Thursday, June 25, 2015

Book Review: The Dragon and the Crown

This review is posted on Amazon.

In telling the story of his life with understated modesty, the author, with the help of his niece, successfully subsumed his ego into a broad epic, a narrative of the transformation of Hong Kong. From the time Stanley Kwan was born to when he emigrated to Toronto, the population in Hong Kong grew roughly ten fold. The transformation from being a British colony to a modern megapolis was fascinating as seen from his eyes. It’s safe to say that most of the people in today’s Hong Kong do not know much of the story of the city, much less the rest of us that are mere third party witnesses.

I am now in my 70s and the friends and classmates from Hong Kong that I knew from my college days remind me of Kwan. Their father or grandfather had multiple wives and thus were members of huge families. Dominated by Confucian values, only the first born of the first wife enjoyed privileged lives. The rest had to fight for their share of patriarchal attention and an opportunity to a better education and career. Those that succeed, like Kwan’s daughters, found their way to schools in the West and established their careers outside of Hong Kong.

Even though the invasion by Japan interrupted his higher education, the schooling under the loose controls of the British administration had already taught the author Chinese and English in addition to his native speaking Cantonese. His language proficiency gave him opportunities to work with the Nationalist Chinese government during the war years and the American Consulate in Hong Kong in post war years. Step by step as he moved from one post to another, we saw how Hong Kong was also evolving and changing.

By telling the stories of his brothers, two of whom left Hong Kong to live and work in the mainland shortly after the Communist takeover, we also learn how the tumult inside China affected his family and made his feelings of patriotism and identification with China more ambivalent. His book helped me understand the origin of the Hong Kong mindset: “Make as much money as you can, while you can.” After WWII, the feeling of uncertainty on the fate of Hong Kong hung heavily on the people of Hong Kong.

This book is a wonderful read on the history of Hong Kong. Too bad the author left for Canada in 1984. While negotiations had already begun between London and Beijing, it was quite some time before the handover on July 1, 1997. The book does not explain why or how the city has been transformed to the state it is in today.

Perhaps the story he told on the near fatal run on the Hang Seng Bank is symptomatic of the Hong Kong Chinese inherent lack of self-confidence and a western worship mindset. In April 1965 a run was made on the bank, heretofore the strongest among the Chinese owned banks in Hong Kong. Facing insolvency, the owners had to sell a controlling interest to the British owned Hong Kong Shanghai Bank. As soon as the deal was announced, the panic went away. As one of my chat buddies often likes to point out: In the minds of many Chinese, the western f*rt smells more fragrant than their own. 

Sunday, June 21, 2015

Time to Choose the Outcome for U.S. China Relations

This piece was first posted on China U.S. Focus.

A major piece in the most recent weekend edition of the Wall Street Journal points out that it’s time to rethink about the U.S. relations with China. This thought provoking article is extremely timely and the issues raised are critical to the future of both countries.

Just as the author detailed the vast change China has undergone since Nixon talked about China and then broke the ice with his historic visit to China, so has America.

Since the turn of the century, the last two American presidents have strived mightily to sell the message that everybody in the world should be more like us. Follow the American model of exceptionalism—as the thinking goes--and there will be peace and prosperity in the world.

Few bought the message; instead the world has become a much more volatile and dangerous place. From Ukraine through the Middle East to most of African, give or take, 900 million people face daily threats of death and destruction.

While beheadings on TV and tragic drowning of desperate refugees in the Mediterranean can’t be directly attributed to U.S. action or inaction, it’s a measure of how little American exceptionalism has made a difference. Instead, the U.S. is fully occupied with putting the genies back into the bottles in Afghanistan and Iraq.

By various estimates, the wars in just those two countries are costing the American taxpayers well north of $3 trillion and the bleeding hasn’t stopped. The official federal deficit is north of $18 trillion and still increasing. Is Washington seriously assuming that we can keep printing our way out of fiscal deficit?

What cost are we willing to pay in order to coerce China into following our exceptional footsteps? Is that expectation even realistic?

