隱形的原因

顧屏山 矽谷 Sing Tao Daily, November 11, 2023 一位好久不見的舊識邀請我們參加周四晚上史丹佛大學紀錄片《隱形國家》（Invisible Nation）放映活動。這是一個與老友重聚並享用主辦者承諾的免費便餐的機會。可是，當我們到達時卻發現，所有的便當都拿光了。這是一系列令人失望的事情中的首樁。 《隱形國家》被宣傳為一部關於台灣的紀錄片，已開始在美國各地放映。按照新聞業的傳統標準，紀錄片應該透過呈現純粹的事實來提供資訊和教育，並讓觀眾得出自己的結論。「隱形」的片名使該紀錄片成為笑柄，它對蔡英文進行毫不掩飾的崇拜，也對台灣作為民主典範全面認可。 《隱形國家》充滿了缺陷，主要是對歷史和個人資訊的故意遺漏。 這部影片描繪從荷蘭殖民這座島嶼開始的台灣歷史，並聲稱唯一由一個政府同時控制大陸和台灣是在1945年至1949年。二戰結束後，蔣介石和收復台灣的國民黨短暫地統治台灣，蔣介石被迫從大陸逃到台灣。這往好處說是具誤導性，往壞處說則是徹頭徹尾的謊言。 解放台灣的鄭成功 不被提及 影片甚至沒有提及鄭成功。他是明朝末年領導人，抵抗滿清佔據中國，並將荷蘭人逐出台灣而撤退到這裡。鄭的孫子最後向北京的清廷投降。此後的幾個世紀裡，台灣一直是中國的一部分，直到北京政府在海戰中打敗仗，於1895年將台灣割讓給日本。 《隱形國家》也沒有提到由盟國起草要求日本無條件投降條款的《波茨坦宣言》（Potsdam Declaration），要日本將台灣交還給中國。在整個戰爭期間，美國堅持承認台灣是中國的一部分。當尼克森總統訪問中國時，這種認知還一直存在，並得到卡特總統和此後歷屆美國總統的重申。 這部紀錄片確實正確地將李登輝的行為，歸因於在政治上擺脫國民黨政府的高壓統治。李登輝接替蔣介石的兒子蔣經國擔任領導人。蔣介石於1949年從大陸撤退到台灣，蔣經國於1978年上任，開始實行自由化並放鬆對台灣的控制。他挑選李登輝擔任副總統，因為李是在台灣出生。 蔣經國可能不知道李有一個日本名字叫岩里政男。眾所周知，以日語為母語的李登輝曾向來訪的日本政要透露，自己更偏向日本，而不是中國。事實上，他哥哥在二戰期間身為日本皇軍成員戰死，他的名字與其他戰死者以及一些被定罪的戰犯一起被供奉在東京靖國神社。 二戰結束後，仍有不少日本人留在台灣。他們改用中文姓氏，並融入當地社會。忠誠度分裂問題以及估計有十萬日本人和其後代對台灣政治的影響，一直沒有被研究。 阿扁也沒有被提及 以李登輝為例，他在擔任台灣政府領導人後，逐步破壞和削弱國民黨，為台灣從反對派民進黨中選出首任總統，鋪平了道路，從而終結國民黨長達55年的不間斷統治。不知何故，本應在紀錄片中佔顯著位置的陳水扁，在《隱形國家》中卻一次也沒有被提及。 陳水扁不僅成為民進黨首任總統，更巧妙地操縱和分化反對陣營，而成為唯一以低於40%的得票率獲勝的總統。他也成為首位在任期結束後因貪腐而立即入獄的台灣總統。他是那種會為任何民主制度帶來毀譽的總統，人們很難責怪這部紀錄片的導演將陳排除在敘述之外。 除了成為台灣近代史上的污點外，陳水扁還下令重新編寫學童的歷史教科書。修訂後的教科書刪除了任何有關台灣與中國歷史、文化和民族血統聯繫的內容。一個世代的台灣年輕人在成長過程中並不知道，他們的祖先並不是從地裡冒出來，而是世世代代從閩南跨過台灣海峽而來。台灣話聽起來跟閩南地區的閩南話幾乎一模一樣。如果有機會學習中國歷史，他們就會知道，早在西元前200年左右的漢代，大陸就已經知悉這個沿海島嶼了。 帶頭發起向日葵抗議活動的年輕人，一股腦地高呼自由，卻未意識到台灣經濟對大陸貿易的依賴，就也毫不奇怪了。每年台灣對大陸的貿易順差，都超過對世界其他地區的貿易逆差總合。這是北京刻意給予台灣特殊優惠政策的成果。 向日葵抗議者的暴力程度不如2019年的香港抗議者，但也同樣破壞公共財產、入侵政府議會、侮辱民選官員。這一切都被紀錄在這部紀錄片中。但既然是打著爭取民主的旗號，在過程中觸犯幾條法律又有什麼大不了的呢？ 當然，台灣的年輕人也不全是傻瓜。聰明並有成就的人明白，他們的未來取決於快速成長的大陸經濟。許多人居住在大陸，並為位於中國大陸的台灣公司工作。有些人甚至在中國本土公司工作。向日葵世代可能不關心經濟、工作和事業。但認真的年輕人並非如此。 民進黨的正面形象 這部電影自然出現了台灣現任總統蔡英文的許多言論和演講。其他在片中發言的人物，包括她的崇拜者和追隨者，甚至跨性別內閣部長。影片吹噓台灣是亞洲首個承認同性婚姻並保護性小眾（LGBTQ）權利的國家。當然，這是一種進步思維的表現，甚至比美國領先一步。 本片也收錄了聯邦眾議院議長普洛西（Nancy Pelosi）不顧一切忠告堅持訪台的片段，此舉令蔡英文和民進黨興奮不已。首府華盛頓最有權勢的女性會見台灣首位女總統，沒有比這更棒的事了。謝天謝地，《隱形國家》沒有收錄蔡英文向普洛西帶上「選美肩帶」的影片，也沒有討論普洛西如何踩踏紅線，極大加劇兩岸緊張局勢，引發解放軍的威脅性敵對反應。 影片本來可以採訪很多人，但都沒有採訪。他們本來可以採訪在大陸生活和工作的台灣人，詢問對兩岸關係的看法。他們本來可以採訪絕大多數台灣民眾，後者其實更願意維持現狀，既不追求統一，也不追求獨立。 他們本來可以訪問街上的人對與山姆大叔的關係有何看法：美國真的會來與台灣軍隊並肩作戰嗎？他們對華盛頓強迫蔡英文政府購買過時的武器有何感想？他們對於被迫從美國農民那裡購買受污染的豬肉有何感想？對於拜登強迫台積電將先進晶片工廠遷到亞利桑那州，然後遭遇預料之外的勞工問題、成本超支、建設延誤等問題，有何看法？還有，拜登是否尊重台灣的「主權」？ 台灣是一個隱形國家，原因很簡單，即台灣根本不是一個國家，而是中國的一個省，就那麼簡單。

Review of documentary on Taiwan: "Invisible Nation," invisible for a reason.

