The Committee of 100 just concluded their annual conference, held in San Francisco. Some significant speeches and gestures took place at this event that I will comment on in a later blog.
In the meantime, you can get one observer's point of view by going on the Andrew Ross' column in the SF Chronicle. Ross moderated one of the panel discussion and stayed to listen to other presentations dealing with US-China relations.
He also hosted and compiled brief commentaries from six disparate contributors, including Susan Shirk, who delivered the keynote speech to kick off the conference and three members of the Committee of 100. The title of this blog is the title Ross used to invite the responses in his compilation.
Sunday, April 11, 2010
Monday, April 5, 2010
Famen Temple, where Buddhism meets Las Vegas
Famen Temple （法门寺） is the closest thing in China to Egypt’s discovery of King Tut's tomb. While not nearly as ancient as King Tut, the Tang dynasty treasures sealed in a vault under the pagoda at Famen also escaped the rapacious attention of tomb robbers and lain forgotten for over a thousand years. When the archeologists found the contents to tally perfectly with an inventory list, in a stone tablet found alongside, they concluded that the underground vault had not been disturbed.
The temple had a decidedly ragged history. It was the favorite place for early Tang emperors to go and pray to Buddha for bountiful harvest and a reign at peace. It then fell in disfavor during periodic anti-Buddhism movements. By Ming and Qing dynasty, being remotely located far away from any urban center, it was largely a forgotten place. At some point, lightening struck the pagoda and knocked off half of the tower.
It was not wholly forgotten, however. An old man in the nearby village, fearful of the invading Japanese troops that might break into the underground vault under the pagoda, had set himself on fire at the entrance. The resulting bad karma discouraged anyone that might have been curious.
In the 1980’s the rest of the pagoda toppled and the local authorities decided to investigate and make a determination as to whether the complex was worthy of the cost of restoration. They were thunderstruck by what they found in the sealed underground vault. They found ornaments, scepter, and vessels of silver and gold of exquisite craftsmanship, the best available during the height of Tang dynasty. These were personal tributes from Wu Zetian （武则天）, the only woman emperor and arguably one of the most powerful in China’s history.
The first time I visited Famensi it was around 1995 not long after Famensi reopened as a tourist attraction. It was a long drive and took nearly a half day to get there. I remember the priceless items on display and wanted to see them again. This time, it only took one and a half hours on expressway from center of Xian in the direction of Baoji.
On approaching Famen Temple, we noticed a massive, newly built complex of gray granite and faux gold facade. From the distance, we could see a giant golden, diamond-shaped edifice at the far end of the complex. As we approached, we could see that the diamond was formed by two somewhat abstract cupping hands joined at the wrists and fingertips. Nestled in the hands was a golden temple—a giant replica of one of objects found in the base of the original pagoda.
It turned out that this new complex was the new entrance to the Famen Temple. Visitors to the temple now walk through the new building. The enormous front façade contained three main entrances whose purpose seemed to be to make the visitor feel tiny. As we walked through the lobby, we could see as yet not completed areas for future shops. We then came upon a courtyard with two huge reflecting pools complete with plastic water lily pads with sun bleached but never wilting flowers. A row of stone lions stood on the side of one pool facing a row of stone elephants on the far edge of the opposite pool.
Walking in the middle walkway between the two pools—that felt more like a causeway, we entered an airy hallway, open to the sky. On the left of the hallway, we passed a restaurant zone. On the right facing the restaurants was a hotel for overnight guests. Opened since the 2009 Olympics, we could not tell if all the facilities were ready for business.
At the end of the courtyard, we came upon a long promenade leading to the new temple crowned by the aforementioned diamond. On the two sides of the promenade were huge golden statues of various major Buddha figures. In between the statues were golden pillars with Buddhist scripture in prominent black. For those not wishing to walk the length of the promenade, rides on electric cart were available for an extra fee.
At the end of the promenade, after a flight of stairs, the visitor would enter a new temple to be greeted by four heavenly guardians and the smiling Happy Buddha, all in gold color, and then enter the main hall, in a layout that followed the traditional layout of Buddhist temples but bigger and grander. On display in front of golden stature of Sakyamuni was the holiest relic in Buddhist religion, namely the original finger bone of Prince Gautama, found among the treasures under the pagoda.
The rest of the treasures were on display at the original grounds of the Famen Temple, to the right of the new complex. The museum built to house the objects was in neo-Tang dynasty style, far less flamboyant and blended well with the newly restored pagoda and temple. The main museum building in three floors were inspired by the same golden temple resting inside the diamond on top of the new edifice. The unique items of the Famensi were now properly displayed in a building of its own.
I am certain that there will be many visitors whose object is to see the original imperial gifts from Emperor Wu and could do without the ornate granite and gold and the implied ostentation. On the other hand, it will take a long time to forget Famen Temple again.
The temple had a decidedly ragged history. It was the favorite place for early Tang emperors to go and pray to Buddha for bountiful harvest and a reign at peace. It then fell in disfavor during periodic anti-Buddhism movements. By Ming and Qing dynasty, being remotely located far away from any urban center, it was largely a forgotten place. At some point, lightening struck the pagoda and knocked off half of the tower.
It was not wholly forgotten, however. An old man in the nearby village, fearful of the invading Japanese troops that might break into the underground vault under the pagoda, had set himself on fire at the entrance. The resulting bad karma discouraged anyone that might have been curious.
In the 1980’s the rest of the pagoda toppled and the local authorities decided to investigate and make a determination as to whether the complex was worthy of the cost of restoration. They were thunderstruck by what they found in the sealed underground vault. They found ornaments, scepter, and vessels of silver and gold of exquisite craftsmanship, the best available during the height of Tang dynasty. These were personal tributes from Wu Zetian （武则天）, the only woman emperor and arguably one of the most powerful in China’s history.
The first time I visited Famensi it was around 1995 not long after Famensi reopened as a tourist attraction. It was a long drive and took nearly a half day to get there. I remember the priceless items on display and wanted to see them again. This time, it only took one and a half hours on expressway from center of Xian in the direction of Baoji.
On approaching Famen Temple, we noticed a massive, newly built complex of gray granite and faux gold facade. From the distance, we could see a giant golden, diamond-shaped edifice at the far end of the complex. As we approached, we could see that the diamond was formed by two somewhat abstract cupping hands joined at the wrists and fingertips. Nestled in the hands was a golden temple—a giant replica of one of objects found in the base of the original pagoda.
