WE BETTER PAY ATTENTION!
- US Worries Over China’s Extensive Underground Nuclear Network
- Forthcoming movie on conflict with China
- China’s Military Growth Threatens World Security (and misc on economics)
- Obama Betrays Another Ally: Taiwan
- What Will China Do? (Beijing’s ongoing commitment to Marxism-Leninism.)
- Abortions and dead babies!
- Keeping an Eagle’s Eye on China’s Military Buildup and World’s Biggest Hacking Operation (and Will the US fight to preserve Taiwan independence?)
- U.S. Giving Foreign Aid to — China! (why?)
- Channeling Neville Chamberlain to appease China? Beware of Ambrose Evans-Pritchard’s Rhetoric!
- The Score Now Stands: China, One…The World, Zero
- A rescue plan for the US economy: Time to take China much more seriously
- Obama Needs To Address Our Cyber-Warfare Gap With China
- China announces its real foreign policy (updated)
- An insulting Communist Chinese anti-American song played by China delegation’s pianist at Obama’s State dinner in D.C. (and other related notes)
- We’ve Got Our Eye on Hu! (China’s Communist President Hu Jintao, that’s who)
- China’s dead babies (oh and the U.S.’s too)
- China: Danger before the Doom
- China and it’s double-edged cyber-sword
- Is America being held hostage by China?
- Feds grant eminent domain as collateral to China for US debts.
- Could China’s Instability Threaten America?
- Coming Soon: World War IV By Ben Shapiro; Today’s Italy, Germany and Soviet Union are Iran, China and Russia.
- China’s Achilles Heel
While the US has bowed down to foreign leaders and vowed to destroy our nuke weapons, China AND Russia along with NKorea and Iran are all building them…
WASHINGTON — A leading US lawmaker who fears budget cuts could delay modernizing the US nuclear arsenal voiced concern Friday about an extensive tunnel complex designed to house Chinese nuclear missiles.
“This network of tunnels could be in excess of 5,000 kilometers (3,110 miles), and is used to transport nuclear weapons and forces,” said Michael Turner, who chairs a House Armed Services Committee panel focusing on strategic weapons and other security programs.
“As we strive to make our nuclear forces more transparent, China is building this underground tunnel system to make its nuclear forces even more opaque,” he added, citing an unclassified Department of Defense report.
Experts also expressed their concern about the network, whose existence was revealed by official Chinese media in late 2009.
The tunnels would allow China to launch a nuclear counter-attack if it was hit by a nuclear strike. “It’s almost mind-boggling,” said Mark Schneider, senior analyst at the National Institute for Public Policy.
“It has enormous implications in terms of their view toward nuclear warfare, survivability of their systems and their leadership in the event of war.
“It is virtually impossible to target anything like that, irrespective of how many nuclear weapons you have,” he added.
Richard Fisher of the International Assessment and Strategy Center said the tunnel complex could allow the Chinese army to conceal its weapons.
“Do we really know how many missiles the Chinese have today?” he asked.
Turner expressed concern that planned cuts to the Pentagon could block efforts to modernize the US arsenal.
“We need to understand the potential long-term consequences of watching as Russia and China modernize their nuclear arsenal while we sit back and simply maintain our existing and aging nuclear forces,” he warned.
Forthcoming movie on conflict with China
September 14, 2011 Jose Reyes
The movie “Two de Force“ is in its final stages of post-production, and will be in theatres, near you, very soon. It is categorized as an action packed movie, featuring a head to head confrontation between the United States of America and The People’s Republic of China.
It could be classified as an update of the Cuban Missile Crisis. China decides to blackmail America in order to collect the ever increasing debt, but with intimidation, declaring the US Dollar as useless. A very possible and certainly realistic scenario which could very well happen in the near future.
This idea is neither considered to be impossible and/or far-fetched, and has unquestionably crossed the minds of Chinese and Americans alike. A simple combination of the ongoing financial disaster in America with the ever increasing debt to China is already producing a dangerous level of tension. Many experts are predicting some kind of a showdown or even some type physical aggression from China. This could trigger an unstoppable war between the two superpowers.
Why not? The totalitarian Communist ideals of China differ and strongly contradict the Democracy “Land of the Free” attitude of America. The Chinese are running out of land and America has plenty of available space to offer. A scenario of this magnitude is theoretically possible and Writer-Director Orestes Matacena has put it into play with this highly anticipated film. Here’s The Synopsis and Concept:
It is 2012. The US delegation and the Chinese delegation meet in Beijing to discuss the US debt to China and all hell gets lose in a clash between these two super powers.
Writer-Director Orestes Matacena wrote the “Two de Force” story in the beginning of 2010 and everything that he wrote and was shot many months ago is happening right now in real life. It’s kind of eerie.
Of course, “Two de Force” is a movie not a documentary. “Two de Force” is a drama with action and humor that exercises poetic license. Throughout the story, all the political characters are seen as normal people who happen to be in powerful positions. Orestes wanted to show how these men and women act the same way we do when they are not in front of a television camera or at a public gathering. More importantly, he explores the big picture of politics, and he questions who really pulls the political strings that govern our daily lives and ultimately determine our future.