Since Nixon’s historic visit, China has been a willing economic partner with the U.S. but has never been interested in following the American model of democracy and government. Now that China is nearly on par with America economically and having seen the debacle of the Wall Street induced financial crisis, China is even less inclined to follow the U.S.

This does not mean that China is ready or desires to take on the U.S. as an adversary. China’s defense strategy depends on a credible ability to strike back with telling blows when provoked, rather than developing the capability to deliver the first blow.

Part of that strategy is for China to let the U.S. know that they have the capacity to retaliate. In the ‘90s, China invited chief of intelligence (Danny Stillman) from Los Alamos to China’s nuclear test facility so he can accurately appraise China’s nuclear weapon capability.

A Chinese submarine surfaced in the middle of the Kitty Hawk flotilla to let Pentagon know that China has the technology to approach the carrier undetected. China shot down their own satellite to demonstrate their ability to compete in star wars.

Most recently China has successfully test-fired a hypersonic delivery vehicle capable of speeds ten times the speed of sound and capable of penetrating America’s missile defenses. These tactical moves are designed to let Washington know that China would not be an easy rollover.

Seems intuitively obvious to this writer that it will always be orders of magnitude more costly to develop first strike weapons that can overwhelm the adversary’s capability to retaliate. It’s the kind of asymmetric competition that does not make economic sense for the Pentagon.

Defense Secretary Carter has been vocal about China’s activity in South China Sea, as though he is building toward a provocation and a confrontation—preparatory to another Gulf of Tonkin like resolution?

Even DoD spokesperson has acknowledged that China has been late to the game of dredging and filling land to build bases. Others such as Philippines and Vietnam have been reclaiming and establishing bases on islands many years before China.

DoD expressed concerns that China’s intention is to interfere with high seas navigation. Since the presence of islets and shoals is dangerous to safe passage and is thus well marked on most maritime charts as areas to avoid, it’s hard to understand how reclaiming the islands can increase hazards to shipping. As if to answer Carter’s concern, the Chinese has erected lighthouses to help with safe navigation.

In game theory, there are four possible outcomes to any bilateral relations. However, in the case of the U.S. and China, neither party is likely to win at the expense of the other.

Only win-win or lose-lose outcomes are possible. Hopefully the leaders in Washington will see the wisdom of choosing the right outcome.

Book Review: The Real China by Dr. Hong Yee Chiu

This review was first posted on Amazon.

This is a remarkable book on a number of levels. Written by a retired space scientist, ostensibly without the "right" academic training in Chinese history or any other related social sciences, Dr. Chiu writes with the passion and zeal of someone driven to explain China, his country of birth, to America, where he resides and pays taxes. Many of us Chinese Americans are sympathetic to his objective but most of us lack his depth of understanding and knowledge of China's history, culture and attitudes, especially toward religion to pull off such a book.

He obviously did a lot of research and collation of Chinese myths, religious beliefs, traditions, political systems in a context that helps the reader understand where and why China is different from America. One simple example will suffice. He points out that in America, we believe "In God We Trust." In China, the Chinese might blame god (lower case) for whatever personal misfortunes but understand that the person is in control of his/her own destiny. Instead of trusting God, in China the trust is placed in "Self Reliance." As Dr. Chiu took pains to explain, 自立更生 (usually translated into self reliance) was not just a slogan from Mao's China but had thousands of years of history behind the notion.

I found the first half of the book particularly fascinating and educational. A lot of stories he described from Chinese history were new and fresh to me. He obviously also knew his stuff about the foundation of the western civilization and he expertly interwoven Chinese thoughts and traditions with that of the West and showed where they were similar but more frequently where they were so different.

In the second half of the book, where the author made the contrast between the meritocracy based government in China versus the popularly elected leaders in America, was less interesting to me, not for lack of trying on his part but probably because I was on more familiar ground. I agreed with him and I see the same rot of western democracy that he wrote about.