It turned out that this new complex was the new entrance to the Famen Temple. Visitors to the temple now walk through the new building. The enormous front façade contained three main entrances whose purpose seemed to be to make the visitor feel tiny. As we walked through the lobby, we could see as yet not completed areas for future shops. We then came upon a courtyard with two huge reflecting pools complete with plastic water lily pads with sun bleached but never wilting flowers. A row of stone lions stood on the side of one pool facing a row of stone elephants on the far edge of the opposite pool.
Walking in the middle walkway between the two pools—that felt more like a causeway, we entered an airy hallway, open to the sky. On the left of the hallway, we passed a restaurant zone. On the right facing the restaurants was a hotel for overnight guests. Opened since the 2009 Olympics, we could not tell if all the facilities were ready for business.
At the end of the courtyard, we came upon a long promenade leading to the new temple crowned by the aforementioned diamond. On the two sides of the promenade were huge golden statues of various major Buddha figures. In between the statues were golden pillars with Buddhist scripture in prominent black. For those not wishing to walk the length of the promenade, rides on electric cart were available for an extra fee.
At the end of the promenade, after a flight of stairs, the visitor would enter a new temple to be greeted by four heavenly guardians and the smiling Happy Buddha, all in gold color, and then enter the main hall, in a layout that followed the traditional layout of Buddhist temples but bigger and grander. On display in front of golden stature of Sakyamuni was the holiest relic in Buddhist religion, namely the original finger bone of Prince Gautama, found among the treasures under the pagoda.
The rest of the treasures were on display at the original grounds of the Famen Temple, to the right of the new complex. The museum built to house the objects was in neo-Tang dynasty style, far less flamboyant and blended well with the newly restored pagoda and temple. The main museum building in three floors were inspired by the same golden temple resting inside the diamond on top of the new edifice. The unique items of the Famensi were now properly displayed in a building of its own.
I am certain that there will be many visitors whose object is to see the original imperial gifts from Emperor Wu and could do without the ornate granite and gold and the implied ostentation. On the other hand, it will take a long time to forget Famen Temple again.
Friday, March 19, 2010
Senators find China Bashing easier than Policy Making
Senators Lindsey Graham and Charles Schumer (Reuters called odd couple) are at it again. They are sponsoring a bill in Congress demanding that China adjust the exchange rate of their currency, Renminbi (RMB), to the dollar because, they claim, the “artificially” low rate is costing America jobs.
This time their arguments are bolstered by commentaries written by no less than Paul Krugman, Nobel winning economist, accusing China of mercantilist practices. Krugman as a columnist for the New York Times certainly has the soapbox to preach his version of global economics.
Fortunately, other equally credentialed, if not as well known, professional economists have stepped up to offer persuasive contrarian views exposing flaws in Krugman’s reasoning.
I found three conclusions particularly noteworthy in Stanford Professor Ron McKinnon’s rebuttal to Krugman. First, he points out that trade imbalance has nothing to do with currency exchange rates. A sudden increase in the RMB value to the dollar may actually increase and not lessen the trade imbalance.
McKinnon argues that fixing the exchange rate of 6.83 RMB to a dollar was essential to stabilizing China’s economy against the global economic downdraft caused by Wall Street. With a stable yuan, China was able to stimulate its economy replacing fallen export with huge boost in domestic consumption, which in turn meant increasing imports from China’s neighboring countries and thus stimulating those economies.
China has contributed to a fast worldwide recovery which would not have been possible without a stable yuan. McKinnon presents data to show that it is America’s “ultra-loose monetary policy” instituted since the 2008 crisis that is guilty of manipulation.
UN Conference on Trade and Development (UNCTAD) has come out in support of China’s control of the exchange rate. According to UNCTAD, China has done more than any other emerging economy to stimulate domestic demand in order to mitigate the crisis and urges China not to cave in to the western pressure.
Dr. David Caploe, Chief Political Economist of online EconomyWatch largely echo McKinnon’s analysis but in more quotable sound bites. He points out that the US has run overall balance of payment deficit since 1959 and overall trade deficit since 1971 seemingly without doing any harm to the American standard of living. “Put bluntly,” Caploe says, “Both the US and the rest of the world have benefited greatly from a global political economy that is fundamentally unbalanced.”
Graham and Schumer haven’t said how and what jobs would return to America if China were to bow to pressure and make a substantial and sudden adjustment in the exchange rate.
In fact it has been obvious to all of us that the jobs that went to China by way of Mexico, Taiwan or Korea left the US long ago and would never come back. Nor would we wish for those low paying jobs to come back because it would mean a collapse in the American economy as it currently exists and return to a third world standard of living.
However, bashing China has always been easier than proposing a carefully thought out roadmap that would create well paying jobs and protect the current standard of living. In fact the challenge of a real plan seems to be beyond even the capability of a Nobel Laureate like Krugman.
Caploe says, “If the US is going to somehow manage to find a way out of the mess it’s in, it should stop blaming China, and admit the fault lies in ourselves.” He goes on to say, “But of course, that’s a lot harder than shifting the onus onto one of the few countries in the world that has a political leadership that actually knows what it’s doing when it comes to economic policy.” Ouch.
A more plausible argument for a stronger yuan is that it would make American exports more attractive but this argument doesn’t stand up to scrutiny either. China is already buying virtually all the lower-valued export such as agricultural products that America is selling. For higher-valued products, such as high tech equipment where the US has a comparative advantage, price has not been the issue. China has been willing to buy more than the US government is willing to sell under Washington’s anachronistic export control regulations.
Steve Forbes, publisher of Forbes magazine, reminds us, "We started in the 1970s to put pressure on Japan to change the value of the yen. The dollar today has fallen 75 percent against the yen, and we still have a trade deficit."
Maybe our problem is that we don't have leaders that can offer real solutions.
================================================
A shorter version appeared in the March 25 issue of the San Jose Mercury News.
This time their arguments are bolstered by commentaries written by no less than Paul Krugman, Nobel winning economist, accusing China of mercantilist practices. Krugman as a columnist for the New York Times certainly has the soapbox to preach his version of global economics.
Fortunately, other equally credentialed, if not as well known, professional economists have stepped up to offer persuasive contrarian views exposing flaws in Krugman’s reasoning.
I found three conclusions particularly noteworthy in Stanford Professor Ron McKinnon’s rebuttal to Krugman. First, he points out that trade imbalance has nothing to do with currency exchange rates. A sudden increase in the RMB value to the dollar may actually increase and not lessen the trade imbalance.
McKinnon argues that fixing the exchange rate of 6.83 RMB to a dollar was essential to stabilizing China’s economy against the global economic downdraft caused by Wall Street. With a stable yuan, China was able to stimulate its economy replacing fallen export with huge boost in domestic consumption, which in turn meant increasing imports from China’s neighboring countries and thus stimulating those economies.