Edited version of Invisible for a reason was posted on Asia Times. I was interviewed on national podcast, "Critical Hour." Critical_Hour_1342_seg_3.mp3 On Youtube video by Veterans for Peace, https://www.youtube.com/watch?v=VT0IFTuzb7o&t=505s A dear friend we have not seen for sometime invited us to attend a viewing of “Invisible Nation,” at Stanford on Thursday evening. It was a chance to visit with an old friend and pick up a light dinner promised by the organizers. By the time we got there, all the bento boxes were taken. It was the first of a list of disappointments. Invisible Nation is billed as a documentary on Taiwan and is beginning to be shown around America. By traditional standards of journalism, a documentary film is supposed to inform and educate by presenting unadulterated facts and let the viewers come to their own conclusion. “Invisible” makes a mockery of the term of documentary. It is an unabashedly adulation of Tsai Ing-wen and blanket endorsement of Taiwan as a model democracy. The flaws of Invisible are many, mostly by calculated omissions of history and personal information. The film portrays Taiwan’s history beginning with the Dutch colonization of the island and claims that the only time one government controlled both the mainland and Taiwan was from 1945 to 1949. The government was the short reign of Chiang Kai-shek and the Kuomintang that reclaimed Taiwan after the end of World War II, and ended when he had to flee from the mainland to Taiwan. This is most misleading at best and outright lie at its worst. Koxinga, liberator of Taiwan, not in the narrative The film fails to even mention Koxinga, aka Zheng Chenggong, the end of Ming dynasty leader who resisted the takeover of the mainland by the Manchus and retreated to Taiwan by evicting the Dutch from the island. Zheng’s grandson eventually surrendered to the Qing imperial court in Beijing. For centuries thereafter, Taiwan was part of China until the Beijing government lost a sea war to Japan and Taiwan was ceded to Japan in 1895. Invisible also does not mention the Potsdam Declaration that stipulated the terms of Japan’s unconditional surrender, drafted by the allies, in which Japan was to hand Taiwan back to China. Throughout the war, United States was insistent in recognizing Taiwan as part of China. This recognition persisted when President Richard Nixon went to China and reaffirmed by President Jimmy Carter and by every American president ever since. The mockumentary did correctly attribute the actions of Lee Teng-hui for the political turn away from the heavy-handed rule of the Nationalist government. Lee succeeded Chiang Ching-kuo, the son of Chiang Kai-shek who led the retreat from the mainland to Taiwan in 1949. The son took over in 1978 and began to liberalize and loosen the control of the island. He selected Lee to be his vice president because Lee was a Taiwan native born. Chiang was probably unaware that Lee also went by his Japanese name, Iwasato Masao. In fact, Lee/Iwasato, a native speaker of Japanese, was known to confide to visiting dignitaries from Japan that his allegiance leaned more to Japan than to China. In fact, his older brother was killed in action during WWII as a member of the Japanese imperial army and his name is enshrined in the Yasukuni Shrine in Tokyo among other war dead and some convicted war criminals. After WWII, there were many Japanese that remained in Taiwan. They took on Chinese surnames and merged into the local society. The question of divided loyalty and the influence of an estimated hundred thousand Japanese that stayed along with their descendants on Taiwan’s politics has not been studied. A Bian not in the narrative either In the case of Lee, after he assume the leadership of the Taiwan government, he gradually undermined and weakened the KMT organization that paved the way for Taiwan to elect its first president from the KMT opposition, the Democratic Progressive Party, thus ending KMT’s 55 years of continuous rule. Somehow, the name of Chen Shui-bian that should have figured prominently in the documentary was not mentioned even once in Invisible. Chen Shui-bian not only became the first president from DPP, he cleverly manipulated and divided the opposition and became the only president to win with less than 40% of the votes. He also became the first Taiwan president to be immediately imprisoned for wanton corruption at the end of his term of office. He was the kind of president that would give any democracy a bad name and one can hardly blame the director of the documentary for leaving Chen out of her story. Aside from being a blot on Taiwan’s modern history, Chen ordered a consequential rewrite of school children’s history textbooks. Obliterated in the revised textbooks was any reference of Taiwan’s linkage to China’s history, culture and ethnic origin. A generation of young Taiwanese people grew up not knowing that their ancestors did not spring out of the ground but came across the Taiwan strait from southern Fujian for many generations. That the Taiwan dialect sounds almost exactly the same as Minnan dialect off southern Fujian. That if they had a chance to study Chinese history, they would know that as early as the Han dynasty around 200 BCE, the mainland already knew about the island offshore. Small wonder that the generation of young hotheads, that spearheaded the sunflower protest, screamed for freedom but did not appreciate Taiwan’s economic dependence on trade with the mainland. Every year, Taiwan’s trade surplus with mainland more than offset the entire trade deficit with the rest of the world. The is a consequence of Beijing’s deliberate policy to give Taiwan special preference. The sunflower protesters were not as violent as the Hong Kong protesters of 2019 but they nevertheless destroyed public property, invaded the government parliament, and insulted publicly elected officials. All of which was recorded in the mockumentary. But since it was in the name of fighting for democracy, what’s the big deal of breaking a few laws along the way? Of course, not all Taiwan’s youth are lunkheads. The intelligent, high achievers understand that their future lies with the fast-growing mainland economy. Many live on the mainland and are working for Taiwan companies located in China. Some are even working for locally owned companies in China. The sunflower children may not care about economy, jobs and a career. But the serious-minded young people do. A progressive image of DPP The film naturally featured many remarks and speeches by Tsai Ing-wen, the current president of Taiwan. Other talking heads include her admirers and followers, even transgender cabinet ministers. The film brag that Taiwan was the first in Asia to recognize same sex marriage and protect the rights of the LGBTQ. Certainly, a show of progressive mindset that is even steps ahead of the U.S. The film also included a clip of House Speaker Nancy Pelosi’s drop in visit to Taiwan, against all advice but to the thrill of Tsai and the DPP. The most powerful woman in Washington meeting with Taiwan’s first woman president. Could not have gotten any better than this. Thank goodness, Invisible did not include the video of Tsai bestowing a beauty pageant sash on Pelosi. Also not included was any discussion on how Pelosi having stepped on the red line, greatly raised the cross-strait tension and prompted threatening hostile reaction from the PLA. But there were a lot of folks the film could have interviewed but did not. They could have interviewed the Taiwanese living and working on the mainland on their perspective of the cross-strait relations. They could have interviewed the vast majority of the people on Taiwan that prefer the status quo, neither for unification or independence. They could have asked the persons on the street on what they thought of the relations with Uncle Sam: Will the US really come to fight alongside the troops of Taiwan? How do they feel about Washington forcing the Tsai government to buy old outdated weapons? How do they feel about being forced to buy tainted pork from American farmers? What do they think of Biden’s strong arming Taiwan Semiconductor Manufacturing into moving their advanced chip fabs to Arizona, and then run into unforeseen labor problem, cost overrun, and construction delays? Has Biden shown any respect for Taiwan’s “sovereignty?” Taiwan is an invisible nation for a simple reason. Taiwan is not a nation but a province of China. Simple as that.

Biden’s contrasting styles and priorities - The Biden administration has concentrated virtually all its efforts on keeping China from rising, to no avail

I celebrated my 85th birthday by writing this piece for Asia Times. For weeks, US President Joe Biden publicly demanded that the issue of raising the debt ceiling was a done deal and not negotiable. As the prospects of national default loomed, the Biden White House quietly began negotiations with Republican House Speaker Kevin McCarthy, and arrived at a compromise in the nick of time so as to avert default. It seems Biden understood, after all, that avoiding the disaster of a default and the mortal pain on the American economy was more important than sticking by his guns. However, he apparently does not understand that the outcome of his negotiations with China is equally crucial to America’s future; his approach has been steadily unyielding, unfriendly and unhelpful. Biden’s China team has adopted a strategy of saying one thing and then doing just the opposite. Every one of his cabinet officers would declare that he or she wishes to meet with their Chinese counterparts to discuss cooperation and collaboration – but always on the US terms, meaning that the US reserves the right to discuss the issues it wants to discuss, but will continue to criticize, attack and sanction China on others. This is the way an imperious hegemonic power acts toward a subordinate country and expects obeisance and compliance. Except China no longer sees itself as a lesser power to the US. China has simply ignored the many White House requests. The latest example came at the Shangri-La security forum in Singapore. The US had asked for a meeting between Defense Secretary Lloyd Austin and his counterpart Li Shangfu on the sidelines of the forum. China refused. The US promptly accused China of irresponsible behavior endangering the bilateral relations by not keeping the lines of communication open. US wants to meet with China for what purpose? Of course, communicating and agreeing to face-to-face meetings are two separate matters. China expects prospects of a useful outcome to justify arranging in-person meetings. For possible constructive results, China wants to see serious and sincere gestures from the US. All too frequently in previous meetings, the American officials viewed them as opportunities to crow about China giving in to American demands, whether actually true or not. That Biden did not even bother to lift the personal sanction imposed on Li Shangfu during Donald Trump’s administration and still expects to have a summit meeting of military leaders seems stupid and arrogant. Mind you, Li was sanctioned for purchasing fighter jets from Russia on behalf of China as part of his duty at the time in charge of procurement for the People’s Liberation Army (PLA). What right does the US have to sanction an official of another country for doing his job? India buys arms from Russia; Turkey buys arms from Russia, apparently with no sanctions. This is just one example of Secretary of State Antony Blinken’s “rules-based international order.” That order is arbitrary and is whatever the US says it is. Blinken was hankering for an invitation to meet in Beijing. Then the wandering weather balloon from China gave him the excuse to cancel the visit on an invitation that never came. Not only that, he reaped a PR dividend by blaming China for the debacle. Examples of hypocrisy and deception abound. Biden warmly embraced Xi Jinping in Bali and swore by the one-China principle and that Taiwan is part of China. Then he openly sells arms to Taiwan and impose complete sanctions of export semiconductor technology to China. Treasury Secretary Janet Yellen goes out of her way to ask China for support of the US treasury debt and then goes to Africa to warn African nations to beware of China’s debt-trap diplomacy. Commerce Secretary Gina Raimondo asked for a meeting with her counterpart to discuss increasing bilateral trade. What she actually meant was she wanted China to buy more but did absolutely nothing to reduce the tariffs imposed on Chinese imports by the Trump administration that might actually raise the volume of bilateral trade. US on the path of self-destruction Decoupling from China is not his intention, Biden claims, but then every action by his team is just the opposite. Every prospective bilateral outcome has to be on US terms, or else. What the Biden White House does not appreciate is that it has embarked on a path of self-destruction for America. The damaging blowback from Biden’s China policy may not be as obvious as not raising the debt ceiling, but there is a strong element of cutting off Uncle Sam’s nose to spite his face that the leaders in Washington seem oblivious to. Just a few examples follow. When Biden first came to office, if he had intended to resume a constructive relationship with China, he could have eliminated the tariffs levied by Trump on Chinese imports. Instead, he retained the tariffs despite hurting the American consumer much more severely than China’s manufacturers. The desire to inflict pain on China far outweighed protecting Americans from even greater pain. Whether it’s assembling new subway cars with Chinese components, installing the world’s most cost-effective port-handling cranes, or surveillance cameras made in China, Washington let its paranoia run wild and turned away the cost savings from buying superior products from China. The sanction of Huawei is an extreme case. Huawei has developed the world’s most advanced fifth-generation (5G) telecommunication system, which has received acceptance around the world. Because of US fear of being spied upon, Washington not only has refused to buy from Huawei but pressured many of its allies to rip out billions of dollars’ worth of Huawei equipment already installed. After enduring the US sanctions for three years, Huawei has just announced the complete replacement of operating software based on Western technology. It will now sell to the world without any constraints, while the United States’ allies suffer hundreds of billions of dollars from the teardown of already installed Huawei equipment and the huge opportunity costs 0f not having a state-of-the-art telecommunication system. China has also surpassed the US in EVs Of course, telecom is not the only technology where China has surpassed the US. Among others, China’s emergence as the world’s leading producer of electric vehicles and owner of leading technology for the batteries that go into the EVs has taken the West by surprise. China has become the No 1 exporter of EVs around the world. Ford and Tesla, among many automakers in the West, would like CATL to build an advanced battery plant next to their EV plants in the US. (CATL is abbreviation for Contemporary Amperex Technology Ltd headquartered in Ningde, China, and is an acknowledged leader in EV battery technology.) The potential deals raise interesting questions. Will Beijing forbid CATL’s transfer of battery technology to the US along the same logic as Washington’s semiconductor sanction on China? Or will some senator, such as a Marco Rubio, raise the specter of Chinese batteries in EVs forming a terrifying network for spying on America? Biden thought he had cleverly jumpstarted the US semiconductor industry by snatching a leading-edge operation from Taiwan Semiconductor Manufacturing Co to Phoenix, Arizona. Now the TSMC management has discovered that they are not able to hire enough people from an American workforce that are qualified and/or willing to work in the rigors of a Taiwanese operation. In the meantime, the people of Taiwan are feeling increasing betrayed by America’s ham-fisted ways. This is a classic lose-lose outcome in the making. Another is Defense Secretary Austin’s insistence on playing the “freedom of navigation” game in waters around China and flying surveillance planes off coastal China. Since Nancy Pelosi’s visit to Taipei last year, China has emphasized its territorial claim over Taiwan and has been increasingly aggressive in responding to American intrusions in Beijing’s back yard. Just last Saturday, a US destroyer along with a trailing Canadian frigate attempted to sail through the Taiwan Strait, which China regards as its territorial waters. In response to this provocation, a Chinese destroyer intercepted the American warship and forced it to change course. Obviously, the PLA is increasingly willing for a showdown over whether China’s territorial waters can continue to be treated as America’s international waters. The firepower and technology of the PLA warships have surpassed the Americans’, and the Chinese appear confident and ready to put it to a test. If the US Navy should succeed in provoking the PLA into a firefight, it is certain that both parties would be losers. China has more friends than US has allies Geopolitically, the US continues to count on the Group of Seven and a handful of other countries to be its allies. Biden’s stipulation is to insist on strict compliance of his foreign policy even at the expense of each ally’s own national interest. Consequently, France is becoming a doubting Thomas about the wisdom of going along with the US, South Korea is trying to wriggle out of not losing China’s sales, as is ASML of the Netherlands. Germany and Australia in their own ways are holding on to their trade relations with China. In sum, the American alliance is increasingly questioning the shakiness of US leadership. Concurrent to American hectoring over its version of “rule-based” order, 19 countries have expressed interest in joining BRICS (Brazil, Russia, India, China and South Africa) purely for the economic advantages of being a body that requires no military allegiance. Saudi Arabia along with other oil-producing countries becoming members of BRICS+ will change the global alignment. The body will be far more populous and economically powerful than the US-aligned G7+. And, by the way, a top agenda item for the new BRICS is to discuss a plan to introduce a new currency to replace the need to settle trade accounts in US dollars. This move is in direct response to Biden weaponizing the dollar and denying dollar access to countries he doesn’t like, such as Russia. The Regional Comprehensive Economic Partnership (RCEP) has just come into full force. Members of the partnership consist of the 10 ASEAN countries plus China, Japan, South Korea, Australia and New Zealand. They will enjoy booming, tariff-free trade among themselves. The US is on the outside looking in. Since China initiated the Belt and Road Initiative 10 years ago, around 150 countries have become beneficiaries of projects and investments through BRI. At reasonable financing terms, China supplies their expertise to build infrastructure such as ports, railroad, highways, bridges, airports and many others to enhance the economic development of the recipient country. By far, BRI has been China’s most effective tool for making friends around the world. The US? It stands impotently on the sidelines and watches with envy, and occasionally throws stones by calling these BRI projects debt traps. Despite Washington’s mighty effort to suppress and obstruct China’s rise, China has become relatively impervious to American sanctions and restrictions. Just like Huawei, China’s semiconductor industry will find ways around the ban. At the same time, China has become the foremost trading partner to virtually every country in the world. China’s economy remains strong and technological innovations will continue, hardly affected by actions from Washington. The Biden administration has concentrated virtually all its efforts on keeping China from rising, to no avail. At the same time, the administration has not done anything concrete to lift the competitiveness of the American economy. In a long line of mediocre leadership, Biden may prove the be the worst.

