Old friend in need


LAURENCE BRAHM

Sep 08, 2009           
     
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In China's diplomatic language, the term "old friend" (lao pengyou) is used often. In the good old innocent days of Sino-US relations, old friends meant people like president Richard Nixon and his then-national security adviser Henry Kissinger, who opened the door to China. Last year, former president George W. Bush was praised as an old friend for his unflinching resolve to attend the opening ceremony of the Beijing Olympics. These old stalwarts stand in contrast to the likes of French President Nicolas Sarkozy, who wavered over attending the Games, and German Chancellor Angela Merkel, who has dared to question China's human rights record.

So, how friendly will US President Barack Obama be viewed, in Beijing's eyes, when he makes his first state visit to China in November? Obama could be given the title "old friend" even though he has been in office for less than a year. Unlike his predecessors, Obama is not in a position to offer favours or face. Rather, he is a friend in need - big need, in fact - because he has to finance Washington's US$1.75 trillion deficit. Beijing is the only one who can afford to do so. That means Washington must play soft with Beijing. Obama's advisers are likely to suggest that he should pretend the dragon is a panda, and cuddle it.

There are good reasons for this. In June, the US Treasury Department got the jitters when China sharply cut its US Treasury bill purchases by US$25.1 billion. China-held US Treasury assets suddenly dropped from US$800 billion in May to US$776.4 billion in June - the largest reduction in nine years. Thus began much speculation in Washington about the motivation behind the move.

Many feared it was politically motivated. China's sharp reduction ran against the market trend. In the same period, Japan increased its Treasury bill purchases by US$34.6 billion, while Britain bought a bullish US$77.2 billion - both friends indeed. So, US analysts had reason to wonder why China would move so suddenly against such a trend. Is Beijing asserting its global geopolitical prerogatives with its newly found financial and economic clout? That is how some read it.

Beijing claims there is no ulterior political motive; just classic Chinese pragmatism and business as usual. China calls its recent reduction in treasuries "a regular adjustment". Some see it simply as diversification.

For years, the established pattern has been that, every month, China leads in the purchase of US Treasury bills, followed by Japan, Britain and Russia. That pattern was first disrupted in the wake of Wall Street's meltdown last September. Beijing shifted from long-term corporate and institutional paper to short-term treasuries, a move seen by some analysts as positioning for a fire sale. Beijing gave Washington the jitters again when it reduced its Treasury bill purchases in April, by US$4.4 billion, which it also said was a market adjustment. The White House sighed with relief when Beijing's purchases shot back up again in May.

Officially, China has adopted "three principles" for managing its US$2.13 trillion in foreign exchange reserves: liquidity, security and yield. These principles are repeated like a mantra from Vice-Premier Wang Qishan and central banker Zhou Xiaochuan , to the foreign-exchange traders themselves. So, as much as Beijing may want to diversify, it doesn't have much choice. On average, US Treasury bills yield 1-2 percentage points more than European ones. China will continue to buy them, for now.

Consequently, US relations with China have entered a new era. Diplomatic visits by both US Secretary of State Hillary Rodham Clinton and Treasury Secretary Timothy Geithner have been perceived more as investment portfolio management roadshows. During their meetings, both quoted ancient Chinese proverbs to help schmooze Beijing into debt financing America's recovery. So, when Obama visits Beijing, he should not be surprised if he is greeted with an ancient western proverb: a friend in need is a friend indeed. Now let's see what friendship is all about.

Laurence Brahm is a global activist, international mediator, political columnist and author. For more information see www.laurencebrahm.com

shambhalahouse@yahoo.com


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Time for America to seek professional help


Bob Herbert
Sep 09, 2009           
     
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Maybe the economic stress has been too much. Looking back at the past few months, it's fair to wonder if the US is having a nervous breakdown.

The political debate has been poisoned by birthers, deathers and wackos who smile proudly while carrying signs comparing the president to the Nazis. People who don't even know that Medicare is a government programme have been trying to instruct us on the best ways to reform health care.

There is no end to the craziness. The entire Republican Party has decided that it is in favour of absolutely nothing. The president's stimulus package? No way. Health care reform? Forget about it.

We need therapy. The wackiness is increasing, not diminishing, and it has a great potential for destruction.

But there is another type of disturbing behaviour, coming from our political leaders and the public at large, that is also symptomatic of a society at loose ends. We seem unable to face up to many of the hard truths confronting the US as we approach the end of the first decade of the 21st century.

