Monday, April 3, 2017

Review of Task Force Report on US Policy towards China, Part II

In Part I of my review of the Task Force report on “US Policy Toward China,” I noted that the tone was surprisingly hostile sounding toward China. This was the report published under the joint leadership of Orville Schell of Asia Society and Susan Shirk of UCSD.

Upon further reflection, I decided that the authors probably thought an unfriendly posture toward China was necessary in order to gain the acceptance of the incoming administration. During the campaign both candidates had been attacking China as if that was the way to winning the votes of the electorate.

Thus, the authors probably felt, or at least subconsciously felt, obliged to be critical of China so that their report wouldn’t appear discordant to pre-existing notions and get trashed without being read.

Part I of my review was to examine the six priority issues on my premise that the Trump Administration has no choice but to collaborate with China. This Part II is my review of the ten longer-term issues identified by the Task Force, again from the perspective that the US needs to work with China and not treat China as an adversary.

Cyber Issues

The discussion of this section by the Task Force was relatively free of the kind of rancor that would singled out China as the only party guilty of cyber infractions and intrusion.  Quite sensibly, the Task Force sought different venues where the US and China could discuss and seek solutions in issues that represent common interest.

Cyber security and cyber attacks are beyond the comprehension of the ordinary citizens. To deal with these issues require technologists with special expertise and knowledge. Instead of international cooperation, if governments allow cyber security to become an issue for finger pointing, the winners would be the cyber criminals.

Energy and Climate Change

By the end of Obama’s term, China had already emerged as the world’s leading user of wind and solar energy. Xi Jinping pledged to work alongside the U.S. to reduce emission of green house gases. Because of China’s rapid economic rise based on “pollute now and remediate later,” China has been suffering from foul air, toxic water and unbridled solid waste. Now that Chinese leaders recognize time has come to pay the price needed for remediation, they are making the commitment without external pressure from any outside party.

However unlike Obama, President Trump seems to continue to insist that climate change is some kind of ruse to steal jobs from America. As the same time, the Republican Congress has rescinded Obama’s order to limit the burning of coal and forbid use of fresh water to wash coal. So long as Trump and Congress are unwilling to accept the science surrounding climate change, China will have to go it alone.

Global Governance

In this section, the Task Force begins with the recognition that “today many global problems are nearly impossible to solve without Chinese involvement and support.” The report, however, failed to point out and perhaps did not understand that China goes about international governance very differently from the US.

As the only hegemon in the world, the US is accustomed to setting the rules and then expects all others to abide by them. Not so with China. Since joining the UN, China has become an increasingly active participant of various international bodies, always within the confines and rules set forth by the bodies. More recently, China has also taken the initiative to lead in the formation of international bodies such as the Asia Infrastructure Investment Bank. In the case of AIIB, China did not set the rules unilaterally but through the participation of all the founding nations.

The Task Force also mentioned that even though China is a signatory of UN Convention on the Law of the Sea, China failed to accept the ruling of UNCLOS on the South China Sea dispute with Philippines. That was an accusation levied at China so often in the American media that it became accepted as true. Unfortunately, it was untrue.

China rejected the arbitration by the Permanent Court of Arbitration (PCA), which was not affiliated with UNCLOS in any way whatsoever, because China never agreed to participate in the arbitration hearings. Just like clapping with one hand, the arbitration can have no validity if only one party participated at the hearing. Furthermore, the US never got around to ratifying UNCLOS and thus had no dog in the fight and must rely on Philippines to act as the Labrador pointer.

Asia-Pacific Regional Security

The Task Force position was typical of the mainstream American view, namely the US has an obligation to guarantee the security of Asia Pacific, specifically pertaining to the waters off the coast of China. To carry out their role as a guarantor of security, it has been necessary for the US Navy fleet to patrol the South China Sea and the East China Sea in the name of freedom of navigation. It has also been necessary to fly surveillance planes around the coast of China.

Whether the constant intrusion of American planes and ships is supposed to make Asian countries feel more secure is a matter of debate. One thing is certain; China does not feel more secure, just more angry and resentful. China has always derived their sense of security not by exercising freedom of navigation elsewhere but by owning a credibly menacing second strike.

