships enable Chinese companies to learn enough about industries to become new competitors to their Western partners.

Kawasaki Heavy Industries Ltd. and Siemens AG, for example, worked with Chinese partners to help build China's high-speed rail network. Now the Chinese companies are bidding against them for international contracts—using products at least partly based on the foreign firms' technology. Last year, France's Groupe Danone SA accepted a cash payment to terminate its joint ventures with China's Hangzhou Wahaha Group Co. after a nasty public feud. The French company had alleged that Wahaha's boss had produced and sold Wahaha-branded beverages supposedly owned by the joint venture through a separate network he owned. Wahaha denied the accusation.

GE's avionics deal with Aviation Industry, or AVIC, also is vulnerable, says Jim Wasson, president of Growth Strategies International LLC, an aerospace and defense consulting firm, and a former GE Aviation executive. The fear is that "once AVIC knows enough about how to do this, they'll kick [GE] out and be on their own," he says.

Lorraine Bolsinger, chief executive of GE Aviation Systems, acknowledges there were concerns within GE about protecting technology. "It was very controversial," she says of the proposed deal. "It was really us knuckle-dragging technology guys that think we had a lot to protect." In the end, she says, "when we and the Chinese together create intellectual property, we are darn right going to protect it."
These days, big Chinese state companies with access to cheap funds and other government support are gunning to dominate some of the same industries that firms like GE have targeted as growth opportunities, from clean technology to turbines.

Even so, GE has such high hopes for China that Mr. Immelt has called it "our second home market." Two years ago, Mr. Immelt said China revenue would double to $10 billion by 2010. But last year it reached just $5.3 billion.

GE saw working with AVIC as a chance to boost its avionics business, which has lagged behind Honeywell International Inc. and Rockwell Collins Inc. The planned venture, to be based in Shanghai, has been chosen to supply China's planned C919 jet, which has the potential to grab a big slice of the Chinese civilian-aviation market. Boeing estimates that market will be worth more than $400 billion over the next 20 years, second only to the U.S.

In negotiations, GE is asking AVIC to match the value of the technology GE is contributing with a cash investment, according to people at GE. If a deal is finalized, all of GE's existing and future civilian avionics contracts will go to the joint venture. Negotiations were supposed to be done by mid-2010, but the parties now hope to finish them by early 2011.

GE executives say the AVIC deal is their closest cooperation ever with a Chinese partner. GE has 45 people in China on the project now, and it is hiring or moving several hundred more people there, even before final terms are hammered out.

AVIC, which makes fighter jets and helicopters in addition to civilian products, has ambitions outside of China. "For the aviation industry, there is no regional market, only the global market," the company said in a statement. "AVIC's strategy is to actively integrate itself into the industrial chain of the world's aviation industry, and to become a truly global company."

Last month, China unveiled the first life-size mock-up of the C919. Other foreign companies have negotiated similar joint ventures to make other parts.

"Our hope and desire is that this joint venture maintains a working-together partnership that benefits both," says Kent Statler, executive vice president at Rockwell Collins, which has a joint venture to supply the C919 with communications systems. "But let's not be naive. We realize that this could turn into a competitor."

For GM, the stakes are especially high: China became the world's largest auto market last year.

Back in 1997, GM decided to plow more than $1 billion into a 50-50 joint venture with SAIC to make Buicks. At the time, it was seen as a risk because car sales had yet to take off in China. This year, GM's China ventures are on track to sell nearly 2.27 million vehicles in the country, compared to 2.18 million sold by GM in the U.S., according to research firm IHS Automotive.

Much of GM's recent growth in China has come through a second joint venture set up in 2002 with SAIC and another Chinese company. The venture, SAIC GM Wuling Automobile Co., makes boxy microvans costing as little as $4,500, which have proven popular in China's smaller cities and towns. Last year Wuling became the first brand in China to sell a million cars in a year. This year, it's expected to account for nearly one-sixth of GM vehicle sales world-wide. Last month, GM reached a deal to buy an additional 10% interest in Wuling for $51 million from the venture's third investor, raising GM's stake to 44%. SAIC owns 50%.

The India joint venture, which began operating in February, is part of GM's effort with SAIC to replicate its China success in other markets. It will produce cars based on its Chinese Wulings, but will sell them under the Chevrolet brand. GM contributed its brand, India factories and dealer network, while SAIC contributed about $300 million to $350 million, a senior GM executive said when the deal was announced.

"We think the business model we have in China with SAIC and the product lineups we have in China are ripe for export to other parts of the world," says Kevin Wale, chief of GM's China operations.

GM and SAIC already have made less ambitious forays abroad together. They export Chevy Sail compacts designed and made in China to Chile and Peru, and are jointly developing more new models to be sold globally, such as the Buick LaCrosse, a sedan designed by teams in Shanghai and Warren, Mich., and sold in China and the U.S.

The India deal takes that cooperation a step beyond shipping jointly produced vehicles overseas. GM and SAIC executives and engineers will be posted in India to design, produce and market cars locally—something SAIC currently has almost no experience with.

One risk to GM is that the venture will better position SAIC to compete abroad on its own—against GM.

Already, SAIC has grown into a powerhouse at home, in part through learning from GM. In 2006, SAIC launched its own solo brand in China, called Roewe. It now competes domestically with the Buicks that SAIC makes with GM. The Roewe brand, which is based it on technology acquired from the now-defunct MG Rover Group Ltd., along with a related nameplate, MG Mingju, sold 146,323 cars in the first 11 months of this year, up 78% from the year-earlier period, according to J.D. Power & Associates. Buick's sales in China, while more than three times as large, grew one-third as fast over the same period.

"Roewe offers comparable products at lower price points and is taking away from GM and others," says Michael Dunne, an auto-industry veteran who heads Hong Kong-based investment advisory firm Dunne & Co.

Last year, GM agreed transfer 1% of its stake in Shanghai GM, its main Chinese joint venture, to SAIC, giving its Chinese partner 51% and effective control. GM said at the time the move would give it better access to credit from Chinese banks, and pave the way for its bigger stake in the Wuling venture.

Last month, GM said the two companies are looking at the possibility of selling SAIC's MG-branded cars through GM's world-wide sales channels. The move could open the door for SAIC's cars to make inroads into Britain, where the MG brand was once based, according to an individual close to GM. Also last month, SAIC paid $500 million for a 1% stake in GM as part of the Detroit auto maker's initial public offering.

SAIC is "very well situated to meet Western [car companies] head on," says Michael Robinet, a U.S.-based senior analyst with consulting firm IHS Automotive. "There's no doubt in my mind, MG and Roewe are going to be both very good launch pads for SAIC to look at new markets beyond China."

Write to Shai Oster at shai.oster@wsj.com, Norihiko Shirouzu at norihiko.shirouzu@wsj.com and Paul Glader at paul.glader@wsj.com
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« Reply #370 on: December 31, 2010, 09:07:17 AM »

http://www.popularmechanics.com/technology/military/navy-ships/what-a-war-between-china-and-the-us-would-look-like

What a War Between China and the United States Would Look Like
Any Chinese move to take over Taiwan would trigger a confrontation with the U.S. Navy and Air Force. Is the U.S. prepared to counter this growing threat?
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« Reply #371 on: December 31, 2010, 10:32:51 AM »

I thought that a good article; it brings into play all variables that have engaged my attention (e.g. killer satelliites, cyber disruptions of our communications, etc).
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« Reply #372 on: December 31, 2010, 10:41:07 AM »

Yes. China isn't looking to meet us ship for ship, plane for plane. Instead, they are looking to technological leaps to nullify our advantages while staging a fight that favors their strengths.
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« Reply #373 on: December 31, 2010, 10:45:31 AM »

Exactly so, but lets take this conversation over to the new "US-China" thread that I just started.  Indeed, would you be so kind as to paste the Popular Mechanics article there as well?
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« Reply #374 on: January 01, 2011, 04:36:27 PM »

http://www.newsweek.com/2010/12/29/in-china-pushing-the-talmud-as-a-business-guide.html

Selling the Talmud as a Business Guide
In China, notions of Jewish business acumen lead to a publishing boom—and stereotyping.
P Deliss / Godong-Corbis

A page from the Talmud, the book consisting of early rabbinical writings that inform the Judaic tradition.

Jewish visitors to China often receive a snap greeting when they reveal their religion: “Very smart, very clever, and very good at business,” the Chinese person says. Last year’s Google Zeitgeist China rankings listed “why are Jews excellent?” in fourth place in the “why” questions category, just behind “why should I enter the party” and above “why should I get married?” (Google didn’t publish a "why" category in Mandarin this year.) And the apparent affection for Jewishness has led to a surprising trend in publishing over the last few years: books purporting to reveal the business secrets of the Talmud that capitalize on the widespread impression among Chinese that attributes of Judaism lead to success in the financial arts.
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« Reply #375 on: January 08, 2011, 12:02:22 AM »

Beijing Tells the Provinces To Slow Down

Zhang Ping, director of China’s powerful National Development and Reform Commission (NDRC) — the leading economic planner — called on China’s provinces to slow down their economic growth targets for 2011 and take into consideration the effects of growth on “energy, environment, water and land.” Zhang said only five or six provinces have lowered their growth targets to 8 or 9 percent — 8 percent being the Communist Party’s estimated rate of growth necessary to maintain sufficient job creation. The others have targeted 10 percent growth rates or higher, and some aim to double their total output in five years.

Zhang’s comments point to the central government’s pragmatic desire for the provincial growth targets to be consistent with the national target. Beijing also does not want provinces to set themselves up for a deadline-driven rush that will increase costs or intentionally use fake numbers to please the central government. Beijing eventually wants to reduce its emphasis on using economic indicators to judge political performance, since it sets rapid growth as the sole good, which has led to a variety of economic policy abuses and social distortions. The government wants a more accurate picture, and is urging the provinces to prepare for lower and — ideally — more sustainable growth. It is also trying to alleviate the massive pressure on China’s domestic resources and ability to acquire sufficient resources from abroad.