The story does not encourage partisan politics in any way, as we allow for an array of opinions to be represented. The goal of the story is not to encourage the audience to pick sides. Instead, the goal is to challenge the viewer to think about the big picture and how all of us are affected by the decisions of regular people that happen to be elected to office in their respective countries. And, in this story, these “regular guys” happen to be the leaders of the two major world powers.
Normally, we only get to see what is allowed to be presented to the public at large. But, what if we could see what happens behind closed doors. . .Official website
The trailer for this movie can be seen here. Would America survive? Is the “Cold War” really over?
Jose Reyes publishes Cubanology.com
Atlas Shrugs – Obama Betrays Another Ally: U.S. to Deny Taiwan’s request, “We are so disappointed in the United States” submitted by VA Right
What Will China Do?
Posted: 25 Jul 2011 08:16 PM PDT From JRNyqist.com:
Jeff Nyquist is one of the few commentators writing today who understands China and the significance of Beijing’s ongoing commitment to Marxism-Leninism.
Most viewers look at China’s emphasis on business and wealth creation and falsely conclude that china is abandoning communism for capitalism.
As Nyquist rightly points out, Marxist-Leninists have always acknowledged the productive capabilities of capitalism and have regularly used capitalist methods to increase their own power and influence.
And that is the key. Capitalism in China is not used primarily to enrich the people. It is used to enrich and empower the Party.
U.S. Giving Foreign Aid to — China! (Still – Why?)
NewsMax Reports: Jan 30, 2011
What does economic superpower China have in common with many poor nations in the developing Third World? They all receive American foreign aid.
That’s right, the United States is among several industrial nations that still subsidize the world’s No. 2 economy, according to the Organization for Economic Cooperation and Development. Japan is the biggest donor, followed by Germany, France, Britain, and the U.S. — countries that are all in debt to China and running massive deficits.
American aid totals the modest sum of $65 million a year, but “why are we sending China any succor at all?” Investor’s Business Daily asked in an editorial.
“It’s hard to justify giving foreign aid to a communist state whose state-run organ, ‘The People’s Daily,’ wrote on the eve of [Chinese President Hu Jintao’s] visit to Washington: ‘China’s emergence is increasingly shifting to debate over how the world will treat China, which is the world’s No. 1 and has overtaken the U.S.’”
IBD points out that China spends at least $100 billion a year on its military, holds some $2.5 trillion in foreign reserves, and boasts more billionaires than any nation except the United States.
Hu recently pledged to double aid to Africa to gain access to its oil, and human rights groups say China is using that aid to prop up brutal regimes.
“So here we are giving charity to China (financing it by taking loans from China, our debt holder), which China uses to finance its wicked projects in Africa under the guise of charity,” IBD observes.
“Are we really this foolish? Apparently so.”
The editorial calls on the House Oversight and Government Reform Committee to investigate why America is still funding China.
There is a new edge to Chinese naval policy in the South China Sea, causing Japan, Vietnam, Indonesia, and the Philippines to cleave closer to the US alliance. Has Beijing studied how German naval ambitions upset the careful diplomatic legacy of Bismarck and pushed an ambivalent Britain towards the Entente, even to the point of accepting alliance with Tsarist autocracy?
Reports about China’s stealth jet and “carrier-killer” missile are changing the strategic power balance in the West Pacific. Western observers believe that China’s at-sea defense capability has been growing wider, and that US aircraft carriers can no longer operate in this region without a second thought.
The Score Now Stands: China, One…The World, Zero
[Editor’s Note: This is the second installment of a two-part interview with Money Morning Chief Investment Strategist Keith Fitz-Gerald. Here in Part II, the investing veteran details his fix-it plan for the U.S. economy. In Part I, which appeared yesterday (Thursday), Fitz-Gerald outlined an investment strategy for 2011.]If Money Morning‘s Keith Fitz-Gerald were granted an audience with U.S. President Barack Obama and Federal Reserve Chairman Ben S. Bernanke, the one message he’d deliver is this: It’s time to stop the gravy train and reform the U.S. financial system once and for all.
“If I had the chance to sit down with President Obama and Fed Chairman Bernanke, I would offer [them an] eight-point plan that’s designed to increase growth, provide jobs and increase America’s international competitiveness,” says Fitz-Gerald, a well-known commentator and bestselling author who is Money Morning‘s chief investment strategist.
In this second installment of a two-part interview with Money Morning Executive Editor William Patalon III, Fitz-Gerald took the time to outline that eight-point rescue plan for the U.S. economy. In that plan, the changes Fitz-Gerald calls for include:
- Cuts in federal spending.
- Pension reforms at all levels.
- A halt to weak-dollar policies.
- And a realization by Washington that it’s time to take China much more seriously.
In Part I of this interview, which appeared yesterday (Thursday), Fitz-Gerald assessed the health of the U.S. and global economies, provided his outlook for the U.S. stock market and for commodity prices, and even offered an investment strategy for 2011.