North Korean Nuclear Threat

As I pointed out in Part I of my piece, while both countries are in agreement that the Korean peninsula must be nuclear free, the national interest of China and that of the US are not aligned. To expect them to cooperate effectively is not realistic.

Bill Perry’s memoir clearly described the origin of the problem as one between North Korea and the US. North Korea felt threatened by American troops in the south and developing the bomb was their way of swapping a deterrent for some sense of security. To resolve the stalemate now, it will continue to depend on Washington to swallow some pride, take the initiative and offer to resume two party talks, i.e. just representatives from the US and the North Koreans in the room.

Maritime Disputes

The US has been dealt a weak hand and should simply face reality.  Washington has not ratified UNCLOS and does not claim any real estate in the waters of dispute. The American naval fleet has to sail a long ways to flex their muscles—a tiring and expensive proposition. America’s role is that of a busybody kibitzer lacking a legitimate stake in the game.

The Report did admit, “Since China has pledged publicly and repeatedly to resolve the disputes in the South China Sea—especially those over the Spratly Islands and associated maritime claims—through peaceful negotiations,” the claimants should be allowed to do just that. The cruising American navy is merely muddying the waters and interfering with negotiations.

Taiwan and Hong Kong

The Task Force noted that the US has “maintained a principled hands-off position” on Taiwan and Hong Kong.  If true—there are always rumors of CIA hanky panky to stir up local unrest—minding one’s own business is a laudable approach.

The Umbrella Movement, contrary to media reports, represented a minor fraction of the Hong Kong population. There were indications that the movement had outside support such as the Mormon Church and who knows what else. The fortunes of the younger generation are tied to the mainland. Those that recognize this fact will have productive careers. Those that don’t will likely become homeless, career protesters.

Tsai Ing-wen of Taiwan has already found out that she can’t have her cake, i.e., enjoyed close economic ties with the mainland, and not give what Beijing wants, i.e., recognition that Taiwan is part of one China. Her economic policies without the mainland are not working, tourists from across the straits are plummeting, and the economy is in negative growth.

The people of Taiwan will decide their own future. Not everyone has the luxury to move to the mainland or to the US. Those that remain in Taiwan will decide soon enough on whether Tsai is on the right course. For the US to interfere would be a big mistake and counter to maintaining peace and stability across the Taiwan Strait.

Human Rights

Despite significant setbacks such as the Tiananmen Square crackdown in 1989, the Chinese people since the end of the Mao era have experienced expanding gains in a variety of individual freedoms in everyday life. These freedoms include the ability to choose their own jobs, become prosperous, travel abroad, marry whom they choose, have more than one child, worship as they wish, and live where they choose.

In addition to the opening statement by the Task Force above, China has taken 700 million of its people out of poverty. With China’s one belt and one road initiative, Beijing is looking to pull others out of poverty along the Silk Road. China does not go around proselyte on how each country should govern, but recognizes that economic improvement is good for the direct beneficiary and in turn good for the neighboring countries. Economic improvements improve the human condition and automatically allow for more human rights.

Defense and Military Relations

The Task Force recommends adopting “an active denial strategy,” which boils down to deploying more military forces and spread them over more locations and thus capable of threatening China from more directions. More recently, China has been deploying its version of active denial strategy to counter American presence in their backyard. Each move is likely to be met by a countermove. In such a scenario, the cost advantage of maintaining comparable relative strength goes to China.

Last, the Trump administration should bear in mind that over the long term, US military power is dependent upon the vibrancy of the nation’s economy, the effectiveness of its system of democratic governance, the caliber of its human capital, and the scope of its research and development and technological innovation. The global apportionment of US military forces matters in the short term; decisive over the long term is the strength of the country’s political and economic foundation.

I couldn’t summarize this section any better than the above. The question for all Americans to ponder is this: Are we Americans so confident of our political and economic foundation that we can go anywhere around the world and pick fights?

