Category Archives: China

Beijing’s water politics

There is increasing concern in South and Southeast Asia over Beijing’s control and implied threat to the major water arteries flowing through the region. Six of the major South Asian and Southeast Asian rivers, the heart of life in South and Southeast Asia, rise on the Tibetan plateau. The Chinese Communists have been on an intensive program of dam building on the upper reaches of the Brahmaputra, the Irrawady, the Meman Chao Phya and the Mekong, which would give them control of these arteries of commerce as well as irrigation for vast areas downstream.

The issue is further complicated by the effect of global warming on the Tibetan glaciers where snows are melting at an unusually rapid pace on 46,000 glaciers, the largest concentration of ice after the south and north poles. Tibet has some of the most rapidly rising temperatures on the planet. One of Tibet’s lakes, Namtso, a holy site where pilgrims circumnavigate its banks in prayer, expanded by 20 square miles from 2000 to 2014 from the melting ice and snow. It’s estimated that Tibet’s glaciers have shrunk by some 15% over the past 30 years. And some scientists have warned that if melting continues at current levels, the warmer temperatures will wipe out two-thirds of the plateau’s glaciers by 2050, affecting more than two billion people in China, India, Pakistan, Bangladesh Bhutan, Burma, Thailand, Laos, Cambodia and Vietnam.

It is against this background that China has been building politically potent barrages. The most dramatic example is China’s plan to divert the Brahmaputra from its upper reaches where it flows a thousand miles through Tibet and then another 600 miles through India., including emptying into the harbor of its second largest city and port, Calcutta. The Brahmaputra is the lifeline of northeast India, an already troubled region with caste and other ethnic conflicts, some traditionally fed by Chinese subversion.

Concern has also been expressed by Thailand, Laos, Vietnam and Cambodia over eight dams it is building on the upper reaches of the Mekong river. The Burmese military junta canceled a dam under construction inside of six other Chinese-led hydroelectric projects planned for the upper reaches of the Irrawady which would have exported electricity to southern China.

Governments and the business communities are worried that Beijing’s apparent intention to dam every major river flowing out of Tibet will lead to environmental imbalance, natural disasters, degrade fragile ecologies, and most of all, divert vital water supplies. The extent of the Chinese program is monumental — on the eight great Tibetan rivers alone, Beijing has already completed 20 dams or has them under construction while it has announced plans for three dozen more.

The Dalai Lama has pointed out the obvious, that China’s program could lead to conflict. He warned that India’s use of the Tibetan water “is something very, very essential. So, since millions of Indians use water coming from the Himalayan glaciers… I think you [India] should express more serious concern. This is nothing to do with politics, just everybody’s interests, including Chinese people.”

The Chinese program for the Brahmaputra is only one of many issues which dog the India-China relationship. Indian Prime Minister Narenda Modi, from the nationalistic Bharatiya Janata Party, has blown hot and cold over this issue as with other irritants in the relation ship between the two countries. Despite extensive contacts, the Himalayan border disputes which date back almost a century are no more near solution than they ever were with frequent if small set-tos by the countries’ military. Increasing penetration of the Himalayan kingdoms of Nepal and Bhutan, once dependencies of British India, has become a continuing concern for New Delhi.

Meanwhile, however, China has become India’s No. 1 trading partner – up to an estimated $80 billion in 2015, $10 billion more than 2014. That’s despite concern in New Delhi that Indian exports are largely raw materials and imports Chinese electronics and other manufactured goods. Extensive economic relations are often seen as insuring political disagreements would somehow be sorted out – but that has to contend with the U.S.-Japan relationship on the eve of World War II. An outbreak of uncontrolled violence between the two Asian giants is one more high priority concern that must be on America’s foreign policy agenda.

This takes on new weight as Washington negotiates with Modi for access for unlimited refueling and basing in Indian ports, a mutual treaty which of course is largely meaningless for Indians deployment in American waters. But access to Indian ports would be of considerable strategic advantage the U.S. operating in the vast Indian Ocean.











Whose tail is Beijing twisting?


The enticement of what is seen as China’s relatively suddenly developing huge market and its infrastructure investment rampage around the world is pulling U.S. policy off course.

The latest evidence is a quiet struggle inside the World Bank group.

One of the holy of holies of U.S. management, in effect, of that international institution since it was created as part of the monetary and current settlement of World II, was its advocacy of free markets. True, the bank itself was a centralized run operation with delegates from the various countries as stockholders ands guarantors of its loans, in effect on a government to government basis.

But early on, the Bank established the International Finance Corp. [IFC] as its “free enterprise” window. The IFC’s function was to partner in otherwise too risky joint investments between foreign lenders and local developing market capitalists in the Afro-Asian world and Latin America. Its activities have been relatively modest these five decades compared to the massive lending of The World Bank itself on its government to government basis. Still though its operation have been limited through the years, it was seen as an effective device for encouraging private investment and market operations in countries whose former colonial regimes favored government enterprise

But now, ironically, the IFC has strayed from what the world generally accepts as “the Washington consensus” – a set of 10 economic policy prescriptions constituting the “standard” reform package for crisis-wracked countries by Washington, the D.C.–based International Monetary Fund (IMF), World Bank, and the US Treasury Department. Under the hand of a former Goldman Sachs banker, Jin-Yong Cai, now leaving 10 months before the expiration of his term after a turbulent three years, to return to Asia and the private sector, the IFC has had a large number of deals involving Chinese-state companies.

The last straw for some critics has been a $300 million IFC investment in China’s Postal Savings Bank, a paltry sum compared to the state-owned China Life paying $2.5bn or its 5 per cent stake. But it continues a pattern in which the IFC’s dedication to private enterprise has gone awry. Some World Bank old hands are asking how this particular investment conforms to the IFC’s mandate to lend to private companies where capital was either unavailable or too expensive and other investment options were not available.

Cai has argued the investment in the Postal Savings Bank will help bring financial services to many of China’s “unbanked” in the hinterland away from the largest cities. That’s certainly a worthy objective, and he says it will bring a healthy investment return as well. But while all that may be true, it seems to be just one more example of how policy, often led by the U.S. government, has been bending the rules to accommodate the Chinese.

That issue could become a major one if the current sudden reduction in growth of the Chinese economy continues to fall as there seems every evidence it will. The world commodity markets, already suffering from the impact of slowing economies in Europe and India as well as China, have already been hit. More bad news seems to be on its way from Beijing even though there is a persistent hope in all quarters that the miraculous high rates of growth of the last two decades will, somehow, return. That isn’t likely.

And as crisis arises in a number of African and Latin American countries where huge Chinese infrastructure investments were committed, in reality tied to high commodity prices for Beijing’s imports, we get wind of how far the Chinese have snuggled into relationships with Western institutions. There will be a price to pay for that, and Western policymakers – above all those in the U.S. – had better be alert to it.





Who’s on first?

Does the United States have two foreign policies, one out of the White House, and the other out of The Pentagon – or, thinking about it, maybe another third one out of the State Department?

That’s about the only conclusion you can draw from a recent exchange over an episode in the South China Sea.

It’s no secret that the Chinese are building military bases a thousand miles south of their Mainland territory, right straight athwart one of the most important sea highways of the world. It is the one that carries $5 trillion worth of manufacturing and raw materials on a supply line for not only China but Japan and South Korea, including oil from the Middle East. They are doing it even when they have to dredge up more coral for shoals that barely are above the water line, especially in these days of reportedly rising sea level.

On the other hand, freedom of navigation, freedom of the seas, freedom of international waters, has been an American institution even before our country won its independence from Britain. Thomas Jefferson and John Adams literally spent years trying unsuccessfully to get the European powers together to halt piracy in the Mediterranean. And it was as our second president, Jefferson, much against his previous prejudices against a standing military force and foreign interventions, who after all sent our first troops abroad. They went to North Africa, then the Barbary Coast, to halt the boarding, kidnapping and ransoming of American ships and their sailors. Remember: “xxx from halls of Montezuma to the shores of Tripoli xxx” was not some idle ditty.

When we heard that our ageing [50 years now] B52 bombers were sent lumbering over the new Chinese bases, we assumed they were taking the advice of many of us and challenging Beijing’s effort to throw up a block to world shipping. But now comes Pentagon spokesman Mark Wright with a statement that the Dec. 10 mission was not a “freedom of navigation” operation and that there was “no intention of flying within 12 nautical miles of any feature,” nhinting that the mission may have strayed off course.