The Obama administration's biggest domestic priority is health care reform. But the biggest issue confronting ordinary Americans is the devastatingly weak employment environment. Politicians talk about it, but aggressive job-creation efforts are not part of the policy mix.

Nearly 15 million Americans are unemployed, according to official statistics. The real figures are far worse. The unemployment rate for black Americans is a back-breaking 15.1 per cent.

Five million people have been out of work for more than six months, and the consensus is that, even when the recession ends, the employment landscape will remain dismal. A full recovery will take years, and there are real doubts as to whether the US economy is capable of providing enough jobs for all who want and need to work.

This is an overwhelming crisis that is not being met with anything like the urgency required.

We've also been unable to face the hard truths about the wars in Iraq and Afghanistan and the toll they are taking on our young fighting men and women. Most of us don't want to know. Moreover, we've put the costs of these wars on a credit card, without so much as a second thought about what that does to our long-term budget deficits or how it undermines much-needed initiatives here in the US.

There are many other issues that we remain in deep denial about. It's not just the bad economy that has thrown state and local budgets into turmoil from coast to coast. It's our refusal to provide the tax revenues needed to pay for essential public services. Exhibit A is California, which is now a basket case.

The serious wackos, the obsessive-compulsive absurdists, may be beyond therapy. But the rest of us Americans could use serious adult counselling. We've forgotten the fundamentals: how to live within our means, the benefits of shared sacrifice, the responsibility of citizenship, the importance of a well-rounded education, and tolerance. The first step, of course, is to recognise that we have a problem.

Bob Herbert is a New York Times columnist


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Medical Council has got it right on charges


LEADER

Sep 10, 2009           
     
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The doctor-patient relationship is at the heart of the practice of medicine. The trust a lay person places in a medical practitioner is almost an act of faith. That is why the community expects the profession to see that its members uphold the highest ethical standards. A recent finding of misconduct against a private specialist who overcharged an elderly patient is a case in point. Doctors, however, are up in arms about it. What sets the decision apart is that it is a landmark case that touches on doctors' right to set their own fees. They are not defending the colleague in question, but claim that the ruling by the Medical Council is dangerous because it does not define "excessive charges".

The council's disciplinary committee reprimanded the specialist after it found he overcharged for laboratory tests for financial gain. He billed the patient HK$2,780 and HK$1,400 for two sets of tests for which laboratories charged HK$1,400 and HK$175. There can be little argument about the overcharging. Filling in an order form for tests is not that different to writing out a prescription.

But that is not the way many doctors and their professional body look at it. Ten of the 28 members of the Medical Council have called for a review of the ruling. The Hong Kong Medical Association fears that it could leave doctors exposed to disciplinary action for charging high fees for professional skills and services because it fails to define "excessive charges".

The Medical Council's code of professional conduct on fees has regard for the difficulty, costs and special circumstances of the services performed and the time, skill and experience required. That would seem to be a framework that leaves doctors reasonable scope to set their fees without fear of being deemed to have overcharged.

Private doctors have every right to set their own fees in a free market. But the Medical Council has got it right when it says that they must set out their charges clearly, honestly and transparently on request, without any hidden elements, and, if they are substantial, do it in advance. Patients are entitled to be informed, and to have an opportunity to go elsewhere if they think the price is too high.


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The tide has turned for insider traders


LEADER

Sep 11, 2009           
     
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Greed and opportunity ensure that so long as free markets exist, unscrupulous insiders will be tempted to find ways to profit at the expense of honest investors, whatever the risk. But if anyone has yet to get the message that Hong Kong now treats as criminals those who trade with the benefit of inside information, they no longer have any excuse. Yesterday's conviction of former Morgan Stanley Asia managing director Du Jun should ram it home.

In the biggest insider dealing case brought by the Securities and Futures Commission, Du faces up to seven years' jail for offences involving HK$87 million. His conviction caps a run of successful prosecutions. Five people have been jailed for insider dealing since April, when the first prison sentences were imposed. There has long been a high tolerance for insider dealing in Hong Kong. The tide has now turned - and not before time.

Insider dealing was, until recently, viewed as a matter best kept away from the criminal courts. The theory was that it is such a difficult offence to prove that the criminal standard - beyond reasonable doubt - would rarely be met. The string of convictions this year shows that need not be the case. Persistence, patience and the use of e-mail records as a valuable source of evidence have paid off. It is surprising it has taken this long for jail sentences to be imposed. Insider dealing was, after all, made a criminal offence in 2003. The shift is due largely to a new, more aggressive, approach by the SFC which involves working closely with the Department of Justice and pursuing cases in the higher courts. It has, so far, proved to be successful. There have been 10 convictions. The policy has created a much-needed deterrent for would-be insider dealers.