“The provinces show no self-restraint because they are profiting from the easy credit and endless economic boom and, on a deeper level, because they fear a recession would create unemployment-charged uprisings that would see them alone in their tower under siege.”
But Zhang’s comments are also emblematic of a deep tension in China’s system. Struggles between the central political power and the provincial powers define Chinese history. The country has three core economic and population regions — the North China Plain and Yellow River Delta (Beijing), the Yangtze Delta (Shanghai), and the Pearl River Delta (Guangdong) — with mountains splitting the south from the north. In addition, there are other populous enclaves like the Northeast or Sichuan Basin, the far western deserts and wastelands, and the breakaway province of Taiwan. The country is equally disposed to division and warring kingdoms as it is to unity through rigidly centralized bureaucracy. The center demands the regions adhere to its edicts and remain unified to protect against foreign exploitation or invasion; the regions amass wealth for themselves, compete with each other, and ignore or resist the center.

The Communist Revolution marked a 30-year period of national reformation and central consolidation. But eventually, China found it needed economic growth, and the opening up of 1978 gave room for special zones and eventually entire provinces to re-engage in market activity. The result was an explosion of economic growth that continues. Within this growth, the economy has waxed and waned, primarily responding to the central government’s devolving power to the provinces to allow them to race, and then struggling to tighten the reins.

Now, China is manifestly nearing the peak of that super-cycle of economic expansion. The failure of the growth model is particularly a problem after the global crisis when exports collapsed. China poured credit into the economy to skip over the recession, but at the expense of rising costs for the natural resources necessary to maintain this growth and deepening disparities in wealth and social frustrations. Small steps to tighten growth in 2010 had limited effects, giving way to a reassertion of the desire for growth. Thus, the top technicians in control of the country’s financial system face the dilemma of making forceful demands to slow the economy at the risk of driving it into the ground — or continuing with small adjustments and thereby revealing their weak will and emboldening the provincial warlords. The provinces show no self-restraint because they are profiting from the easy credit and endless economic boom and, on a deeper level, because they fear a recession would create unemployment-charged uprisings that would see them alone in their tower under siege.

Beijing has faced the dilemma before — notably in the late 1980s and mid-1990s — but it is especially hesitant to force its way now because of a monumental political change approaching. The older generation of leaders is passing the torch in 2012-13, and power transitions cannot yet be said to be a casual or comfortable affair in the People’s Republic. So, a generational division overlays the central-provincial divisions — some of the young leaders, finding support from the central policy specialists, are more inclined to impose controls on the economy and try to engineer a smooth descent, so that they do not inherit an about-to-burst or already bursting bubble and instead have the option of reaccelerating when they take power to benefit their personal networks and consolidate power.

But some powerful voices in the older generation, aided by the provincial warlords and their patrons, seem to lack the appetite for risky policy moves. They are constrained by the niggling fear that however well planned, an attempt to moderate growth now could trigger an irreversible slowdown and the conclusion of the growth super-cycle that has held for the past 30 years. An economic disjunction of that magnitude could in turn precipitate the kind of totalizing socio-political revolution that has occurred every 30 or 40 years in China’s modern history. They are demanding a proud legacy when they retire and the regime is demanding a smooth transition for its own sake. But there is no guarantee they will get this, and, for now, the policy tug-of-war intensifies.

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« Reply #376 on: January 12, 2011, 04:38:53 AM »

BEIJING — When garment buyers from New York show up next month at China’s annual trade shows to bargain over next autumn’s fashions, many will face sticker shock.

Though many Chinese are earning higher salaries, the government has become worried that rising inflation could lead to social unrest.
“They’re going to go home with 35 percent less product than for the same dollars as last year,” particularly for fur coats and cotton sportswear, said Bennett Model, chief executive of Cassin, a Manhattan-based line of designer clothing. “The consumer will definitely see the price rise.”

Inflation has arrived in China. And after Tuesday’s release of crucial financial statistics by China’s central bank, few economists expect Beijing officials to be able to tame rising prices any time soon.

While American importers of Chinese goods will feel the squeeze, the effect on American consumers may be more subtle and the overall impact on United States inflation may be minimal.

There are simply too many other markups along the way — from transportation to salesclerks’ wages — that affect the American retail prices of Chinese-made products. Excluding those markups, imports from China are equal to little more than 2 percent of the overall American economy.

The bigger consumer impact is in China itself. As China’s booming economy enables more of its own citizens to buy the goods pouring out of its factories, Chinese consumers are feeling inflation directly. And Beijing is increasingly worried about the social unrest that could result.

In China, consumer prices were 5.1 percent higher in November than a year earlier, according to official government data. And many economists say the official figures actually understate the rate of inflation, which might in reality be twice as high.

“Four percent, China can bear it — beyond 5 percent, people will complain a lot,” said Huo Jianguo, president of the Chinese Academy of International Trade and Economic Cooperation here.

Higher global commodity prices, as well as rising wages in China, play roles in the increasing cost of Chinese goods. But economists say the main reason for the inflation now is China’s foreign exchange reserves, which surged by a record amount in the fourth quarter.

The central bank has been pumping out currency at an ever-accelerating pace over the past decade to limit the renminbi’s appreciation against the dollar. That strategy has helped preserve a competitive advantage of Chinese exporters by keeping their prices relatively low on global markets — while also protecting the jobs of tens of millions of Chinese workers in export factories.

Now, though, that cheap currency policy seems to be reaching its limits. The extra renminbi are feeding inflation. That is starting to undermine exporters’ price competitiveness — just as a stronger renminbi would do if Beijing was not intervening to begin with.

Money supply figures for December, which the central bank released on Tuesday, showed that cash and bank deposits were increasing at a rate twice as fast as even China’s soaring economy. Ever more renminbi are available to buy goods and services.

Victor Fung, the group chairman of Li & Fung in Hong Kong, a 35,000-employee trading company that supplies most of the world’s big retailers with Asian goods, said that contracts signed late last year would produce a jump of 10 to 20 percent in the import prices of consumer goods arriving at American ports by the second quarter of this year.

“By the middle of this year, you’ll see considerable diversion of trade away from China,” which will start to bring down the United States trade deficit with China, Mr. Fung said in an interview.

But there are only limited alternatives to China as a supplier of cheap goods. As American retail chains scramble to shift orders to other countries like Bangladesh and the Philippines, they are finding that inflation is emerging as an issue across much of Asia.

What is more, the far smaller factories in other Asian countries have little capacity to absorb the huge orders that Chinese factories routinely handle, corporate executives and economists said.

In China, there is little question that the consumer price index understates the true extent of inflation

=============

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A holdover from the days of central planning, the Chinese consumer price index includes apartment rents but excludes soaring costs for owner-occupied housing. And it is based heavily on the prices of an outdated list of consumer products that are no longer popular. Garments qualify for inclusion only once they have been on sale continuously for at least six months, for example, which frequently means that they are no longer in style.

Hu Xingdou, an economist at the Beijing Institute of Technology, said that a more accurate gauge of inflation would show consumer prices rising 10 percent a year. The National Bureau of Statistics has said it is actively studying ways to improve the consumer price index.
Inflation in China is not just the result of China’s currency market intervention, although Mr. Hu and other economists describe it as the biggest single cause. Another cause is aggressive lending by Chinese banks, despite repeated demands by regulators to slow things down.

Rising prices for exports are also caused by wage increases for Chinese blue-collar workers, whose pay has been climbing as much as 15 percent a year. Those workers have more clout than they once did because the supply of factory labor from rural areas, which once seemed inexhaustible, is starting to dry up — a result of three decades of China’s “one child” policy of family planning, as well as a big expansion in university enrollment.

And globally, strong demand from consumers in China and other emerging economies is pushing up not only gasoline prices, but also the prices of cashmere, rabbit fur, cotton, copper and many other commodities.

Candy Chen, the sales manager of the Zhenjiang Weishun Toys Company in Zhenjiang, China, said that the cost of plastic stuffing for the company’s toy animals had nearly doubled in the past year, while wages were up 10 to 15 percent.

The effect of higher prices in China on broad measures of American inflation is far from clear. The rule of thumb for many consumer products, from shoes to garments to toys, is that the import price is only a quarter to two-fifths of the final retail price, which also includes transportation within the United States and the wages, rent, electricity bills and other costs incurred by stores.

After showing little change for nearly two years, import prices for goods arriving from China at American docks rose from September to November at a rate equivalent to an annual rise of 3.6 percent.

In another indicator that the Chinese central bank released Tuesday, China’s foreign reserves leaped by $199 billion in the fourth quarter. The increase was much larger than economists had expected, and they suggested that China had roughly doubled its intervention in currency markets to around $2 billion a day.

China’s reserves, at $2.85 trillion, dwarf those of the world’s second-largest holder, Japan, with $1.04 trillion. The United States, by contrast, holds only $46.4 billion of foreign reserves because it prints dollars, the main reserve currency.

Mr. Model of Cassin, who is visiting Beijing this week from his company headquarters just off Seventh Avenue, said that the world had changed and that Chinese manufacturers were now more interested in catering to their domestic market than in offering rock-bottom prices to big American companies.

“All of a sudden, they’re more interested in selling domestically,” he said. “The American wholesaler will fight them on $5. The domestic retailer doesn’t care as much.”
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« Reply #377 on: January 12, 2011, 08:32:45 AM »

Second post of the morning:

A little trip down memory lane:

Mao's Great Leap Forward 'killed 45 million in four years'
By Arifa Akbar, Arts Correspondent
Friday, 17 September 2010


Mao Zedong, founder of the People's Republic of China, qualifies as the
greatest mass murderer in world history, an expert who had unprecedented
access to official Communist Party archives said yesterday.

Speaking at The Independent Woodstock Literary Festival, Frank Dikötter, a
Hong Kong-based historian, said he found that during the time that Mao was
enforcing the Great Leap Forward in 1958, in an effort to catch up with the
economy of the Western world, he was responsible for overseeing "one of the
worst catastrophes the world has ever known".

Mr Dikötter, who has been studying Chinese rural history from 1958 to 1962,
when the nation was facing a famine, compared the systematic torture,
brutality, starvation and killing of Chinese peasants to the Second World
War in its magnitude. At least 45 million people were worked, starved or
beaten to death in China over these four years; the worldwide death toll of
the Second World War was 55 million.