“The United States routinely conducts B-52 training missions throughout the region, including over the South China Sea,” Wright said in an email to The Associated Press. “These missions are designed to maintain readiness and demonstrate our commitment to fly, sail and operate anywhere allowed under international law.”

Wright said the U.S. was “looking into the matter.”

The announcement leaves everyone including us in a complete quandary.

First of all, do B52s – sometimes armed with nuclear weapons – stray off course in this day and age of super-GPS [Global Position System]? If so, not only their pilots and navigators need to be brought up on charges but so do the commanding officers, whether they be in Pearl or in Arlington.

Secondly, we had assumed that the “straying” B-52s were another effort to tell the Chinese in no uncertain terms that we would not permit the challenging of the right of freedom of the seas in international waters which they have declared unilaterally. They are, incidentally, stepping on the toes of the Filipinos and others who have claims to those shoals because they are in their territorial waters or zones of economic exploitation.

If this assumption is correct, why in the name of all that is holy in nautical strategy would you not maintain openly and loudly that you are challenging the Chinese! Beijing, sensing some ambiguity in Washington, was already ready, of course, with a protest over the overlights and making new threats The answer to that protest is a public statement reiterating our right to fly through the area because it is in international waters, and not Chinese territory as Beijing claims.

Who’s running this show, anyway? Or is our Helmsman missing altogether?



The scandal of Christian persecution

The lack of public outcry over the continued persecution and murder of Christians in the Middle East is a scandal of enormous proportions. Only a few websites devoted to possible rescuing these victims dogs the internet. But pronouncements from public figures and even the leaders of Western Christendom are few and far between.

The fact is that Christians today face more persecution in more countries than any other religious group.

U.S. Christians sources estimate that 180 Christians are killed in 60 countries monthly for pursuit of their faith. Many of these are in notorious environments such as North Korea. But there are continuing incidents in nominally secular India, for example, where the current administration has its roots in Hindu chauvinism and in its twin, Moslem Pakistan.

But since 2011, of refugees official settlement in the U.S. just over 2,000 have been Muslim but only 53 Christians. It is true that particularly Syrian Christian refugees often more affluent, have made their way to the U.S. through ordinary visa channels and permanent residence. But the Obama Administration opposes legislation which would fast-track Christian refugees. That’s despite the fact that nearly a third of Syria’s Christians, about 600,000, have fled, harried by extremist groups like the Nusra Front [an Al Qaida affiliate] and now Daesh.

The Obama Administration downplaying of Christians in the refugee crisis is based on its fear such support would be viewed and used by Daesh [ISI or ISIL]. Or that it might be considered in the U.S. as part of the argument of “the clash of civilizations”. As in his earliest public Mideast pronouncements, Obama has argued inordinately supposed “Islamohobia” and antagonism toward American Moslems and the world Islamic community. But the reluctance to take on the issue goes back to the Bush Administration when Condoleezza Rice told a refugee aid official the White House did not intervene in ‘‘sectarian’’ issues.


It’s also true that Mideast Christians, generally, suffered less under the former autocratic regimes – including Sadam Hussein’s Iraq – than they have under their successors which often have a strong Muslim cast. Syrian Christians, for example, tended to stay loyal to Basher al-Assad rather than join the originally peaceful opponents of his bloody regime. The various Christian sects, some “in communion” with the Roman Catholic Chruch, others related to Eastern Orthodoxy, and others unique to the region and India, do not want to give up their ancient claims to their historic homes.

But having said all this, the toll of Christians in the region has been horrendous. In many instances Daesh has simply beheaded locals where it has taken over traditional Christian villages. These ethnicities date back thousands of years even preceding their conversion as the earliest followers of Christ. They have been given the choice of converting, death flight, or paying jizya, a special tax on “followers of the book”, that is, Christians, Jews and Zoroastrians.

Obama did get around to referring to Christian and other minorities last fall when he said ‘‘we cannot allow these communities to be driven from their ancient homelands.’’ And when Daesh threatened to eradicate the Yazidis, an ancient syncretic sect combining elements of the region’s major religions, the U.S. beat back the terrorists with intensive bombing and Special Forces intervention.

But proposals to permit a large entry of Mideast Christians has been denounced as a violation of the constitution prohibition against religious favoritism. But in fact admission of refugees has often been based on a particular ethnic group targeted by oppressors abroad. And in this instance Christians constitute such a group.

The argument that more forceful rhetoric and more specific Christians worldwide, but particularly in the Mideast, must be made. The charge of “crusaders” – distorted as it is in all aspects – by Daesh and other Islamic terrorists should not be an excuse for not taking up the cudgels for an important and generally neglected human rights cause.



The Growing China enigma

American policymakers are having to deal with an increasingly mystifying China.

The giant culture that is less than a nation-state but far more than an amorphous one and half billion people is, perhaps inevitably, moving rapidly in different and conflicting directions. As always is the case in a world of jungled conflicts, the U.S. must hope for the best but prepare for the worst. And that worst could be an inevitable conflict over basic American international policy, not least, freedom of the seas.

The Chinese are continuing to build what can only be called military bases in a barrier across one of the most strategic commercial route in the world through the South China Sea. It may take years before the Chinese can project sufficient power from those reconstructed coral shoals to challenge the U.S. Navy. But the world moves faster and faster, and assurances that we are technologically meeting the threat of asymmetrical warfare in which the Chinese traditionally have excelled has to be periodically reexamined

China continues spending in her own terms vast resources on these bases and on the expansion of her military, particularly her seapower. That’s despite the fact that her economy has drifted – one could say inevitably – into slower rates of growth than the double-digit increases of the past three decades. The actual drop, always subject to speculation because of Beijing’s “create accounting”, is perhaps less important than the speed at which she is slacking off.

This has already impacted world commodity markets where China custom had caused high growth, and those countries – including Russia — which had been sucked into single product export patterns. Beijing’s galloping economic invasion of raw material producers, particularly in Africa, where infrastructure projects were sold  as a “swap” for raw materials, are in trouble. That’s telling in such countries, such as Angola, with the energy price halving in no small measure because of the Shale Revolution in the U.S. American lower prices and a gas surplus has sent the oldtime oil price guardians such as Saudi Arabia, and now Iran, pumping as fast possible to maintain market share. But in Southeast Asia Beijing continues to push subsidized giant railroad and highway construction and damn the home finances.

These gambles have been matched by an unprecedented campaign against corruption by Pres. Xi Jinping in his effort to create a new personality political culture matching that of the fabled Mao Tse-tung. These campaigns in the past, while based on evidence in a totally corrupt society, actually are intended to eliminate opposition within the ruling one-party Communist state. More recently, Xi has gone further afield than just high Party officials, and named  multi-billionaire Party-favored oligarchs. That seems inevitably another economic gamble given the slowing economy.

In fact, Xi – despite criticism within and without the Party that they were the greatest obstacle to economic progress – has enhanced the power of the government-owned huge behemoths with near monopolies. Whittling them down and their political hold on credit for a move toward the tiny private sector and most of all, increased consumption, was supposed to be the order of the day. But it is not happening.

The Obama Administration, for the most part, is tip-toeing around all these issues and the puzzles they present for American policy in Asia, and, indeed, in the world. Cutting back on the U.S. military at a time of aggressive Chinese rhetoric and movement is not exactly apt. Minor tinkering with currency manipulation and export subsidies, which will probably expand given the Chinese slowdown, is not an answer to the loss of American manufacturing, now interestingly enough also moving away from China toward more low-wage countries.

China policy has, of course, been a major battleground for American strategists for the past half century or more. But it is looming still larger and the next administration, whatever and whoever it is, had better come with some preparation.




An India-Japan alliance

For most of the last half century, Washington “visioners” have been trying to cement relations between Japan and India. The match seemed natural: Japan’s highly industrialized economy needed markets and raw materials from a still industrializing India. That, it has always been argued, would reinforce a political, and perhaps eventually military alliance, between Asia’s two largest democracies. After the 1949 collapse of China’s Nationalists, such a combination seemed an important contribution to The Cold War effort to halt Communist expansion in Asia. After all, it was reasoned, Japan shared India’s Hindu origins of Buddhism as well as a contemporary dedication to representative democracy.

Washington’s planners even went so far as to include such calculations in the massive economic aid programs to India, South Korea, Taiwan and South Vietnam in the 1950s and 60s. But a special fund set up for regional collaboration – essentially Japan and India — extended year after year, only produced one project. That was a development of an iron ore deposit, a railroad, and a port – originally intended to replace Calcutta as India’s then major commercial center, on the Bay of Bengal.