2023 bodes poorly for US international relations

First posted On Asia Times. America’s top diplomat Antony Blinken’s most important task for the new year is to secure a summit meeting between US President Joe Biden and China’s leader, Xi Jinping. The odds of Blinken coming up empty and failing to arrange this meeting are exceedingly high. The reason is that China is growing weary of repeated cycles of Biden saying one thing and doing just the opposite. As Chinese Foreign Minister Wang Yi is alleged to have said in a telephone conversation with Blinken, “This business of warmly embracing while getting stabbed in the back is getting tiresome.” As reported by Asia Times from Bali, Biden committed not to interfere with China’s governing structure, not to wage a new cold war with China, not to recruit allies to align against China, and not to promote or support Taiwan independence, nor reject the principle of one China. He also pledged that the US does not intend to initiate military conflict, wage economic warfare, decouple the two economies or hinder China’s economic development. Any unbiased observer could be forgiven for thinking that after the warm and fuzzy three-hour meeting, Biden would seize the opportunity to take steps to relax the bilateral tension. He could have rescinded the foolish tariff war initiated by former president Donald Trump and carried on by his own administration. The trade war has worked against American interests, as the trade deficit has continued to grow in China’s favor while tariff-added prices on Chinese imports increased inflationary pressure for the American consumer. But Biden did not. He could have backed off on the draconian semiconductor embargo he imposed on China, as a gesture of goodwill. He did not. Biden didn’t mean what he said Instead, Biden signed the National Defense Authorization Act (NDAA), which included $10 billion in military aid to Taiwan. This aid is actually in the form of a loan. At $2 billion per year, Biden has placed orders on behalf of Taiwan with America’s weapons makers and has already sent the bill for the interest charges to the Taipei government. Typical of Washington chicanery, Taipei pays first for a possible future delivery of advanced weapons. Based on past records, Taipei holding an empty bag is not beyond the realm. After the new year dawned, Washington is also said to be ready to send “observers” to sit in offices inside the Taiwanese government for a stint of up to two years. Of course, observers have a way of becoming advisers and eventually becoming a take-charge shadow government, turning President Tsai Ing-wen’s government into zombies. Biden has also sent word to Taipei that the period of four-month active duty for conscripted soldiers is too short. President Tsai dutifully ordered a revision of the statute to 12 months commencing in 2024. Critics in Taiwan jeered at this alleged toughening of military preparedness. They opined that the 12-month training will qualify the young soldiers to carry and fire a rifle but stand no chance in face of advanced firepower, if the People’s Liberation Army were to invade. Getting these young people killed in action, however, would satisfy Washington in getting Taiwan to stand as proxy versus China, just like Ukraine in the proxy war with Russia. Of course, all the developments related to Taiwan directly contradict the solemn pledges Biden made at the Group of Twenty summit in Bali. There are two takeaways for the world. One is that what American leaders say can’t be trusted; their promises do not equate obligations. Second, the US will act only in itss own self-interest and care not a whit about its allies. Treating Taiwan as a pathetic vassal is just one example. America’s European allies have already seen the cost of joining the US in supporting the proxy war in Ukraine. While Ukrainians and Russians were expected to be the big losers in the conflict, the Europeans did not expect to become victims of runaway inflation. The rise of inflation was due to the American sanctions on Russia, which retaliated by stopping the flow of gas and oil to the European Union. The pain of being an American ally As French President Emmanuel Macron bitterly observed, the Europeans were offered relief with liquefied natural gas (LNG) from the US, but at four times the domestic American prices. Thus while the EU paid through the nose for their energy, the Americans reaped obscene profit. Hardly an ethical or honorable way to treat an ally. German Chancellor Olaf Scholz also saw through the American duplicity and he quickly organized an 11-hour visit to Beijing to meet with Xi Jinping in early November, before the G20. He took along a delegation of senior CEOs to reaffirm and cement the bilateral economic relationship with Germany’s largest trading partner – especially crucial as Europe has to confront rampant, ongoing inflation. Macron also sees the urgency of building France’s economic ties with China and is busily arranging for a visit by him to be formally added to Xi’s official calendar. It’s hard to know where he is in the queue. Heads of state of Italy, Australia and New Zealand are also jockeying to meet with Xi. They all see economic tie-ups with China in one form or another as a top-priority item on their national agendas. However, the first to meet Xi in the new year is Philippine President Ferdinand Marcos Jr. He arrived in Beijing on Tuesday for a three-day visit. As Asia Times reports, the Philippines is in desperate need for foreign capital investment and just the kind of help with infrastructure building that China’s Belt and Road Initiative (BRI) is known for. Unqualified success of BRI First proposed by Xi in 2013, the BRI has become China’s signature tool of diplomacy. Close to 150 countries had signed up to become members of the BRI by the end of 2022. Many of the BRI projects involved building transportation corridors via trains or highways and ports and harbors. Such infrastructure projects enabled the host country to join or expand its participation in world trade. Other projects involved hospitals, libraries and schools. All were designed to help the economy of the host country. The projects are financed by China at below-market interest rates and even at zero interest in some cases. Chinese companies provide the leadership, management and technology to implement each project. In the early years, China bore the slings and arrows of criticism from the Western media and from Washington politicians. Now, with hundreds of projects going on around the world, the BRI has become well accepted in much of the developing world. Any Westerner still warning about China’s “debt trap” diplomacy is treated with derision and contempt. China’s message is easy to understand. It is in favor of open trade and mutually beneficial collaboration. It does not require geopolitical pledges of allegiance or alignment. And it does not wish to argue over who has the correct definition of human rights or democracy, or insist on who is right. After the 25th People’s Congress in late October, Xi began to meet with other national leaders. Vietnam’s Communist Party chief Nguyen Phu Trong became the first foreign leader to visit Beijing, quickly followed by Germany’s Scholz. World leaders eager to meet with Xi Xi then left Beijing for the G20 summit in Bali and the Asia-Pacific Economic Cooperation (APEC) summit in Thailand. Leaders lined up to meet with Xi on the sidelines of both summits, eager to re-establish bilateral relations and explore economic cooperation with the world’s largest trading nation. President Xi later went on a three-day state visit to Saudi Arabia. In Riyadh, China concluded a US$25 billion deal for oil. The Saudis also hosted an inaugural China-Arab states summit during Xi’s visit, and a meeting with the Gulf Cooperation Council, which comprises Saudi Arabia, Bahrain, Kuwait, Oman, Qatar and the United Arab Emirates. On top of China’s 25-year strategic partnership with Iran, China can now claim to being friends with 1.8 billion people of the Islamic world, be they Sunnis or Shiites. Before the end of calendar year 2022, China also entered a free-trade deal with Ecuador, the fourth such deal in America’s back yard, in addition to Chile, Costa Rica and Peru. Contrary to what the wise old men of the West are telling Washington, world trade and globalization are far from dead but more popular than ever with the countries that are not members of Group of Seven. For the year of 2023, there are two earth-shaking developments that might catch the US by surprise. One is the possible routine use of the petro-renminbi as means of payment for energy from the Middle East. The internationalization of the yuan has been a gradual process and Washington could easily be caught off guard, like a frog in a steamer. The total replacement of the petrodollar is not likely in 2023 but the renminbi inroad could give Washington a real nightmare to worry about. A grand collaboration in Siberia A doozy of a deal in the offing is the ongoing discussion between Russia and China for a grand collaboration involving Siberia. As discussed in Asia Times, American sanctions and pressure on Russia have forced President Vladimir Putin to deepen his alliance and dependence on China. Historically, Russia has always been leery of opening Siberia for Chinese investment for fear of losing control of the territory owing to the potential of an overflowing Chinese population that could flood the frozen tundra region. Now Putin is in desperate need to realize the full potential of 40% of the landmass currently in permafrost hibernation. According to Russia media, the deal on the table would involve China investing $160 billion on 79 projects. The projects would not just include extracting oil, gas and minerals but would also cover infrastructure, agriculture, automotive, machinery and communications. China has the money, technology, know-how and most crucially, the hardy and hard-working people to make it happen. Russia needs the economic development that comes from industries. Now, figuratively speaking, while Blinken is sitting in the reception room waiting to be summoned to discuss another Biden-Xi summit, he has to be prepared to answer two likely questions from Qin Gang, the newly appointed Chinese foreign minister. What’s the point of another summit? What is there to talk about? Virtually all national leaders have been invited to meet with Xi in Beijing. A subtle snub would be for Xi to offer to meet with Biden in Xiamen. Other than not being Beijing, Xiamen has a lot of subtle symbolism. From Xiamen, one can see Kinmen, an island that belongs to the Taipei government. Xiamen is warm and scenic and maybe Biden won’t care. He might think he has been transported to the Caribbean. Of course, Biden could also return the compliment and offer to host the return summit in Taipei. After all, the US already owns that city and the government there. Critical_Hour_1142_seg_3.mp3