China has contributed to a fast worldwide recovery which would not have been possible without a stable yuan. McKinnon presents data to show that it is America’s “ultra-loose monetary policy” instituted since the 2008 crisis that is guilty of manipulation.
UN Conference on Trade and Development (UNCTAD) has come out in support of China’s control of the exchange rate. According to UNCTAD, China has done more than any other emerging economy to stimulate domestic demand in order to mitigate the crisis and urges China not to cave in to the western pressure.
Dr. David Caploe, Chief Political Economist of online EconomyWatch largely echo McKinnon’s analysis but in more quotable sound bites. He points out that the US has run overall balance of payment deficit since 1959 and overall trade deficit since 1971 seemingly without doing any harm to the American standard of living. “Put bluntly,” Caploe says, “Both the US and the rest of the world have benefited greatly from a global political economy that is fundamentally unbalanced.”
Graham and Schumer haven’t said how and what jobs would return to America if China were to bow to pressure and make a substantial and sudden adjustment in the exchange rate.
In fact it has been obvious to all of us that the jobs that went to China by way of Mexico, Taiwan or Korea left the US long ago and would never come back. Nor would we wish for those low paying jobs to come back because it would mean a collapse in the American economy as it currently exists and return to a third world standard of living.
However, bashing China has always been easier than proposing a carefully thought out roadmap that would create well paying jobs and protect the current standard of living. In fact the challenge of a real plan seems to be beyond even the capability of a Nobel Laureate like Krugman.
Caploe says, “If the US is going to somehow manage to find a way out of the mess it’s in, it should stop blaming China, and admit the fault lies in ourselves.” He goes on to say, “But of course, that’s a lot harder than shifting the onus onto one of the few countries in the world that has a political leadership that actually knows what it’s doing when it comes to economic policy.” Ouch.
A more plausible argument for a stronger yuan is that it would make American exports more attractive but this argument doesn’t stand up to scrutiny either. China is already buying virtually all the lower-valued export such as agricultural products that America is selling. For higher-valued products, such as high tech equipment where the US has a comparative advantage, price has not been the issue. China has been willing to buy more than the US government is willing to sell under Washington’s anachronistic export control regulations.
Steve Forbes, publisher of Forbes magazine, reminds us, "We started in the 1970s to put pressure on Japan to change the value of the yen. The dollar today has fallen 75 percent against the yen, and we still have a trade deficit."
Maybe our problem is that we don't have leaders that can offer real solutions.
================================================
A shorter version appeared in the March 25 issue of the San Jose Mercury News.
Tuesday, March 16, 2010
In doing no Evil is Google doing any Good?
Google’s very public dispute with China has everyone confused. First Google accused China of hacking into their servers but wait Google did not necessarily mean China but that hackers were from China. In fact hacking was identified as coming from servers belonging to a couple of schools in Shanghai, but wait may be not, may be some clever hacker, who could be from anywhere, has disguised their origin by commandeering those servers.
Google then announced that they are going to stop censoring the contents flowing through their servers in China and would no longer obey China’s laws related to the control of information being access by China’s netizens. Testimony before Congress seems to indicate that Google will definitely get out of China. Well, maybe not said CEO Eric Schmidt because he was confident of a positive outcome from quiet negotiation with Beijing--negotiations that Beijing has denied taking place.
Bill Gates couldn’t understand what the fuss was all about. If a company is going to operate in China, the company is expected to obey Chinese laws. That’s the way it has been for Microsoft. If you don’t wish to obey the local laws, then yes, you better get out.
Somehow the issue seems more complicated from Google’s point of view. Whether at Google’s request or not, the US government seems ready to come to Google’s aid, by threatening to file a complaint with the World Trade Organization (WTO) accusing China of protectionism. Since China’s laws on cyberspace apply to all Internet enterprises and not just against Google or just foreign companies, it is a head scratcher as to how the U.S. can make such a complaint stick.
It’s possible, I suppose, for the US to insist on China opening the Internet to the same degree that the US is open so that Google can be more successful instead of being merely a distant second in market share in China. But that would be based on a rather dubious premise that having to filter the content puts Google at a disadvantage.
Finally Kai-fu Lee, former head of Google China, spoke up and shed some light to this matter. Lee was lured away from Microsoft in 2005 to right the floundering Google ship in China. By most accounts, he was going a good job as Google was slowly gaining on Baidu, the market leader in search in China. He unexpectedly resigned in September last year.
While attending the Abu Dhabi Media Summit last week Lee was asked about China’s Internet industry. While he would not comment directly on Google in China, he said, “For an American company to succeed in China, it needs to do the following: first, you have to have an empowered local team; second, you need to humbly listen to the local user; third, you need to move fast to give users what they want; and fourth you need to have a longer-term outlook and not be too greedy in wanting to make money on day one.”
Google isn’t the only one to stumble in China. Facebook, eBay, Amazon and Yahoo all did not achieve dominant market share in China comparable to their success in the US. I suspect that all suffered from the same drawback. Namely, their not understanding the local market and not trusting their China team to seize the moment and make decisions without having to go through the corporate bureaucracy back home.
Lee was too diplomatic to ever admit that the frustration of lacking local empowerment was what caused him to seek greener pastures. But he certainly does understand the China market and potential. He has established Innovation Works to harness the energy of entrepreneurs inside China and nurture them into next generation Google’s.
Lee’s incubated start-ups will be participating in a home market of 350 million web surfers and Internet users and 680 million mobile phone users, both largest in the world and growing at double digit rates. In another 7 to 8 years, Lee expects the by then 800 million mobile phone users to access the Internet with their smart phones and that’s the market he wants to play in.
Surely CEO Schmidt has to be agonizing over the dilemma: can Google afford to dither and watch the world’s most dynamic market zip by?
=========================================
After Google announced their move to Hongkong, I sent an updated commentary based on this blog to New America Media.
Google has just revealed that many countries have asked Google to remove contents. Of the countries that have asked Google to censor the contents, the United States came in 4th in frequency of requests.
Google then announced that they are going to stop censoring the contents flowing through their servers in China and would no longer obey China’s laws related to the control of information being access by China’s netizens. Testimony before Congress seems to indicate that Google will definitely get out of China. Well, maybe not said CEO Eric Schmidt because he was confident of a positive outcome from quiet negotiation with Beijing--negotiations that Beijing has denied taking place.
Bill Gates couldn’t understand what the fuss was all about. If a company is going to operate in China, the company is expected to obey Chinese laws. That’s the way it has been for Microsoft. If you don’t wish to obey the local laws, then yes, you better get out.