Mr Dikötter is the only author to have delved into the Chinese archives
since they were reopened four years ago. He argued that this devastating
period of history – which has until now remained hidden – has international
resonance. "It ranks alongside the gulags and the Holocaust as one of the
three greatest events of the 20th century.... It was like [the Cambodian
communist dictator] Pol Pot's genocide multiplied 20 times over," he said.

Between 1958 and 1962, a war raged between the peasants and the state; it
was a period when a third of all homes in China were destroyed to produce
fertiliser and when the nation descended into famine and starvation, Mr
Dikötter said.

His book, Mao's Great Famine; The Story of China's Most Devastating
Catastrophe, reveals that while this is a part of history that has been
"quite forgotten" in the official memory of the People's Republic of China,
there was a "staggering degree of violence" that was, remarkably, carefully
catalogued in Public Security Bureau reports, which featured among the
provincial archives he studied. In them, he found that the members of the
rural farming communities were seen by the Party merely as "digits", or a
faceless workforce. For those who committed any acts of disobedience,
however minor, the punishments were huge.

State retribution for tiny thefts, such as stealing a potato, even by a
child, would include being tied up and thrown into a pond; parents were
forced to bury their children alive or were doused in excrement and urine,
others were set alight, or had a nose or ear cut off. One record shows how a
man was branded with hot metal. People were forced to work naked in the
middle of winter; 80 per cent of all the villagers in one region of a
quarter of a million Chinese were banned from the official canteen because
they were too old or ill to be effective workers, so were deliberately
starved to death.

Mr Dikötter said that he was once again examining the Party's archives for
his next book, The Tragedy of Liberation, which will deal with the bloody
advent of Communism in China from 1944 to 1957.

He said the archives were already illuminating the extent of the atrocities
of the period; one piece of evidence revealed that 13,000 opponents of the
new regime were killed in one region alone, in just three weeks. "We know
the outline of what went on but I will be looking into precisely what
happened in this period, how it happened, and the human experiences behind
the history," he said.

Mr Dikötter, who teaches at the University of Hong Kong, said while it was
difficult for any historian in China to write books that are critical of
Mao, he felt he could not collude with the "conspiracy of silence" in what
the Chinese rural community had suffered in recent history.

http://www.independent.co.uk/arts-entertainment/books/news/maos-great-leap-forward-killed-45-million-in-four-years-2081630.html

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« Reply #378 on: January 24, 2011, 10:58:44 AM »

I think this author misses fails to discuss some key points e.g. Chinese governmental control of the purchased companies towards geopolitical ends, but the piece does inform nonetheless.
==========================================

By CHARLES WOLF JR.
From 2007 through the first half of this year, Chinese buyers—state, private and in between—acquired 400 companies located outside of the country. The acquisitions span a wide range: mining companies in Australia, Vietnam and South America; oil and gas companies in Africa and the Middle East; banking, financial services and insurance companies in Europe; and electronics, telecommunications and lab testing companies in the U.S. The total cost? $86 billion.

That may sound like a big number, but in fact it's relatively small. The number of companies at play in global cross-border M&A markets during this period exceeded 12,400, with acquisition costs of more than $1.3 trillion. China's share of the total number was 3.2%, and its share of total acquisition value was 6.6%. China ranks sixth in both number of deals and in acquisition value: behind the U.S., U.K., France, Germany and Japan, though just ahead of the United Arab Emirates. Cross-border acquisitions by U.S. investors numbered over 5,000 (42.1% of all transactions), and nearly $400 billion by value (30.1% of aggregate value).

China's acquisitions beyond its borders are also modest compared with foreign investors' acquisitions within China. Currently, China's annual cross-border acquisitions are about half of annual foreign direct investments in the country.

What is significant about China's acquisitions over the past few years is the change they represent from the negligible amounts in the past. Prior to 2007, nearly all China's foreign investments involved buying U.S. debt, along with lesser purchases of euro and yen debt. China currently holds more than $1.6 trillion of U.S. government debt and an additional $1 trillion of non-U.S. government debt and other assets.

It didn't used to be in the business of acquiring foreign companies. That's changed, and I expect that China's acquisitions will at least double in the next five years, and perhaps quadruple by 2020.

There are three principal drivers behind this forecast. First is China's extraordinarily high rate of domestic savings—above 45% of GDP. As long as this rate appreciably exceeds China's not-quite-so-high rate of domestic investment (about 35% of GDP), China will have a large global trade surplus, regardless of fluctuations in its exchange rate. This surplus, together with China's net receipts from other sources—including earnings from its prior foreign investments, the excess of inbound versus outbound investment, and remittances from Chinese residents abroad—will generate a current account surplus of $300 billion to $350 billion annually. This will provide a ready source of financing for foreign acquisitions.

Second, China has shifted its focus away from investing in U.S. government debt. While it will continue to invest in such holdings, the investments will be much smaller than in the past. China is aiming to strengthen the renminbi's role as a potential international reserve, thus it will be less willing to shore up the dollar by purchasing large amounts of U.S. government debt. The result is that it will use its surplus to acquire foreign companies.

The third and perhaps strongest driver of a growing Chinese role in international M&A markets is Beijing's interest in acquiring foreign companies that possess one or more of the following characteristics: rich holdings of natural resources, high-technology or emergent technologies, and financial know-how and close connections with other financial institutions. Because of the recession, such acquisitions may be available at more attractive prices than usual.

If this forecast is accurate, it will have significant consequences for China and global markets.

Externally, China will be a more active and influential player in global M&A markets. In some cases, China may exercise its financial leverage to successfully challenge competing bidders from other dominant countries. This competition could help integrate China more fully into the global economy.

China's prominence could also lead to increased tension with host countries, especially in light of the marked disparities between the restrictions that it imposes on foreign investors' acquisitions within China and the looser ones usually applied on China's acquisitions abroad. Demands for equivalent and reciprocal treatment shouldn't come as a surprise.

Yet such demands can be expected to evoke strong resistance within China, especially if reciprocal treatment is sought in fields like energy, natural resources, rare earths, chemicals and infrastructure that are dominated by large state-owned companies such as Sinopec, Cnooc and Chinalco.

China's foreign acquisitions will have other repercussions within China. Experience gained from corporate governance in companies it acquires abroad may be a good influence on the often obscure governance practices of Chinese companies. More diligent governance practices—like independent audits and transparent executive compensation—are likely to be met with favor from China's Securities Regulatory Commission, but resistance from corporate management. But if the more advanced governance practices prevail, it would be beneficial for China and the rest of the world.

Mr. Wolf holds the distinguished corporate chair in international economics at the RAND Corporation and is a senior research fellow at the Hoover Institution.

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« Reply #379 on: February 09, 2011, 12:14:38 PM »

http://www.tnr.com/article/politics/magazine/82211/china-foreign-policy?page=0,0&passthru=MzQ2ZDBiYmM0MzgzNWFlYTFiOTcwNmY0NTkzYjgzY2M&utm_source=Editors%20and%20Bloggers&utm_campaign=15bad5c325-Edit_and_Blogs&utm_medium=email

Meet the hardliners who now run China’s foreign policy.
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« Reply #380 on: February 20, 2011, 11:19:45 AM »

China tries to stamp out 'Jasmine Revolution'

(AP) – 5 hours ago

BEIJING (AP) — Jittery Chinese authorities wary of any domestic dissent staged a concerted show of force Sunday to squelch a mysterious online call for a "Jasmine Revolution" apparently modeled after pro-democracy demonstrations sweeping the Middle East.

Authorities detained activists, increased the number of police on the streets, disconnected some mobile phone text messaging services and censored Internet postings about the call to stage protests at 2 p.m. in Beijing, Shanghai and 11 other major cities.

The campaign did not gain much traction among ordinary citizens and the chances of overthrowing the Communist government are slim, considering Beijing's tight controls over the media and Internet. A student-led, pro-democracy movement in 1989 was crushed by the military and hundreds, perhaps thousands, were killed.

On Sunday, police took at least three people away in Beijing, one of whom tried to lay down white jasmine flowers while hundreds of people milled about the protest gathering spot, outside a McDonald's on the capital's busiest shopping street. In Shanghai, police led away three people near the planned protest spot after they scuffled in an apparent bid to grab the attention of passers-by.

Many activists said they didn't know who was behind the campaign and weren't sure what to make of the call to protest, which first circulated Saturday on the U.S.-based, Chinese-language news website Boxun.com.

The unsigned notice called for a "Jasmine revolution" — the name given to the Tunisian protest movement — and urged people "to take responsibility for the future." Participants were urged to shout, "We want food, we want work, we want housing, we want fairness" — a slogan that highlights common complaints among Chinese.
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« Reply #381 on: February 27, 2011, 10:02:31 PM »

http://pajamasmedia.com/blog/first-hand-report-from-a-jasmine-rally-in-shanghai/?singlepage=true

A First-Hand Report from a ‘Jasmine Rally’ in Shanghai
Will the wave of change sweeping the Middle East spread to the Far East and hasten political reform in the world’s largest unelected dictatorship?
February 27, 2011 - by John Parker


In mid-February, as the anti-authoritarian wave sweeping the Middle East continued to gather momentum, a Twitter user using the account name of Shudong posted a tweet announcing that “Jasmine Revolution” rallies would be held on February 20th in every large city in China, and announced that the details would be posted later elsewhere. This information was indeed posted as promised, apparently on the U.S.-based website Boxun.com; it called for rallies to be held on the 20th in Beijing, Shanghai, Tianjin, Nanjing, and other major cities around the country, and repeated every seven days thereafter, until such time as the organizers’ concerns were met.

According to a translation posted on the China Digital Times website, which often reports on dissident and other pro-democracy activities, the Jasmine organizers cited a number of grievances as the reason for their action, including:

    * corruption (“a government that grows more corrupt by the day…”)
    * high inequality (“Why is it that in just the last few decades China has gone from being a country with the smallest gap between the rich and the poor to one with the largest?”)
    * high inflation (“The excessive printing of currency is recklessly diluting the value of the people’s wealth.”)
    * lack of judicial independence (“we are resolute in asking the government and the officials to accept the supervision of ordinary Chinese people, and we must have an independent judiciary.”)
    * the one-party system itself (“China belongs to every Chinese person, not to any political party…. The Chinese people’s thirst for freedom and democracy is unstoppable”.)