When Prime Minister Shinzo Abe toured India this month, it appeared that after all Washington’s huffing and puffing, the two countries were on their own settling into the kind of elaborate cooperation Washington geopolitcians hypothesized. The growing specter of Chinese economic as well as military expansion certainly played a role [China is, ironically on of both countries’ largest trading partners.] Leading the new effort is a $15 billion dollar low-interest Japanese loan to finance a favorite project of Prime Minister Narenda Modi, a new fast railway from Bombay, India’s commercial capital, to Ahmnebad, capital of Modi’s native Gujerat state – and eventually to the Indian capital of New Delhi.

Modi, trying to break the mould of a half century of Indian state capitalism, is using Japan to expand the country’s weak infrastructure which most economists see as its greatest barrier to the kind of economic take-off in China in the past three decades. India has the theoretical capacity not only to repeat China’s “miracle” but to go far beyond it with its enormous raw materials resources and one of the youngest – and soon to be largest – populations. Snuggling Japan into the Indian economic picture also could be the wedge needed to defeat the ever present “East India Complex” – the paranoia of India’s enormously powerful “babus”against foreign investment. These bureaucratic clerks whom politicians have relied on in post-British India are one of Modi’s most difficult problems.

Given the long history of Tokyo’s effort to achieve a breakthrough, it is still early to predict its ultimate success. Probably no two international negotiators have larger cultural differences than the Japanese and Indians; the first with their mania for an almost sexual satisfaction from extended negotiation, and the Indian tendency for talk for its own sake.

A shadow, too, hangs over Modi’s political following. He does represent new entrepreneurial tendencies among smaller Indian businessmen – India’s big brandnames often have chosen to go abroad rather than fight through local problems. But his party’s origins in Hindu chauvinism are dangerous at a time when the Islamicists are attempting to infiltrate India’s Muslims. [With 180-million, they are the world’s third largest the world’s third largest Islamic community, much of it mired in poverty and ignorance.] India’s blood links to the political disorder in neighboring Muslim Pakistan, carved too out of British India, make such a threat all the more real.

Still, the new Japan-India ties are a welcome development in an Asia where the Obama Administration’s “pivot” has failed to materialize, and Beijing’s aggressive intent is manifest all around – including India’s disputed Himalayan frontier with Tibet..


Pulling up our Southeast Asia socks

Signing this week by the Obama Administration of new military cooperation agreements with Singapore is an important milestone for a number of reasons. It marks a further upgrading in one of the U.S. most important logistics and surveillance operations worldwide Operating out of Singapore is essential to the U.S. Navy’s forward positions in Southeast Asia and the Indian Ocean.

The new agreement permits American surveillance aircraft to operate off what is an important — if not in name — U.S. base in the city state. Singapore lies, of course, at the heart of Southeast Asia’s transportation and communications systems, increasingly threatened by domination by Communist China.

. In fact, Singapore’s lifeblood has always been, first under British and then Singapore Chinese leadership, an unparalleled center of efficiency, transport and communications. Coupled with its location at a chokepoint on one of the world’s most important economic arteries, it takes on an importance far beyond its size. And even more important, in the worst of times, despite its less than six million people, it has maintained its stability when often surrounded by a group of faltering former colonies attempting to convert themselves into nation states.

Perhaps even more important the new agreement continues what has been a rather bold Singapore foreign policy, a tacit military alliance with the U.S. in the face of growing Chinese strength and adventurism in the South China Sea. That’s despite the overwhelming Chinese ethnic composition of its people. It’s no secret that Singapore has pushed the Obama Administration to maintain the principle of freedom of navigation in the face of Beijing’s building a series of naval and air bases on dredged-up islands on coral reefs a thousand miles south of the China Mainland smack across a naval artery carrying a third of the world’s cargo. That challenge by the Obama Administration has been long coming and hesitant.

But for Singapore freedom of the seas and navigation through the critical Malacca Straits is the essence of its existence. The Singaporeans, in fact, view the Obama Administration as less forceful than they would hope, even though Washington recently has sent naval craft and aircraft into the waters bordering the new China bases as a challenge to their international legality.

At the same time, of course, Singapore has a huge and growing $100-billion trading relationship with China. Having a two-way advantage with the American defense umbrella while at the same time doing a thriving business with Beijing is not a new role for Singapore’s authoritarian leadership. During the Vietnam War, Singapore provided a logistics base for Hanoi in its war against the U.S. Supplies out of Singapore were a highly profitable trade route through Cambodia leading to the border areas with Vietnam, supplying much of the nonlethal materiel that kept the Viet Cong/Hanoi operations going against the Saigon government backed by the U.S., and in its last stages, a regime directly defended by American armed forces. But Lee Kuan Yew, longtime leader of Singapore, repeatedly argued the American stance in Vietnam, despite its ultimate failure, had given the new Southeast Asia nations, including Singapore, a shield for their early development.

A diminishing number of U.S. Naval ships is going to be hard pressed to maintain the U.S.’ current commitments, including those in both the East China and the South China Seas.. “The pivot” to Asia has not shaken off Washington’s interests and obligations in the Middle East despite former Sec. of Hillary Clinton’s famous speech outlining that proposed turn. In fact, there is concern among the U.S.’ allies in the Mideast region that in the midst of a campaign, largely based on bombing, against Daesh and other terrorists, no American carrier is now in the area. Whether, indeed, that is simply a function of the overburdened carriers, homeporting for refitting, or a studied strategy of the Obama Administration to limit its exposure in the area is debatable.

Meanwhile, news reports indicate that China is continuing to build and expand its barrier reefs across the South China Sea commercial artery. The Obama Administration is going to have to match its rhetoric with action there if the Singapore and other Southeast Asian commitments to the American position of freedom of the seas is to be maintained.




Asian pivot needs oil

Former Secretary of State Hillary Clinton’s “pivot to Asia” hasn’t made the turn anticipated a strategic Obama Administration move to face up to China’s growing regional aggression.

Not only has it not been able to shake loose from the Mideast chaos which Pres. Obama has tried desperately avoid, but it faces a continued Beijing push toward Southeast Asia, the Koreas and Japan. The Southeast Asians, for their part, have shown skepticism about Obama’s commitment – especially in view of their growing Chinese commercial ties and their over-the-shoulder look Beijing’s growing naval thrust.

That’s why an American statement in Bangkok last week was such a clinker: “I don’t spend a lot of time, I don’t spend any time, saying to Washington here’s how we get Thailand back. We haven’t lost Thailand,” U.S. Ambassador to Bangkok, Glyn T. Davies told reporters. He added: “I think it’s a good thing for Thailand to have a good relationship with China.”

Davies, a veteran career Foreign Service officer, might have used more diplomatic language – if as we suspect, he hadn’t intended to be quoted. If Davies sounded defensive, it might just be because relations between Washington and Bangkok have soured since the May 2014 coup, one of a long history of military takeovers and the second in a decade. The resulting junta crackdown has strained U.S.-Thai relations but been embraced by Beijing. The Thais have reciprocated with gestures such as sending back to Beijing international recognized human rights exiles and joint military exercises.

Davies has been on a campaign – presumably on instructions from Washington – since he arrived two months ago. He has gone public with U.S.’ opposition to unusually stringent lèse-majesté laws with long sentences for alleged slander against Thailand’s revered King Bhumibol Adulyadej. To curry popular favor, the junta has gone all out to support the 87-year-old monarch, whose his important unifying role is now jeopardized by poor health and the unpopularity of his son, the crown prince.

Commentators who just walked in are raising alarm over the competition to what has been a strong U.S.-Thai alliance since the early days of The Cold War and the conflict in Vietnam. But a longer view, which Davies surely has, is that the Thais have always balanced their act.

During the colonial period – when Siam was, admittedly, a quaint backwater, they played France against Britain to remain the only country in Southeast Asia to maintain independence. Later, with strong personal relations with Woodrow Wilson’s missionary family, its two revolutionaries who had overthrown the absolute monarchy in 1932, gave access to both asides up to and during World War II. One, Regent for the then minor king, Pridi Phamnamwong, was secretly in cahoots with the Americans. His nemesis, Phibun Songkram, was partisan of the European fascists, and headed an all-but Japanese puppet government.