Trade and Investment Relations

Because trade and investments are of vital national interests to both parties of the bilateral relations, the Task Force made detailed and specific recommendations for the Trump Administration. One of these was to ratify the Trans Pacific Partnership as quickly as possible. Given that cancelling TPP was     virtually the first act as soon as Trump was sworn into office, it is unlikely that he will pay any attention to the other recommendations presented in the report.

One exception worth mentioning is Chinese investments coming into America. Because of favorable economics, Chinese companies are now looking to set up manufacturing plants in the US. Hopefully the Trump administration will not cut off one’s own nose and discourage such job creating investments.

Conclusion

The recent Pew survey indicates that Americans’ impression of China has become increasingly negative with time. I attribute this to, probably unintentional, the conspiracy between media, academics and politicians. Negative stories about China from the mainstream media invariably outnumber any warm and fuzzy stories about how well China is doing. It’s almost an industry rule that negative stories about China sell while positive stories do not.

The 2 to 1 split between academicians with unfavorable views of China to those more favorable as represented in the Task Force is probably an accurate measure of the academic circles in the US. I am not sure why this is so. Possibly professors tend to mentor students of like mind and help their academic advancement. Young aspiring professors may find espousing accepted views to help them advance their careers. Thus, bad impressions of China become self-reinforcing.

The politicians of America find bashing China risk free and profitable at the polls. They behave irresponsibly and reinforces the negative feelings of the American people toward China.

I would like to propose a new way of looking at the bilateral relations. Namely, why getting along with China is in America’s national interest. I can think of two major reasons. First, about 1/7 of the earth from Ukraine down through Afghanistan, Iraq and Syria and rest of Middle East to Sub-Sahara, are in turmoil. All kinds of crimes against humanity are taking place daily. Uncle Sam as the world’s guarantor of security has his hands full dealing with this region, about 1/8 of the earth surface. Given the runaway federal budget deficit and military personnel getting weary, why should the US go look for China or anyone else to turn them into adversaries?


Secondly, China has taken a long-term view by going around helping other countries build their infrastructure. Improved infrastructure will stimulate the economy and raise the living standards. These improvements will have a rippling effect for countries along the upgraded highway and rail—and give less reason for acts of terrorism. What China is doing is not what America can do or would like to do, but the two together can be perfect partners for world peace.

Thursday, March 23, 2017

China Comes to MIT

An edited version appeared in Asia Times.

“China Comes to MIT” is an exhibit celebrating the 140-year history of students from China that attended Massachusetts Institute of Technology. On display at the Maihaugen Gallery in the MIT Library until November, the exhibit contains an amazing collection of personal stories of students from China that attended MIT from 1877 to 1931. Along with individual profiles, the exhibit also explains the circumstances and developments that led to the special relationship between China and MIT.

Eight of the first nine to enter MIT from China were members of the Chinese Education Mission, sent by the Qing government to receive an American college education. The CEM was the result of Yung Wing’s tireless effort with the imperial court promoting the idea of exposing China’s youth to western education.

Yung, under the generous sponsorship of American missionaries, was the first Chinese to graduate from an American university—Yale, class of 1854. He recognized the value of a western education in helping China modernize and convinced the government to send young boys, ages 12 to 15 to live with missionary families in New England and begin their American education.

The first Chinese student to matriculate MIT was Mon Cham Cheong in 1877 just ahead of the young men from CEM. Cheong’s father was a progressive minded, wealthy merchant who sent him to the US under the guardianship of a similarly wealthy merchant in Boston. Thus Cheong was also the first self-funded student from China.

In all, stories of 38 individuals were profiled in the exhibit including the bio of the first Chinese woman to enter MIT. She was Li Fu Lee; she married Kuan Tung (MIT ’27) and followed him to MIT. She entered as a junior and received an electrical engineering degree in 1929. There were only 25 women in her class and she was made chairman of the social committee of the MIT Chinese Students’ Club—already enough attending to have a club.

The Wong Tsoo story was my personal favorite. Also known as Wong Tsu, he was among the first batch of students to graduate from the newly formed department of Aeronautical Engineering in 1916. Upon recommendations of others at MIT, William Boeing hired him sight unseen to be his first chief engineer.