Interestingly, the “freedom and democracy” language was a direct quote from China’s current premier, Wen Jiabao, and acknowledged as such. Premier Wen spoke those words during a remarkable CNN interview last year, where he appeared to support the idea of political reform, triggering speculation of a rift within China’s top leadership over fundamental political issues. On the morning of February 26th, in an action that seemed clearly timed to pre-empt the second weekly Jasmine Rally (scheduled for the afternoon of the 27th), Wen conducted a highly unusual web chat with Chinese citizens, in which he promised to address a number of the grievances raised by the Jasmine Rally organizers, including taming inflation, runaway property prices, and environmental damage. This chat was heavily covered by Xinhua, the Chinese Communist Party-controlled news service, but tellingly, no mention was made of political reform.

It was unclear whether this extraordinary chat was instigated by Wen himself, or by China’s top leaders as a whole. Regardless of which is the case, the lack of any similar action by President Hu Jintao was very conspicuous. This was consistent with Hu’s reputation: his unwillingness to consider even the most timid political reforms has been duly noted by China’s people, who have begun referring to him in sardonic Internet postings as “Hu-barak” or (more recently) “Hu-ammar Qaddafi.” These appellations are partly a response to the Chinese regime’s pervasive Internet censorship, which has cracked down heavily on postings that mention the fallen Arab dictators by name.

Unfortunately, the Wen chat was only the nice-guy public face of Beijing’s response to the Jasmine Rallies — the mere suggestion that its top leaders could end up like Hosni Mubarak appears to have given the CCP a serious case of the vapors, and its response was strikingly disproportionate to the actual act which triggered the rallies. Within hours of the first postings, according to Chinese sources cited by CDT, police were requesting server logs to hunt down “Shudong,” who had posted anonymously. Detentions of several top dissidents soon followed, while others were put under house arrest. CCP goons even threatened to rape the wife of one dissident, according to technology blogger Jason Ng. Ng also cited claims on some websites that the army had been issued live ammunition to deal with the protests.
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DougMacG
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« Reply #382 on: March 04, 2011, 09:52:24 AM »

"anytime data like this is collected, there is a potential for misuse,"  - No!?!?!?!

http://www.pcworld.com/businesscenter/article/221349/beijing_to_track_peoples_movements_via_their_mobile_phones.html

Beijing to Track People's Movements via Their Mobile Phones

By Michael Kan, IDG News

China plans on tracking the movements of people in Beijing using their mobile phones, a measure that while aimed at relieving traffic congestion, could set off concerns over misuse.
   
China announced the plans in an article posted on a government website earlier this week. The system would work by tracking the movements of the 17 million users in Beijing currently signed on with the telecommunications carrier China Mobile. Once the users turned on their phone, the system could pinpoint their location and what direction they were heading.

The plan would tackle Beijing's growing traffic problem, which has resulted in highway jams that have lasted as long as nine days. But China has also gained a reputation for using technology to squelch dissent. The government has allegedly hacked the email accounts of human rights activists and launched cyberattacks against websites carrying online protest calls.

The new system would use mobile phone information to monitor traffic flows in different areas of the city, and see how residents are using the subway and bus systems. The article did not say when or exactly how the system will be implemented, only that it has passed expert review.

Users will be able to sign up and receive data from the system, the notice said. But it's unclear whether or not residents of Beijing can voluntarily bow out of the system to protect their privacy. The Beijing Science & Technology Commission behind the project could not be reached for comment.

Although the Chinese government intends to use the data for traffic purposes, "anytime data like this is collected, there is a potential for misuse," said Mark Natkin, managing director for Beijing-based Marbridge Consulting.

China has also made previous efforts to collect data on mobile phone users. Last year, the government began requiring people to use their real identities when setting up mobile phone accounts. China has more than 850 million mobile phone users, many of whom bought their numbers without using their actual ID.

Experts have said these past moves could be a part of a larger agenda by the Chinese government to reduce anonymity among the populace. In the case of China's plan for a tracking system in Beijing, it could potentially monitor an individual's movement, Natkin added.

"By U.S. standards, European standards, that would be considered a violation of a person's privacy, but not necessarily here (in China)," he said.

Not everyone sees a problem with the planned tracking system.

"The project seems like it will look at the data on a large scale. The data they are dealing with is so big, I don't think it will result with any privacy problems," said Zhao Wei, CEO of Chinese security company Knownsec. "I think it could actually be effective in solving traffic problems."
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Crafty_Dog
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« Reply #383 on: March 04, 2011, 10:21:45 AM »

With an intention of figuring out how to get away with doing this in the US,  highly placed anonymous sources who regularly read this forum for its penetrating insight, have asked us to see if we can ferret out GM's response to this development  cheesy
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« Reply #384 on: March 04, 2011, 10:35:08 AM »

Associated Press
MANILA, Philippines—The Philippines wants China to explain why two of its patrol boats harassed a Philippine ship searching for oil in a disputed area of the South China Sea, an official said Friday.

The incident occurred Wednesday at Reed Bank near the Spratly Islands, which are claimed by China, Brunei, Malaysia, Taiwan, Vietnam and the Philippines.

"We're in conversation with our Chinese friends and we are seeking an explanation from them," Foreign Secretary Albert del Rosario told a news conference.

Previously:
China Confronts Philippine Oil Vessel, Spurring Dispute

.Reed Bank—about 125 miles (200 kilometers) west of the Philippine province of Palawan—"is our territory," he added.

Lt. Gen. Juancho Sabban, commander of the military's Western Command headquartered in Palawan, said two warplanes were deployed Wednesday after oil explorers from the Philippine Department of Energy complained of harassment. When the planes reached the area, the Chinese vessels had left, he said.

Chinese Embassy spokesman Ethan Sun reiterated his country's claim to the Spratly Islands and adjacent waters, but said Beijing was committed to maintaining peace and stability in the area and resolving disputes through peaceful negotiations.

A Philippine military official said Thursday the Chinese boats maneuvered close to the Philippine vessel at least twice, apparently threatening to ram it but then turning away. They did not fire any warning shots, he said.

A Philippine navy patrol ship has been deployed to secure the oil exploration, which will resume, the official added.

The Spratlys have rich fishing grounds and are believed to sit atop vast oil and gas deposits. They also straddle busy sea lanes that are a crucial conduit for oil and other resources fueling China's fast-expanding economy and those of other Asian nations. They have long been regarded as a potential flash point for conflict in Asia.


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G M
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« Reply #385 on: March 04, 2011, 12:21:47 PM »

With an intention of figuring out how to get away with doing this in the US,  highly placed anonymous sources who regularly read this forum for its penetrating insight, have asked us to see if we can ferret out GM's response to this development  cheesy

That technology has been here a long time.  rolleyes
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« Reply #386 on: March 04, 2011, 01:11:21 PM »

http://investigation.discovery.com/videos/solved-cell-phone-tracking.html

**A quick tutorial on cell phone location technology in the US. From what I understand, China's domestic security structure would use cell tracking technology to supplement what they use now, not making much difference in the overall capacity of the state to reach out after any dissidents.
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« Reply #387 on: March 08, 2011, 08:05:55 AM »

http://www.thedailybeast.com/blogs-and-stories/2011-03-06/worldwide-gender-gap-means-more-bachelors-in-asia/

"No country for young men."

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« Reply #388 on: March 10, 2011, 09:41:22 AM »

From Canadian Business magazine, 14 March 2011
China's coming collapse

The Middle Kingdom's prosperity is an illusion. And when China finally falls, we'll all feel the pain.
By Jason Kirby

As fearmongering election campaign ads go, it's hard to top the "Chinese Professor," which flickered across the Internet just before Americans went to the polls last fall. In the spot, set in a sleek Beijing lecture hall 20 years in the future, a sharply dressed Chinese instructor explains to his Asian students why previous empires, from Ancient Greece to the U.S.A., turned to dust. The Americans failed because they lost sight of their principles, he says in Mandarin, with subtitles. They overspent, overtaxed and over–borrowed. "Of course, we owned most of their debt," he cackles, as the class joins in. "So now they work for us."

If you missed the ad, put out by the conservative group Citizens Against Government Waste, no matter. The notion that China's headed for superpower status at the expense of the United States has been repeated so often that many in the West now take it as an undisputable fact. With breathless enthusiasm economists predict China's red–hot economy will power past America's to become the world's largest in just 15 years. Bookstore shelves are filled with titles like China's Ascent and When China Rules the World: The End of the Western World and the Birth of a New Global Order, in which author Martin Jacques argues America is in denial about the fact China is its "usurper and ultimate replacement." Hollywood's even getting in on the act with a remake of the 1980s Cold War paranoia flickRed Dawn, in which Soviet soldiers overran a Midwest American town. Only this time, the marauders are Chinese. Having conquered American capitalism, the People's Liberation Army is coming for America's Capitol, too.

It's easy to find evidence that ostensibly confirms China's unstoppable ascent. Try this: Go to Google News and type in "China," along with any laudatory adjective, then add the suffix "–est." Do so, and you'll learn that China is building the world's third–tallest skyscraper ("China usurps U.S. in skyscrapers"); it produces the smartest children ("Chinese students outperform U.S. in recent test") and now boasts of the world's fastest trains ("China's fastest train leaves rest of world behind"). This super–country narrative has become so pervasive that the majority of Americans take it for granted. At the end of last year, pollsters for the Allstate/National Journal Heartland Monitor asked Americans which country "has the strongest economy in the world today." Half picked China, and just one in five selected the United States.