The highlights of Part II follow below. And if you missed Part I, you can access yesterday’s story by clicking here.
Obama Needs To Address Our Cyber-Warfare Gap With China
Though Beijing is keenly interested in cybercommunications, it’s not at all into online freedom, and is using hacks and malware to achieve its goals.
January 24, 2011
China announces its real foreign policy (updated)
The Chinese economy today parallels that of the latter-day Soviet Union – immense accomplishments co-existing with immense failures. In some ways, China’s stability today is more precarious than was the Soviet Union’s before its fall. China’s poor are poorer than the Soviet Union’s poor, and they are much more numerous – about one billion in a country of 1.3 billion. Moreover, in the Soviet Union there was no sizeable middle class – just about everyone was poor and shared in the same hardships, avoiding resentments that might otherwise have arisen.In China, the resentments are palpable. Many of the 300 million people who have risen out of poverty flaunt their new wealth, often egregiously so. This is especially so with the new class of rich, all but non-existent just a few years ago, which now includes some 500,000 millionaires and 200 billionaires. Worse, the gap between rich and poor has been increasing. Ominously, the bottom billion views as illegitimate the wealth of the top 300 million.
January 24, 2011
Insulting Chinese Anti-American tune played at state dinner
At the White House State dinner on Jan. 19, about six minutes into his set, Lang Lang began tapping out a famous anti-American propaganda melody from the Korean War: the theme song to the movie “Battle on Shangganling Mountain.”
The film depicts a group of “People’s Volunteer Army” soldiers who are first hemmed in at Shanganling (or Triangle Hill) and then, when reinforcements arrive, take up their rifles and counterattack the U.S. military “jackals.”
The movie and the tune are widely known among Chinese, and the song has been a leading piece of anti-American propaganda by the Chinese Communist Party (CCP) for decades.
How insulting is it?
The song Lang Lang played describes how beautiful China is and then near the end has this verse, “When friends are here, there is fine wine /But if the jackal comes /What greets it is the hunting rifle.” The “jackal” in the song is the United States.
This was no unintentional diplomatic faux pas. This was crudely obvious, deliberate effort to smack down the United States and elevate China, as Mr. Lang makes crystal clear:
“Playing this song praising China to heads of state from around the world seems to tell them that our China is formidable, that our Chinese people are united; I feel deeply honored and proud.”
Reports also indicate the selection went over very well in China.
Now, we musn’t make a big deal out of this. If we do, it means we all want the cold war to come back. Since the left insults America on a daily basis, what’s wrong with a foreigner doing it? It’s no big deal that a country that is proving its desire to compete with us in Asia – even destroy our influence and drive us out of the region (official Chinese military policy) – comes into the president’s house and, in effect, spits in his eye.
We just aren’t enlightened enough to understand that we should welcome China’s coming hegemony with open arms. And despite their refusal to rein in North Korea, their encouragement of the Iranian nuclear program, and their dismissive attitude toward any and all concerns of the United States on trade, currency, and intellectual property, that doesn’t mean we should start treating them as a competitor and not a partner.
After all, what are you people? Warmongers?
We’ve Got Our Eye on Hu! (China’s Communist President Hu Jintao, that’s who)
As I arrived in D.C. this week I noticed the Chinese flags flying next to the American flag along Pennsylvania Ave. The flags are a part of the welcome to Chinese President Hu Jintao who arrived in Washington today for talks with President Obama about a variety of issues–everything from currency valuation to China’s new fighter aircraft. But underneath all of the diplomacy, there’s an irony to this visit. President Obama, who won the Nobel Peace Prize in 2009, is welcoming a Chinese leader who jailed his country’s Nobel Prize winner, Liu Xiaobo. Mr. Hu, who supported the bloody crackdown of dissidents in Tienanmen Square, is head of a government that advances China’s notorious “one-child” policy, which is responsible for aborting tens of millions of unborn babies. He helps advance an aggressive–and increasingly militant–Chinese foreign policy in Asia and even Africa. Under his rule, hundreds if not thousands of Christians are persecuted for having the courage to follow Jesus Christ. While he’s in town, maybe Hu would like to stop by Capitol Hill, where Reps. Chris Smith (R-N.J.) and Frank Wolf (R-Va.) are holding a hearing about his country’s continued pattern of human rights abuses. If not, let’s hope that President Obama will raise these concerns with China’s leader and uphold America’s historic commitment to religious liberty. True peace comes only through moral courage. Let’s pray Washington exercises it.
January 23, 2011
China’s Dead Babies
By Nancy Morgan
Just like the Germans, China practiced varying methods of abortion and prevention to find the the most efficient way to destroy these unwanted babies. And they were successful. It has been estimated that 1.7 million female babies “went missing” every year, through abortion and/or murder by parents who needed a boy to take care of them in their old age.