Du's case broke new ground, and not just because it involves such a large sum of money. It marked the first time the SFC had moved to freeze the assets of an insider dealer using a provision in the Securities and Futures Ordinance which is becoming an increasingly useful tool in the fight against market misconduct. The case may yet become the first in which the proceeds of insider dealing are distributed to the victims, in this case people who sold the shares to Du. There will, no doubt, be legal issues to resolve. But if profits can be seized in such cases and used to compensate those who lost out, this will go a long way towards removing the perception that insider dealing is a victimless crime.

The reality is that it poses a serious threat to our financial system, tilting the level playing field and causing serious damage to markets and investors. It must be taken seriously.

It is not only the regulators who have a responsibility to ensure insider dealers cannot thrive. Corporations must be on their guard for signs that those with confidential, price-sensitive information are using it for illicit trades. In the case of Du, questions must be asked about the effectiveness of his investment bank's compliance system. It failed to detect his activities until far too late, even though he informed the control office he intended to trade. Du had access to confidential information about a deal with oil company Citic Resources (SEHK: 1205). He was borrowing large sums of money from his employers to purchase millions of shares in that company. It should not, in those circumstances, have been possible for the crime to be committed.

The judge will decide on the penalty Du must pay for his greed. But his conviction has already helped reinforce the message that insider dealing will no longer be tolerated.


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World cannot afford another trade war


LEADER

Sep 16, 2009           
     
  |   

  



Beijing's response to the US slapping tariffs on Chinese tyre imports has predictably been swift and to the point. It has lodged a complaint with the World Trade Organisation. An investigation has been threatened into possible unfair American practices in exports of automotive products and chicken meat. Is a tit-for-tat trade war looming?

Neither country can afford a trade lockdown, and so far actions have been relatively measured. Their recovery from the financial crisis depends on their maturing trading partnership. Economies so powerful and so deeply entwined have to be handled with care. In short, Beijing and Washington need one another.

But trade spats have the potential to spiral out of control.

Domestic pressure probably drove US President Barack Obama to ignite the dispute last Friday. Unions - key supporters of his campaign - contend that 5,000 American jobs have been lost to China's alleged dumping of cheap tyres. A 35 per cent tariff was put on the tyres and a preliminary decision made to impose duties of up to 31 per cent on steel pipes from China. Obama has insisted that the dispute will not escalate, but he has set a precedent by applying a previously unused part of the trade law known as Section 421. It allows US industries and workers to seek protection from sudden increases in Chinese imports with a minimal burden of proof. In recent months there have been complaints about perceived surges of all manner of Chinese goods, among them shoes, blouses, women's underwear, computer monitors, hearing aids and T-shirts. The floodgates could be in danger of opening.

China's economy, naturally, is directly affected by tariffs. The cost of the duty on tyres is estimated at US$1 billion, not accounting for the impact of lost jobs. This, in turn, strikes at Beijing's efforts to meet the 8 per cent GDP growth target seen as essential to preventing social unrest. There is potential for a knock-on effect beyond economics to other aspects of relations.

The actions come at a sensitive time. Obama is scheduled to meet President Hu Jintao at the G20 summit in Pittsburgh next week. He will also make his maiden trip as president to China in November. Washington needs Beijing's help on a range of issues, from global warming to Iran's nuclear programme. China generally does not counter trade moves with just a trade-related response; Washington may find relations will cool at all levels.

Neither Beijing nor Washington - nor the world - can afford a round of protectionism from the two most important economies. The financial crisis has already led to a growing tide of protectionism, which is harming economies and relations. The same trend followed the economic meltdown of the early 1930s; it deepened rather than alleviated the Great Depression.

So far, at least, reactions have been measured despite populist rhetoric. Beijing's turning to the WTO to referee the dispute over tariffs is in keeping with the nature of their ties, and indicates a desire to keep relations on an even keel in an interconnected world.

The US economy will remain in the doldrums and its unemployment rate will stay high until Americans start spending again. China's export markets, so crucial to development and improving the lot of the population living in poverty, will also be flat until that time. Neither government can really win a trade dispute. Escalating this fight makes little sense given what can be lost. Far better is to co-ordinate policies and build understanding through developing ties at all levels.


