Breaching China’s great wall of arrogance

Outgoing Joint Chiefs Chairman Admiral Mike Mullen’s bumbling replies to questions by “automated” university students during a mid-July Beijing visit were symptomatic of total disarray in U.S. China policy. Instead of clear-cut defense of no military takeover of Taiwan, with its 25 million the only free society in Chinese history, the Admiral backed into a defense of U.S. policy as if the Taiwan Relations Act were an impediment Washington leadership had difficulty overcoming.

He did not forthrightly defend traditional American support for freedom of the seas in the face of Beijing’s outrageous claims on Southeast Asia waters with their gas and oil prospects through which much of world commerce – including China’s vast exports – flows freely courtesy of the U.S. Navy. Nor did he condemn Beijing’s support for the world’s most hideous tyranny in North Korea. For Pyongyang is not only a threat to regional peace with its buildup of weapons of mass destruction but worldwide through its nefarious exports – in league with the Chinese — to pariah states.

Supplicants for months, Washington’s aim with the Mullen visit was facilitating liaison between U.S. and Chinese military to reduce possibilities of accidental clashes and ventilate Beijing’s rapidly escalating but ultra secret military buildup. But Beijing’s generally boorish response – except for a promise of a Mideast anti-piracy exercise where China has been odd-man out in coordinating multinational operations – inevitably promises more misunderstanding.

That was despite Adm. Mullen carrying a major concession in Washington’s continued refusal to meet Taipei’s request to purchase additional fighter aircraft and submarines. U.S. arms for Taiwan’s defense has become the pretext for Beijing’s rejecting military courtesies, while it pursues a double-edge strategy of economic integration with the Island while positioning one of the world’s largest missile arrays opposite it just across the Strait.

Adm. Mullen’s performance again demonstrates Washington’s lack of a strategic framework given China’s centrality in a rapidly changing world coupled with Beijing’s growing arrogance. Minor but indicative: on the eve of his journey, Adm. Mullen publicly accused the Pakistan government of murdering a journalist. Even had he proof, going public in the Obama Administration’s ill-conceived current media campaign against the Pakistanis only further aggravated relations with Islamabad. Essential as Pakistan is for Washington’s pursuit of the Afghanistan War and worldwide counterterrorism campaign, he played into Beijing’s efforts to exploit U.S.-Pakistan frictions in pursuit of its own alliance with Islamabad against India.

Adm. Mullen’s confusion epitomizes not only the lack of a coherent official U.S. policy toward “a rising China” but parallels increasing difficulties by American entrepreneurs in hot pursuit of the Chinese shirttail. [“If we could only persuade every person in China to lengthen his shirttail by a foot, we could keep the mills of Lancashire working round the clock”, an 1840s British commentator wrote.] Foreign businessmen increasingly must choose between the mythical unquenchable market for investment and trade or eschew exposure to an economy without the rule of law.

As Beijing’s domestic political crackdown intensifies, spurred by fear of contagion from rising popular revolt in the Middle East and Southeast Asia, and the insecurity of next year’s Communist Party leadership generational succession, commercial relations with foreigners are deteriorating. The media focuses on the larger economic issues: China’s perilous growing dollar hoard through its manipulated currency, protected markets and subsidized exports. But increasingly foreign companies are threatened with death by a thousand cuts.

For example, Beijing backed off price blackmail with its rare earths monopoly when faced with sanctions in the World Trade Organization where Washington’s aggressive sponsorship facilitated Chinese entry on unfulfilled promises of compliance. But after announcing exports at last year’s level of its highly contaminating metals production essential for information technology hardware worldwide, Beijing’s arbitrary customs voided contracts.

Even more threatening, suddenly the whole vast, abysmally corrupt, network of foreign investors’ ownership in Chinese companies through local middlemen held corporately in overseas tax havens has come under “scrutiny”. The Chinese had winked at such arrangements for decades as a device to entice but manipulate direct foreign investment. Now these arrangements are being used to freeze out foreign participation in company expansion with transferred technology. Coupled with expanding theft of intellectual property – the latest, French, German and Japanese high-speed rail know-how – Beijing looks to feel there are no holds barred in their seduction of foreign businessmen faced with a worldwide markets slowdown.

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