Somehow the issue seems more complicated from Google’s point of view. Whether at Google’s request or not, the US government seems ready to come to Google’s aid, by threatening to file a complaint with the World Trade Organization (WTO) accusing China of protectionism. Since China’s laws on cyberspace apply to all Internet enterprises and not just against Google or just foreign companies, it is a head scratcher as to how the U.S. can make such a complaint stick.
It’s possible, I suppose, for the US to insist on China opening the Internet to the same degree that the US is open so that Google can be more successful instead of being merely a distant second in market share in China. But that would be based on a rather dubious premise that having to filter the content puts Google at a disadvantage.
Finally Kai-fu Lee, former head of Google China, spoke up and shed some light to this matter. Lee was lured away from Microsoft in 2005 to right the floundering Google ship in China. By most accounts, he was going a good job as Google was slowly gaining on Baidu, the market leader in search in China. He unexpectedly resigned in September last year.
While attending the Abu Dhabi Media Summit last week Lee was asked about China’s Internet industry. While he would not comment directly on Google in China, he said, “For an American company to succeed in China, it needs to do the following: first, you have to have an empowered local team; second, you need to humbly listen to the local user; third, you need to move fast to give users what they want; and fourth you need to have a longer-term outlook and not be too greedy in wanting to make money on day one.”
Google isn’t the only one to stumble in China. Facebook, eBay, Amazon and Yahoo all did not achieve dominant market share in China comparable to their success in the US. I suspect that all suffered from the same drawback. Namely, their not understanding the local market and not trusting their China team to seize the moment and make decisions without having to go through the corporate bureaucracy back home.
Lee was too diplomatic to ever admit that the frustration of lacking local empowerment was what caused him to seek greener pastures. But he certainly does understand the China market and potential. He has established Innovation Works to harness the energy of entrepreneurs inside China and nurture them into next generation Google’s.
Lee’s incubated start-ups will be participating in a home market of 350 million web surfers and Internet users and 680 million mobile phone users, both largest in the world and growing at double digit rates. In another 7 to 8 years, Lee expects the by then 800 million mobile phone users to access the Internet with their smart phones and that’s the market he wants to play in.
Surely CEO Schmidt has to be agonizing over the dilemma: can Google afford to dither and watch the world’s most dynamic market zip by?
=========================================
After Google announced their move to Hongkong, I sent an updated commentary based on this blog to New America Media.
Google has just revealed that many countries have asked Google to remove contents. Of the countries that have asked Google to censor the contents, the United States came in 4th in frequency of requests.
Monday, March 15, 2010
Joseph Nye Swung and Missed
Many of you probably have heard of Professor Joseph Nye, now of Harvard and former U.S. assistant secretary of defense. I remember him as the very persuasive advocate of the effectiveness of the exercise of soft power in international relations. He stressed that properly applied soft power in the form of nuanced diplomacy can be far more effective than in-your-face display of raw military might.
It is therefore most disappointing that in his latest analysis of Sino-U.S. relations, which he called a "turn for the worse," that he completely missed the mark. Nye blamed China for failing to toe the U.S. line of imposing sanction on Iran. He did mention President Obama's meeting with Dalai Lama and agreeing to sell arms to Taiwan as sources of friction in the bilateral relations but he seemed to believe that with ample prior precedents, China should be accepting and not get hot and bothered.
Nye also mentioned that "many American congressmen" complain about American jobs being destroyed by China's maintenance of an artificially low yuan, but he failed to point out the ludicrous premise such complaint is based. Instead he accuse Beijing of making a serious miscalculation because the U.S. is not in decline but still ranks as the second most competitive economy in the world, after Switzerland.
I am not sure how World Economic Forum, an organization based in the West, gage economic strength, but I am not as sanguine as Nye about America's future. I fear that America is about to become a failed state.
Take the health care standoff. I do not find members of Congress talk about what's in national interest. I find members working diligently to make sure the other side do not score any popularity points.
Thanks to a protective coddling of Wall Street, we experienced a great economic meltdown and have incurred trillions in national debt. Our only prospect of getting out of debt is prayer and a pig in the poke, hope for the best some hazy years down in the future. No one has the political courage to say we need to cut spending and (gasp) raise taxes. Obviously a major cut in spending is to get out of Iraq and Afghanistan but we don't seem to know how to do that either.
Our collective aversion to paying taxes plus our preference for guns over books has led directly to a drive to bottom for our public education system, pioneered by California condemned to mediocrity with the enactment of Proposition 13. We are successful in not leaving "any child behind," instead just entire generations behind.
President Obama has said that we will pull out of the economic doldrums through an economy built on innovation. But where will future innovations come from, if we don't want immigrants, won't encourage foreign students to stay and depend on lousy schools to crank out poorly prepared graduates? On top of all that, we have a significant fraction of Americans that seriously believe the study of science is anti-Christ tantamount to devil worship.
Not to worry, some will say, because we have the strongest democracy in the world. Is that so? Thanks to the American invention known as gerrymandering (a manipulation of voting districts to favor a particular political party), members of state and national legislatures once elected are virtually guaranteed lifetime employment. To further enhance their job security, they raise money. The more the better. Once a politician wins an election, he or she immediately raises more campaign contributions because the politician knows full well that vulnerability is inversely proportional to the size of the campaign bank account.
America hasn’t been a democracy based on one person, one vote for decades. We used to go door to door campaigning for our candidates. No more, now we organize neighborhood gatherings for the purpose of collecting political contributions. America has become a democracy based on money. With rare exception, the one that raises the most money, wins. Guess what, most money come from special interest. Every politician rails against special interest—but, by the way, contributions gratefully accepted. Special interests love to make contributions because contributions get access and influence. Consequently, our politicians are not beholden to the voters, just the special interests.
Politicians are safe in their seats so long as they do not rock the boat. Thus they take the easy way out. Rather than exercise leadership and statesmanship and telling the American people of the hard tasks that lie ahead, they just blame China, for everything conceivable.
China in the meantime is building a network of high speed rail that will crisscross the country based on its own technology, i.e., not stolen from Los Alamos. They are proposing to build three trans-continental high speed rail systems: Two to Western Europe by way of Russia and central Asia and one south to Singapore.
China has the wealth to invest in infrastructure based on latest technology and they are sharing with their neighbors. The high speed rail will inevitably bring China closer to the community of nations that will share in the economic benefits. There may even come a day when bilateral relations with America will pale in importance compared to relations with rest of the world.