There is way too much loose talk about the inevitable conflict between a rising power and a reigning one. Reading this book by the policy makers in Washington can help them understand China better and perhaps help them conclude that a conflict is not an ordained outcome.

With professional editing to improve the organization, composition and layout, this could have been a 5 star review.

Wednesday, June 17, 2015

Collaborating with China is in America's National Interest

This item was first posted on Asia Times.

As reported in the weekend edition of WSJ, there are two contending schools of thought on how to deal with China’s rise. One school is to raise the pressure in confronting China such as increasing the surveillance flights over South China Sea.

The other is to concede the inevitability of China’s rise and find ways to accommodate China. Perhaps the most developed among this latter line of reasoning is the book in progress by Kevin Rudd, the former prime minister of Australia and visiting scholar at Harvard.

Rudd sees China’s economy sustainable, growing at more than 6% annually and he expects China’s economic, political and foreign policy influence in Asia to continue to grow. China is now a bigger trading partner than is the U.S. with every Asian country.

Forcing the Asian countries to choose between the security of the U.S. military presence and the economic linkage with China would be unwise, Rudd suggests. It would be an all around losing proposition.

I would go further and suggest that finding ways to collaborate with China is in America’s national interest.

North to south, from Ukraine to Afghanistan to Iraq and the Middle East to most of the African continent, roughly one seventh of the earth’s land mass and as many of the population face the daily prospect of death and destruction. This has been more than plenty for the U.S. to deal with.

Just Afghanistan and Iraq has cost the U.S. north of $3 trillion—depending on how expenditures are counted—and still no end in sight. The U.S. national debt is over $18 trillion and no sign of shrinking. To freely pick up the option of adding China to the list of adversaries makes no fiscal sense.

In Xi Jinping, China’s new leader, Rudd sees a strong leader impatient for China to take its place on the world stage.

According to Rudd’s report, “Xi does see potential value in strategic and political collaboration with the United States. I argue that Xi is capable of bold policy moves, even including the possibility of grand strategic bargains on intractable questions such as the denuclearization and peaceful re-unification of the Korean Peninsula.

In other words, by collaborating with China, it would be possible to resolve certain knotty problems that the U.S. despite its military might cannot solve.

With its $4 trillion in reserve, China has been going around the world making friends by proposing win-win infrastructure investments. Recently, Premier Li Keqiang while in Peru proposed building a railroad from Peru traversing through the Amazon to Brazil. It would be a land bridge from the Pacific to the Atlantic.

It is bold and it is visionary but China has the experience and expertise to undertake and bring to completion such vast projects.

With the “one belt, one road” initiative, China proposes to invest in a string of ports from China’s east coast all the way through the Mediterranean to Greece and Italy and high speed rail through Central Asia to the seaports of Western Europe.

Even countries that are wary of China such as India, Philippines and Vietnam have sign on to be part of the initiative because they can see the value of becoming part of the economic integration that the initiative promises for the future.

Only the U.S. has been slow on the uptake. The Obama Administration wasted political capital trying to convince nations not to join the Asian Infrastructure Investment Bank on the soothsaying (and lame) concern that the bank would not be transparent.

Figuratively speaking, 57 nations broke the door down and trampled Treasury Secretary Jack Lew in the rush to join the bank. The founding nations recently met in Singapore and quickly drafted the articles of incorporation.

Unlike the World Bank and Asian Development Bank, nonpaid and non-resident board of directors will oversee the bank. And, unlike the stodgy predecessors, the new bank will aim for high standards of efficiency and transparency.

Each nation will have votes related to their capital contribution. China with the largest contribution will have the highest number of votes but will not have veto power. Smaller Asian nations will have more say in this bank than they ever did at the World Bank or the ADB.

China’s national interest is to be at the heart of global economic integration. Infrastructure investments will enhance the global economy, consistent with their long-term objective. 

Competing with the U.S. militarily or otherwise is not in their interest. It shouldn’t be for the U.S. either. Instead, replacing confrontation with collaboration should be in America’s national interest as well.