Yet for all the talk of China's economic might, skeptics are gathering force. Over the past year, a growing number of analysts and investors have argued all is not as it appears in the Middle Kingdom. What they see instead is a government desperately priming the pump to maintain an illusion of prosperity. Far from an economic powerhouse, China's economy remains a middleweight when its vast number of poor people is taken into account — the country's per capita GDP is only around US$4,500, 1/10th that of the U.S. And as a share of the economy, household incomes have actually declined over the past decade. With the domestic economy too weak to maintain China's high growth rates, and with exports to the West hurting, the Communist Party in Beijing and its regional offshoots have come to rely heavily on cheap exports and debt–fuelled investment to sustain China's fragile fortunes. And the problems will only get worse as China's massive population starts to age rapidly over the next decade. Investors in the West have become too focused on China's growth and interpret it as a sign of a healthy economy. But the country only maintains that growth rate because it doesn't worry about being profitable. As Jim Chanos, a U.S. hedge fund manager and China skeptic famously put it early last year, China "is on a treadmill to hell."

China is trying to transform itself from an agrarian backwater into a modern industrial power in the span of a single generation — a feat that took the West a century of ups and downs, harsh lessons and hard–won victories. Within its borders, China's dash for modernity has sparked a dangerous property bubble, led to astonishing overcapacity and generated enough toxic debt to put even a U.S. mortgage banker to shame. But the country's super–charged growth has also profoundly driven world events. Its massive stockpiles of foreign reserves and low–cost factories have suppressed long–term interest rates, kept global inflation in check and driven a boom in commodities that has benefited Canada immensely. In the same way, our interconnected economies mean a slowdown in China is likely to export pain to the rest of the world in ways we've never seen before.

So forget the collapse of the Greek or Irish economies, which grab headlines but ultimately matter little to the world economy. Investors are completely unprepared for the shock and upheaval that will come should China fail, and Canada in particular would feel the pain.

In a country that's often been called the world's factory floor, China's Pearl River Delta is the industrial engine that keeps the assembly lines running. So, when America's economy tanked in 2008, and western consumers stopped buying TVs and sneakers, the region was hit hard. Exports to the U.S. and the rest of the world plunged, and more than 100,000 factories shut their doors, throwing millions of Chinese labourers out of work. As protests broke out, officials worried the backlash could escalate. Their fears were justified. When workers at a steel mill in Dongguan rioted after learning about a new round of job losses, the mob beat a senior manager to death.

Faced with crisis, China's leaders swung into action with a mammoth stimulus plan. In November 2008, Beijing unveiled a US$600–billion rescue effort that, relative to GDP, was several times larger than what America put in place. More important, the government ordered its state–run banks to crank up lending, especially to residential and commercial developers. The banks promptly obliged, shovelling more than US$1.5 trillion of loans out the door last year, an amount equal to 30% of the country's economy. It worked better than the Chinese could have ever hoped — on paper at least. In the face of a global recession, China's GDP rocketed 8.9% in 2009. Soon, analysts were crediting Beijing with saving the global economy. The sharp rebound in oil and other commodity prices that came with China's renewed vigour certainly pulled Canada out of the pit.

To many, the episode was yet another sign of China's economic prowess. Anthony Bolton, a well–known British fund manager who moved to China to establish a special fund dedicated to the country, hailed "the effectiveness of the centrally run economy."

Instead, the crisis and the government's response exposed just how fragile China's economy has become. The problem is simple — for all the hype around China's emerging middle class, Chinese shoppers contribute very little to the country's fortunes. In any economy, domestic consumption typically makes up roughly 55% to 65% of GDP. The remainder is typically split between exports and investment. Not so in China. Over the past decade, domestic consumption's share of the economy has plunged from around half to a miniscule 35%, the lowest of any significant economy ever, according to Michael Pettis, a finance professor at Peking University whose online writings have become must–reads for those eager to divine what's really going on in China.

With almost nothing in the way of health insurance, welfare or a social safety net for retirement, Chinese feel pressure to save every penny they earn. At the same time, official policies that favour Chinese banks and exporters — namely artificially low interest rates, an undervalued yuan and cheap labour — come at the expense of household savers. This isn't to say consumers aren't spending more than they did a decade ago. A stroll through the busy retail shops along Shanghai's Nanjing Road, or hours spent in a Beijing traffic jam amid shiny Black Audis, will attest to that. It's just that the red–hot growth that has earned China its miracle status was overwhelmingly the result of exports and investment.

But the days of China being able to fall back on cheap exports is coming to an end, say experts. It's not just that consumers in developed countries have retrenched, though that's an immediate threat. China's policy of devaluing its currency to grab export market share from the West is now squarely in the crosshairs of politicians in the U.S. and Europe. "Unless Beijing shows real determination to move on the currency front, the likelihood of the U.S. slapping on a surcharge on China's imports in 2011 is high," Diana Choyleva, an analyst at Lombard Research in Hong Kong wrote in a report last fall. "The early 2010s could well turn out to mark the end of China's years of miraculous growth, with trend growth halving during this decade."

With the writing on the wall for China's export machine, officials have to scramble for an alternative way to juice the economy. So China has increasingly looked to investments in infrastructure and construction to keep Chinese workers employed. In 2009, the peak of China's stimulus campaign, fixed investments accounted for a whopping 95% of the country's GDP growth. Even last year, despite all the efforts by Beijing to rein in its stimulus efforts, investment in fixed assets was the fastest–growing segment of the economy. One report by Thomson Reuters suggested investment in fixed capital projects is "significantly above the levels that prevailed in Japan and the U.S. during their respective real estate bubbles."

Ironically, it is China's investment in these hard assets like airports, bridges, mines, railways and office towers that wow so many in the West. We look in awe at China's cities, with their shimmering skyscrapers, and the claim that another 10 New Yorks must be built over the next two decades to accommodate the country's surging middle class. With the West's infrastructure falling apart, we envy their vast network of high–speed railway lines — more extensive than in the rest of the world combined — never mind the 5,000 kilometres to be laid over the next two years alone. And while it can take years for cities in the West to decide whether or not to build a new airport, China is erecting terminals across the country at a rate of nearly 10 a year. Yet the glint from all that shiny metal and glass can easily obscure what's really going on. Traffic through many of the four–dozen terminals China has built in the past five years is a fraction of what was originally forecasted, according to an Los Angeles Times report. It's why Yasheng Huang, a professor at MIT and author of the book Capitalism with Chinese Characteristics, uses the term "Airportologists" to describe western pundits who draw sweeping conclusions about China's economy after passing through its massive terminals.

China's stellar GDP statistics may send western business leaders into raptures, but even the Chinese government doesn't believe them. In a diplomatic cable released by Wikileaks in December, Li Keqiang, executive vice–premier of China and a leading candidate to replace Premier Wen Jiabao, told a U.S. official China's GDP statistics are "man–made," and are "for reference only."

The fact is, says Vitaliy Katsenelson, director of research at Investment Management Associates in Denver, Colo., and a prominent China skeptic, China's frantic building boom over the past five years not only boosted GDP on paper and put millions to work but also produced a property bubble where neither investors nor developers are likely to ever recover their costs. "They already had a weak foundation, and on top of that you've had a government throwing enormous amounts of money at the economy in a chaotic way," he says. "This isn't going to end good."
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« Reply #389 on: March 10, 2011, 09:43:01 AM »

When Ma Zhiyuan's phone rang last year, and a real estate agent told him she had a client ready to pay cash for his Beijing apartment, he was stunned. What surprised him was not that she was offering stacks of Maos. China's new middle class are as thrifty as their parents and see apartments as the ultimate place to stash their accumulated savings. No, what struck Ma, a marketing manager, was that he hadn't even listed the place for sale. The realtor had simply hunted him down as the owner of the unit. And now she was offering 1.1 million yuan, or about $170,000 for the pad.

To someone in the West, that may not seem like an exorbitant amount for a highrise apartment in a major capital city. Yet, at that price the unit was 26 times greater than the average Beijinger's salary. Even so, Ma told her he'd have to think about it. (He'd been renting out the apartment and enjoyed the extra income.) Shortly afterward, the realtor called back to say her client would pay 100,000 yuan more. And when Ma rejected that, she offered another 100,000 yuan, and then another. It went on like this for weeks. Finally Ma agreed to a price: 1.6 million yuan, nearly 50% more than the place had been worth a month earlier. "They hadn't even seen the apartment," he says. "At that time, housing prices were going crazy."

"Crazy" fails to capture the utter insanity of what's gone on in China's property markets. In January, home prices in 70 Chinese cities jumped another 6.3% from the year before, and have more than tripled in the past five years. In prime markets like Beijing and Shanghai, prices have risen far faster. It's no longer surprising to find taxi drivers and teachers who claim to own two or even three apartments each. At one point, Shanghai economist Andy Xie cited local media reports that some 65 million urban homes reported zero electricity consumption over a six–month period, suggesting there are enough vacant homes in China to house 200 million people. While power companies denied that was the case, in the regions around Shanghai, Beijing and other cities, fancy new apartment blocks stretch off into the horizon, their surfaces pocked with black holes where windows would otherwise be. Policy–makers have attempted to deflate prices. They've limited the number of homes Chinese can buy, restricted many state–run companies from buying up land, and ordered banks to rein in their lending, yet still prices continue to rise.

It's not just the residential sector. Commercial developers have engaged in their own orgy of debt–fuelled construction projects, bidding up land values threefold last year and erecting countless office towers, malls and hotels. It's all adding to a glut of properties that are sitting vacant. In Beijing, where the official commercial vacancy rate is 30% but approaches 50% in many pockets, developers go to great lengths to make empty buildings look occupied, going so far as to paint silhouettes of office workers in stairwells. For instance, in the 29–storey Central Point towers, built three years ago, a handful of tenants finally moved in last fall, according to a property manager. However security guards were surprised to see a visitor come through the door, and appeared to be the only people in the building.

How could there be so many new buildings going up when, at the same time, so many others already sit empty? Simple. China is engaged in an elaborate shell game to hide a mountain of bad debts piling up on the balance sheets of its banks, developers and state–owned enterprises. In the case of real estate, it's a matter of turning a blind eye to staggering losses, says Patrick Chovanec, a professor at Tsinghua University's School of Economics and Management in Beijing. In an interview last year, he pointed to situations where buildings sit half empty, yet landlords refuse to lower their rental rates. To do so would sink the value of the underlying land, which was used as collateral for the developer's loans. "The rational response would be to lower the rental asking price, but that would mean the value of the collateral would be lowered and the bank would be forced to write down the loan," he says. "So the building stays empty. Economically it makes no sense."