Nye reminded the readers that Deng Xiaoping would have “led China to the cooperative relations with the U.S. that marked the early of part of last year.” Alas, Nye did not seem to realize that it has been America that has changed from early last year and not China.
It is therefore most disappointing that in his latest analysis of Sino-U.S. relations, which he called a "turn for the worse," that he completely missed the mark. Nye blamed China for failing to toe the U.S. line of imposing sanction on Iran. He did mention President Obama's meeting with Dalai Lama and agreeing to sell arms to Taiwan as sources of friction in the bilateral relations but he seemed to believe that with ample prior precedents, China should be accepting and not get hot and bothered.
Nye also mentioned that "many American congressmen" complain about American jobs being destroyed by China's maintenance of an artificially low yuan, but he failed to point out the ludicrous premise such complaint is based. Instead he accuse Beijing of making a serious miscalculation because the U.S. is not in decline but still ranks as the second most competitive economy in the world, after Switzerland.
I am not sure how World Economic Forum, an organization based in the West, gage economic strength, but I am not as sanguine as Nye about America's future. I fear that America is about to become a failed state.
Take the health care standoff. I do not find members of Congress talk about what's in national interest. I find members working diligently to make sure the other side do not score any popularity points.
Thanks to a protective coddling of Wall Street, we experienced a great economic meltdown and have incurred trillions in national debt. Our only prospect of getting out of debt is prayer and a pig in the poke, hope for the best some hazy years down in the future. No one has the political courage to say we need to cut spending and (gasp) raise taxes. Obviously a major cut in spending is to get out of Iraq and Afghanistan but we don't seem to know how to do that either.
Our collective aversion to paying taxes plus our preference for guns over books has led directly to a drive to bottom for our public education system, pioneered by California condemned to mediocrity with the enactment of Proposition 13. We are successful in not leaving "any child behind," instead just entire generations behind.
President Obama has said that we will pull out of the economic doldrums through an economy built on innovation. But where will future innovations come from, if we don't want immigrants, won't encourage foreign students to stay and depend on lousy schools to crank out poorly prepared graduates? On top of all that, we have a significant fraction of Americans that seriously believe the study of science is anti-Christ tantamount to devil worship.
Not to worry, some will say, because we have the strongest democracy in the world. Is that so? Thanks to the American invention known as gerrymandering (a manipulation of voting districts to favor a particular political party), members of state and national legislatures once elected are virtually guaranteed lifetime employment. To further enhance their job security, they raise money. The more the better. Once a politician wins an election, he or she immediately raises more campaign contributions because the politician knows full well that vulnerability is inversely proportional to the size of the campaign bank account.
America hasn’t been a democracy based on one person, one vote for decades. We used to go door to door campaigning for our candidates. No more, now we organize neighborhood gatherings for the purpose of collecting political contributions. America has become a democracy based on money. With rare exception, the one that raises the most money, wins. Guess what, most money come from special interest. Every politician rails against special interest—but, by the way, contributions gratefully accepted. Special interests love to make contributions because contributions get access and influence. Consequently, our politicians are not beholden to the voters, just the special interests.
Politicians are safe in their seats so long as they do not rock the boat. Thus they take the easy way out. Rather than exercise leadership and statesmanship and telling the American people of the hard tasks that lie ahead, they just blame China, for everything conceivable.
China in the meantime is building a network of high speed rail that will crisscross the country based on its own technology, i.e., not stolen from Los Alamos. They are proposing to build three trans-continental high speed rail systems: Two to Western Europe by way of Russia and central Asia and one south to Singapore.
China has the wealth to invest in infrastructure based on latest technology and they are sharing with their neighbors. The high speed rail will inevitably bring China closer to the community of nations that will share in the economic benefits. There may even come a day when bilateral relations with America will pale in importance compared to relations with rest of the world.
Nye reminded the readers that Deng Xiaoping would have “led China to the cooperative relations with the U.S. that marked the early of part of last year.” Alas, Nye did not seem to realize that it has been America that has changed from early last year and not China.
Sunday, February 7, 2010
Obama needs another playbook for China
Recent geopolitical activity suggests that President Obama is playing his China cards in a traditional way set by his predecessors, but we need to ask whether those cards are still valid.
President Obama came into office last year facing the biggest financial crisis since the Great Depression. He knew he had to take swift and drastic actions and he did. He also knew he had to change the international image of the United States to a more humble and gentle one, and in concert with Secretary of State Clinton, he was largely successful.
In particular he dispensed with the usual antagonistic confrontations that his predecessor administrations indulged at the beginning of their relations with China. Instead he stressed the importance of collaboration between Beijing and Washington in solving the many challenges facing both nations.
Secretary Clinton’s first trip abroad after taking office was to China and she said all the right things. Secretaries Chu and Locke visited China more than once in the first year, partly because of the importance of their portfolios (energy and commerce) to the bilateral relations and partly because their ethnic Chinese background is regarded as useful for building goodwill. Defense Secretary Gates made overtures for military exchanges that China accepted and the relations between the Pentagon and the People’s Liberation Army began to warm.
Of course, as we would expect between the debtor and the creditor holding most of the notes payable, Treasury Secretary Geithner has devoted more face and phone time with Chinese officials than any other cabinet officer. He had to work hard to assure his counterparts in Beijing that the United States would control the deficit and protect the value of the dollar so that China would have reasons not only to hold onto the trillions of IOUs but would continue to buy Treasury notes and bills in the future.
For some reason the dynamics between the two countries changed after Obama came back from his trip to China in November. Since then the collegiality has been replaced by increasingly strident exchange of words, threats and counter threats. Obama’s administration has demanded that China revalue their Renminbi and open their market. Obama has announced the intent to sell arms to Taiwan and to meet Dalai Lama. It’s almost as if Obama had planned to build up a cache of goodwill with China in order to spend it in the second year.
Piling on is Pentagon’s latest Quadrennial Defense Review where they discussed potential military threats from China. Despite the protestations to the contrary, the U.S. military continue to look at China through cold war lens. They are obsessed with the "lack of transparency and the nature of China's military development and decision-making processes." They are fixated on the need to understand China’s military capability and intentions and to be able to measure against America’s own.
China on the other hand is unlikely to oblige. According to the Art of War, the classic tome on strategy written by Sun Zi, the weaker power will always cloak in deception and ambiguity and hide one’s vulnerabilities. The U.S. may have nothing but altruistic intentions in wishing to know China’s strength and plans, but it is not in China’s self-interest to make it easy for the U.S. to sleep at nights—certainly not when the U.S. comes across with so much hostility.