STRATFOR Global Intelligence – Security Weekly
By Sean Noonan | December 9, 2010
A recent batch of WikiLeaks cables led Der Spiegel and The New York Times to print front-page stories on China’s cyber-espionage capabilities Dec. 4 and 5. While China’s offensive capabilities on the Internet are widely recognized, the country is discovering the other edge of the sword.
China is no doubt facing a paradox as it tries to manipulate and confront the growing capabilities of Internet users. Recent arrests of Chinese hackers and People’s Liberation Army (PLA) pronouncements suggest that China fears that its own computer experts, nationalist hackers and social media could turn against the government. While the exact cause of Beijing’s new focus on network security is unclear, it comes at a time when other countries are developing their own defenses against cyber attacks and hot topics like Stuxnet and WikiLeaks are generating new concerns about Internet security. Read more »
New to STRATFOR? Get these free intel reports emailed to you. If you did not receive this report directly from us and would like more geopolitical & security related updates, join our free email list.
Is America being held hostage by China?
December 2nd, 2010 12:26 pm ET
But this is only part of the picture.
The largest single holder of American debt is China. The ChicComs have bought up nearly a trillion dollars in U.S. debt, and for collateral they have been offered control of portions of American land. (see below)
China has been much more willing to meddle in U.S. economic policy since Obama came to office as well. Sensing that America’s debt-load is reaching a dangerous threshold where the risk for default is very high, the ChiComs have publicly criticized the Obama Administration’s spending policies, which are paid for with borrowed money. The ChiComs have also decried the practice of the Administration in printing more money that is not backed by any valuable assets, which further drives up the debt and deepens the economic crisis.
The reason for the willingness of the Chinese to openly criticize U.S. economic policy is very clear. The ChiComs are obviously frightened over the prospects of losing their investment in American debt. They are afraid they won’t get their money back.
A tried-and-tested tenet of simple economics is that the higher the debt the greater the risk for default. The U.S. is now at the stage where the risk for default on our mountain of debt is very high. Thus, the meddling of the ChiComs in U.S. economic policy.
It is no accident, then, that Barack Obama has handled China with kid gloves. Not only does he need to prevent the ChiComs from panic about American debt, but he needs China to reign in North Korea at the most dangerous time for the Korean peninsula since the cease-fire that ended the U.S. combat mission in the region in the 1950s.
The problem, however, goes much deeper. Unfair and unbalanced trade practices with China has led to the undesirable consequence of American funding of the expansion of Chinese defense capabilities, not to mention their ever-increasing military machine which is manned by the largest army in the world.
In short, America is helping to fund the largest Communist army in the world and potentially our greatest enemy.
This comes at a time when it appears that the Pentagon budget will be slashed in an effort to reign in the debt. Some of the programs that could go on the chopping block include the development of the next generation of stealth aircraft that effectively shield themselves from the more sophisticated tracking systems our enemies use to shoot down jets..
Added to that ominous prospect is the disclosure yesterday that the Fed has sent billions of U.S. dollars to the European Union to bail out countries on the brink of collapse. This is in spite of the fact that the U.S. cannot pay its own debt and is itself headed toward collapse.
What explanation could possibly account for this madness? Pay your money and take your choice.
But it is growing more obvious by the day that powerful forces in the U.S. government–and powerful sugar-daddies behind the throne–are pushing America to total disintegration. The Wikileaks scandal is but another big push in that direction, giving credence to speculation that the Obama Administration did not wish to stop the constant flow of damaging information from Wikileaks.
IF THIS NEXT PIECE IS TRUE?, IT WOULD BE ONE THE MOST EGGREGIOUS VIOLATIONS OF EXECUTIVE POWER, AMERICAN SOVREIGNTY, AND THE U.S. CONSTITUTION IN HISTORY !
Feds grant eminent domain as collateral to China for US debts.
Beijing, China — Sources at the United States Embassy in Beijing China have just CONFIRMED to me that the United States of America has tendered to China a written agreement which grants to the People’s Republic of China, an option to exercise Eminent Domain within the USA, as collateral for China’s continued purchase of US Treasury Notes and existing US Currency reserves!
The written agreement was brought to Beijing by Secretary of State Hillary Clinton and was formalized and agreed-to during her recent trip to China.
This means that in the event the US Government defaults on its financial obligations to China, the Communist Government of China would be permitted to physically take — inside the USA — land, buildings, factories, perhaps even entire cities – to satisfy the financial obligations of the US government.
Put simply, the feds have now actually mortgaged the physical land and property of all citizens and businesses in the United States. They have given to a foreign power, their Constitutional power to “take” all of our property, as actual collateral for continued Chinese funding of US deficit spending and the continued carrying of US national debt.
Franklin Roosevelt’s Democrats needed WWII to bolster their failed depression program; Barack Obama’s Democrats are in a comparable place. Most know that troubled, frightened rulers may turn to war to shore up their positions. Should we expect that?
WWII roared up from the never-quenched embers of WWI in the desperation of a world depression. It was the completion of something never properly finished. Hitler’s economic cure, militarization, couldn’t be sustained in isolation; the European Allies’ depressed economies were weak, tempting Hitler’s needs. The U.S. was both weak and isolationist. We know the result.