World sees contrasting styles in diplomacy

First posted on Asia Times. After the US midterm election last month, I suggested that voters have yet to pass judgment on the current administration’s dismal foreign policy. Recent developments indicate that President Joe Biden’s policy will continue to assert the rights that belong to the hegemon of the world. After the election, Biden met with Chinese president Xi Jinping on the sidelines of Group of Twenty summit in Bali, a major international event. There the two leaders enjoyed a more than three-hour heart-to-heart chat and exchange of views. The Chinese side took careful minutes of the meeting and posted a summary of what Biden had said. The American side weren’t such careful note-takers but posted no disagreements to the Chinese summary. Biden basically doubled down on the US commitment not to interfere with China’s governing structure, not to wage a new cold war with China, not to recruit allies to align against China, not to promote or support Taiwan independence, nor reject the principle of one China. In addition, he said, the US does not intend to initiate military conflict, wage economic warfare, decouple the two economies or hinder China’s economic development. Spirit of Bali did not last long Xi expressed satisfaction with the American position, with the added hope that Biden’s lieutenants would act in accordance and consistent with the commitments expressed at this meeting by President Biden. Alas, the white man again spoke with a forked tongue. No sooner had Biden hurried back to attend his granddaughter’s White House wedding that his team began anew to tear China down. Defense Secretary Lloyd Austin, albeit not a white man, is a recent example picking up the cudgel to bash China. His plea to Congress to justify mega-billion-dollar allocations for defense is that such massive spending was needed to mount effective deterrence to China. Deterrence for what? China does not have military bases around the world like Uncle Sam has. China does not have naval flotillas sailing around every sea and ocean; Uncle Sam has. China does have a marine fighting force, but about one-hundredth the size of Uncle Sam’s. Who’s threatening whom, anyway? An example of the upside-down logic is Austin’s quote the Russian President Vladimir Putin’s “war is not the result of NATO expansion, it is the cause of NATO expansion.” Most readers know well, as should the American people, that the North Atlantic Treaty Organization has been pushing eastward toward Russia for decades, and Russia’s Ukrainian invasion only began in February. By way of the same (il)logic, the US must deter the threat of China because we Americans have decided that China is a threat. How dare China develop countermeasures to our advance weaponry and deprive our right to shock and awe? Their action is a threat to our security. Our only alternative is to keep ramping up our defense budget. Consequentially, the bipartisan House of Representaives just enacted an allocation of $858 billion for the military. That’s $45 billion more than Biden even asked for. What’s a few more billions here and there? Washington wants to make sure that America feels secure enough to sleep at night. World lines up to be China’s friends In the meantime, the rest of the world has been watching Biden’s fumbling diplomacy and concluded that when the Americans draw a line in the sand, it doesn’t mean anything. But if Biden can profess to make nice with China, as he did in Bali, so can the rest of the world. Thus Qatar has just entered a 27-year contract to supply liquefied natural gas to China, which means that from now on Qatar can only offer occasional spot-market sales, if any, to the energy-hungry European Union. Xi Jinping has just concluded a full-scale, three-day state visit to Saudi Arabia. He was accorded all the pomp and circumstance heretofore reserved for Riyadh’s most important ally, the US. But when Biden flew all the way to Saudi recently, he was greeted with a cursory fist bump. More important, Biden was humiliated when OPEC+, led by Saudi, ignored his request to increase oil output in order to cut the price of oil and ease inflationary pressure in the US. Instead, Saudi did just the opposite and cut production. Saudi provides China energy security While in Riyadh, Xi concluded a comprehensive strategic partnership cooperation agreement with Saudi Arabia. Part of the agreement included reaffirmation that Taiwan is part of China and that both parties pledge non-interference in the domestic affairs of the other. These provisions were for the benefit of the US watching on the sidelines. Bilateral trade, in rough balance between China and Saudi Arabia, was worth $87.3 billion in 2021, nearly 34% up from the previous year. Xi noted that China’s Belt and Road Initiative is a perfect complement to help the Saudis realize their Vision 2030 goals. One immediate effect is Saudi’s engagement with Huawei to help build a smart city. Xi also finalized a $25 billion deal for oil, and suggested the replacement of the petrodollar with the renminbi for payment. The demotion of the dollar would be explosive news, and both Beijing and Riyadh may have elected to keep quiet on what would be the beginning of the end of the dollar as the world’s reserve currency. The best face The Wall Street Journal could put on the Riyadh summit was to say, “China hasn’t yet demonstrated interest or ability in supplanting the US’s broad role in the Middle East, and the Saudis don’t really want to replace the US as their main security guarantor, analysts say.” I would say that’s a classic attempt to put lipstick on the pig. Riyadh also hosted a summit meeting of the Gulf state leaders, with Xi on expanding cooperation on not just energy but trade and infrastructure building. As the World Cup in Qatar has amply shown, the world-class venues for that soccer tournament and supporting infrastructure were built by Chinese companies. The Arab Gulf states have plenty of money but need the infrastructure to help them turn to other avenues of economic development and diversify from oil. China is more than happy to supply that need. And China does not require geopolitical allegiances nor demand access to military bases. In addition to the Gulf states, leaders of Egypt, Tunisia, Iraq, Morocco, Algeria and others were at the Riyadh summit. Coupled with China’s existing 25-year strategic partnership agreement with Iran, China can count on the 1.8 billion people of the Islamic world as friends. The West alleging debt traps from Belt and Road financing by China is increasingly ringing hollow and is ignored by most of the world longing for the mutually beneficial relationships that China offers. Aligned with China through BRICS, SCO Other large countries that than Group of Seven allies of the US are lining up to join BRICS and the Shanghai Cooperation Organization (SCO). All it takes to join is an invitation, and there are no dues for membership. BRICS stands for Brazil, Russia, India, China and South Africa. The purpose of the organization is to promote peace, security, development and cooperation. A long list of nations has express interest in joining or have formally applied to become members. Among them, Saudi Arabia sees the group as important customers for its oil. Turkey, as a member of NATO, sees BRICS as a geopolitical hedge between the West and the rest of the world while addinc another tie with China. The SCO was organized to counter the West. Its membership included China, Russia, Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan. Later, India and Pakistan were added. Iran has become the latest member. Neither the SCO nor BRICS encompass military alliances but are in solidarity against hegemony and unilateralism – meaning the US. The fact that adversarial states, such as India and Pakistan and Iran and Saudi, can share common ground and belong to the same organizations is a hopeful vector for world peace. Much of the world outside the West does not see any benefit from being aligned with the US, just living with the fear that goes with sleeping with a tiger. Even some allies are seeing the downside of having to face the whims of American hegemony. Unilateralism and Biden ASML, based in the Netherlands, is openly challenging the White House sanction against selling photolithographic machines to China. ASML is the world’s leading maker of the multimillion-dollar etching machines necessary for making semiconductor chips. China is its most important customer, and not selling to China is to commit corporate suicide. Samsung has invested heavily on semiconductor plants in China making chips for customers inside China. Samsung, possibly with the help of the South Korean government, is also trying find some dispensation to wriggle out from under Washington’s ban. Taiwan Semiconductor Manufacturing Company (TSMC) is the most hapless victim of the undeclared chips war. It is known to have the most advanced fabrication process and is recognized as the leader in making the most advanced chips for the world. For this reason, Washington considers TSMC being located in Taiwan as a risk to US national security. Consequently, TSMC has been coerced into disassembling its fab processing line from Taiwan and shipping it to Arizona along with a technical and management team. In addition, if Taiwan should face imminent invasion by the mainland’s People’s Liberation Army (PLA), the US with the tacit acceptance of the Taipei government would likely plant explosives to destroy the TSMC facilities remaining in Taiwan. Overlooked in this revelation are several noteworthy conclusions. The US government does not own any part of TSMC but has no compunction about blowing its facilities into smithereens in the name of guarding national security – of America, of course. Moving to Arizona and planning the destruction of TSMC properties remaining in Taiwan is to admit that the US cannot defend Taiwan against the PLA. Obviously, the fate of 24 million people living in Taiwan is of no concern to Washington. Furthermore, moving technicians and management lock, stock and barrel from Taiwan is admission that the US no longer has the skillset and capability to run state-of-the-art semiconductor fabs. Morris Chang, the retired founder of TSMC, was mostly on the mark on another occasion when he said that production costs in the US would be at least 50% higher than in Taiwan. Certainly not good news for tamping down inflationary pressure. But at the ribbon-cutting ceremony in Arizona to mark the arrival of TSMC equipment, Chang backed off somewhat by saying the 50%-higher operating cost was when TSMC first tried to operate a fab in Oregon more than 20 years ago. Oregon never became an economically appealing base to expand the company’s presence in the US. Now, he seemed to imply, Phoenix will be different because of past lessons learned. Biden celebrates return of US manufacturing Biden spoke at the ceremony and declared the “return of American manufacturing.” Perhaps he was thinking of Chang being an American citizen, or he was thinking of the first group of 300 from Taiwan who will be given instant green cards (permanent resident certificants) and become bona fide Americans. Or, maybe he was simply delighted with the success of the “grab and go” caper. And consistent with Biden’s claim, somebody had better brief the Federal Bureau of Imvestigation in full, so as not to trigger arrests of suspicious-looking Asian faces walking around Phoenix. These are newly arrived “Americans” and not spies from China. Joining the celebration were other luminaries such as Apple chief executive officer Robin Cook, Nvidia CEO Jensen Huang and AMD CEO Lisa Su. To the surprise of no one, they all gushed about the prospects of having a first-class fab as their supplier in their back yard. Time will tell if the transformation of TSMC into “USSMC” will become a real success or simply be another lip gloss on the pig. We can see that Taiwanese President Tsai Ing-wen is no Volodymyr Zelensky. The president of Ukraine constantly asks Biden for more billions to stay in the fight against Russia. Tsai doesn’t ask for any funds, she just lies down and willingly gives away Taiwan’s crown jewel to please her American master. China builds friendship around the world. The US gets along by strong-arming those considered to be its allies on the unilateral principle that it’s all for the good of America. To no one’s surprise, the number of friends is dwindling. Perhaps it’s time that the Biden administration listens to a commentator at The Harvard Crimson who is no fan of China: “It’s time Americans stop throwing pity parties and give up on trying to regain bygone dominance. Instead, we should chart a new course of bilateral cooperation between the US and China, one founded on cultural exchange and the free flow of information.”