No one outside of Obama’s team can really know what prompted the White House to change. One obvious explanation is that with domestic political setbacks such as the loss of Ted Kennedy’s Senatorial seat as well as other potential losses looming, Obama felt the need to strengthen his ties to his core constituency, a key part of his support being well established China bashers.
If so, it would be disappointing because Obama should have the intelligence to see and the courage to tell the people of the United States that blaming the valuation of the Renminbi will not bring jobs back home—low paying jobs that nobody wanted for decades. Furthermore, since the financial crisis the bilateral relationship has undergone a fundamental change. China no longer sees itself as the 95 pound weakling that needs to absorb a periodic pummeling just to tag along and hang around with the big bully.
Having seen how China weathered the financial storm relatively unscathed, the people of China now believe that they have a system that works better than the West and they expected to be treated with the respect of a peer and not dismissed as a junior flunky. Right or wrong, this is increasingly their attitude. Given that, China’s leaders could hardly be seen to back down before hard nose demands from Washington.
Unilateral actions such as arms sales to Taiwan and meeting the Dalai Lama are particularly sensitive issues because China views those acts as direct interference into their internal affairs. In the past, Beijing might protest for a while and then let it fade away. This may no longer be possible because the Chinese now have heightened expectations consistent with their new self image. Their announced intention to impose sanctions on companies that participates in arms sales to Taiwan reflect the desire to back up rhetoric with real punishing consequences.
Similarly the confrontation over the valuation of the yuan could lead to mutually assured destruction of both economies with devastating global impact. Since a strengthening of the Renminbi is equivalent to a devaluation of the dollars in China’s possession, if backed to a corner, they may decide to walk away from supporting the dollar rather than be seen to acquiesce and do something against their own interest. Most recently, Vice Premier Wang Qishan rather ominously told Geithner not to bother making another trip to Beijing to explain the same tired U.S. position.
I hope cooler heads in Washington prevail before we get too close to the brink. As one columnist in Wall Street Journal recently asked, “How many enemies do we need?”
An edited version was posted on New America Media.
President Obama came into office last year facing the biggest financial crisis since the Great Depression. He knew he had to take swift and drastic actions and he did. He also knew he had to change the international image of the United States to a more humble and gentle one, and in concert with Secretary of State Clinton, he was largely successful.
In particular he dispensed with the usual antagonistic confrontations that his predecessor administrations indulged at the beginning of their relations with China. Instead he stressed the importance of collaboration between Beijing and Washington in solving the many challenges facing both nations.
Secretary Clinton’s first trip abroad after taking office was to China and she said all the right things. Secretaries Chu and Locke visited China more than once in the first year, partly because of the importance of their portfolios (energy and commerce) to the bilateral relations and partly because their ethnic Chinese background is regarded as useful for building goodwill. Defense Secretary Gates made overtures for military exchanges that China accepted and the relations between the Pentagon and the People’s Liberation Army began to warm.
Of course, as we would expect between the debtor and the creditor holding most of the notes payable, Treasury Secretary Geithner has devoted more face and phone time with Chinese officials than any other cabinet officer. He had to work hard to assure his counterparts in Beijing that the United States would control the deficit and protect the value of the dollar so that China would have reasons not only to hold onto the trillions of IOUs but would continue to buy Treasury notes and bills in the future.
For some reason the dynamics between the two countries changed after Obama came back from his trip to China in November. Since then the collegiality has been replaced by increasingly strident exchange of words, threats and counter threats. Obama’s administration has demanded that China revalue their Renminbi and open their market. Obama has announced the intent to sell arms to Taiwan and to meet Dalai Lama. It’s almost as if Obama had planned to build up a cache of goodwill with China in order to spend it in the second year.
Piling on is Pentagon’s latest Quadrennial Defense Review where they discussed potential military threats from China. Despite the protestations to the contrary, the U.S. military continue to look at China through cold war lens. They are obsessed with the "lack of transparency and the nature of China's military development and decision-making processes." They are fixated on the need to understand China’s military capability and intentions and to be able to measure against America’s own.
China on the other hand is unlikely to oblige. According to the Art of War, the classic tome on strategy written by Sun Zi, the weaker power will always cloak in deception and ambiguity and hide one’s vulnerabilities. The U.S. may have nothing but altruistic intentions in wishing to know China’s strength and plans, but it is not in China’s self-interest to make it easy for the U.S. to sleep at nights—certainly not when the U.S. comes across with so much hostility.
No one outside of Obama’s team can really know what prompted the White House to change. One obvious explanation is that with domestic political setbacks such as the loss of Ted Kennedy’s Senatorial seat as well as other potential losses looming, Obama felt the need to strengthen his ties to his core constituency, a key part of his support being well established China bashers.
If so, it would be disappointing because Obama should have the intelligence to see and the courage to tell the people of the United States that blaming the valuation of the Renminbi will not bring jobs back home—low paying jobs that nobody wanted for decades. Furthermore, since the financial crisis the bilateral relationship has undergone a fundamental change. China no longer sees itself as the 95 pound weakling that needs to absorb a periodic pummeling just to tag along and hang around with the big bully.
Having seen how China weathered the financial storm relatively unscathed, the people of China now believe that they have a system that works better than the West and they expected to be treated with the respect of a peer and not dismissed as a junior flunky. Right or wrong, this is increasingly their attitude. Given that, China’s leaders could hardly be seen to back down before hard nose demands from Washington.
Unilateral actions such as arms sales to Taiwan and meeting the Dalai Lama are particularly sensitive issues because China views those acts as direct interference into their internal affairs. In the past, Beijing might protest for a while and then let it fade away. This may no longer be possible because the Chinese now have heightened expectations consistent with their new self image. Their announced intention to impose sanctions on companies that participates in arms sales to Taiwan reflect the desire to back up rhetoric with real punishing consequences.
Similarly the confrontation over the valuation of the yuan could lead to mutually assured destruction of both economies with devastating global impact. Since a strengthening of the Renminbi is equivalent to a devaluation of the dollars in China’s possession, if backed to a corner, they may decide to walk away from supporting the dollar rather than be seen to acquiesce and do something against their own interest. Most recently, Vice Premier Wang Qishan rather ominously told Geithner not to bother making another trip to Beijing to explain the same tired U.S. position.
I hope cooler heads in Washington prevail before we get too close to the brink. As one columnist in Wall Street Journal recently asked, “How many enemies do we need?”
An edited version was posted on New America Media.