So, Bangkok’s flirtation with Beijing can be seen as the 21st century version of an old game, playing both sides to maintain its independence. But it’s one much more difficult as Thailand has emerged as one of the strongest economies in Southeast Asia. There is new danger, too, in expanded communications – including rail and road access from China and neighboring Laos, new “geography” for a region once bound to heavy Chinese emigration only by sea. There was a time, too, when the Sino-Thai elite emphasized their “native” aspects, harder now when it is profitable in all ways to enhance Chinese ties.

We would suggest it is better for Washington and its representatives to bear that in mind, especially in a period when the U.S. with a “lead from behind” Administration is less skillful at its traditional regional role of supporting local nationalism and freedom of navigation.






Overintellectualizing by Underintellectuals


The Obama Administration’s utter strategic confusion, particularly in foreign affairs, was nowhere more exhibited than in Sec. of Defense Ashton B. Carter’s recent statements at the Reagan Defense Forum. Irony was added to insult when Carter equated the Obama policies with those of Pres. Ronald Reagan.

How quickly it is forgotten that Reagan’s forthright stand against Soviet totalitarianism and Communist China’s tyranny was not only an object of derision by his critics at the time, but also by those like Carter who claim they are more sophisticated in their attitudes toward an acknowledged enemy. Luckily, for all the reasons we know, logical and illogical, Reagan won the hearts of the American people, their ballots, and he succeeded reversing earlier policies contributing to the final implosion of the Soviet Union and the death of Communism.

It is remarkable that in his remarks, Carter should identify exactly those elements of the Reagan strategy which are missing in the Obama Administration’s approach. For example, he says, quite accurately, that “[T]he Reagan era saw a generational revitalization of American defense strength.” But, in fact, the Obama Administration is retreating in the face of what he correctly labels: “Russia appears intent to play spoiler by flouting these principles and the international community. Meanwhile, China is a rising power, and growing more ambitious in its objectives and capabilities.”

Carter uses the usual artifice of saying he cannot discuss measures which the Obama Administration is taking to oppose what he calls “xxx most disturbing, Moscow’s nuclear saber-rattling raises questions about Russia’s leaders’ commitment to strategic stability, their respect for norms against the use of nuclear weapons, and whether they respect the profound caution nuclear-age leaders showed with regard to the brandishing of nuclear weapons.”

But repeatedly the Obama Administration has challenged both Russia and China – whether in Syria or East Asia – and then retreated on announced positions. At the same time, while it is true that the American military is by far the strongest in the world, produced with budgetary commitments larger than the other major other world’s military combined, the Obama Administration is seeking to reduce that commitment.

It is, of course, true that the American public is weary. Two long and inconclusive wars in the Middle East have sapped the will to lead a worldwide alliance for peace and stability. But the role of leadership is not to adhere to momentary popular trends, but to  undertake and sell politically the longterm strategies and tactics necessary to maintain this country’s defenses, the first among all the roles of the commander-in-chief

Pres. Barak Obama campaigned on an ideology that the U.S. was overcommitted abroad, that American.policy had made too many mistakes in the past, that withdrawal was the most important element in his international strategy. He has followed that course. But whether in Cuba, in Ukraine and the Baltic States, or in the East and South China Sea, it is now abundantly clear that this effort to pull back on American power has not produced a lessening of pressure from our opponents or a more peaceful world.

In the final months of his presidency, Obama has been forced to change, reluctantly and incrementally, these policies. In the Middle East, the Administration is being forced to accelerate a modest effort to destroy Daesh [ISI or ISIL], a barbarous attempt to create a worldwide aggressive Islamic caliphate. In the South China Sea, the preservation of a basic American goal from the beginning of the Republic, freedom of the seas, has been reluctantly upheld by challenging Beijing claims. But in neither case, have these measures had a forthright Reaganesque thrust. Nor will they, therefore, contrary to Carter’s plea for a more nuanced understanding of the complicated world situation [was it ever otherwise?], succeed.





Obama’s NATO lapse

Pres. Barack Obama’s veto message of the Military Authorization Bill mentioned the controversial closure of Guantanomo’s terrorist facilities and the failure to achieve reform of systems acquisition and other issues. But critics charge it was largely an attempt to blackmail the Republicans in Congress into supporting his non-military expenditures which have come under fire from budget cutters.

Whatever the final outcome of this particularly bureaucratic hassle, nowhere in the swamp of the Obama Administration’s foreign policy snafu is the contradictions of policy so apparent as in Washington’s relation with the North Atlantic Treaty Organization What has been the world’s most successful alliance is now in jeopardy, in part, of course, from new and difficult strategic and tactical circumstances of a rapidly fluctuating Europe and world geopolitical imbalance.

But an important part of the present disarray lies in the fundamental contradictions in Pres. Barak Obama’s basic approach to the whole international scene. Obama’s worldview consisted of a grossly oversimplified concept of American foreign overextension, particularly through its military, and a remedy existed in drastic and dramatic cutbacks in U.S. commitments – such as in Iraq – would be met with a similar response from antagonistic elements abroad. That simply has not proved out, neither with the forces of Islamic chaos and terrorism in the Middle East nor with Vladimir Putin’s drive to restore former Soviet glory as a superpower.

Rushing to meet Putin’s thrust in Ukraine, NATO alliance headquarters senior military now see it may have neglected its Mediterranean flank, a vulnerability they say and others see as laid bare by Russia’s muscular intervention in Syria.

Obama’s reluctant turnaround on meeting what he publicly underestimated as the threat of Daesh [ISIS, ISIL] in Syria and Iraq has been slow and ineffective. In fact, Daesh is rapidly attempting to lead terrorists throughout the Arab and Islamic world, however discordant the various Islamic terrorists evade unity..

After more than a year, the U.S. response has been only reluctantly meeting any of the challenges which the Obama worldview earlier refused to accept. As he said in his quintessential 2009 Cairo speech, Obama believed he could reverse antagonisms between Islam and the West. But it is now clear that the traditional radical strains of the Moslem faith are in the ascendancy throughout the Islamic world. A modest if totally inadequate bombing campaign against Daesh not only has failed to destroy it but even to halt its tactical victories in the region and, more frightening, curb its growing appeal to like-minded elements around the world. The flow of volunteers to it from the West as well as from other Moslem countries is a bitter testimony to this trend.

Meanwhile, NATO Secretary-General Jens Stoltenberg has publicly recognized its own strategic failings. He has announced Treaty delegates at a Dec. 1 meeting will take up the new strategic implications for the Alliance’s southern flank brought on by the Russian plunge into Syria. Increased surveillance and reconnaissance activities, deployments of NATO troops in advisory roles to crisis-hit countries across North Africa and the Middle East, and reinforced permanent NATO military deployments in the Mediterranean region are all on the agenda. Stoltenberg said, not surprisingly, that there were now “many threats to the South of the alliance” that had to be urgently met. Stoltenberg’s statement came as Trident Juncture, NATO’s largest war games in a decade was taking place in Spain.

 Admiral John Richardson, the new U.S. chief of naval operations, had already acknowledged the new strategic situation by announcing he was considering sending more ships including submarines to deter what is generally considered in NATO circles, Moscow’s adventurism. Given the growing demands on the U.S. fleet, however much its gains in technology and firepower, make such deployments increasingly difficult.

But “[F]reedom of navigation [in the Mediterranean] is fundamentally important to NATO,” as General Adrian Bradshaw, NATO’s deputy supreme allied commander has said. “As we observe the deployment of more sophisticated [Russian] capabilities with considerable reach it becomes more and more important that we refresh our deterrence.” NATO advisers are already in Iraq, Jordan and Tunisia to bolster the alliance’s regional influence were ready to be sent to Libya as soon as a unity government was formed there.

The question now hanging over all these strategic and tactical concepts is whether the U.S. has the will, and will undertake a reversal of its drastic reduction in military force, to meet these challenges. They find their most dramatic exposition in the new demands made on NATO, but they have competitive demands in the growing aggressive actions of the Chinese in the Asian theaters. And the obvious questions are whether our European allies are prepared to meet the new challenge and whether the Obama Administration moves even more dramatically to reexamine its priorities.








A Chinese bombshell

The unanticipated Singapore meeting Nov.7th [Saturday] of People’s Republic Pres. and Communist Party Boss Xi Jinping and Republic of China [Taiwan] Pres. and Kuomintang Party leader Ma Ying-jeou is a bombshell in Chinese and East Asian affairs.

It is not only the first encounter of the two heads of rival Chinese states and movements since the defeat and retreat of Generalissimo Chiang Kai-shek to Taiwan in 1949, but it is precedent shattering on a number of other counts.