In less than a year, Wong had designed a seaplane that Boeing sold 50 copies to the US Navy and that was how the Boeing Company got its start as an airplane manufacturing enterprise. (Maybe this is why as a MIT undergrad, I could always get a summer job at Boeing when I went home for the summers.)

Wong did not stay in Seattle very long but went back to China in the latter half of 1917. For services rendered, Boeing gave him a check for $50.77 as payment in full. The MIT exhibit picked up the rest of his story.

Upon arrival in China, Wong began to design and build many more planes while moving his factory several times to the interior to keep out of the grasp of invading Japanese troops. Because of the shortage of strategic materials during wartime, he even designed and built gliders out of bamboo for use as troop carriers.

Wong had a MIT classmate who shared his passion for aviation and was his partner in operating the first airplane factory in China. Japanese spies assassinated him and Wong took over managing the plant and adopted his friend’s son

He shared his enthusiasm for aeronautics by teaching in Tsinghua’s engineering college where he actively encouraged promising aeronautical engineers to pursue additional training at MIT. One of his students was Qian Xuesen, who would later become the father of China’s rocket science.

The MIT exhibit isn’t just about individual stories; it’s a comprehensive portrayal of China’s fascination with practical education available in the west at the turn of the 20th century. After a century of humiliation at the hands of the western powers in the 19th century, every aspiring student in China dreamed of additional training in the west so that they could acquire the skills needed to modernize China and catch up with the rest of the world.

As pointed out in the exhibit, “by 1914, engineering had become the favorite field for government students (i.e., funded by the Chinese government). In the eyes of many, engineering was not simply a practical skill, but a means of serving the nation.”

In 1914, MIT had 33 students from China, more than any other school in America. This tradition continues today. With a total enrollment of nearly 13,000 undergrad and graduate students, 30% are international students from over 140 countries. Nearly one out of every four comes from China; at a total of 888, China has more than twice the number from second place India.

Professor Emma Teng, head of MIT Global Studies and Languages, curated this exhibit. It’s obvious that she has put a lot of thought and energy in assembling the different parts of the display. The exhibit is a treasure trove of historical information and personal stories. Not everyone will be able to visit the display but all will be fascinated by the content of the companion website, www.chinacomestomit.org.


Tuesday, March 21, 2017

Whither the U.S. and China

Bay Area U.S.-China Policy Speaker Series
        
DATE & TIME
VENUE
Monday, March 20, 2017

5:45pm Check-in
6:30pm Program
7:30pm Book Signing
The Commonwealth Club

555 Post Street,
San Francisco, CA
94102
For many years after its reform and opening in 1978, China maintained an attitude of false modesty about its ambitions. That role has been set aside, asserts panelist Howard French, who says China has revealed plans for pan-Asian dominance by building its navy, increasing territorial claims to areas like the South China Sea, and diplomatically bullying smaller players. Hear from French and China analyst George Koo, who says that whatever China’s plans, following a western template to become a global hegemon is not a likely outcome, nor will “false modesty” necessarily find any validity. Come for a fascinating discussion about the historical context of China’s actions and what the future holds for the U.S. relationship with China under the Trump administration.
Register Here
FEATURED SPEAKERS
Howard French, Former New York Times Asia Correspondent; Author, Everything Under the Heavens: Empire, Tribute and the Future of Chinese Power
George Koo, Ph.D., Member, Committee of 100; Regular contributor, online Asia Times
George Lewinski, Former Foreign Editor, "Marketplace"—Moderator

The Committee of 100 is a non-partisan leadership organization of prominent Chinese Americans in business, government, academia, entertainment, and the arts. For over 25 years, the Committee has been committed to a dual mission of promoting the full participation and inclusion of Chinese Americans in all fields of American life, and encouraging constructive relations between the peoples of the United States and Greater China. www.committee100.org.
See video excerpt at http://video.sinovision.net/?id=37897
See follow up TV interview in Putonghua,
Podcast of the entire discussion and on YouTube.