Thursday, February 4, 2010
Arms sales adds complexity to the U.S.-China-Taiwan Triangle
President Obama’s announcement to sell $6.4 billion of arms to Taiwan seems to have caught China by surprise. Some in Washington see Beijing’s reaction as a normal response when the U.S. raises the tension in the U.S.-China-Taiwan triangle while others are not so sure.
One thing is clear, however. Obama does not have the luxury of starting a confrontation with China. Many argued that coming into office facing the tsunami of a financial crisis, Obama needed China’s support of the dollar by continuing to buy and holding on to treasury notes. A soft, non-confrontational approach was the only way.
Thus Obama’s decision to sell arms to Taiwan can be read in at least two different ways. One is that Obama has established great rapport with the leaders of Beijing as a result of his November trip to China and arms sales was among the many subjects discussed, and that Obama’s announcement and Beijing’s response are orchestrated. In fact, some academicians inside China have been quoted as saying that Beijing’s official protest is for domestic consumption.
The other interpretation is that Obama’s trip to China was a failure as he did not come back with specific agreements that could be counted as wins. Obama, therefore, has decided to send the message that he, too, can play hardball. By offering only Black Hawk helicopters and Patriot missiles, but withholding advanced fighters and submarines, he is seen as saving a heavier punch for the future, in case he needs to ratchet up the tension by another notch.
This view, while fitting with the inclination of more hawkish analysts in Washington, seems to fly in face of what Obama has demonstrated from the oval office, namely, an intelligent leader who makes thoughtful and rational decisions. Furthermore, he continues to need China’s cooperation not only in the international arena such as Iran and North Korea but also to keep holding onto to the dollar. A confrontation with China does not seem to be in our national interest.
Official spokespersons from Washington justify the arms sales as a U.S. obligation “to ensure Taiwan’s self-defense capability.” This claim is a bit of an exaggeration. Compared to Taiwan, China has more than eight times the military personnel, five times more fighter aircrafts and 15 times more submarines, not to mention the thousands of missiles pointing at Taiwan. A few squadrons of helicopters are not going to tip the scale. (See a PLA analyst commenting on Taiwan's military.)
Obama’s announcement, coming on the heels of Taiwan president Ma Ying-jeou’s highly publicized diplomatic swing through Central America, including two transit stops in San Francisco and Los Angeles -- a privilege never accorded his predecessor -- is a win for Ma and probably intended for Taiwan’s internal consumption.
So the third interpretation of the arms sales and the following brouhaha can be read as staged for the benefit of the domestic audiences of all three countries in the trilateral relations. Ma’s political opposition has been attacking him for being soft on the mainland and leaving Taiwan defenseless. He can now claim to hold a stronger hand while he continues to engage Beijing on economic cooperation. Of course, Taiwan politics being what it is, the opposition is now complaining that the United State’s offer sets the price for the arms as much as 40% above market value.
Both Obama and Ma (in China they are referred to as two horses, “ma” being the word for horse) are hurting in their home approval ratings. While China’s President Hu Jintao and Premier Wen Jiabao are not subject to popularity polls, strong approval at home is important to their ability to govern as well. Beijing’s pledged to retaliate against companies involved in the arms sale, no doubt, will make them popular at the home front.
It was only one administration ago that the White House spoke of containment of China. A significant part of the Washington establishment continues to regard China as an adversary. Selling arms to Taiwan may be politically necessary in response to domestic pressures, but such an announcement and possible future meetings with the Dalai Lama are not going to win China over as a partner in solving international crises.
Eventually, Obama will have to make up his mind whether to treat China as a friend or as a non-aligned third party, if not an outright adversary. A positive trip to China followed by offsetting moves on controversial issues such as arms sales to Taiwan will not accomplish the goal of gaining China as a valuable ally. And given the arrays of problems he is facing, Obama needs all the help he can get.
The above published by New America Media.
One thing is clear, however. Obama does not have the luxury of starting a confrontation with China. Many argued that coming into office facing the tsunami of a financial crisis, Obama needed China’s support of the dollar by continuing to buy and holding on to treasury notes. A soft, non-confrontational approach was the only way.
Thus Obama’s decision to sell arms to Taiwan can be read in at least two different ways. One is that Obama has established great rapport with the leaders of Beijing as a result of his November trip to China and arms sales was among the many subjects discussed, and that Obama’s announcement and Beijing’s response are orchestrated. In fact, some academicians inside China have been quoted as saying that Beijing’s official protest is for domestic consumption.
The other interpretation is that Obama’s trip to China was a failure as he did not come back with specific agreements that could be counted as wins. Obama, therefore, has decided to send the message that he, too, can play hardball. By offering only Black Hawk helicopters and Patriot missiles, but withholding advanced fighters and submarines, he is seen as saving a heavier punch for the future, in case he needs to ratchet up the tension by another notch.
This view, while fitting with the inclination of more hawkish analysts in Washington, seems to fly in face of what Obama has demonstrated from the oval office, namely, an intelligent leader who makes thoughtful and rational decisions. Furthermore, he continues to need China’s cooperation not only in the international arena such as Iran and North Korea but also to keep holding onto to the dollar. A confrontation with China does not seem to be in our national interest.
Official spokespersons from Washington justify the arms sales as a U.S. obligation “to ensure Taiwan’s self-defense capability.” This claim is a bit of an exaggeration. Compared to Taiwan, China has more than eight times the military personnel, five times more fighter aircrafts and 15 times more submarines, not to mention the thousands of missiles pointing at Taiwan. A few squadrons of helicopters are not going to tip the scale. (See a PLA analyst commenting on Taiwan's military.)
Obama’s announcement, coming on the heels of Taiwan president Ma Ying-jeou’s highly publicized diplomatic swing through Central America, including two transit stops in San Francisco and Los Angeles -- a privilege never accorded his predecessor -- is a win for Ma and probably intended for Taiwan’s internal consumption.
So the third interpretation of the arms sales and the following brouhaha can be read as staged for the benefit of the domestic audiences of all three countries in the trilateral relations. Ma’s political opposition has been attacking him for being soft on the mainland and leaving Taiwan defenseless. He can now claim to hold a stronger hand while he continues to engage Beijing on economic cooperation. Of course, Taiwan politics being what it is, the opposition is now complaining that the United State’s offer sets the price for the arms as much as 40% above market value.
Both Obama and Ma (in China they are referred to as two horses, “ma” being the word for horse) are hurting in their home approval ratings. While China’s President Hu Jintao and Premier Wen Jiabao are not subject to popularity polls, strong approval at home is important to their ability to govern as well. Beijing’s pledged to retaliate against companies involved in the arms sale, no doubt, will make them popular at the home front.