Today we’re looking again at world economic weakness and fear, with another newly strengthened and militarized country resentful of the generations of subservience imposed upon it by those same Allies. That country would be China. It’s much stronger now than in 1950, when it bloodied the U.S. military in Korea. The U.S., on the other hand, has dissipated in Korea, Viet Nam, Iraq, and Afghanistan, with a Pyrrhic success in Kuwait but no sustainable gain clearly worth its price since WWII. China has industrialized and acquired Tibet, and the nation is extending its influence economically and militarily.
China sees no choice; its Communist ideology failed, and its government is preserving the mandate of Heaven in the face of poverty and broken promises piled on generations of atrocities and suffering. Millions have discarded poverty, and hundreds of millions watching want their turn. The ex-Communist hierarchy must visibly deliver — or else.
Slowing delivery threatens the government, and a threatened government can’t afford to look weak. Taiwan’s independence; Japanese, Russian and Indian boundary claims; and U.S. naval suzerainty in nearby waters are all perceived as imposed, intolerable weaknesses. Another is the existence of South Korea, a flaunted weakness rendered insulting by today’s contrast with the North, which exists only because China poured soldiers into North Korea’s failing attempt to take the South, forcing a stalemate.
China tries to offset its perceived weakness by lining up publicly against those imposing weakness upon it and, where it can, encouraging their enemies. In addition to supporting such as Iran, from whom it gets both oil and the thwarting of its opponents, China uses its North Korean client for behavior China can’t afford to engage in openly. China continues to develop its military toward the point that will allow it to act directly against those it sees as interfering.
China has industrialized, like everywhere else, on the backs of its people, but its government has largely held off the liberalizing societal changes seen elsewhere in order to speed up the process. That process has relied on rich world customers who have now spent themselves broke, threatening the program, and therefore the government.
Threatened governments rattle sabers and bully the weak to look stronger, a pattern we have seen from China before. Calculating governments take advantage of both perceived weaknesses and momentary distractions to accomplish things that seem too risky at other times; we have seen this from China as well.
From China today, one might see the U.S. and Europe as declining markets becoming unable to finance future hegemonic activities and, specifically, becoming unable to offer southeast Asia military protection, opening the way to Chinese influence. One might even see Japan added to that.
Then, consider Korea from China. The Korean War was not an independent action by North Korea. It was an attempt by China, with some Soviet help, to expel the West and augment China, using Koreans to do the work. When the Koreans failed, the Chinese themselves tried. The state of suspended warfare remains in place; there has never been a peace. To China, Korea is unfinished business.
China has been steadily adding missiles on its coast aimed at Taiwan and has at times heavily shelled some of its surrounding islands. Its intent to take the island is clear and on record. It is replacing indigenous peoples with Han in Tibet and Xinjiang, the old Chinese Turkestan. It has taken Macau and Hong Kong, is about to complete its first aircraft carrier, and is investing in missiles, drones, satellites and computers. It’s sitting on a Mount Everest of U.S. dollars.
North Korea has fired missiles over Japan; it recently torpedoed an unwarned South Korean warship and then shelled an offshore island, creating numerous casualties. It has announced an intention to do more. China (with Russia) has dropped the dollar and will settle its debts in its own currency. There’s a major media video alleged to show a mystery missile launched off southern California, followed by a very late and technically unsupported government denial. There seem to be no clear and public U.S. actions pointing to a cost that will be imposed upon a China/Korea progression, leaving much for them to gain.
A similar situation led to Saddam Hussein’s miscalculation invading Kuwait, but the cautious Chinese are not so rash. They misread the first Korean War and have avoided such mistakes since, but they haven’t failed to pursue real opportunities. The rich world’s financial collapse is clearly such an opportunity; the open question is timing.
China would like its goals to fall into its hands at the lowest cost; at some point, as economic weakness proceeds, war won’t be necessary. The once-rich world will have to let it happen. But China can’t wait too long, as that same weakness threatens its own stability. And maybe Obama will decide to follow the Rooseveltian script. These are spooky times!
Could China’s Instability Threaten America?
December 01, 2010
China’s double-digit economic growth over the past thirty years has been breathtaking. Growth has limits, however, and China may soon be reaching them. With worldwide recession and inflation coming to the yuan, a slowdown in China’s growth is increasingly probable. If China experiences any letup in growth, the nation’s internal stability becomes a concern. The modern Western trait of rising expectations has set in with the populace. By their sheer numbers, any setback in the standard of living could ominously jeopardize the nation’s political and economic structure — and affect us as well.
Beijing has established, over the years, an integrated economy with surrounding Asian nations equal in population size to that of the United States. They have the technological and financial advantages of a modern economy and, with their huge population, the cost advantages of a developing one.
But China has problems, too. Part of their insecurity stems from a dependence on foreign sources for raw materials. China imports about half its oil, for example, and the vast majority of that comes from tankers that pass through the strategic choke-point at the Strait of Malacca near Singapore. And to reach Africa or the Persian Gulf, they must cross a vast Indian Ocean heavily patrolled by the U.S. and Indian warships.