The Beijing Communist regime has always insisted the Taiwan institutions have no validity, that they are in fact the presence of a rogue regional regime in rebellion against their own legitimate central government. Much of the world has not accepted that characterization – and with the stability and exceedingly successful economic model on the Island – has maintained  various nonprotocol relationships with Taipeh.

The U.S. link, considered by both sides as essential to Taiwan’s continued success, was enshrined in the 1979 Taiwan Relations Act. America’s formal acceptance of the Beijing de facto control of the Mainland came after years of Washington refusing “to recognize” a Communist regime. Much of that new role – for example, its veto on the United Nations Security Council – had come from the Franklin D. Roosevelt Administrations insistence that Chiang’s China be accorded great power status after its long struggle as a victim of European colonialism and Japanese aggression. But the Act, by a recalcitrant Congress after Pres. Jimmy Carter switched sides, not only maintained an American relationship with the then Kuomintang regime but assured it of continuing military aid support to sustain its independence.

Beijing’s tacitly made a concession to the Taiwan Chinese – and the U.S. – by an offer for reunification under the slogan “one country, two regimes”. But Beijing until now has always refused the protocol concession of treating the Taiwan government as an equal negotiating partner. And, indeed, the forthcoming meeting is being carefully circumscribed by referring to Ma only as Taiwan’s “leader” and describing the summit as a “pragmatic arrangement”.

Hwoever, this abrupt break by Beijing with what was considered an sacrosanct policy is explained by Xi’s growing personalized power structure in Beijing. First and foremost, as a former Communist leader in the coastal regions on the Mainland facing Taiwan, he considers himself an expert on Taiwan politics. That, coupled with his own hard-charging personal takeover of the Communist Party as no leader since Mao Tse-tung in the 1950s, emboldens him to take what other Communist officials would not have dared. By offering some measure of conciliation – although little of substance is likely to come of this particular meeting – he hopes to strengthen Beijing’s current pitch as a responsible member of the world’s family of nations.

A more important explanation is that Xi is lending his support to Ma’s Kuomintang Party, which according to all the polls, has collapsed in anticipation of January elections. The opposition Democratic Progressive Party, with a long history of putting distance between Taiwan and the Mainland, even suggesting formal independence, is now headed for a landslide. Whether, in fact, Xi’s gesture may not backfire is the subject of current debate in Taiwan where the growing unpopularity of the Kuomintang is linked to Ma’s ambitious series of economic and political agreements with the Mainland.

Student groups and other political activitists have been increasingly critical of Ma’s moves. The growing friction between local interests in Hong Kong and Beijing has also influenced public opinion in Taiwan. The same “one country, two regimes” was used to smooth the 1997return of the former British Colony to China. But recent encroachments on local government and, ironically, former British freedom of speech and equality before the law, have been noted in Taiwan.

Only time will tell if Xi has overplayed his hand. But it is certain that this new nuanced play of Chinese forces increases the importance of the U.S.’ own China policy, with Taiwan’s critical strategic geography again a growing factor in aggressive Beijing moves in both the East China and the South China Seas.



Tragic Maoist inheritance continues


After decades of brutal – and often corrupt – enforcement, Beijing has announced the end of its one-child per couple policy. Introduced in 1979, it may have prevented as many as 400 million births in the world’s most populous country.

But the end of the one-child policy will not stop Beijing’s attempt to control reproduction including forced abortions and sterilization. The effort at population control has been so draconian that bloody seventh-month pregnancies were reported in 2012 after failure of a couple to pay a 40,000 yuan [$6,338.37] fine. [Average annual wages in China in 2014 were 56,339 yuan.] The fines brought the government about 2 trillion yuan [$314 billion] since 1980, but there has been no public accounting where these monies went. That’s why there is widespread skepticism even if the restrictions were abandoned, it would result in additional financing for public health.

Not officially acknowledged, of course, is the now built-in lobby for some continued population control by a large bureaucracy with almost unlimited powers operating even in remote rural areas. The two-child limit will still require official permission for the second child — so bureaucrats will still have the power to say no, or in some cases to assign fines.

Communist authorities have had to move, not out of humanitarian concerns and continued foreign protests, but because of a demographic catastrophe overtaking the country. Demographic trends are notoriously hard to predict, of course. A recent example has been the turnabout in birth rates among Israeli and West Bank Arabs which have dropped substantially, whereas birth rates among Israeli Jews [and not just the religious] have increased substantially. The trend somewhat negates the old argument that Arab majorities would inevitably dominate the region.

But in China, about 30% of the population is now over 50, with the threat of rising social costs and a depleting work force. It’s what is called among a very practical Chinese public with limited calls on a government social network, 4-2-1 — four grandparents and two parents dependent on one child. Again, falling birthrates are dogging many of the world’s developed economies, especially China’s neighbor, Japan. But the announcement of new rules has not been greeted enthusiastically on China’s social media; many urban couples report they simply cannot afford nor do they want to jeopardize their present rising living standards with another child.

One of the worst aspects of the one-child regime was infanticide against females. The upcoming census is expected to reveal a gender ratio of 122 boys for every 100 girls, typically replacing 105-106 boys for every 100 girls. There are already today 35 million young Chinese men, more than the population of Canada, for whom there are simply no female partners.

One solution being suggested in non-official quarters, is encouraging immigration of Southeast Asian workers. There are already reported to be tens of thousands of illegals from those countries working in China’s manufacturing. But so far there has been no official government supported programs of in-migration of younger workers.

It is not clear whether the new regulations will cover so-called “illegal” children, that is, those born beyond the one-child limit to couples despite the regulations and fines. Government census report there are at least 12 million, but informed observers reckon there are two or three times that number not registered for fear of government reprisals. That would make them as many as 3% of China’s 1.37 billion.

There is obvious “lesson” in Beijing’s madness. It is the inhuman, immoral and inoperative effort to control population through government fiat. But untangling the mess would be monumental, even were there the will among the huge Chinese Communist bureaucracy — some 50 million officials, amounting to about one official for every 27 people. As long as Communist elite rules, that is extremely unlikely.










Don’t flag with the flag!

After much too much time elapsed the Obama Administration acceded to U.S. Navy urgings to challenge Beijing’s capacity to block of one of the world’s most important naval arteries. Beijing has chosen vague 1947 maps of the South China Sea in an attempt to extend its territorial waters to reefs lying athwart one of the world’s most important seaways, carrying cargo between East Asia and South Asia, the Middle East and Europe. Indeed, the oil traffic alone from the Mideast to East Asia – China included — is one of the world’s industrial lifelines.
On Oct. 27th the Pentagon finally acknowledged the seriousness of the problem by sending a guided missile destroyer, the USS Lassen, through the contested waters. Ian Storey, a strategic analyst at Singapore’s Institute of South East Asian Studies, told the Guardian newspaper: “They’ve gone in heavy. There is not much else heavier than that except an aircraft carrier.” In fact, the US navy has two aircraft carriers in the region, shifted out of the Mideast as part of former Sec. Hillary Clinton’s “pivot to Asia. The USS Theodore Roosevelt only recently left the Middle East [now without a U.S. supercarrier] to resupply in Singapore, adjacent to the South China Sea, and the USS Ronald Reagan, is based in Japan. Perhaps a whole aircraft carrier with all its ancillary ships would overdo the effort.
But U.S. Defense Secretary Ashton Carter announced that the “Freedom of Action” operations would continue. “We will fly, sail and operate wherever international law permits,” he declared. “There have been naval operations in that region in recent days and there will be more in the weeks and months to come
We would have preferred that the Secretary put on record the exact passage details. Leaving the issue to confirmation of news accounts strikes us as a little ridiculous since the whole idea was to openly assert what the U.S. considers international law which it has upheld since the earliest days of the Republic. It was, after all, the attacks against international shipping which persuaded our third president Pres. Thomas Jefferson – after a decade of fruitless talk with the European naval powers to take a united stand – to send American Marines in our first foreign military intervention in the early 1800s. And that was a Jefferson who earlier in his career had opposed a standing military!
China said it “shadowed and warned” the USS Lassen off — sending the missile destroyer Lanzhou and patrol vessel Taizhou to the area — and called the U.S. action illegal. China Central Television reported Vice Foreign Minister Zhang Yesui told U.S. Ambassador Max Baucus that the U.S. should “cherish the hard-won momentum of development” in ties.
China’s reclamation as of June had created 2,900 acres, according to the Pentagon. Beijing contends it is building airstrips for civilian purposes but it has already installed artillery. There is concern Beijing may declare an air defense identification zone [ADIZ)] over these waters as it has in the East China Sea facing Japan, an action rejected by Tokyo and other powers but largely now respected by foreign aircraft flying in the region.
. As Storey said, now, another step is required: “U.S. credibility is on the line here. Countries have been watching very closely. It can’t be a one-off, symbolic sail past these features. It has to be conducted on a regular basis.” Washington must continue to assert a presence within the 12-mile area that Chinese aggression has claimed. Hopefully that will come quickly with more ships, and perhaps aircraft, and not take the months of intra-Administration debate which have permitted the Chinese to create a growing presence more than a thousand miles from their Mainland.
News reports say the Australian government, too, is now considering sending some of its warships and perhaps aircraft through the area. We hope that Washington is encouraging this initiative. And we hope it is also urging other parties – particularly the Philippines which has counter claims to the original shoals on which the Chinese have built – to do the same. The broadest possible coalition of our friends in the area, and the European allies, to demonstrate this confirmation of the freedom of the seas is absolutely essential.