It was only one administration ago that the White House spoke of containment of China. A significant part of the Washington establishment continues to regard China as an adversary. Selling arms to Taiwan may be politically necessary in response to domestic pressures, but such an announcement and possible future meetings with the Dalai Lama are not going to win China over as a partner in solving international crises.
Eventually, Obama will have to make up his mind whether to treat China as a friend or as a non-aligned third party, if not an outright adversary. A positive trip to China followed by offsetting moves on controversial issues such as arms sales to Taiwan will not accomplish the goal of gaining China as a valuable ally. And given the arrays of problems he is facing, Obama needs all the help he can get.
The above published by New America Media.
Saturday, January 30, 2010
Banana Republics and the U.S.
It would be overly harsh to say that the Central American countries are failed states. Based on two weeks touring through Belize, El Salvador, Honduras and mostly Guatemala, it may be too presumptuous to make any definitive conclusions but one cannot avoid the impression that these countries do not function very well.
Everywhere our tourist bus went in Guatemala, the national tourist police in massive black 4-wheel drive vehicles shadowed us. Although these visibly armed escorts were at the invitation of our tour guide, the need for their presence in order to reassure the tourists was, in itself, not too comforting.
We were taken to see schools in the hills. Despite entitlement of free public education to everyone up to 8th grade, we learned that the funds allocated to the school were dissipated along the way by leakage to greedy pockets of officials and very little reach the intended destination.
On the shore of Lake Atitlan, we saw a beautiful estate with its own heliport. On the outskirts of Guatemala City we saw districts of tin shacks and mud hovels. If there was any doubt, the diminutive, clearly undernourished Mayan women hawking their handicraft on the streets confirmed the existence of a great unequal distribution of wealth.
All the countries on our itinerary seemed to share a common characteristic, namely, a small wealthy ruling class of European stock and a vast general population of underclass consisted varying shades of darker skin tones. The ruling class has not shown any inclination to advance the economy of their nation by improving the lives and therefore productivity of their people.
Rather, the ruling class seemed to depend on suppressing the potential of their general population as their way of staying on top, politically and economically. Inevitably, this means the need to control the populace via the military resorting to customary tools of brutality. Inevitably the people rebelled with bloody consequences.
The governments promptly informed Washington that the ensuing civil war was actually counterinsurgency against leftist guerillas trained by the Cubans. Reflexively, Washington sent arms and local conflicts become massive conflagrations. People, many in the professional class with critical skills, emigrated out of their home country and another banana republic was born.
While these destructive internal conflicts have been resolved a decade or so ago, the surviving governments have not found their way to a more effective and perhaps enlightened rule. Most of the poor continued to be trapped in their cycle of poverty and seemingly no prospects for a better life.
One can argue that the America is becoming more like a banana republic than these Central American states becoming more like free and open societies that the United States once was. In America, power is now concentrated in the rich who can make big campaign contributions. The governments, local, state and federal, are doing increasing less for schools and students in the ghettoes are condemned to a future without hope.
Of course, the main reason for touring Central America was to learn about the ancient Mayan civilization. We learned that Mayan were very hierarchal with clear separation of classes and professions. One guide even suggested that the Mayan royalty practiced close kin marriages in order to breed giants as a distinction between royal class and the (figuratively) lowly commoners—and most Mayans were quite short, well under 5 feet in stature.
I suspect the use of complicated hieroglyphic form of writing was also consistent with a culture that prized privileges and exclusivity. The complexity was a way of keeping the ability to read from being widespread and limited to the handful in the learned class. Whether its astronomy or calendar or religious ceremony, the Mayans seemed to thrive on enveloping everything in mystery and secrecy.
Perhaps the very restriction of knowledge to only a handful of people in each generation ultimately led to the extinction of the culture when some miscalculation or accident snuffed out heirs to carry on the traditions.
Everywhere our tourist bus went in Guatemala, the national tourist police in massive black 4-wheel drive vehicles shadowed us. Although these visibly armed escorts were at the invitation of our tour guide, the need for their presence in order to reassure the tourists was, in itself, not too comforting.
We were taken to see schools in the hills. Despite entitlement of free public education to everyone up to 8th grade, we learned that the funds allocated to the school were dissipated along the way by leakage to greedy pockets of officials and very little reach the intended destination.
On the shore of Lake Atitlan, we saw a beautiful estate with its own heliport. On the outskirts of Guatemala City we saw districts of tin shacks and mud hovels. If there was any doubt, the diminutive, clearly undernourished Mayan women hawking their handicraft on the streets confirmed the existence of a great unequal distribution of wealth.
All the countries on our itinerary seemed to share a common characteristic, namely, a small wealthy ruling class of European stock and a vast general population of underclass consisted varying shades of darker skin tones. The ruling class has not shown any inclination to advance the economy of their nation by improving the lives and therefore productivity of their people.
Rather, the ruling class seemed to depend on suppressing the potential of their general population as their way of staying on top, politically and economically. Inevitably, this means the need to control the populace via the military resorting to customary tools of brutality. Inevitably the people rebelled with bloody consequences.
The governments promptly informed Washington that the ensuing civil war was actually counterinsurgency against leftist guerillas trained by the Cubans. Reflexively, Washington sent arms and local conflicts become massive conflagrations. People, many in the professional class with critical skills, emigrated out of their home country and another banana republic was born.
While these destructive internal conflicts have been resolved a decade or so ago, the surviving governments have not found their way to a more effective and perhaps enlightened rule. Most of the poor continued to be trapped in their cycle of poverty and seemingly no prospects for a better life.
One can argue that the America is becoming more like a banana republic than these Central American states becoming more like free and open societies that the United States once was. In America, power is now concentrated in the rich who can make big campaign contributions. The governments, local, state and federal, are doing increasing less for schools and students in the ghettoes are condemned to a future without hope.
Of course, the main reason for touring Central America was to learn about the ancient Mayan civilization. We learned that Mayan were very hierarchal with clear separation of classes and professions. One guide even suggested that the Mayan royalty practiced close kin marriages in order to breed giants as a distinction between royal class and the (figuratively) lowly commoners—and most Mayans were quite short, well under 5 feet in stature.
I suspect the use of complicated hieroglyphic form of writing was also consistent with a culture that prized privileges and exclusivity. The complexity was a way of keeping the ability to read from being widespread and limited to the handful in the learned class. Whether its astronomy or calendar or religious ceremony, the Mayans seemed to thrive on enveloping everything in mystery and secrecy.
Perhaps the very restriction of knowledge to only a handful of people in each generation ultimately led to the extinction of the culture when some miscalculation or accident snuffed out heirs to carry on the traditions.
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