And then there is the one-child policy adopted in the 1970s. The policy has resulted in an inherently unstable demographic of 125 men for every 100 women of childbearing age. Moreover, China is aging faster than almost any country on Earth. By 2030, about the time China’s economy is projected to surpass the U.S., their population will begin to decline.
A massive wealth disparity also exists between China’s coastal populations and its poorer interior regions. With the vast majority of China’s population living in the eastern third of the country near the coast, the other two-thirds of the country is relatively unpopulated.
About 17 million people annually migrate from the country to the cities. Beijing is hoping to limit that flow by taxing and shifting resources away from wealthier coastal regions and giving it to the interior regions without meeting great resistance from either.
When economic growth inevitably slows, however, conflicts will arise, and competing factions could emerge, with some calling for a strong central government that imposes a heavy-handed order and others calling for a more free decentralized government. How this struggle will play out is uncertain. In the end, China may remain formally united, but its power could be distributed among its regions, much as it was before Mao.
China’s immediate problem, however, is inflation. A succession of wage increases for factory workers has occurred this past year. That, along with a rise in commodity prices, could bring a spiraling inflation, where higher wages and prices feed off each other. The threat of inflation is forcing China’s central bank to begin cooling the economy. Beijing is already contemplating price controls for some consumer staples, and particularly for food items. The Wall Street Journal recently reported that China’s “consumer price index’s spike to 4.4% on-year in October was mostly due to a 10.1% on-year rise in food prices.”
By keeping the yuan artificially weak against other currencies, Beijing may have allowed its economy to overheat, and has contributed to trade imbalances and global recession. The fading value of the euro has compounded the problem. In preventing the yuan from fully appreciating, China has accumulated $2.6 trillion in foreign-currency reserves, mostly in dollar-denominated assets.
Although Beijing has recently decided to allow the yuan to strengthen, it has much farther to go to reach fair value with the dollar. Ending trade and monetary imbalances, and the global recession is unlikely unless the yuan is allowed to rise freely. Allowing the yuan to rise, however, would slow China’s economy still further. Such a policy would be mostly for the benefit of other nations, and is therefore very improbable.
History suggests that China will continue to act in its own best interest by maintaining trade advantages. This, in turn, allows them to keep their people employed and to grow their economy and their military. They have little room for error. With 1.3 billion mouths to feed and food prices rising, no one knows when some chance incident might trigger another Tiananmen Square-type bloodletting, a Chinese sell-off in the U.S. Bond market, or a showdown over Taiwan.
We cannot assume that Chinese and American interests are the same. For policymakers in Washington, China’s ravenous appetite for raw materials and our growing indebtedness to them are worrisome. We must be open to the possibility that our current approach is not working, but instead is strengthening a regime that represses its people and threatens other nations.
In a world of sovereign debt defaults, currency devaluations, and quantitative easing, China’s goal is to protect its economy. In doing so, however, the Chinese could be destabilizing the world economy and causing an aggressive competition for resources. We too will feel the economic effects of their actions. It is inescapable.
The United States must undoubtedly begin the difficult process of reducing its budget and foreign trade deficits. So far, few in Washington have shown a genuine will to address these issues. That must change. With China’s inherent instability, a wise and measured policy approach by Washington will be required for the good of both nations. No easy answers exist for either country.
Coming Soon: World War IV
By Ben Shapiro (Archive) · Thursday, November 25, 2010
Many commentators have compared the current war on Islamism to World War II. “Like the Second World War,” President Bush said in 2004, “our present conflict began with a ruthless, surprise attack on the United States. We will not forget that treachery, and we will accept nothing less than victory over the enemy.”
Unfortunately, the War on Terror no longer resembles World War II; it looks far more like World War I. It will take a World War IV to truly correct the shortcomings of the War on Terror.
At the end of World War I, the Allies left a hollow Weimar Republic. They left German’s armaments industry intact. They wanted to reach out to their enemies, to work with them through foolish institutions like the League of Nations. They saw war as an ultimate evil and felt that the right combination of kindness and appeasement could prevent conflict. They ignored the rise of Mussolini, the rise of Hitler, the rise of Stalin — all of which replaced the nascent democracies of their nations. In fact, the West didn’t merely engage in ignorance — it praised these new leaders as scions of a new age.
H.G. Wells summed up the worshipfulness of the blind West toward the rise of Communism and German and Italian fascism: “The world is sick of parliamentary politics,” he wrote. “The Fascist Party, to the best of its ability, is Italy now. The Communist Party, to the best of its ability, is Russia. Obviously, the Fascists of Liberalism must carry out a parallel ambition on a still vaster scale.”
Fast-forward 90 years. Today’s Italy, Germany and Soviet Union are Iran, China and Russia. We could have done something about them in the War on Terror. Instead, we ignored them, paving the way for a far greater conflict in the coming decades.