Much needed infrastructure improvements in Asia will cause the Asian economy to boom. A growing Asia will be a vital stimulus for the rest of the world. And certainly not least as the world’s second largest economy by then, the U.S. would be a significant beneficiary.

I can offer an illustrative date point in support of this view. Last year, nearly 2.2 million tourists visited the U.S. from China and they spent around $23 billion as compared to 23 million visitors from Canada and they spent $26 billion, about 9 to 1 difference.

China is already the world’s largest source of tourists with the reputation as the biggest per capita spenders. The ten-year, multiple entry visa negotiated last year will greatly facilitate more visitors from China, unless jaundiced geopolitics get in the way.

The path to begin collaboration is not complicated. Washington should stop telling Beijing what to do and stop making accusations in public. Incidents of verifiable cyber incursions and theft of intellectual properties should be discussed and resolved in private and not used for the benefit of fanning domestic antagonism.

The U.S. has long forgotten the practice of the Golden Rule when it comes to international policy. In the case with China, applying the golden rule would simply mean do unto China as America would have China do unto the U.S.

For America to yield to the idea that ratcheting tension with China is the right approach is to concede to the inevitability of the Thucydides Trap, namely that a rising power and a reigning power will always lead to conflict. This outcome might be good for the defense budget and the military industrial complex but tragic for everybody else.

Monday, June 8, 2015

Rules of Conduct for Chinese Working in America

This piece first ran in online Asia Times.

Hard on the heel of dropping espionage charges against Sherry Chen, the Department of Justice announced two more headline grabbing cases of economic espionage.

One case involved 6 Chinese nationals living and working in China and the other involved a naturalized Chinese American who was head of the physics department at Temple University.

Even though much of the facts pertaining to these cases remain as yet undisclosed to the public, there is much we can learn and speculate from what is known. The lessons to be derived will be especially relevant to all ethnic Chinese working in the U.S.

Dr. Hao Zhang was arrested on May 16, 2015 upon his entry into the U.S. via L. A. International airport. His original plan was to attend an international conference in Phoenix. Now he will face arraignment in a federal court in San Jose California. His five co-conspirators are all part of the same semiconductor company in Tianjin.

According to the DOJ press release, Zhang and Wei Pang met as graduate students at USC around 10 years ago. They then went separate ways by joining two American companies developing integrated circuits for the mobile phone.

Subsequently, Zhang and Pang rejoined with faculty positions at Tianjin University and co-founded a company to design and make ICs for the mobile phone. The press release alleged that the two founders stole proprietary technology from their respective U.S. employers prior to returning to China. Zhang will face a 32-count indictment.

In the New York Times article that broke the initial story, Zhang’s arrest was accompanied by the indictment of five others, presently residing in China.  The article goes further to point out that this was the second indictment of the accused in absentia, the first being the indictment of 5 PLA soldiers accused of cyber hacking.

The intent of these high profile announcements was, obviously, copied from the classic book of Chinese stratagems, i.e., “kill the chicken to scare the monkey.” And, all ethnic Chinese whether they are U.S. citizens or not better heed this warning—namely that the American law enforcement authorities are watching and monitoring your every activity.

How did the FBI know to spy on Zhang and Pang when they were students at USC? Because they are Chinese? The feds were certainly patient waiting for the opportunity to pounce.

Should you experience the misfortune of actually getting arrested, as is the case of Dr. Zhang, you are in trouble. Contrary to popular notion that the legal system in the U.S. is fair, the scale of justice is heavily weighed in favor of the government.

As many predecessor cases have shown, if you are Chinese, you are guilty until proven innocent.

The institutionalized racial bias against the Chinese dates back to J. Edgar Hoover, when he opined that the Chinese in America couldn’t be trusted. His minions have since expanded his opinion into a carefully structured theory to justify his bigotry. One of the more popular variant is called the “grains of sand” theory of espionage.

According to these acolytes, China conducts spying far differently from the more traditional means. Instead of money and sex, China fans the sense of loyalty to the motherland and then encourages any Chinese living in America to send any useful information back to Beijing.