Resovietizing Russia


While Vladimir Putin is busy challenging America’s role as leader of the free peoples, the Russian dictator is also refiguring his domestic scene in the Soviet image. In fact, one could make the argument that in many ways he has already accomplished that and to a degree even the old Soviets hands would have been envious. What Putin and his small band of supporters have done at home may in the long run be more important than his aggression against Ukraine, his support f the crumbling the al Bashar regime in Syria, and his feints at the Baltic states.

There are, of course, important historical differences to Soviet times. There is no Communist Party with its monopoly of power and its tentacles throughout the world. But Putin has eliminated, in all but name, any organized political opposition to his one-man coterie of hangers-on, some his old colleagues in the secret police and others profiteers from Russia’s new state capitalism. That too, is a difference: Russia no longer pretends to an oligarchic Soviet economy.

In fact, with 40% of its economy now dependent on oil and gas exports to Europe, Putin’s No. 1 problem is Western sanctions and the dynamite that American shale gas and oil technology has thrown under world energy prices. Supplying one third of the European Union’s energy imports, Putin despite the fall in world energy prices and the sanctions slapped on some of his buddies as a riposte to his efforts to take over Ukraine and Byelorussia, is desperatelyl trying to hang on to those ties.Gasprom, the world’s largest gas distribution network, is trying to expand its Nordstrom line down through the Baltic Sea. A state-controlled company, having squeezed out competitors and grabbed stakes of foreign oil companies in new fields in Sakhalin in the Far East, it is trying to dominate European distribution networks as well..

But Putin’s reversion to and dependence on a government elite which leeches off the economy as did the so-called nomenclatura, the Soviet leadership and bureaucracy, is all too familiar. In fact, Gennady Gudkov claims “there are now five to six times more bureaucrats in a Russia with 140 million population than there were in the entire USSR with its 286 million residents.” Gudkov, himself, one of the vanishing band of Putin’s critics. is a businessman and former member of the Duma [parliament] who has seen his business wither as he has become a victim of Putin’s persecution

Furthermore, the bureaucracy led by the chief bureaucrat, Putin himself, is acquiring more and more power. Even claptrap trimmings of the Soviet system have been abandoned – such as the largely fraudulent elections for regional governors. Even the billionaires who profit from their relationship within this highly personalized rule are vulnerable and can be – as several have in the recent past – fallen into disfavor and purgatory if not exile or jail.

Putin’s rule resembles, more than anything else, the style of a banana republic, with little or no hint of ideology. He does try – and gets cooperation – from the Russian Orthodox Church just as the tsarist regime did for centuries. But he continues to cultivate old Communist talisman, including the reenshrinement of Feliz Dzerzhinsky, the archleader of Soviet internal repression. It was Putin, after all, who said that the fall of the Soviet Union was the greatest catastrophe of the 20th century.

What characterizes Putin’s strategy, however, is the old role of a bully on the international stage. It was inevitable that U.S. policy, which under former Secretary of State Hillary Clinton, tried to find a “reset” button for American-Russian relations would fail. Reinstituting Moscow’s former glory is Putin’s only strategy to retain what is, alas!, his vast popularity at home and that requires an American enemy. Washington has no options in this situation: it must maintain a quiet, non-bellicose opposition to the Russian leader. Just as with the Soviet Union, the economic soft underbelly of the Putin regime is extremely vulnerable. Nothing would make more sense now than to reverse the Obama Administration’s policy and permit market forces to export American gas, and perhaps even oil, now in overabundance, to continue the disintegration of Russian markets and Europe’s dependence on that supply.





Taiwan’s democracy needs US arms

If there was any doubt that Taiwan is the first democratic state in the long history of the Chinese, it came this week in the buildup to January presidential election. The current ruling Kuomintang, descendant of Generalissimo Chiang Kai-shek’s Nationalists who fled the Mainland Communists in 1949, suddenly switched nominees.
At an extraordinary party congress they voted overwhelmingly for party Chairman Eric Chu..Chu, mayor of suburban New Taipei City and a former accounting professor. The former candidate Hung Hsiu-chu had been running about 20 percentage points behind Democratic Progressive Party candidate Tsai Ing-wen, another female candidate. Tsai advocates greater caution in relations with Beijing, her radical wing proposing formal independence instead of the current ambiguous de facto autonomy.

The KMT was trying to recoup after disastrous parliamentary elections last November, when they paid a price for several deals with a Chinese Communist Party Mainland partner. The KMT, the business community and academic economists, had all argued for them because of the Island’s economic integration with the Mainland and its lackluster economy.
Taiwan-based firms moving to, or collaborating in joint ventures in Mainland China, have fed trade between the two to $198.31 billion, with exports from Taiwan to the Mainland at $152 billion. Cheap Mainland labor assemble high-end components from Taiwan for reexport. But as the Mainland economy has rapidly dived into a slump from record-breaking two decades of rapid growth, the Taiwanese are again turning to Southeast Asia and the U.S. for thrust for their export-led economy
After taking a hard line against the last DPP president, Chen Shui-bian [2000- 2008], Beijing softened toward the current Nationalist President Ma Ying-jeou, but now constitutionally barred from a third four-year term. Ma’s government signed 23 agreements with China to promote investment, tourism and trade, with tensions reduced to their lowest level in more than six decades.
But the growing subversion of Hong Kong despite its autonomy enshrined in the 1997 British agreement to turn it back to Beijing has had its effect. In spring 2014, the Sun Flower Movement, a coalition of students and political activists, occupied the Taiwanese parliament and ministries, demanding detailed parliamentary scrutiny of the 2013 Cross-Trade Service Agreement Ma signed with Beijing.
It’s not at all clear what comes next. China President Xi Jinping in the midst of the most stringent crackdown on political and media activity in several decades, struggling to concentrate power in his hands rather than the recent collegiate Communist Party leadership. Xi reputedly knows as much as any senior Chinese official about the Taiwan issue, having served as governor of a Mainland province facing it. Bringing Taiwan and the Singkiang Uighur and Tibetan dissidents under Beijing control has been one of Xi’s main goals.
The People’s Liberation Army [PLA] has moved ballistic missiles and modern warplanes to bases overlooking the Taiwan Strait. By the end of 2010, the PLA had more than 2,000 ballistic missiles aimed at Taiwan, 50 percent more than just two years earlier, and ten times more than in 2000. A 2007 Rand Corporation report questioned whether the U.S. could fulfill its obligation to defend Taiwan in the event of an all-out Mainland attack. “The Chinese People’s Liberation Army is well aware of its own shortcomings and the United States’ military superiority,” the Rand Air Force study said. “Instead of engaging U.S. forces head-on, they would attempt to take advantage of what they perceive to be American weaknesses, including the need to deploy and operate forces thousands of miles from home.”
That is why the current transfer of weaponry to Taiwan waiting approval in the Senate, as well as its reexamination given the new Mainland buildup, is an absolute priority the Obama Administration and Congress should get on with.