This same scenario is playing out across the country on a massive scale, say experts. Beijing and the World Bank officially claim China's government debt remains very manageable, at less than 20% of GDP — far below levels in the industrial world — but the truth is, local governments are piling on new debt at a staggering pace. In research last year, Victor Shih, a political economist at Northwestern University, examined the borrowing records of 8,000 local–government entities. He found that at the end of 2009 local governments had taken on US$1.7 trillion in debt, with another US$1.9 trillion in lines of credit available. Coupled with other obligations, Beijing is on the hook for nearly US$6 trillion next year, bringing it to par with GDP — making China seem almost as profligate as America. The trillion–dollar question is: How much of that debt is going to go sour? For his part, Shih has warned of a "wave" of non–performing loans hitting the country in 2012, while in August there were reports the China Banking Regulatory Commission conducted a stress test and found 20% of loans to be in "trouble." By comparison, a stress test on America's largest banks in 2009 found that in a worst–case scenario, losses at the 19 banks would hit 9.1% of their loan portfolio, although, admittedly, many believe in reality it was far higher.

The final tally of dud loans in China could be far higher, sparking a financial crisis in the country. Consider the case of New Ordos, a city the government of Inner Mongolia built from scratch in just five years to house 100,000 people. There is plenty of public art and innovative architecture on offer in the city, including a reservoir with an artificial waterfall. The only thing missing is people. Most of the apartments are sold out but remain vacant, since speculators snapped them up as investment properties. The most striking building is the eight–storey library, built to resemble books standing side by side. Inside, however, it's nearly devoid of books and patrons. On a weekday morning last year, the only people using the computer lab, equipped with 100 new PCs, were two teenage boys playing video games.

New Ordos is far from alone. There are at least a dozen other ghost cities scattered across the country. In November, the government of Hebei said it plans to build three new cities in the region around Beijing over the next few years. In Dongguan, the city where rioting workers killed a factory manager, the New South China Mall lays claim to being the largest mall in the world, yet is bereft of tenants. Likewise, in Beijing, Pangu Plaza, a hotel and mall complex shaped like a dragon and which runs the length of seven football fields, is largely vacant of shops and people.

The list goes on and on. But for how much longer, wonder some China watchers. The rush to build over the past five years has left China drowning in overcapacity in many key sectors. In Liaoning province, the government is spending hundreds of millions of dollars to build five mega–ports over the next couple of years, even though China's ports are already operating far below capacity. Likewise, according to a report by Pivot Capital Management that analyzed China's manufacturing capabilities, China continues to build new steel mills, cement factories and aluminum smelters even though up to one–third of existing plants sit idle.

As for China's ever–expanding network of bullet trains, Chinese media report trains on several of the new lines frequently run with more than half their seats empty. Some worry China's high–speed rail experiment will lead to a debt crisis, since the mammoth project has already saddled China's railway ministry with US$150 billion in debt. Over just the next few years that figure is expected to rise to half a trillion dollars.
« Last Edit: March 10, 2011, 10:36:29 AM by Crafty_Dog » Logged
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« Reply #390 on: March 10, 2011, 09:44:34 AM »

It is at this point analysts and economists invariably argue none of China's overspending and debt really matters. All of those empty apartments, unused factories and ghost cities will eventually teem with people as rural Chinese move to the cities and grow rich. The theme of China's urbanization has become deeply entrenched, with the oft–repeated line that over the next 20 years China will add 350 million people to its urban areas — a migration greater than the entire population of the United States. Yet critics point to flaws in this argument that threaten to stunt rather than fuel China's growth.

For one thing, China under–counts the number of people already living in urban areas, says Katsenelson. China only considers a region to be urban if it has a population density greater than 1,500 people per sq. km, versus around 500 people in the West. By that measure, Edmonton wouldn't make the cut. Indeed, some so–called rural villages in China boast steel mills and factories, while one, Beishanmen, near the city of Xi'an, recently erected a 23–storey apartment tower. Katsenelson also argues that since local officials are tasked with meeting specified growth targets on a per capita basis, there's an incentive to downplay the size of the local population. "There are probably a lot more people living in cities already, but they're just not in the numbers," he says. Besides, for the hundreds of millions of rural peasants who have already migrated to cities — supplying factories with an endless supply of cheap labour — life in cities like Shanghai, Beijing or Shenzhen means being treated like second–class citizens, since their access to social services and education for their children is tightly limited.

But above all, China faces a demographic time bomb that's as bad, if not worse, as the one plaguing Europe. Largely as a result of the country's one–child policy, instituted in the 1970s, China's population is aging fast. The number of workers aged 20 to 29 will peak in about four years, then drop sharply over the next 15. At a point in the not distant future, China's population will actually begin to shrink. All of those factors will curtail the number of people who are likely to move to cities and take up new jobs. "Their labour force is getting old and shrinking," says Katsenelson. "I don't think migration is going to be as big a force as people are expecting it to be."

We've seen all this before. Remember that campaign ad about the Chinese professor? Rather than look 20 years in the future to see what China holds in store, the world would be wise to cast its gaze back a couple of decades instead. In the '80s and '90s, U.S. newspaper and magazine headlines trilled the rise of an Asian superpower and the decline of America's influence abroad. That country was Japan, and business leaders couldn't contain their enthusiasm for Tokyo's economic miracle. One–time presidential candidate Walter Mondale warned Americans that unless things changed, there would be no future for their children other than to sweep the factory floors between Japanese–made computers.

That's not at all how things turned out, of course. Japan's overreliance on cheap exports and debt–fuelled investment backfired. The refusal to acknowledge the bad debts incurred by banks during its property bubble plunged Japan into its "lost decade" and ended talk about Japanese global domination. (Driving home that point, China recently overtook Japan to become the world's second–largest economy.)

Two decades of stagnation didn't tip Japanese society into chaos, but if China's economy goes bust, don't expect the fallout to be nearly so smooth. "The problem for China is compounded by the fact that, unlike Japan, the vast majority of Chinese have not participated in this boom," says George Friedman, CEO of Stratfor, a global intelligence company. In simple terms, the Japanese got rich before they got old, but the Chinese will get old before they get rich. "For them, unemployment, especially for those several hundred million who came to the cities to get jobs, is personally catastrophic, so they have a serious problem."

Many argue China's US$2 trillion in foreign reserves would protect it from any crisis, but Chovanec points out there have only been two times in modern history when a country accumulated such large reserves — America in the '20s and Japan in the '80s. And if history repeats itself, it's not just going to be their problem. China is inextricably tied into the global economy. What happens there will have far reaching repercussions, especially in countries like Canada and Australia that have supplied China with the raw material to remake itself.

To grasp what a slowdown in China would do to Canada's economy, it's worth stepping back a moment to look at how all those Chinese skyscrapers, railway lines and steel mills have reshaped the economic and political landscape here. Last January, Canfor, Canada's largest lumber company, mothballed its sawmill in Quesnel, B.C. The move came as a result of the collapse of America's housing market, which evaporated demand for B.C. lumber. Then, several months later Canfor surprised locals by announcing it would bring everyone back to work. Only now the entire output from the mill is loaded onto freighters and shipped to China. The Asian giant may still accounts for only 15% of the province's lumber exports, but exports to China are up 71% in just one year, and many believe it's only a matter of time before China, and not the U.S., becomes B.C.'s largest forestry customer.

What's happened in tiny Quesnel has played out across the country over the past decade on a massive scale. By some estimates, demand from China is behind half the rise in global commodity prices, such as copper, oil, nickel, iron ore, coal and potash — all resources hauled from the Canadian landscape. China has become Canada's fastest–growing trading partner, and three–quarters of what we now sell to them comes from the ground. This dynamic shielded us from the brunt of the global recession. In 2009, Canada's exports fell 28% from the year before because of the crisis in the U.S., yet at the same time our exports to China actually rose 7%.

Some have argued the resource sector isn't all that crucial to Canada's well–being, since mining and oil and gas extraction directly account for just 4.5% of the economy. But this figure fails to capture the wider influence the commodity boom has had here. While conventional manufacturers in the automotive, steel and textile sectors have struggled, companies building equipment for the energy and mining sectors barely blinked. Banks and investment firms have reaped windfalls from merger and IPO activity in the resource sector, while the boom is lucrative for investors in the domestic market. Meanwhile, China's boom has spilled into Canada's real estate market. In Vancouver, according to condo marketer Bob Rennie, between 60% and 80% of all real estate sales in the city's West Side are now to mainland Chinese, while markets like Calgary and Saskatoon have soared thanks to all the new oil and potash wealth.

In plain terms, should China's economic miracle turn out to be a mirage, all of that would be at risk. "If China fails, or even if this fixed investment model fails, countries like Australia and Canada are in deep trouble," says John Lee, a foreign–policy expert at the Hudson Institute who is also a research fellow at the Centre for Independent Studies in Sydney, Australia. For one thing, commodity prices are likely to plunge. That could throw a wrench in plans for the oilsands, which require high oil prices to remain profitable, and crimp much of the manic exploration activity in mining. Canada's resource sector was one of the primary drivers for employment over the past decade, according to Statistics Canada, so a correction in China would also rob this country of a key engine for job growth. It would also sap provincial and federal governments of needed tax and royalty revenue, hurting their balance sheets.

A slowdown in China would have repercussions far beyond commodity prices. If China's growth slumps, experts see civil unrest as the likely outcome. China already faces dozens of large–scale "mass incidents" — the government's term for riots — each year, but they're largely contained to rural areas. That could change with a prolonged downturn. "At the moment, they have unrest, but it's in rural areas, not the cities," says Lee. "The whole strategy of [the Chinese Communist Party] to stay in power is to keep the urban people happy. If growth slows down, they won't have the means to keep those people happy." For instance if China's housing bubble were to collapse, urban property owners would be hard hit. In a recent report the Chinese Academy of Social Sciences argued house prices in 11 cities, including Beijing, Shanghai and Shenzhen are overvalued by between 30% and 50%. The obvious fear within the Chinese government is a repeat of the Tiananmen Square protest and crackdown in 1989. After the incident, it took three years for the economy to fully recover.