Apparently there is a massive super computer sitting in some ministry basement crunching away the collected information, and voila, out comes the intricate design of a missile warhead or design of an integrated circuit or even the latest organization chart of the CIA.

This may sound patently absurd to the person on the street but the FBI finds this rationale useful for seeing all Chinese as potential spies.

Even if you are innocent of any wrongdoing, once FBI or other law enforcement agencies rush to arrest and prosecute, you are doomed. As attorneys who have defended Chinese victims will tell you, the government when facing a case falling apart for lack of proof will offer the defendant a plea bargain deal on lesser charges for the jail time he/she may have already served. Even a democracy like ours does not like to admit a mistake was committed.

You say you want to demand justice and sue the government? They can delay and delay and it could take years for your day in court.

In Sherry Chen’s case, she was fortunate. The federal prosecutor in this case elected to simply drop the charges and not add to her trauma by proposing a plea bargain. We can speculate, perhaps it’s because this prosecutor is an African American and is sensitive to the weaknesses of our judiciary.

In response to Chen’s case, Congressman Ted Lieu and 21 other members of Congress called a press conference and sent an open letter to Attorney General Loretta Lynch asking her to investigate as to whether there is any policy in the federal government that targets government employees on the basis of race.

While Congressman Lieu made it clear that he was concerned with Chinese American citizens being treated fairly in America, there is no reason his concern should not apply to protection from prosecutorial abuse for non-citizens. The idea that aliens do not deserve proper due process would be a step in the direction of Abu Ghraib all over again.

Maybe Zhang will get a break. He will appear before U.S. District Judge Edward J. Davila of the Northern District of California. Judge Davila presided over the civil suit Haiping Su filed against the federal government for racial discrimination and the judge ruled in his favor. At least he would be aware that the fed is not above prosecutorial abuse.

Carly Fiorina apparently did make the distinction between Chinese in China and Chinese Americans. She said in Iowa, “They're not terribly imaginative. They're not entrepreneurial. They don't innovate—that's why they're stealing our intellectual property." And, she is running for president?

The case against Professor Xi Xiaoxing, former head of Temple’s physics department, is curiously different from the Zhang Hao case. After his arrest and release on bail, there is virtually no additional media coverage.

We do know that he is a naturalized U.S. citizen and came to the U.S. after having attained his PhD degree from Peking University. Apparently his expertise in superconductivity was already established internationally before he left China.

It would appear that contrary to Fiorina’s view, he was bringing intellectual goods to America rather than the reverse. Apparently some of his email messages sent to China formed a basis for accusing him of fraudulent conduct.

In light of these recent cases, it’s crystal clear that whether you are an American citizen or not, there are certain rules of conduct that you must heed to stay out of legal trouble:
  • ·      If you are ethnic Chinese--or even ethnic Asian because sometimes the fed does not make any distinction--you should assume that you are under surveillance.
  • ·      Be mindful of what you say on the phone or via the Internet. If what you say can be misinterpreted or misunderstood by the monitoring feds, you need to change the way you express your thoughts.
  • ·      The above rules are especially relevant if you work in the technology space. Remember that the presumption is that you are predisposed to sending intelligence to Beijing.
  • ·      Do not assume you won’t get in trouble if you send publicly available information to China for the most innocuous reasons. The U.S. is a country of laws and regulations. If the authorities decide that they want you in jail, they can find laws that you have not heard of to justify putting the handcuffs on you.

  •      If the FBI comes to see you, ostensibly to talk about the weather, before you agree to the conversation, do the American thing. Get a lawyer. You have that right.

The Committee of 100 has available a 3-hour workshop on “Unique Challenges and Risks for Chinese Americans in Science and Technology.” In the interest of public service, the Committee will present this workshop anywhere in the U.S. by cooperating with local Asian organizations. The latter will organize and provide the venue. For more information, contact Ms. Holly Chang, (212) 371-6565 or