Testing China’s aggression

Apparently Pres. Obama has learned a lesson from his lack of strategy in Syria: The Financial Times reports he has finally acceded to Sec. of Defense Ashton Carter’s pleas to assert freedom of the seas in Southeast Asia.
Within the next two weeks, senior American officials say, U.S. naval vessels will challenge Beijing’s claim to incorporate vast stretches of the South China Sea into its territorial waters.
The vessels will enter the 12-mile limit which Beijing has drawn along “the nine dot line”, its only claim to a group of coral shoals where it has been building at breakneck speed. During the past two years, the Chinese have scooped up enough mud and gravel to build thousands of acres on the several islands replete with military airstrips.
The new bases permit China to advance beyond the so-called first-island chain which has restricted its naval activities to occasional feints across the Strait to threaten the Taiwanese, and contest islands long claimed and occupied by Japan in the East China Sea.
These new bases, hundreds of miles from their Mainland ports and justified only with ancient maps showing vague Chinese claims could become important for projection of strategic power, already menacing nearby Philippines and Vietnam.
The White House has been reluctant to permit the Navy to exercise time-honored rights of passage in one of the world’s most important naval commercial waterways, whether recently because of the state visit just concluded of Chinese leader Xi Jinping, or a part of Obama’s general withdrawal of American power around the world. That lack of resolve has put into question former Sec. of State Hillary Clinton’s “pivot to Asia” which the Obama Administration has made part of its worldwide strategy.
It has been clear, however, that although there were glowingly optimistic statements anticipating the Xi visit, Obama got nowhere in negotiating any of the major issues which now confront the two countries. These include, of course, recent Chinese hacking of U.S. cybernetworks, violation of intellectual properties of American and other foreign companies, or other trade issues such as the manipulation of its currency [which Washington has refused to formally recognize, a flagrant example exercised on the eve of the visit with a Chinese devaluation.].
But no issue between the two countries has carried such dangerous longterm implications and possibilities of confrontation as Beijing’s aggressive behavior in the South China Sea. The move could be even more important – and fraught – than any of the red lines which Obama has drawn, and then violated, in Syria and the Mideast. Or as important as the growing aggressive behavior of Russia’s Valdimir Putin in Ukraine, and now, in Syria.
A successful test of traditional right of peaceful passage through international waters, in this case those which Beijing has unilaterally claimed as its own territory, is seen by most traditional naval scholars as something long overdue.
Today China’s elaborate and rapid efforts to create a “blue water” navy are still in their infancy. American spokesmen, including the highest echelons of the U.S. Navy, have in the past recognized that China has the right and as an emerging great power, would, build a modern naval fleet. At one point, an American admiral, noting the difficulties of building and maintaining aircraft carriers – China has rebuilt one bought from Ukraine and has another building – was something the U.S. might assist in for a “peacefully emerging China”.
But increasing signs of aggressive behavior by the Chinese have vitiated, at least for the time being, that kind of open military collaboration. And, in fact, Beijing has generally rejected the most routine military to military communication which has become normal and practical among the major powers in their effort to avoid untoward incidents.
Insisting , along with traditional U.S. allies in the region, that peaceful passage through international waters must be preserved and the valid claims of neighboring states honored, is, however much a risk now, one to be preferred than at a later time when Beijing’s resources will be greater and when dangerous precedents would be established.

Big Chinese rats, slowly sinking ship?

Word that Beijing’s favorite multibillionare Li Ka Shing is disinvesting in China has added weight to reports that what purports to be the world’s second economy is in trouble.
In fact, People’s Daily, the regime’s No. 1 mouthpiece, attacked the 87-year-old Hong Kong property, telecoms and port tycoon after the reports of his transfers appeared in other controlled Chinese media. In the past, Li has had official support in expansion of his enormous holdings.
Li’s denials haven’t reduced the growing concern elsewhere about the China outlook. The fact that Li also appeared to be moving his operations, which started with a fortune in artificial flowers, more and more out of its original Hong Kong setting is adding to the importance attached to his actions.
Local media have guessed that Li has unloaded some $16 billion in Mainland China assets in the last three years. As one of the world’s wealthiest if not its richest businessman with assets estimated at more than $33 billionm that would still be only a portion of his assets.
In a three-page denial, Li referred to his companies being “more prudent” toward real estate investments in China, reflecting a general consensus that one of Beijing’s problems is how to handle a growing property bubble. But with China’s gross domestic product growth now officially estimated at the lowest in almost three decades, the Communist Party’s attack seemed not only bitter but defensive.
“Li Ka-shing’s choices do appear particularly brazen,” the paper snarled, “In the eyes of ordinary people, we shared comfort and prosperity together in the good times, but when the hard times come he abandons us. This has really left some people speechless.”
Li’s statement claimed that unlike some Chinese investors, he did not hold land as a hedge against inflation or other economic downturns. Although many of Li’s properties are held through offshore sanctuaries in the Cayman Islands and the British Virgin Islands for Hong Kong stock market listing purposes, he argued some of his Mainland investments including retail stores had been increasing. And he said he is a full-fledged backer of Communist Party chief Xi Jinping’s reform program.
But Li’s plays add to a growing body of evidence that not only is China’s growth declining to new low levels but the speed of the fall is leading to growing pessimism. Pessimists are still a minority to those who while they see a period of major readjustment, believe the Chinese economy will continue to thrive if at a much lower level, as it sheds its massive infrastructure investment strategy for a new consumerism.
The pessimists point out, however, that the Chinese economy sailed through the 2007-08 worldwide financial crisis by an unprecedented credit expansion. That has led to bank debt growing from $14 trillion in 2008 to $25 trillion today – more than double the total US commercial banking sector. To facilitate this, Beijing has printed money – at an unprecedented rate, one that historically elsewhere has led to financial chaos.
Furthermore, most of this credit has gone to the monopolistic huge government corporations with their incestuous relationship with the Communist Party. They are notorious for corruption, inefficiency and producing fewer jobs – now the main excuse for one-party rule. At the same time, China’s miraculous manufacturing expansion was based on an abundant low wage pool – now drying up as a result if its one-child birth controls policies. Rising labor and other costs are reducing the capacity of Chinese exporters to compete with other low wage countries and growing productivity in some markets, including the U.S.
The Shanghai stock market rollercoaster – which the authorities unsuccessfully have tried to curb with every tool at their disposal – could be a sign that a debt crisis is imminent. That’s why Li’s backing out of the economy could represent one giant and canny player recognizing that possibility and preparing for it.

Xi and his military

On the eve of China’s Pres. Xi Jinping’s arrival for an elaborate state visit to the U.S., a testy little incident has taken place over the Yellow Sea. A week ago two Chinese fighter-bombers made what the Pentagon calls “a dangerous interception” with a slow-moving U.S. spy plane on its regular patrol of the area.
Republican U.S. Sen. John McCain, chairman of the Senate Armed Services Committee, said the incident “shows that China feels emboldened to continue its pattern of aggressive behavior in the Asia-Pacific region.” Timing of the incident ahead of the Chinese president’s visit “raises further questions about China’s intentions and the Obama administration’’s response thus far,” McCain said.
Aside from the possibility it could have turned into a major incident, it appeared to confirm earlier statements that Beijing has unilaterally taken the Yellow Sea out of the sphere of international waters to claim it as Chinese territory. Those Chinese claims have gone virtually unnoticed in the Western media, but now become one more evidence of the aggressive nature of China’s growing military stance. The Yellow Sea between the China Mainland and the Korean Peninsular is the northern part of the East China Sea, and U.S. surveillance is an essential part of the defense of South Korea including the 30,000 American troops stationed there as part of Washington’s commitment to its defense. .
It could be, of course, that the incident was only coincidental with Xi’s travel plans. Another possible explanation is that military “hawks” were intent on embarrassing Xi in his effort to exploit his visit to the U.S. to enhanced his prestige for his increasingly grab for power. There are reports in Chinese circles of growing friction between Xi and the People’s Liberation Army over the Chinese leader’s aggressive anti-corruption campaign. However accurate in identifying the ubiquitous corruption among the leadership as well as lower echelons of the Communist Party and government, it is also seen as a weapon in an intra-Party struggle. And Xi has extended the campaign to high members of the military where their operation of non-military enterprises has been a source of vast corruption.
To compound all these possible areas of friction, Xi has moved, according to Chinese sources, quite suddenly, to axe the military numbers. On Sept. 7 at a ceremony commemorating China’s participation in the victory in World War II, he announced that China would chop some 13% off Beijing’s 2.3 million in uniform. Xi’s move came suddenly with no consultation outside of the all-important Central Military Commission which like the other Party and state offices he heads.
Such a move was long contemplated along with a massive reorganization of old Soviet organizational patterns and allocation more resources to air and naval forces. But commentaries in the People’s Liberation Army daily, spokesman for the senior military, have warned that the move will be hard to implement. Finding new jobs for the cashiered officers and men will be all the more difficult given the downturn in the Chinese economy with a rapidly diminishing overall growth rate. One commentator acknowledged opposition to the cutback because “[S]ome units suffer from inertia and think everything is already great. Some are scared of hardships, blame everyone and everything but themselves … They shirk work and find ways of avoiding difficulty.”
China has seen protests by demobbed soldiers – the latest in June including veterans of China’s short border wars in 1969 with the then-Soviet Union and with Vietnam in 1979. Although unreported in the controlled press, some demonstrations were said to have taken place in front of the Central Military Commission August 1st Building in western Beijing. And although most military analysts agree the cutback was a part of a long overdue modernization, continued friction will test Xi’s control over the military at a time of aggressive strategic projections against Japan in the East China Sea and the building of a tier of new bases confronting Southeast Asian neighbors in the South China Sea