US pushes ‘rule-based disorder’ Latest set of sanctions targeting the chip industry will do no one any good, certainly not the US itself

First posted in Asia Times. Upon becoming president of the United States, Joe Biden immediately set forth to promote “rule-based international order,” ostensibly for the world community, but the message was really intended for China. The “world order,” according to Biden, was for Beijing to conduct its foreign affairs in line with Washington’s expectations. Now into the second year of his regime, it has become increasingly clear that Biden’s idea of order is actually disorder and is causing chaos not only in the world but especially to the American economy. The latest example is the most recent series of sanctions and embargoes forbidding sales of semiconductor chips and manufacturing equipment to China. Up to now, China has been far and away the largest buyer for semiconductor processing equipment and is the major market for advanced chips designed by such Silicon Valley companies as Nvidia and made by such foundries as Taiwan Semiconductor Manufacturing Company (TSMC). The ban seeks all the members of the semiconductor industry, foreign and domestic, to go cold turkey and stop doing business with China. Heretofore, the industry has been a prime example of a virtuous circle created by globalization. In simplified terms, we can say that innovations in chip designs for new uses are created in Silicon Valley, fabricated by foundries in Taiwan and South Korea, and then shipped to China to assemble into devices and final products, which are then sold around the world. Companies engaged in making fabrication and processing equipment kept pushing the boundaries of their technology and collaborated with the foundries to produce the next generation of advanced chips. The equipment companies were not just in the US but also in Japan and the Netherlands. Everyone wins in a virtuous circle In a virtuous circle, everybody does what he does best and contributes to a supply chain at the most cost-effective efficiency. Everybody wins in such a circle. By breaking up the circle, everybody loses. South Korean foundries such as Samsung sell 40% of their output to China, including foundries they operate inside China. China represents around 30% of sales for semiconductor fabrication equipment from American companies such as Applied Materials and Lam Research. China is also the most important market for ASML, the Netherlands-based company that is in essence the only maker of advanced lithographic machines. Despite the just-imposed ban, the company has continued to increase its local hire in China to support its sales and technical services. Every member of the circle now faces a perplexing dilemma: Do they obey the Washington edict at the expense of their financial interests and companies’ futures? Or do they pay a lot of money to lawyers and lobbyists to plead on their behalf and secure certain dispensations that would allow their continuing to do business with China, perhaps at a more subdued level? Or do they find questionable routes and intermediaries to continue their sales to China? Or can they flat out defy Washington? In theory, their lost sales to China would be replaced by the expansion of a new and growing US market, as foreign companies such as TSMC and Samsung are enticed or coerced into building new fabs in the US. The challenge is whether other members of the circle can survive long enough while waiting for the new capacities in America to make up the immediate shortfall around the world. Furthermore, there are serious concerns and doubts as to whether new fabs could actually happen in the US. The cost of defying Washington’s order will be high, but the industry can already see that the cost of yielding to Biden’s sanctions makes no sense given the devastating consequences. TSMC obediently gave up on serving Huawei, its most important customer, under orders from Donald Trump’s White House more than two years ago. Now it apparently has given up on the rest of the China market in exchange for locating fabs in the US. Since then, the market capitalization of the company has declined by half from its peak. Washington offers losing propositions Washington doesn’t offer any incentives or rewards, just threats and intimidation if they are not obeyed. This is what a hegemon does, but increasingly the world is disenchanted and not convinced South Korea is the latest to feel the sting that goes with being a loyal American ally. Washington expected the Koreans to give up their huge markets in China, and the reward was for their president to face a rude and very public brushoff when he greeted Biden at the UN General Assembly (UNGA) in New York recently. According to K J Noh, who understands the Korean language, South Korean President Yoon Suk-yeol cursed in the foulest terms at the way he was treated. Hard to blame him though. Biden is asking his country commit economic seppuku but acted like Yoon was some Asian scumbag – another gaffe that the White House staff will have to repair. The European Union has also learned that there is no upside in being a groupie of American foreign policy. By joining the US in supporting the Ukrainians and sanctioning Russia in the Ukrainian war, the EU is facing a bleak cold winter with a shortfall of fuel to heat homes and fire the boilers that the German industries will need to keep operating. Facing record-breaking inflation, the people in the EU are becoming restless and beginning to agitate and question the reasons for antagonizing Russia and bringing economic misery on to themselves. Shortly before the UNGA, the Shanghai Cooperation Organization concluded its annual conference, held in Samarkand, Uzbekistan. Under China’s leadership, the SCO welcomed Iran and Belarus as new members, with a long list of other nations applying to join, including Turkey, Saudi Arabia, Egypt and others. The SCO now accounts for half of the world’s population and more than 25% of global GDP. Non-aligned countries find the SCO increasingly attractive as an antidote to American unilateralism. Geopolitical rivals such as India and Pakistan or Saudi Arabia and Iran can leave their contentions outside and join the organization to work on trade and economic cooperation, and collaborate on combating terrorism. Unlike the American led groups of nations, political or military alliances are specifically excluded within the SCO. There are, by the way, no nations waiting to join the US alliance to contain China. As I observed in June, the US approach to recruiting others to join in an alliance to contain China is a faltering strategy that will lead to America’s self-destruction. Biden’s insistence on decoupling China from the semiconductor supply chain is another step in that direction. Another step to self-destruction Washington seems not to have anticipated China’s likely response to the latest sanctions. Its semiconductor industry is redoubling its efforts and investments to develop technical advances that would replace the chips and fab equipment that have been cut off by the American sanctions. China has the raw technical manpower graduating from their colleges and universities every year and has recruited senior engineers and fabrication technologists – Asia Times called them godfathers – from Taiwan, Japan and South Korea to advise on the technical and management direction. News from China already indicates that they are making breakthroughs getting around the American embargoes. Even American analysts say that the trade barriers are doomed to fail. In the long run, the Biden sanctions will help China create its own independent semiconductor industry and leave the currently established providers out in the cold. When and if China decides to retaliate in full, it has the wherewithal to inflict pain in kind. China’s CATL is the world’s largest producer of lithium batteries for electric vehicles. The company has announced plans to build a US$7 billion plant in Hungary to serve European automakers. Its plans for North America are on hold since Nancy Pelosi’s jaunt to Taipei. China also has a virtual stranglehold on the world supply of rare earth minerals, some crucial in strategic military applications, and can elect to restrict sales to the US. Most recently, the Pentagon was aghast to find that the engine of the F-35 fighter depends on rare-earth magnets made in China. This latest “discovery” shows the deep integration of the two major economies and the difficulty of disentangling and decoupling the two. It also can show the destructive power of paranoia in Washington. The wise old gnomes in the bowels of the Pentagon probably wouldn’t suggest tearing apart all the existing F-35s to remove the magnets from China, but could certainly see this matter as another “urgent” reason to increase the defense budget greatly in order to develop a domestic replacement. The hostile drumbeats from Washington reverberate within the echo chamber for the benefit of the handful of allies sitting inside, seemingly unaware of the ongoing peaceful cooperation between China and the rest of the world. It’s hard to know when the American people will say enough is enough and vote for a thorough reform of how Washington makes friends instead of enemies.

What China’s Taiwan white paper is saying - This important document is intended to remind the West that China will not budge on its position on Taiwan

This was first posted in Asia Times. By flying to Asia and landing in Taipei, the Speaker of the US House of Representatives, Nancy Pelosi, disregarded the “one China” principle and the fact that Taiwan is a province of China. Pelosi stepped over China’s red line. And, as promised, China responded by holding live-fire drills all around the island for the first time in the history of cross-Strait relations. The military exercises by the People’s Liberation Army prompted the aircraft carrier USS Ronald Reagan to sail away from the waters of Taiwan. This made it abundantly clear to the people in Taiwan that while the United States wants to encourage Taipei to start a war with the mainland, Taiwan would have to fight the PLA by itself. Seeing these developments, the collective wisdom of the people in Taiwan as reflected by the media is to conclude that to declare independence and break away from China would be suicidal. The US Congress and President Joe Biden’s administration, however, have continued to test China’s resolve and attempt to push the red line. Since the US and the People’s Republic of China (PRC) normalized relations in 1979, Congress has enacted a series of legislation to weaken the bilateral agreement progressively as expressed by three communiqués. The first communiqué was agreed in 1972 when then-US president Richard Nixon went to China. Each communiqué stating that Taiwan is a part of China was signed by both Washington and Beijing and is binding on both parties. Unlike these joint agreements, the US government arrogantly presumes that any law enacted by its Congress is unilaterally binding on China as well. In response to this American arrogance, the State Council Information Office in Beijing has issued a white paper on the “Taiwan Question and the Cause of China’s Reunification in the New Era.” This important document is obviously intended to remind the West that China will not budge on its position on Taiwan. First of all, the paper reiterates that Taiwan is part of China, that reunification is inevitable, that the way reunification will take place is a matter between Taiwan and the mainland, and that Beijing will brook no outside interference. This is a re-statement of the red line about Taiwan that has never changed but is now stated in no uncertain terms. Second, the white paper reviewed Taiwan’s place throughout the history of China. The terms of Japan’s unconditional surrender at the end of World War II mandated the return of Taiwan to China after 50 years of Japanese occupation. At present, 181 countries including the US recognize the PRC as the legal government of China and that Taiwan is part of one China. Advantages of being part of China Some people in Taiwan may not fully appreciate the intertwined cross-Strait economic relationship. If so, they should read the white paper and understand the advantages of Taiwan being a part of the national economy. As just one of the indicators, Taiwanese businesses have over the years invested more than US$71 billion in more than 1.2 million projects on the mainland – not to mention an annual trade surplus of $170 billion that Taiwan enjoys with the mainland. From 1980 to 2021, the mainland’s economy grew three times as fast as Taiwan’s and has become the second-largest in the world, and is soon to overtake the US to become No 1. China has become a major power not only economically but in science and technology and in military prowess. As more people in Taiwan come to understand China’s place in the world, they will appreciate being a part of China. Winding through Congress is the Taiwan Policy Act of 2022, which according to its sponsors will promote the security of Taiwan, ensures regional stability and threatens China with broad economic sanctions. But the consequences of Pelosi’s visit to Taiwan showed that such an act will do just the opposite: The island will become less secure and the region less stable. As we have also seen from the Ukraine war, the US sanctions imposed on Russia backfired badly, causing worldwide food shortages, rising energy prices and overall inflation, and solidified the ruble’s place among the world’s major currencies. Any attempted sanctions on China would inflict blows to the US economy many times more serious than the sanctions on Russia. One only need look at the foolhardy tariff war waged by former US president Donald Trump and continued by Biden. The American consumer had to pay a higher price for goods made in China because of the tariffs, and the trade surplus by China only increased rather than reduced. For Washington to threaten China with sanctions is meaningless if not just stupid. Moreover, the white paper has reasserted China’s red line on Taiwan, leaving no room for ambiguity or equivocation. This is a matter of sovereignty for China. The Chinese do not make empty threats. They will view stepping over the line as an act of war. No independence without US support Taiwan’s ruling pro-independence (taidu) faction would not be so foolish as to declare independence without US support. If the US does show support, then China will most likely strike at the US naval ships first and take them out of action. Without American military presence, the taidu faction will become irrelevant and negotiations between Taiwan and the mainland for a peaceful reunification can begin.