First: Iran. After engaging in a long and arduous war against Islamist terrorists ranging from Iraq to Afghanistan, the West is now firmly convinced that it can abandon nascent democracies in those countries without consequence. Iran is filling the void in both countries, at the same time developing nuclear weapons and flexing its muscles against Israel and Lebanon. Iran is on the rise, and the West continues to dally, pretending that a deal with the Islamist mullahs is on the way.
Next: China. China is a moving force behind the nuclear program in Iran and has been for decades. China has sent Iran nuclear technology, high-tech missiles and specialized materials for the production of nuclear arms. The Iranian press reported in 2002 that after President Bush labeled Iran a member of the “axis of evil,” President Jiang Zemin took a trip to Tehran and told the Iranians that they needed to work together to “prevent domination of a superpower on the entire world.” China uses North Korea as a proxy state to attack and menace the West in much the same way Hitler’s Germany routinely threatened Czechoslovakia over the Sudetenland.
China has also drawn closer to the Pakistani regime that continues to hamstring anti-terrorism efforts. Meanwhile, America continues to inflate its currency and sell its debt to the Chinese, with Obama continually expressing his admiration for the Chinese economy and environmental policies (mimicking his bankroller, George Soros, who loves China’s government).
Finally: Russia. Since the fall of the Soviet Union, the West has assumed that Russia is now a member of the liberal democratic states. It is not. Russia remains a thugocracy run by KGB man Vladimir Putin. During the Bush administration, the Russians assisted the Iranians with their nuclear agenda, threatened the independent and free state of Ukraine, and invaded the former Soviet satellite of Georgia. They developed substantial ties with anti-American regimes like China and Venezuela and are reportedly working to help the Hugo Chavez regime go nuclear. President Obama’s response: Give them a “re-set” button, proclaim them an ally, offer them the ability to inspect our nuclear sites under the new START treaty, and kill our missile defense plans.
After World War I, Woodrow Wilson toured the world stumping for his League of Nations. “My clients are the children,” he said in one speech. “My clients are the next generation … I intend to redeem my pledges to the children; they shall not be sent upon a similar errand.”
Twenty years later, they were sent on a similar errand because the world forgot that there is no substitute for victory in appeasement and willful ignorance. The world is forgetting again. And once again, our children will pay the price.
China’s Achilles Heel
November 14, 2010
China has now assumed, in the mind of many Americans, the role of the unstoppable leviathan about to trample the economy and sovereignty of the United States and much of the free world. The focus, not surprisingly, is almost exclusively economic. Yet the never-ending debate on the value of the Chinese currency, the overwhelming trade imbalance, and the trillions of dollars held as currency reserves obscures a more fundamental issue.
Since the ruthless crackdown, epitomized by the images in Tiananmen Square in 1989, the assumption has been that politics does not matter. But the absence of political liberalization will prove to be an Achilles heel as Chinese society becomes more affluent and fluid, and its economy more complex.
It was a basic tenet of Western belief that economic growth and quasi-capitalism in China would bring about political liberalization. However, this has not happened to date, as the Chinese middle class has been co-opted into the current system. They have little desire to see hundreds of millions of poor urban and rural citizens getting the vote to press for their piece of the economic pie.
However, as the market forces have been unleashed, administrative decision-making and the size of the state have skewed the economy. Capital and resources are inefficiently allocated. Manufactured goods and food are traded in the market, but land, labor, and capital markets are controlled. Thus, wealth disparities grow amid rising discontent at the fortunes made by those with the right connections.
Further, within the legal system, judges are told that the first priority is to strengthen the party, not to administer justice fairly. The basic party line was recently reinforced by Hu Jintao, the current president and party leader, when he said, “China must persist with the road of political development with Chinese characteristics … [and] advance the socialist political system’s self-improvement and development.”
The potential pressure from the nearly one billion Chinese who are not in the middle class is nonetheless being recognized by no less a figure than Wen Jiabao, China’s prime minister. Recently he said that China needs to protect the democratic and legal rights of the people; mobilize the citizens to manage state, economic, social and cultural affairs in accordance to the law; resolve the problems of a centralized power that lacks checks and balances; tackle corruption; and open channels for public monitoring and criticism of government.
The aim, he said, should be to build a fairer and more just society that upholds the rule of law while protecting the vulnerable and giving citizens a sense of security and confidence. “If we don’t push forward with reform, the only road ahead is perdition.”
These sentiments were quickly hailed by the reformers in China, but just as quickly, the current ruling class rallied to defend the status quo, reminding everyone that Mr. Wen is due to retire in early 2013 and his sentiments are his alone. Others speculate that these were mere words designed to placate the masses.
However, in 2012, both Mr. Wen and Mr. Hu will be handing over power to the next generation of leaders. As the economy continues to grow and unrest among the vast majority of the population of 1.4 billion people increases, they will demand their place at the table. China will be faced with a potentially devastating dilemma.