But the world is a much more interconnected place than it was even 20 years ago, and China's role is vastly greater. The International Monetary Fund recently stressed China's importance to global growth when it updated its growth forecast for the country — at 10.5% in 2010 and 9.6% in 2011. "China's strong and sustained growth over the past several years has served as a linchpin for global trade, benefiting exporters of commodities and capital goods," the fund said in a report. Anything hinting of a revolution would undoubtedly shock investors and spark a crisis of confidence among economists who have come to view China as the cornerstone of the economy decades into the future. There's a reason paranoid officials tried to block Chinese netizens from reading about populist uprisings in Egypt and elsewhere.

Some observers are hopeful the aftershocks of a Chinese economic collapse would be muted. Pettis at Peking University has argued on his blog that a slowdown in Chinese growth "might not be the disaster for the world that many believe." If China's massive trade surplus with the rest of the world contracts, that could act as a boost to its trading partners. He argues everything depends on whether China rebalances its economy amid a sharp slowdown by raising interest rates and wages. If that happened, a recession would be borne by state–owned enterprises, and not consumers, he says.

There are also those who insist China's blistering growth rate is sustainable, saying predictions about the demise of China's economy are nothing new. And they're right. It's been nine years since the book The Coming Collapse of China first hit bookshelves.

But simply because China has twisted and contorted its economy to generate empty growth doesn't mean its future success is guaranteed. Quite the opposite. China has failed to learn the most important lesson of being a modern, thriving economy, says Chovanec at Tingshua University. "Failure is very important for any economy. To have businesses fail, to have people lose money, to have the stock market and real estate go down, is all really critical, because it teaches people what is a good investment, and what is a waste of resources," he says. "Unless you have that, then people will think they can put their money into whatever they want, and they'll always make more money, until the costs get socialized and everybody wonders why everyone in China is so poor."

Not that you'll hear frank talk like that from most investment bankers, business consultants or in corner offices in the West. Otherwise ardent free market capitalists, they remain strangely convinced that China's socialist brain trust is capable of correctly pulling all the levers of its massive economy to keep it on a path to prosperity. Perhaps this isn't so strange, though. After all, China offers all the elements of Wall Street's most cherished commodity — the investment story. Such a narrative must be easily packaged, sold and resold — think dot–coms, U.S. real estate or green energy — and China offers angles. As with all investment stories, critics pointing out the risks are easily dismissed, until it's too late.
« Last Edit: March 10, 2011, 10:36:58 AM by Crafty_Dog » Logged
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« Reply #391 on: March 22, 2011, 09:15:23 AM »

When a Billion Chinese Jump
The dark side of China's rapid industrialisation is terrible environmental damage, claims a British journalist.

When a Billion Chinese Jump | by Jonathan Watts | Scribner | 448 pages | 2010 | US$17
ISBN: 141658076X

 The odd title of this book by the Asia environment correspondent for The Guardian, “When a Billion Chinese Jump”, comes from a warning he heard as a child. If everyone in China jumped at the same time, he was told, the shock would knock the earth off its axis and kill everyone on the planet.  You don’t have to read too far into the book before you realize that the world’s second largest economy may be killing all of us in its head-long dash to modernise with scant regard for our planet.

Jonathan Watts argues that Chinese have so deep a cultural prejudice against nature that even the central government’s efforts to protect and improve the environment are ignored.

The book is more a travelogue than a scientific tome. Watts peels the onion of environmental degradation as he journeys across China, from the village in Yunnan (which supposedly is Shangri-la in the novel “The Lost Horizon”) to the more developed and industrialized cities of the coast, to its hinterland, coal fields in Shaanxi, and Inner Mongolia and the encroaching desert. He relates the environmental catastrophe through the voices of environmental activists, scientists, government officials and disenfranchised victims suffering disease and indignity.

Consider some of the following environmental crimes:

Since 1949 China has built 87,000 dams – most of them environmental catastrophes. Some Chinese and foreign seismologists have claimed that the devastating Sichuan earthquake of 2008 occurred because one of the dams placed so much weight on a fault line that “had been relatively inactive for thousands of years”.
In 2006 some 8.6 million tonnes of untreated sewage was pumped into the South China Sea by just two provinces – Guangdong and Fujian in the country’s industrialised south.
By 2020 the volume of urban rubbish in China is expected to reach 400 million tonnes – the equivalent of the rest of the world in 1997.
Half the world’s current airborne dust comes from China.
This is scary stuff. China’s voracious appetite threatens the world.

But scarier still is that the people interviewed by Watts on his journey across China speak as though man and nature are disconnected from each other. They tend to believe that nature is something to be conquered and used, rapaciously if we wish. Even Chinese scientists seem to believe this. One of them has suggested using 200 nuclear bombs to blast a hole through the Himalayas to improve wind circulation in China.

Watts attributes this to Confucianism. This ancient philosophy privileges social harmony and the material needs of society over nature. Mao Zedong’s Great Leap Forward in 1958 started a mad rush to industrialise that trampled everything in its path and created the world’s worst man-made famine. Although China’s current development spree is by no means so catastrophic, the environment is still being trashed because Chinese are still Confucians at heart. As Watts points out, fixing the environment will require more than legislation and government edicts from Beijing; it will require a deep cultural shift.

In such an impressive book there are some disappointing lapses.

Watts fails to mention China’s belief in its own superiority. This was most evident in imperial times, but it lingers on today. Other nations are regarded as barbarians who should pay homage to China. This seems to explain why China ignores neighbouring countries when disposing of its waste. China currently seeds clouds over Beijing and Inner Mongolia (part of China) with chemicals to force it to rain on its territory, ignoring the desertification of the grasslands of independent Mongolia.

Another fault is that Watt doesn’t look into a crystal ball. For example, what will happen when water becomes even scarcer than it is today? There is already discussion in Chinese scientific and military circles about harnessing the headwaters of the Ganges and diverting them away from India and into China. Forecasting is the real jump that could shake the world to its core, is it not?

Watts sees hope for the future in a myriad of small, community level initiatives throughout the country. But China is vast and each region has gigantic problems. Thinking locally is like sticking your finger in the crack in the dam. There are just too many cracks. What is needed is a concerted effort by the Central Government to coordinate national action.

China needs a cultural shift, not from Communism to capitalism, but from Confucianism back to Taoism – an older Chinese philosophy that taught man to live in harmony with nature. And then it needs to think of itself as a citizen of the world, not as the centre of the world.

Depressingly these changes seem very distant. In the meantime, China, which has the highest per capita rates of cancer and stillborn births in the world, will continue to poison itself -- and perhaps the rest of us as well.

Constance Kong is the pen name of a Shanghai-based business consultant.

This article is published by Constance Kong, and MercatorNet.com under a Creative Commons licence. You may republish it or translate it free of charge with attribution for non-commercial purposes following these guidelines. If you teach at a university we ask that your department make a donation. Commercial media must contact us for permission and fees. Some articles on this site are published under different terms.
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« Reply #392 on: March 29, 2011, 11:47:55 AM »

Chinese censorware nukes any voicecall that contains the word "protest"
Cory Doctorow at 12:26 AM Wednesday, Mar 23, 2011

Censors at the Chinese politburo have ramped up their electronic surveillance and censorship efforts; some piece of spyware is now monitoring all voice communications, and will terminate any phone call in which someone speaks the word "protest" in Mandarin or English (and presumably in other languages):

A Beijing entrepreneur, discussing restaurant choices with his fiancée over their cellphones last week, quoted Queen Gertrude's response to Hamlet: "The lady doth protest too much, methinks." The second time he said the word "protest," her phone cut off.

He spoke English, but another caller, repeating the same phrase on Monday in Chinese over a different phone, was also cut off in midsentence.


The Chinese firewalls are also blocking VPN connections, degrading Gmail connections, and randomly blocking access to sites from LinkedIn to the Hong Kong Stock Exchange. One analyst quoted in the NYT claims that the politburo is being deliberately ham-fisted in this crackdown in order to convey the message that they are in total control.

http://www.boingboing.net/2011/03/23/chinese-censorware-n.html
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« Reply #393 on: March 30, 2011, 06:32:07 AM »

China's crackdown on domestic dissenters continues, with a 10-year prison sentence issued on Friday to Liu Xianbin, a founder of the China Democratic Party and a signer of Charter 08, a pro-democracy charter. Mr. Liu was sentenced for subverting state power, which in China can mean anything the authorities want it to mean, even advocating for democratic freedoms.

Ten years is unusually harsh and especially so for the 43-year-old Mr. Liu, who has already served almost a decade behind bars. His wife, Chen Mingxian, was allowed to attend the trial otherwise closed to the public and she reports that Mr. Liu was routinely interrupted by the judge as he sought to defend himself. After serving his earlier prison term, Mr. Liu was harassed by security agents who made it difficult for him to hold a job.

Mr. Liu's latest jailing is part of a crackdown that started in February, when a U.S.-based website posted a call for peaceful democratic protests in China. Beijing proceeded to round up scores of activists, human rights lawyers and others. Some have been confined to house arrest; others, like blogger Ran Yunfei, have been criminally detained.

The most worrying cases are those who have simply "disappeared" into the maw of China's extralegal shadow jails. Human rights lawyer Gao Zhisheng, who has been tortured before, hasn't been seen since April 2010. Teng Biao, Jiang Tianyong and Tang Jitian haven't been heard from since February.

The government is also squeezing the media, both domestic and foreign. The South China Morning Post reports that an outspoken columnist for Southern Weekly, a relatively liberal publication by Chinese standards, was recently pressured into a two-year "sabbatical." Internet censorship remains heavy. Foreign journalists in China's biggest cities have had their movements restricted and some have been physically assaulted by security agents.

China's cruelties deserve to be widely publicized and condemned in the West, not least so the country's brave activists know they are not suffering in vain. As in the Middle East, the democratic aspirations of the Chinese people will one day be impossible to contain. Here's hoping that Mr. Liu and his courageous countrymen live to see that day.