Damage from Pelosi’s Asia tour awaits final tally - Besides worsening US and Taiwanese relations with China, her trip made the semiconductor conundrum even more complicated

This was first posted on Asia Times. Nancy Pelosi came and left. Some in Taiwan called her visit a part of her graduation trip. A tad condescending, perhaps, but they meant it was her last hurrah. After the forthcoming midterm election in the US, her Democratic Party is expected to lose control of the House of Representatives and she will no longer be the Speaker. She had to make her grand tour, fully paid for by taxpayers, while she could. The immediate consequences are clear. Step over Beijing’s red line and you can expect China to react as it promised. Some hotheads were disappointed that People’s Liberation Army (PLA) fighter jets did not shoot down Pelosi’s plane. However, by exercising live-fire exercises in seven regions surrounding the island of Taiwan, China was saying not only that the “median line” in the Taiwan Strait does not exist, but that it can enter Taiwan’s waters any time it wants, anywhere it wants, and fire at any target it wants. Pelosi’s provocation had given China the necessary cause. The PLA fired missiles from the mainland over the width of Taiwan that landed on the opposite side of the island facing the Pacific, the potential area where US naval vessels would lurk if they were there to defend Taiwan. They weren’t. The aircraft carrier USS Ronald Reagan had already hightailed out of danger and sailed for Japan. No wish to waste Patriot missiles The Taipei government explained that the air-raid alarms remained silent because it did not want to panic the populace unduly. It did not fire at missiles incoming from the mainland because it did not want to waste expensive Patriots on missiles that were going to land harmlessly in the sea. A poll taken shortly after Pelosi’s visit found that 9% of Taiwanese people remain convinced that the US military will be around to defend them. The world will be waiting to see if US carriers will resume patrolling the South China Sea and if the PLA will challenge the American version of “freedom of navigation” in the body of water that China considers its own. Pelosi’s meeting in Taipei also revealed why South Korean President Yoon Suk-yeol declined to meet her. Over lunch in Taipei, Pelosi urged Morris Chang, founder and former chairman of Taiwan Semiconductor Manufacturing Company (TSMC), to locate some of its fabrication plants outside of Taiwan, specifically to complete its new site in Arizona and perhaps establish a presence in Japan. Chang’s polite reply to Pelosi was that building semiconductor fabs in different locations is not economically or technically practical. An American citizen, Chang did not say that he did not think the US has the needed skilled personnel, which he had said on other occasions. Strong-arming South Korea Pelosi’s mission in Seoul was to pressure Samsung and other chip makers in Korea to join TSMC and move their fabs to the US. Her selling point was to take advantage of the US$52 billion in the CHIPS (Creating Helpful Incentives to Produce Semiconductors for America) Act as a financial incentive for such a move to the US. The conundrum for the Korean chip makers is that the US would expect them to take sides, that is, the American subsidy would require them to stop supplying chips to China. While China represents only 10% of TSMC’s market, the Korean fabs sell 60% of their output to China. Giving up 60% of their business to comply with the American embargo would be a real dilemma for South Korea. While the Korean government is stalling on making a commitment to Washington, Yoon’s avoiding seeing Pelosi was a diplomatic way to avoid being put on the spot, at least for the short term. A less diplomatic view was that meeting with Pelosi was not in South Korea’s national interest. Washington’s method of denying China access to semiconductor technology has been excruciating for the entire spectrum of players in the chip industry. TSMC was the first to feel the pain when former US president Donald Trump’s administration ordered it to stop providing advanced chips to Huawei, ZTE and others. China used to be a major customer, accounting for more than 20% of TSMC’s sales. Now. according to the current chairman and chief executive officer, Mark Liu, the figure is around 10%. The Dutch company ASML is the world’s leading maker of lithography machines essential in making semiconductors. Its most advanced extreme ultraviolet (EUV) system sells for more than $150 million per unit, and the company is forbidden to sell to China. Now Washington is asking the Netherlands to forbid export of an older generation of deep ultraviolet (DUV) machines to China. Last year, ASML sold $2.78 billion worth of this product line to China, accounting for 14.7% of the company’s total sales. Embargo painful for US company too Lam Research based in Silicon Valley is one of world’s major supplier of equipment for semiconductor fabrication, with annual revenue just under $20 billion. Based on its latest quarterly report, China accounts for 31% of its sales while the US accounts for 8%. Undoubtedly, Lam management is agonizing on how to plead for an exemption from President Joe Biden’s administration so the company will not have to commit corporate seppuku. Washington’s determination to decouple from China is shortsighted and reflects what lawyers know about technology, which is not much. For many years, the US has underinvested in semiconductor manufacturing while China has done just the opposite. The $52 billion in the CHIPS Act is too little and too late. Asking companies to withstand self-inflicted pain and act against their own self-interest is unfortunately a case of Washington being an implacable bully. To survive, the victims will have to find ways around American exceptionalism. Already there are reports appearing to indicate that China is coping, American sanctions and embargoes notwithstanding. See for example two recent discussions, here and here. Could China embargo EV battery? Another development associated with Pelosi’s trip to Taiwan that seems to have escaped mainstream media’s attention is the Chinese company Contemporary Amperex Technology Co Ltd (CATL) putting on hold its plan to build a plant in the US until the dust settles from her tour. CATL is the world’s largest maker of batteries for electric vehicles (EVs) and the owner of world-leading battery technology. Vehicles using its battery pack can go more than 965 kilometers per charge. Its current battery offers four main advantages: safety, long lifespan, high energy, and fast charging ability. The founder and chairman of CATL, Robin Zeng, has a PhD in condensed-matter physics. In an interview, he indicated that his company has two groundbreaking batteries under development ready for imminent market introduction. As of May this year, CATL had the largest market share in China’s EV battery market of 45.85%, and as of 2021, it had a global market share of 32.6%. CATL had been looking at potential sites in the US states of South Carolina and Kentucky to build an EV battery plant to supply Ford and BMW. It’s probably unlikely, but Beijing could decide to reply in kind and deny America’s access to China’s advanced technology and order CATL to abort plans to invest in the US. Or, on the other hand, US Senate Majority Leader Chuck Schumer could express concerns that a Chinese battery under the hood could be used as a listening device to spy for China, the same logic he expressed on subway cars from China.

What has ‘champion of democracy’ wrought? Nancy Pelosi’s welcome to Taiwan was far from unanimous, and her ‘support for human rights’ is in question in her home city

First posted in Asia Times. This first of three on Pelosi's trip to Taiwan. Despite earnest counsel from many quarters against going to Taiwan, including threatening warnings of dire consequences from Beijing, the Speaker of the US House of Representatives, Nancy Pelosi, insisted on making the trip. She landed in Taipei in pitch-black conditions near midnight on Tuesday. Her plane landed on the little-used Songshan Airport close to the Taipei city center. The runway and other lights on the ground were lowered just in case. Her flight path from Malaysia took an exaggerated circular route over Indonesia and then around the east coast of the Philippines and landed in Taipei from the east. Thus she completely avoided China’s airspace over the South China Sea and the Chinese coastline. Her flight took significantly longer than if she had simply flown directly by line of sight from Kuala Lumpur to Taipei. Apparently, an exact replica of the military aircraft did take off from KL hours earlier and flew directly to Taipei. We have to wonder how that crew must have felt as a decoy to test the resolve of China’s People’s Liberation Army. American fighter jets took off from the carrier USS Ronald Reagan to provide escort service with the help midair-fueling tankers, needed to extend the fighters’ limited range. As Pelosi’s plane approach Taiwan airspace, Taiwan-based jets took over the escort service. Happily, Pelosi’s plane landed without incident. So, other than burnishing her credentials as a champion of democracy and human rights – subject to further discussion later – what has her tour accomplished? Well, President Tsai Ing-wen awarded Pelosi with the Order of Propitious Clouds, Taiwan’s highest civilian order. And the award came with a pretty turquoise sash worn across the body as if she were Miss California. In fact, the pro-Democratic Progressive Party faction of the Taiwan media gushed enthusiastically over the beauty of Pelosi when she was young, repeatedly showing a photo of her standing with then-president John F Kennedy, who was giving her an appreciative ogle. Other members of the Taiwan media were less complimentary and flattering. One commentator observed that Pelosi promised more security for Taiwan. Yet as a result of her visit, the tension across the Strait has heightened, and now people in Taiwan face frequent fighter-jet incursions from the mainland. Taiwan has become less secure. Another said that the cross-Strait problems should have been left to the two sides to resolve and not commandeered by the US. Now, he lamented, “We have been reduced to a chess piece between two great powers.” Yet another asked the rhetorical question: “Can Taiwan become the next Ukraine?” Heretofore, we have been secure and peaceful and faced no risk of war across the Strait, he said. But the Western media are pushing Taiwan to the front line of conflict. The response from the mainland was for its customs authority to announce suspension of imports from Taiwan encompassing more than 3,000 products, most of which are foodstuffs and agricultural goods. The announcement came on the eve of Pelosi’s arrival and will likely incur heavy losses and put a dent in the trade surplus Taiwan normally enjoys. Pelosi throws the party, Taiwan foots the bill Tsai’s government is supposed to have realized the possible consequential fallout of heavy economic losses and had quietly asked Pelosi if she could consider not coming, but to no avail. It’s not as if Pelosi was unaware of the potential damage and negative consequences of her visit. On the eve of her departure from the US, voters in her own congressional district demonstrated in front of her office asking her not to visit Taiwan. She also elicited vocal protest in Taipei after her arrival. One sign read, “War Speaker Pelosi get out of Taipei.” Laotaipo, “old woman,” is one of the nicer name-callings for her. Less kind, some thought of the US military transport as her personal broom to fly into Taipei. China’s show of displeasure came with the announced live-fire drills commencing shortly after Pelosi’s departure for South Korea. The drills will in essence surround the entire island and threaten Taiwan in every direction. Pelosi’s visit has given China an excuse to do a practice run for a potential future invasion. No wonder Republican members of Congress, while enthusiastically encouraging her and voicing their support for her trip to Taiwan, all found reasons to stay home and not join her. Only former secretary of state Mike Pompeo volunteered to make it a bipartisan tour, but apparently no one cared for his company. One final measure of the popularity of Pelosi’s foray to Taiwan is South Korean President Yoon Suk-yeol informing her that he is on vacation and can’t take the time to see her. Since being elected president, it took less than three months for Yoon’s popularity to drop below 30%. He could see the reaction Pelosi got from Taiwan and saw no upside for him to meet with her. Pelosi has represented the city of San Francisco in Congress for well over three decades. During this time, she has risen in seniority to become the Speaker of the House, two steps from the presidency. She has also taken on the mantle as a champion of democracy and human rights. In her more than 30 years of public service, we have seen the institution of democracy in America erode and deteriorate to the point of gridlock and impasse. True, it would not be fair to blame it all on her. It took many petty politicians to make the mess that we Americans are in, but she is one of them. During her term of office, the blight of her district has worsened every year. San Francisco has become the major city with the worst homeless problem in all of the US. The sidewalks, doorways and public areas are just gross beyond description. Nancy Pelosi apparently cares about human rights as far away as China but not much in San Francisco.