In an article on China in the Financial Times, Mr. Jonathon Fenby summarizes:
… those who benefit from the present system and those who see its preservation as their mission have the upper hand. That may serve their purposes for the time being. But it could be a dangerous path in blocking the evolution China needs, particularly if the regime’s claim to deliver ever-increasing material well-being is hit by events such as a big drop in external demand, rising inflation or a food crisis. The loyalty of the people may then matter a great deal.
The United States should not look at China with fear and apprehension. While they may currently hold the upper hand in financing the U.S. debt, that issue can be mitigated by eliminating the massive deficits being run up and by growing the economy. The American worker is still the most productive in the world and can compete with the Chinese if U.S. government policy toward manufacturing, energy, and business development takes a 180-degree turn from the present course.
The ticking time bomb that is the economic and political expectations of a Chinese population that is 4.5 times larger than the United States’ will detonate at some point down the road — and that point may not be far in the future.
China: Danger Before the Doom?
Consider China, which may be the first country to grow old before it grows rich. For the past quarter-century, China has been “peacefully rising,” thanks in part to a one-child policy that has allowed both parents to work and contribute to China’s boom. But by the 2020s, as the huge Red Guard generation born before the country’s fertility decline moves into retirement, they will tax the resources of their children and the state. China’s coming age wave — by 2030 it will be an older country than the United States — may weaken the two pillars of the current regime’s legitimacy: rapidly rising GDP and social stability. Imagine workforce growth slowing to zero while tens of millions of elders sink into indigence without pensions, without health care and without children to support them. China could careen toward social collapse — or, in reaction, toward an authoritarian clampdown.
The pace and scope of China’s military modernization have increased over the past decade, enabling China’s armed forces to develop capabilities to contribute to the delivery of international public goods, as well as increase China’s options for using military force to gain diplomatic advantage or resolve disputes in its favor. [Italics added]
China’s leaders describe the initial decades of the 21st century as a “strategic window of opportunity,” meaning that regional and international conditions will generally be conducive to China’s rise to regional preeminence and global influence, and seek to prolong that window of opportunity as much as possible.
Continued economic development remains the foundation of the Party’s popular legitimacy and underwrites its military power. Unexpected increases in resource demand, global resource shortages or price shocks, or restricted access to resources, could affect China’s strategic outlook and behavior, and might force its leadership to re-examine its resource allocation priorities, including those for the military. [Italics added]Demographic stresses will increase in the future, creating a structural constraint on China’s ability to sustain high growth rates.
In those years, Japan developed into a mercantilist economy, depending on raw materials from abroad to manufacture at home. As Japan moved into the 1920s and 1930s, so grew the country’s nationalism and militarism. Japanese militarism and conquest in Asia-Pacific were driven by the aim to create a “sphere of influence” in Asia-Pacific, whereby raw materials access and access to Asian markets would be guaranteed.
What’s also not very surprising to me is that our State Department must also have known about the significance of the tune and chose to accept the insult by not saying anything. The Epoch Times:
Symbolic gestures such as this are far more significant in Chinese culture than in our own. The very formality of the occasion magnifies the seriousness. It would be a big mistake to dismiss this incident. The message being sent to the Chinese people, China’s East Asian neighbors, and the world is unmistakable.
A message to all members of The Patriot Caucus PAC – It’s not often we can say we agree with Harry Reid, but when he refers to China’s Hu as a dictator… well at least he’s done something right
Obamateurism of the Day
1/20/2011 8:05:23 AM Ed Morrissey
President Barack Obama threw a lavish state dinner for Chinese premiere Hu Jintao last night. For the right perspective on just how objectionable this particular decision was, I’ll turn to my Twitter reader Lash3, who retweeted a succinct… More…
Big news at state dinner: Obama announces China will let U.S. keep pandas for five more years
1/19/2011 9:50:56 PM Even the normally mild-mannered Jake Tapper can’t resist sneering: “forget the Falun Gong, Tibet and Liu Xiaobo….WE GOTZ PANDAS FOR 5 MORE YEARZ ZOMG.” My friends, it’s come to this. President Hu, we have met today in a…. More…
White House reporters ask first truly tough questions in two years — Pres. Obama was inaugurated two years ago today, which means it only took the White House Press Corp members one year, 11 months, and 29 days to find their spines. “Could you explain to the American people how the United States could be so allied with a country that is known for treating its people so poorly, using censorship and force to oppress its people?” asked AP reporter Ben Feller. He then turned to China’s Hu Jintao and asked, “How do you justify China’s record and do you think that’s any of the business of the American people?” When a mixup with the translator prevented Hu from hearing Feller’s question, Bloomberg’s Hans Nichols used his turn to ask Feller’s question again. But no amount of tough questioning could force either Obama or Hu to answer honestly. And in front of God and everyone, the 2009 Nobel Prize winner claimed that the country which is keeping the 2010 Nobel Prize winner under house arrest has made “enormous progress” on human rights which has been “widely recognized in the world.” The ensuing cognitive dissonance threw the Washington Post for a spin. Both headlines appeared in this morning’s paper: “President Obama makes Hu Jintao look good on rights”; “Obama presses Chinese leader on rights.”