Tuesday, March 14, 2017

Blowback is a lesson the Trump Administration should keep in mind

An edited version of this commentary first appeared in Asia Times and later reposted on SupChina.

“What goes around, comes around,” can be a critics comment on the blowback at the perpetrator whose action had misfired. The late Chalmers Johnson devoted an entire book criticizing American foreign policy based on “blowback.”

However, once in a while, what comes around could be a good thing. One example, remarkably enough, involves China and Japan. The story came from a speech by Daisuke Kotegawa given at the international conference organized by the Schiller Institute, held in June 2016 in Berlin. Mr. Kotegawa was a retired career bureaucrat from Japan’s Ministry of Finance.

He noted that after Fukushima in 2011, hotels in Tokyo had vacancy rates of 90%. But in recent years, tourists from China are filling the hotels. When the cherry blossoms are in bloom, Chinese tourists are overfilling the hotels.

In 2015, 5 million visitors came to Japan, double from just two years earlier. With average spending of about $3000 per person, that was a $15 billion injection into Japan’s economy.

“So thanks to those foreign tourists, our economy is now very good,” said Kotegawa. He went on to say that he was part of the team that agreed to provide economic assistance to China in 1989 to the tune of more than $10 billion per year for six years in the form of loans at 0.5% interest.

These loans were made to build airports in Beijing, Shanghai and Guangzhou, along with seven each of ports, railroads, fertilizer factories, dams and power plants. The telephone networks in Shanghai and Beijing were financed by these loans as well as the subway system in Beijing.

Thanks to the infrastructure put in place with Japan’s assistance, the Chinese people got wealthy and as Kotegawa-san observed, “Now we are actually getting the fruits in the form of huge numbers of Chinese tourists.”

This story has a couple of lessons for the Trump Administration. One is that a well-oiled economy needs a first rate infrastructure. The American Society of Civil Engineers just released their quadrennial “Infrastructure Report Card” on sixteen sectors of America’s infrastructure such as roads, rail, dams, drinking water and so on.

Most sectors earned a rating of D, which means the infrastructure is “in poor to fair condition and mostly below standard, with many elements approaching the end of their service life. A large portion of the system exhibits significant deterioration. Condition and capacity are of serious concern with strong risk of failure.”

Even though the category of bridges earned a C+, one of the higher grades from ASCE; nevertheless, 56,000 bridges in America are “structurally deficient”—in other words, potential catastrophes waiting to happen.

President Trump campaigned on fixing the infrastructure and members of Congress have known for years that the nation’s infrastructure is old and worn. But either Congress lack the intelligence to figure out where the funding can come from or lack the courage to propose taxes that would pay for the improvements. Kicking the can down to next election is what they do best.

According to ASCE, it will take a couple of trillion dollars to bring America’s infrastructure up to snuff; mind you, not at grade A state of the art but at least up to grade B enabling the American economy to start humming again. But if Congress can’t come up with the funding, how will Trump deliver on his promise?

This is where China comes in. They have gone from being a recipient of soft loans and foreign assistance to becoming the world’s largest investor, partner and builder of infrastructure projects. They have taken their Silk Road initiative around the world and countries are eager to work with China because China has developed the reputation for producing quality results on schedule and at low cost, and additionally with attractive financing terms.

All Trump Administration needs to do is to be willing to take a different approach to the bilateral relations with China, a new look based on what’s in national interest for America. How will sailing naval fleets on South China Sea benefit our national interest? How will launching a trade war with China benefit America? In other words, how will confrontation benefit America? Not much.

On the other hand, if Trump can invite the Chinese companies to help build and finance the infrastructure projects; that clearly would be in America’s interest. Trump can even stipulate that for every winning bid by a Chinese company, it would have to take on a joint venture partner drawn from the list of local American construction outfits. Since it’s been many years that American companies have undertaken large infrastructure projects, these JV projects will help bring them up to speed again.

By making sure that what comes around will benefit America, the Trump Administration will be well on the way to developing a winning relationship with China. Just keep in mind that the people of America and China have everything to gain by collaboration and nothing by confrontation.