Open letter to Nancy Pelosi - If you step over the red line China has laid down, it can’t back down and not react

Watch Cyrus Janssen discuss the letter. https://rumble.com/v1e8ilj-nancy-pelosi-visit-taiwan-broke-us-promise-on-one-china-policy.html Dear Nancy, In 1991, you were a member of the Congressional party invited to Beijing as guests of the Chinese government. There you held a well-planned “impromptu” press conference in Tiananmen Square where you unfurled a banner proclaiming “Human Rights in China.” A group of members of the western media patiently waited for you to break off from your official host and show up. That was just simply brilliant. The show-and-tell established your credentials as a human rights advocate. As a newly elected member of Congress, the publicity certainly didn’t hurt your chances of getting re-elected. Of course, the Chinese government probably regarded your breach of protocol as rude and uncouth, but hey, that was their problem. Now rumors have it that you are planning to visit Taiwan in August. A lot has changed since your trip to China more than 30 years ago. The Taiwan media are all in a tizzy asking each other, “Who invited Nancy Pelosi? After all, Taiwan isn’t some American offshore possession that Nancy can come and go as she pleases.” To paraphrase one of the commentators, “Doesn’t she understand that we can’t stand the excitement and tension of her visit?” “Most people of Taiwan,” he continues, “like the relations with the mainland just the way it is. Peaceful, stable, quiet and we sell a lot of our stuff across the Taiwan Straits, to the tune of over $100 billion in surplus every year.” Some say that you are visiting Taiwan to encourage the Taipei government to start a fight with the mainland. The people of Taiwan have seen how the U.S. has been helping Ukraine in their fight with Russia and they don’t want any part of that setup. Before the Ukraine war, around 60% of the people of Taiwan were sure that the American soldiers would join the fight in their defense. Now that number has fallen to around 30%. Maybe the publicity of your visit to Taiwan, daring the Peoples’ Republic of China to respond, will help your party in the midterm November election. However, you are now the Speaker of the House and two steps away from the presidency. Like it or not, your actions represent the official position of our country. If you step over the red line China has laid down, it can’t back down and not react. We don’t know what their response will be but it will be dangerous—potentially explosive, in fact. As a loyal American, I humbly ask for your careful consideration for the sake of world peace and your personal safety. Best person regards, George Koo The writer of this letter is a retired business consultant, resides in California and is deeply worried about the future of America.

Biden’s policy toward China is a road to self-destruction

This was first posted in Asia Times. President Joe Biden’s administration appears determined to project the image that United States remains the world’s hegemon regardless of cost or consequences and despite overwhelming developments around the globe that are contrary to such misguided hubris. The American leadership has always rested on the carrot-and-stick approach to rally countries around a unipolar world headed by the US. The carrot is in the form of foreign aid Uncle Sam dangles before a country as reward for joining the American camp. The stick is the threat of economic disengagement and sanctions and the withholding of military protection, thus stripping away that nation’s sense of security. Since the financial crisis of 2008 and subsequent quantitative easing by printing billions of dollars to keep the US economy afloat, the economic might and stability of the American monetary system is not what it used to be in the minds of many nations. When the Biden White House unilaterally confiscates foreign reserves owned by other countries but held in the US, such as in the cases of Afghanistan and Russia, the reputation of the US as a fiduciary is in doubt. The full faith in and credit of the US government cease to mean very much to the world. Thus the carrot has dried and withered, and after the 20-year war and debacle in Afghanistan, the stick Uncle Sam carries appears to have shriveled and is not so intimidating. Sending arms but no troops to Ukraine merely confirms America’s preference for war by proxy with little appetite for direct engagement. Bully on the block Yet the Biden team seems oblivious to the erosion of the US stature as the world leader but insists on going around the world approaching each country and demanding that it choose sides and align with the American geopolitical positions. The US has elected to designate China as its adversary for the foreseeable future. For allies and would-be allies to side with the US means they must also regard China as their adversary as well. The American demand places these countries in a dilemma, because regarding China as an adversary is in conflict with their own national interests. China is most likely their most important trading partner and a potential major investor and major supporter in the building infrastructure under the Belt and Road Initiative. China has expressed no interest in displacing the US to become the world hegemon and places no demand or expectation that countries choose sides. Friendship with China does not discourage or preclude friendship with the US. Beijing’s style of international diplomacy makes it easy for countries to get along with China and with the US while demurring from being a fully committed formal member of the American alliance. The Summit of the Americas held in Los Angeles this month hosted by President Biden is just the latest indication. Many Latin American countries including Mexico found reasons not to attend. Nothing like throwing a party that used to be a must-show event that nations now decide to bypass. Russia proposes New Group of Eight The Russian State Duma Speaker Vyacheslav Volodin suggested recently that the G7 nations – once considered the world’s leading economies – are continuing “to crack under the weight of sanctions imposed against Russia,” obviously referring to the sacrifice of their economic self-interest in order to meet the demands of the US. Most other nations will have nothing to do with the American-imposed sanctions against Russia. From the non-compliant group of nations, Volodin proposes the formation of a “New Group of Eight” as counterweight to the G7. He selects Russia, China, India, Indonesia, Brazil, Mexico, Iran and Turkey as members of NG8. Volodin reasons that this group of eight countries with a combined GDP (measured in purchasing power parity – PPP) is 24.4% larger than that of the G7 nations. Furthermore, the NG8 contains about half of the world’s population and is much more representative of world opinion and interests. Ironically, Russia left the G7 group in 2014 and is now the promoter of NG8. This development can only be attributed to American insistence on remaining on top of a unipolar world, a unipolar world vaporizing Star Trek-style as we speak. The Biden White House seems to think it has succeeded in getting Ukraine to go into war with Russia and is willing to send another $40 billion worth of weapons to Kiev to enable it to fight to the last Ukrainian. They now think that they can persuade Taiwan to do the same, namely, provoke China into conflict. To provoke war with China, the Taipei government would have to declare independence. Washington has been encouraging the ruling Democratic Progressive Party to inch toward that red line, selling the party leaders the idea that the US is ready to go to war with Taiwan. However, a majority of people in Taiwan do not find American assurances credible, do not believe Taiwan can win a proxy war against China, and cannot justify the death and destruction it would entail just to make Washington happy. The people in Taiwan also find it inconceivable that the Chinese would actually attack their own people on Taiwan. China ready to go to war over Taiwan In the meantime, Beijing has invoked the UN Convention on the Law of the Sea (UNCLOS) and declared that the waters of the Taiwan Strait are within the territorial waters of China. Henceforth, any vessels belonging to foreign countries that sail between the mainland and Taiwan and challenge the sovereignty of China will be subject to attack without notice. China is a signatory of UNCLOS while the US is not. Beijing has drawn the red line based on international law. Continued provocation by American officials in Taiwan will put US vessels in the Taiwan Strait in jeopardy. The Beijing expression of its intentions is as stark and unequivocal as it can be. The next move will be up to the Pentagon to see if it is willing to test China’s resolve. There can be no question that China would rather fire on the US Navy than threaten Taiwan with missiles. Heretofore, Biden has depended on creating more money out of thin air to keep the American economy going. Printing money has been so easy that sending $40 billion to Ukraine seems pain-free. Conflict over Taiwan and waters around there, however, would surely lead to a meltdown of the Fed printing press.