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« Reply #394 on: March 30, 2011, 08:21:56 AM »

R2P? NFZ?
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« Reply #395 on: April 06, 2011, 01:57:12 PM »



Chinese artist Ai Weiwei posed an important question about the one-party state in this newspaper's Asian op-ed pages last year: "The question . . . is how a state based on limiting information flows and freedom of speech can remain powerful." And if that's possible, "what kind of monster" will it become?

Mr. Ai's detention Sunday at Beijing's airport as he attempted to travel to Hong Kong brings this juggernaut into sharp relief. The police have provided no information about the 53-year-old's whereabouts or explained why he was arrested. The same day, Mr. Ai's wife, nephew and a clutch of his employees were arrested and questioned. Authorities raided his Beijing studio and carted away computers and other items.

Mr. Ai has thus joined the growing ranks of China's new "disappeared." In February amid the popular Arab revolt, an online petition urged a similar Jasmine Revolution in China. The government has reacted by criminally detaining dozens, if not hundreds or thousands, of the country's most prominent human rights lawyers, bloggers, democracy activists and others.

The detention of Mr. Ai is especially notable because of his national stature. The son of a famous poet, he is a prominent artist, film-maker and architect in his own right, a popular Web communicator, and an advocate for the rule of law and individual freedoms. He is also unafraid: In 2009, when Mr. Ai tried to attend the trial of another activist, the police beat him so badly he got a brain bleed that almost killed him. He continued to speak out.

British Foreign Secretary William Hague called on the Chinese government Monday to "urgently clarify Ai's situation and well being" and called for his immediate release. Germany's Foreign Minister did the same.

The U.S. State Department managed to roll out spokesman Mark Toner, who said the U.S. government was "deeply concerned" but added "our relationship with China is very broad and complex, but it's an issue where we disagree and we continue to make clear those concerns." Secretary of State Hillary Clinton and President Obama have been mute.

Perhaps the Obama Administration should listen to Mr. Ai, whose op-ed for us included this statement: "Most discouraging to those of us who are fighting for increased freedom is the tendency for developed nations to lower the bar to please China. They make excuses not to concern themselves with violations of human rights. To espouse universal values and then blind oneself to China's active hostility to those values is irresponsible and naive."

The State Department says its top Asia official, Kurt Campbell, is set to visit Beijing Thursday to "prepare for the upcoming Strategic and Economic Dialogue." Maybe that trip should be postponed until Beijing tells the world in which dungeon it has dumped Ai Weiwei.

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« Reply #396 on: April 06, 2011, 02:34:48 PM »

Thomas Friedman unavailable for comment.   rolleyes
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« Reply #397 on: April 06, 2011, 02:50:45 PM »

Reassessing China's Rise: Knowns and Unknowns by Ted Galen Carpenter
from Cato Recent Op-eds
2 people liked this
It has nearly become the conventional wisdom that China is an emerging superpower, and that Beijing will challenge Washington for global leadership within the next quarter century. That nation's huge population and spectacular economic growth over the past three decades make such predictions quite credible. But while they may turn out to be correct, other outcomes are also possible.

Certainly, China's already strong position is benefiting from a number of recent global developments. The earthquake, tsunami and nuclear disaster in Japan combine to weaken one of China's major economic and strategic competitors. The estimated cost of those horrible events is $300 billion — and that may turn out to be a very conservative estimate. The continuing problems with the nuclear power plants have knocked nearly 20% of Japan's electric power generating capacity off-line, and those problems are likely to persist for months. Experts already speculate that firms in China (along with those in South Korea and Taiwan) will be the principal beneficiaries of Japan's woes.

Beijing also gains some advantage from the economic, fiscal and foreign policy problems that the United States is encountering. Washington's spendthrift habits — which have produced an annual federal budget deficit of $1.5 trillion — not only weaken America, but they give China important diplomatic and economic leverage. China is now the largest foreign holder of US Treasury debt. Thus far, Beijing has been subtle about using that leverage, but US officials are all too aware of the vulnerability such dependence creates.

Washington's military adventures in the Muslim world also play into Beijing's hands. Not only do such controversial military missions increase the level of regional and global anger at the United States, they enable China to play the role of a less intrusive, more constructive partner to Islamic countries and other nations. America's military missions are also expensive, with combined costs of the Iraq and Afghanistan wars running between $130 and $175 billion a year. Washington's insistence on policing the planet and subsidizing the defense of its European and East Asian allies leads to an overall military budget of more than $700 billion — nearly as much as the rest of the world combined. That is a financial hemorrhage that Beijing can — and does — gleefully avoid.

Washington's need to secure Chinese support (or at least tolerance) of its military interventions also gives Beijing an opportunity to extract concessions. One wonders, in particular, what concessions the Obama administration had to make to get China to refrain from exercising its veto in the UN Security Council when the resolution authorizing coercive measures against the Libyan government came up for a vote. But it is a safe bet that concessions were required. The Chinese do not regard foreign policy as an altruistic enterprise, and Beijing's willingness to cast an abstention rather than a veto was quite important to the United States.

Nevertheless, greater caution — even skepticism — about the continuation of China's meteoric rise is warranted. There are three especially strong reasons to put up a caution light regarding the notion of China's "inevitable" rise to superpower status — much less its ability to displace the United States as global leader.

One reason is that too many (perhaps most) predictions of that nature are based on simplistic, linear projections of China's future economic growth. As the PRC's economic base becomes larger, and the economy becomes more mature, it will be harder and harder to sustain spectacular growth rates. A country beginning its economic progress from a position of dire poverty (as China did in the late 1970s) can, with the right economic policies, achieve annual growth rates of 8-10% or even higher. But large, more mature economies rarely experience such rates of expansion. No one expects the United States — or for that matter, such countries as Japan, Germany and Italy — to grow at such a brisk pace. For more mature economies, annual GDP growth of 5 or 6% is considered extremely vigorous. At some point, probably within the next decade, China will begin to make that transition and see its pace of economic progress decelerate.

That highlights the second reason for caution about China's emergence as a superpower. Such an achievement requires the continuation of social peace and political stability. There are already small but ominous signs on both fronts. Even the leadership of the Communist Party is acutely aware of the enormous gap between the coastal provinces and the interior of the country regarding the extent of economic progress and prosperity. In addition, legions of young people, especially young males, leave the countryside each year and need to be absorbed into the boom cities, mostly near the coast. Chinese officials become rather nervous when one asks them what is likely to happen to millions of rootless young men, if the economy begins to falter and they can't find jobs. The Chinese Communist Party is still enough of a Leninist party to understand the explosive revolutionary potential of that situation. Privately, Chinese scholars and opinion leaders express worry if GDP growth was to sag to a still healthy 7 or 8% — much less if it dropped to lower levels.

Worries about preserving social peace and political stability have become more acute over the past year or two. Small, but persistent, public demonstrations against governmental abuses and corruption are increasingly frequent, and Chinese officials have occasionally felt compelled to adjust policies to placate the public. At the same time, tightening of restrictions on the internet and harsh crackdowns on prominent political dissidents have grown in the past few years. The speed with which the Chinese regime moved to ensure that the upheavals sweeping the Middle East and North Africa would not be duplicated in China suggests a government that is uneasy at best. Even the extent of debate on economic policy, which seemed so vigorous in academic and think tank circles under Jiang Zemin, has gradually become narrower and more cautious as the era of Hu Jintao has gone on. That does not indicate a political system marked by confidence and stability. Premier Wen Jiabao's periodic calls for greater openness also hint that some members of the elite believe that modest political reform is essential, lest the party risk an explosion caused by the pent-up, frustrated demands of the country's rapidly growing middle class. Any rupture in China's social and political stability, of course, would have widespread, negative ramifications for economic growth and any superpower aspirations.

A third reason for caution is that many of China's diplomatic and political gains in the international arena are the direct or indirect result of America's self-inflicted wounds. Washington's decision to embark on not one but two military interventions and nation-building missions in the Muslim world will likely strike future historians as cases of appallingly bad judgment. If the current mission in Libya does not turn out to be a brief affair in which the United States plays a very limited role, that intervention will be added to the list of US foreign policy follies.

Perhaps China will be lucky, and the US political and policy elite will continue to pursue expensive, bloody chimeras in the sands of the Middle East and the mountains of Afghanistan. Perhaps US leaders will even add new military crusades to the burdens borne by the American armed forces and American taxpayers. But there is always a chance that wiser, more frugal, and more realistic leadership will emerge in Washington. And if that happens, China's gliding progress down the road toward superpower status may encounter a speed bump, perhaps even a large pothole.

China may yet become the leading power of the 21st century. But Western pundits and policy experts should stop acting as though that outcome is ordained. There are too many domestic economic, political and social variables, as well as too many international strategic and diplomatic variables, to be certain about China's future status.

Ted Galen Carpenter, vice president for defense and foreign policy studies at the Cato Institute in Washington, D.C., is the author of eight books and more than 400 articles and policy studies on international affairs.

http://www.cato.org/pub_display.php?pub_id=12937
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Crafty_Dog
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« Reply #398 on: April 06, 2011, 04:25:24 PM »

The piece is not all that it could be IMHO.  To my eye, not only is it written with an view to pushing libertarian non-interventionism by the US (so as to maintain our pre-eminent role in the world huh) it ignores some of the most poweful reasons that China may not become all that it seems destined to be:

1) Its bookkeeping is seriously dishonest.   There is good reason to think it a major bubble, perhaps even larger than ours of not so long ago.

2) The economic model is turning the country into a major toxic dumpsite.  Water is polluted and it seems quite likely that it is inevitable that water scarcity will become a major bottleneck in the near future.

3) Weird demorgraphic profile thanks to the one-child policy.
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Body-by-Guinness
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« Reply #399 on: April 06, 2011, 08:03:52 PM »

Agree, Crafty. I was surprised it didn't mention the banking hijinks other pieces I've posted dwell on, and the author's embrace of disengagement while raising the specter of Chinese preeminence was disingenuous. Still, the three take aways that inspired me to post it were the contrarian view of China's emergence, the question of what BHO gave away to keep China from vetoing action against Libya, and the door our military involvement has opened for Chinese engagement in that neck of the woods.
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