Xi’s bluffing hand

Next week’s state visit of China’s No. 1 Xi Jinping looks to be all pomp and circumstance. There is little expectation that the long list of critical issues between Washington and Beijing will be addressed in any substantive way. And, in fact, the international Greek chorus which sings a baleful song of American decline will have a new chorus.
That’s despite, ironically, Xi’s own vulnerability. He desperately needs the increased prestige and illusion of gateopening in the face of his ambitious grab for Mao-like power in a domestic Chinese scene filled with growing problems. That Chinese economic miracle of the last two decades that brought a backward Soviet-style economy into worldwide prominence and leadership is sputtering. The overall growth has fallen rapidly and may well be at something like 5% or 6% annual instead of the double digits of the recent past, or the usually fictional statistics of the present claim of 7+%. That means China is longer producing the jobs necessary for satisfying a still growing but rapidly eroding cheap labor pool as a result of the now abandoned bitter one-child restrictions..
Rapid economic growth had become the only prop for the one Party regime. Xi now is in reality replacing it with a grab for the kind of personal power not seen in recent collegiate rule among the Party elders, reinstituting old measures of repression against any hint of feeble dissent. The continuing roller-coaster of the Shanghai stockmarket, while less a part of the economy than its models in Japan and the West with China’s top-down allocation of credit and capital, is a propaganda disaster. Xi and his team have thrown everything including kitchen sink promises of a move toward a consumer economy at the issue with no success. It suggests that, in a sense, the Party has created a Frankenstein, an enormous economy that it fears to turn over to market forces but one it can no longer plan for or control.
The traditional if more spectacle anti-corruption campaign, while revealing new and incredible corruption and malfeasance among the highest echelons of the Party and the start-owned behemoth monopolies, is actually aimed to squelch opposition within the Party. But a struggle continues, critical since it includes a former member of the ruling politburo and his following who ran the so-called security apparatus. [The Soviets learned long ago when you eliminate a secret police chief, the only way to eliminate the snake is to kill it, literally, at the head, and so far Xi has not done that.] Xi, even more than his immediate predecessors who like he did not have a military background such as early Chinese Communists, is stoking the upper military echelons with appointments. But in any internal crisis, he again like his predecessors, if worse comes to worse would be more than ever dependent on the People’s Liberation Army to save the regime from disintegration– and this time the military might not hand it back to Party apparatchiks.
China’s new role as a world power is also facing increasing challenges, many of its of their own making. Claims of a new alliance with Vladimir Putin’s Russia ballyhooed in Western mainstream media does not exist. For example, a decade-old attempt to tie Russian gas and oil to the Chinese economy, despite repeated announcements of its completion, still has not solved the pricing and pipeline funding. Contradictorily, on the eve of Xi’s arrival in the U.S., Putin has laid out a honey trap for the U.S. [speaking from Central Asia where the Russians and the Chinese engage in a contest for influence and raw materials], He suggests an American-Russian condominium – a return to its world superpower, on Moscow’s terms status of course. But it does expose the real relationship between Moscow and Beijing, that is, featuring the historical struggle for the depopulated several times zones of the old Russian empire in Siberia and the Far East.
China’s overseas showpiece deals, particularly in Africa but also in Asia, which were to demonstrate China’s new economic prowess, are under stress. Again ironically, China’s slower economic growth and thirst for raw material imports – along with dramatic explosion of raw material hoarding – is poisoning the swap deals of construction projects for oil and gas and other raw materials. China is still No. 1 trading partner for most of Southeast Asia, of course – and even seducing India into a raw materials for manufactured goods exchange with a huge Chinese balance of payments surplus. But there is growing concern throughout the region, including a tightening of Japanese, Australian and Indian and U.S. military cooperation, in the face of China’s claims and continued building of military bases on coral strips in the South China Sea.
The Obama Administration’s reaction to Xi’s vulnerability has been to offer negotiations on all issues with only rhetorical responses to Beijing’s increasingly aggressive posture. Hillary Clinton’s “pivot to Asia” has stalled midway as the Mideast cesspool deepens. There was apparently the usual bureaucratic dance within the Administration over Obama’s loud leaks of a threat of sanctions against the most grievous recent Chinese violations of cyrberwarfare and intellectual property theft. [Another Obama red line crossed?] But the most blatant recent currency manipulation in which Xi hoped to halt falling exports with even more monetary subsidy has not been challenged by imposing countermeasures. At a time when the whole of the international community sees Obama’s deal with Iran on the Tehran mullahs’ pursuit of atomic weapons as a retreat full of U.S. concessions, Xi is in effect being offered an opportunity to make a deal.
But whether he can and would do that with his own domestic constraints in his grab for absolute domestic control remains a big question with a likely bad answer from Washington’s point of view.

Abe strikes the right note

There had been enormous speculation in Japan and those interested in the Land of the Rising Sun about Prime Minister Shinzo Abe’s formal speech on the 70th anniversary of the end of The Great Pacific War [as it was known in East and Southeast Asia].
Would he, as two predecessors on the 50th and 60th anniversaries, express a formal apology for Japan’s aggression? That was the demand, particularly of the South Koreans whose relationship with their former colonizer remains fraught despite vast cultural and economic ties critical to their own remarkable post-Korean War recovery.
One of Abe’s difficulties in making any statement, of course, is that he was speaking to two different audiences, the outside world and particularly those countries who had suffered Japanese depredations and his internal audience where he trying to reverse pacifist policies in the face of threatened Chinese and North Korean aggression. He succeeded, up to a point, although as important a touchstone as the speech was, Abe faces enormous difficulties in regard to both domestic and foreign policies.
Abe did not make a formal Japanese-style abasement. However, it was a carefully honed historical analysis in which he examined virtually all the parts of the complex relationship Tokyo had with the world before World War II and in the postwar period. He did acknowledge Japan’s culpability and puts the remorse and apologetics of the contemporary Japanese in an historical context:
Japan has repeatedly expressed the feelings of deep remorse and heartfelt apology for its actions during the war. In order to manifest such feelings through concrete actions, we have engraved in our hearts the histories of suffering of the people in Asia as our neighbours: those in Southeast Asian countries such as Indonesia and the Philippines, and Taiwan, the Republic of Korea and China, among others; and we have consistently devoted ourselves to the peace and prosperity of the region since the end of the war.

Such position articulated by the previous cabinets will remain unshakable into the future.
What may surprise those few Americans and other Westerners who study the speech is the extended references to colonialism, including Japanese attempts to bring parts of Asia under its rule. Not only is that a relevant issue in terms of the historical record, but many in the West including the U.S., rightly appalled by the barbarism of much of the Japanese military, do not see it as an integral part of the regional geopolitical background.
It comes as a surprise to those who do not know the area that, for the most part, Asian nationalists during the European colonial period looked to Japan – and continue even now — not only as a model but as a liberator. Japan had been, of course, the only non-European state to move quickly into the ranks of an industrial society. And among the tenets of the radicals who overtook Japan in the mid-1930s, there was a genuine feeling that they had a role to play in liberating the rest of Asia from European colonialism. Abe introduces that theme, if obliquely, in his remarks and it is certain not to please many who either do not know the history or rationalize it as the introduction of modernism [as even Karl Marx did!]
Repeatedly in his statement, Abe refers to the generosity of the former enemies – particularly the U.S. – in facilitating not only the rehabilitation of Japan in the family of nations but its surprising economic post-World War II comeback. That is certainly fitting and a contribution to what is, in its totality, an interesting review of the history of Japan’s relations with the world over the last century, that unfortunately may be ignored by too many people who ought to learn from it.