Lessons from an unnecessary war

Edited version first posted in Asia Times. A translated version appeared in the Sing Tao Daily. As Russian tanks rolled into Ukraine, the Western nations condemned Russian President Vladimir Putin for the illegal invasion and the killing and destruction that went with it. “Putin is deranged, Putin is insane, Putin is a killer and he will destroy the world along with Russia,” are just some of the condemnations being heaped on him by the leaders in the West and the mainstream media. CNN’s Fareed Zakaria denounced “Russia’s utterly unprovoked, unjustifiable, immoral invasion of Ukraine.” US Senator Lindsey Graham went so far as to suggest hiring killers to assassinate Putin. Social media along with the mainstream became overloaded with dubious information and fantastical accusations. Some of the cacophony was clearly propaganda from Russia and some from Ukraine amplified by the West. Absent from the commentary of pundits and politicians alike is any semblance of rational reasoning and analysis as to causes and developments that led to the current tragic crisis. An exception would be historian John Mearsheimer, who in an hour-plus lecture given at the University of Chicago back in 2015 explained in some detail how the West continued to ignored Putin’s objections to the expansion of the North Atlantic Treaty Organization. Since the outbreak of war in Ukraine, his lecture has gone viral around the world and been downloaded millions of times. Then this month, Mearsheimer reviewed and updated his views but did not alter his basic position, namely that the US and NATO are to blame for events leading to this disastrous war. His March 2022 talk provided a useful outline of all the provocations by the West starting from 1999. Far from being crazy, Putin as the titular leader of Russia has the responsibility to protect the security of Russia. He has repeatedly objected to NATO’s eastward expansion but was ignored by the US and NATO at every step along the way. Contrary to the impression popularized by the mainstream media, Putin did not precipitate a sudden invasion of Ukraine. For weeks, he amassed troops surrounding Ukraine threatening war as his final warning if the US and allies elected not to pay attention to his demands. Missile crises, then and now If the Americans could not tolerate missiles in Cuba back in 1962 and threatened to go nuclear against the Soviet Union, Putin has asked, how should Russia feel secure with missiles across its border in Ukraine? His question has never been addressed by US President Joe Biden or Secretary of State Antony Blinken. They seemed merely to shrug and ask Putin to accept on faith that the US can be trusted never to threaten Russia with missiles next door. After repeatedly reneging on the promise not to expand NATO membership, they are asking a lot from Putin. Biden also dispatched Blinken to contact China’s Foreign Ministry and ask Beijing to intercede and encourage Putin not to invade Ukraine. Blinken seems to have a talent for turning on a dime and suddenly finding China, heretofore an American adversary, into a bosom buddy in times of need. He was politely ignored. Biden’s other counter is to impose sanctions, economically isolate Russia and stop buying oil from Russia. Since the operation of US refineries depends on the heavy crude that Russia can provide, Blinken has had to call on Caracas and offer to do the Venezuelans a big favor and lift crippling sanctions so as to begin buying crude from them. In the meantime, the world price of a barrel of oil has more than tripled. As a producer and supplier of oil, Russia is enjoying windfall oil revenue to soften the economic pains coming from Biden sanctions. Biden tells Americans to suck it up The Biden administration seems to feel that the American public won’t mind gasoline prices going sky-high and that inflation will mean doing without for many American households. He seems confident that the European Union nations will also loyally go along, even though the Europeans will feel the pain of inflation and energy shortages even more than Americans. The world can only marvel at the kind of strategic thinking emanating from Washington. Washington has shown no inclination to find a resolution that would end the conflict and reach a peaceful settlement. Biden’s idea of supporting Ukraine in the war was to proclaim that American soldiers will not fight Russia but will supply as much weaponry as necessary for Ukraine to fight the Russians down to the last Ukrainian standing. Ukrainian President Volodymyr Zelensky is beginning to see a serious downside to having the US as an ally and seems willing to find a way to a negotiated peace. This is where China can play a constructive role. China has maintained positive diplomatic relations with both Russia and Ukraine. Chinese President Xi Jinping and Putin issued a long joint statement on February 4 declaring long-term economic cooperation and commitment to a multipolar world. As for Ukraine, it is a major hub of China’s Belt and Road Initiative and an important trading partner. During this war, China Red Cross has begun to send humanitarian aid to Kiev, and the Ukrainian government has assisted China in rounding up and evacuating Chinese nationals from the conflict zones. China has expressed sympathy to Russia’s objection to NATO’s encroachment but did not support the invasion of Ukraine. China has always stood on the side of respecting the sovereignty of other nations. China for peace, US for war Surely the world can see that while the US sends arms to promote death, destruction and everlasting instability, China sends food and medicine and can be a trusted honest broker for peace and stability. Nevertheless, the road to peace and security will be long and challenging. It will require all the other parties with vested interests, such as EU and NATO members and most important of all the US, not to disrupt and interfere. It will take EU and NATO member nations that value peace and return to economic prosperity, over their allegiance with the US, to overwhelm the American attempts to sabotage the peace process. Blinken is said to have already formulated a Ukrainian government-in-exile, preparing for the day when the country is overrun by Russia. It will be incumbent on all nations in favor of peace to ensure the safety of Zelensky and not let him become a victim of a CIA hit squad. Ukraine war a lesson for Taiwan This war has raised another question that must be answered, about the status of Taiwan. Some mainstream media outlets have actually suggested that China will take advantage of the distraction the conflict has caused in in Europe to invade Taiwan. This proposition is as preposterous and as poorly reasoned as any from the mainstream media. Beijing regards the people of Taiwan as Chinese and as their own kind. The evacuation of Chinese from Ukraine, as an example, included people with Hong Kong, Macau and Taiwan passports. Mainland China will not launch an invasion unless pushed to a last resort. The last resort would be when the Taipei government declares independence. If Taiwanese leader Tsai Ing-wen falls for American encouragement and steps over the line in the sand, she can count on Uncle Sam to provide all the weapons she needs to fight to the last person in Taiwan. Biden has openly declared that he won’t send any Americans to Ukraine to take on the Russians. He won’t take on China either. It should be obvious that the US is a declining hegemon that can only offer conflict and economic sanctions, while China has no interest in military intervention and can offer economic cooperation and collaboration to anyone. The contrast couldn’t be more clearly seen than in the Ukraine conflict. Another commentary posted in Asia Times on the same day discussed the position by President George H.W. Bush that's relevant to my piece.

Chip industry’s virtuous circle made vicious by Biden’s policy- Forcing chip foundries to turn over internal files is a lose-lose proposition

First posted in Asia Times. A report of this posted appeared in China Daily. Chinese version posted in Sing Tao Daily. I commented on this subject in China Economic Net. Same piece also appeared in China Daily. Some years ago, before my retirement, I offered the observation that the semiconductor industry had become a remarkably virtuous circle across the world. As everyone knows, in a virtuous circle, all participants win. True enough, semiconductor technology was discovered and developed in California’s Santa Clara county, south of San Francisco, which is how it became known to the world as “Silicon Valley.” There Intel Corporation pioneered the advances in its microprocessor technology and created the mega personal-computer industry. Other entrepreneurs in the valley soon followed Intel, either to compete with better circuit designs or to develop complementary integrated circuits to expand the use of semiconductors in a multiplicity of applications. Thus the role of semiconductors proliferated into everyday use, and they now serve many essential functions not conceived by the original inventors. A recent example is the dependence on microchips to execute many functions in automobiles. A worldwide shortage of chips for cars has brought the manufacture of autos to a near standstill. The severe economic consequences of this stoppage have given US President Joe Biden’s administration the excuse to take unprecedented action; more on that later in this article. As the industry evolved, the mantra was to design and make every generation of chips faster, cheaper and smaller. The complexity of each generation raised the cost of making them exponentially. Today, the cost of fabricating (the industry’s term for producing chips) the most advanced devices is in the billions of dollars. Soon, companies in the US dropped out of making their own chips because of the escalating capital investment required to keep up. The techno-entrepreneurs concentrated on designing new devices for new applications. All that required was some computer-aided design stations and a group of smart circuit designers. TSMC fills a need Taiwan Semiconductor Manufacturing Company saw this developing industry trend and decided to concentrate on fabrication technology and kept committing the capital investments needed to keep up with the advances in process technology. TSMC’s strategy was to serve as everybody’s foundry and offer semiconductor fabrication as a service for a fee. To be credible, it promised strict confidentiality, to protect the client’s trade secrets and never to make its own devices to compete with its customers. The “fabless” companies rushed to Taiwan to take advantage of this win-win business arrangement. As a matter of self-interest, these companies willingly shared their know-how with TSMC to improve the manufacturing process so that TSMC steadily improved its fabrication techniques. The fabless companies received their proprietary chips at reasonable cost in a timely manner without a heavy capital commitment. Very quickly, TSMC became the world’s leading semiconductor foundry service company. Others followed suit and copied the TSMC model, but the Taiwanese company captured more than 50% of world’s chip-foundry business and maintained its grip as the leader of semiconductor manufacturing technology. Companies that have enjoyed great success taking advantage of the TSMC business model include Apple, Nvidia and Huawei. Apple designed proprietary chips for all of its product lines across the board and has them made in third-party foundries, mostly by TSMC. Nvidia is the world leader in designing chips for complex computational tasks such as in computer games, machine learning and artificial-intelligence applications and even for mining cryptocurrencies. TSMC is a major supplier of Nvidia’s chipsets. Huawei relied on TSMC’s advanced fabrication technology to make the Chinese company’s proprietary chips for its smartphones and, of course, for its fifth-generation (5G) telecommunication equipment. US, Taiwan and China form a virtuous circle For a while, this was a virtuous arrangement. Apple took its designs to Taiwan and assembled its chipsets into iPhones, iPads and computers in China and sold them worldwide. Nvidia had its chip designs made in Taiwan and also enjoyed worldwide sales. But then Huawei got too successful and became the world leader in 5G and a major supplier of smartphones. The former Donald Trump administration in the US thought the one way to stop Huawei was to deny it access to TSMC’s foundry services and also to any American-owned semiconductor technology. Trump’s successor Joe Biden has gone a step further by becoming the Godfather of the worldwide semiconductor industry and make an offer the foundries cannot refuse: Turn over your confidential files to the US Department of Commerce (DOC) or else we will stop you from operating. The foundries were given 45 days to comply after the September announcement, and it appears that the leaders, TSMC and Samsung, will comply and others will follow suit. Neither Taipei nor Seoul can stand up to Washington and fight this strong-armed unethical outrage. The US has long envied China’s ability to set industry policies in accordance to national priorities. Apparently, the latest DOC edict is Biden’s attempt to mimic Beijing and favor domestic industry, namely Intel, with policy and financial subsidy. TSMC will lose TSMC’s position in the industry will no doubt be diminished. It will not able to collaborate in the manner it was used to and now will only be able to serve its customers in China with great difficulty, if at all. Its covenants with its customer is in tatters. If TSMC relocates some of its facilities to the US to please Washington, it will face the same set of comparative disadvantages of having to operate in America that caused Intel to fall generations behind. Cutting off China will force that country to accelerate the development of indigenous semiconductor technology. It will be stymied for an interim period but in the end, China will have its own semiconductor production and market. As TSMC loses its luster, skilled management and technical personnel will seek opportunities elsewhere. Some might migrate to the US but more are likely to look for jobs in China, where they will not be penalized for language or cultural disconnect. It’s not at all certain that Intel can catch up to TSMC thanks to Washington’s assistance. Besides policy and financial subsidy, doing so will also require people with motivation and skillsets. In that respect, China far outnumbers the US. Washington seems to think its is playing a win-lose game. It doesn’t seem to appreciate that by cutting China off, American companies will be deprived of access to the largest market in the world. When the world’s semiconductor market is split into two, the halves will be less than the whole. Thus a virtuous circle will become dysfunctional, and everybody will lose.