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Fate of climate pact is in American hands


Jonathan Freedland
Sep 17, 2009           
     
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Anyone who cares about the survival of our planet should start praying that President Barack Obama gets his way on reforming US health care. That probably sounds hyperbolic, if not mildly deranged: even those who are adamant that 45 million uninsured Americans deserve basic medical cover would not claim that the future of the earth depends on it. But think again.

Next week, world leaders will attend the first UN summit entirely dedicated to climate change. The plan is to replace the Kyoto treaty with a new one, to be agreed in Copenhagen in December. The prospects of getting a deal worthy of the name get bleaker every day.

Few deny that the world needs a new agreement. In the 12 years since Kyoto, we've emitted a whole lot more carbon. The science is now clear that if we do not manage to keep the increase in the earth's temperature below 2 degrees Celsius, we risk facing the effects of catastrophic climate change.

A new Copenhagen treaty would lead us to the day when our worldwide emissions peak - and then start coming down. We would at last be reversing the tide that threatens to engulf our planet.

If that's the prize, there are the most enormous obstacles in its path. A single text would have to be acceptable to rich and poor nations, democratic and not. Elected leaders will also have to be sure that whatever they sign at Copenhagen will be accepted back at home.

Which brings us to Obama. Last November, greens and diplomats breathed a sigh of relief around the world. While George W. Bush had ripped up Kyoto, Obama would surely lead the way to Copenhagen.

Now, that early confidence is fading. Those same diplomats and negotiators have seen Obama struggle to make what, to outsiders, look like pretty reasonable changes to US health care. They have seen a summer campaign demonise him as an amalgam of Stalin, Hitler and Big Brother, bent on sending America's frail grannies to their deaths in the name of a new socialism.

If that's the response he gets when he suggests Americans should be covered, even when they change jobs or get sick, imagine the monstering he'll get for telling them they have to start cutting back on the 19 tonnes of carbon dioxide each one of them emits per year.

But, if Obama cannot even get his health care reform through a Democratic-controlled senate, what chance a climate change treaty that goes beyond Kyoto?

So is the world about to blow its last chance to avoid catastrophe? Earlier this week I visited the Department of Energy and Climate Change - where a Countdown to Copenhagen clock greets visitors in the lobby - to talk to the British environment minister, Ed Miliband.

He concedes that talks are "hanging in the balance" but argues that, even if some omens are troubling, the stars will never again be in such favourable alignment. He is confident that, as long as the Chinese come to see low carbon as an opportunity to make green-tech products for export - and as long as US opinion can be brought around - a deal is within reach.

Jonathan Freedland is a writer for the Guardian


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A test of official concern for the 'little people'


Stephen Vines
Sep 18, 2009           
     
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The government seems intent on turning a tragedy into a scandal by insisting that it will take some six months for the Labour Department to conduct an investigation into the deaths of six workers in an accident at the International Commerce Centre.

On the surface, this appears to be a classic case of the government doing its best to protect the interests of a powerful property company by ensuring its investigation drags beyond the point where emotion over the deaths remains raw.

This impression has been strengthened by explanations from Secretary for Labour and Welfare Matthew Cheung Kin-chung. He is testing credibility by saying that a lengthy investigation is required because the accident occurred in a long lift shaft. Really? Does that mean that an investigation in a small building would be shorter? This is nonsense of the highest order.

What prompts Cheung to utter such twaddle? No doubt he is aware that the deceased workers were employed by a subsidiary of Sun Hung Kai, one of Hong Kong's most influential companies. And, no doubt, he is aware that one of the administration's cardinal rules is to avoid upsetting tycoons wherever possible.

This is not to pre-judge the issue and conclude that the company is guilty of negligence or inadequate supervision of its employees. Clearly, the accident needs to be thoroughly investigated, but does it really take six months to do the job?

Following the accident, Chief Executive Donald Tsang Yam-kuen rushed to the site in a small but appropriate piece of theatre designed to express official concern and offer condolences to the families of the deceased. His actions remain at the level of a show if they are not followed up by swift action to identify why these workers died and to discover whether there are ways of ensuring further accidents of this kind do not occur.

Speed is of the essence, not just so that justice is done, but in accordance with the legal adage that justice delayed is justice denied.

Compare this sloth with the speed of the government's response to something like a threatened bank failure. When, for example, the ailing International Bank of Asia ran into problems, it took a matter of days for officials to deliver decisive support. The administration ensured that not only was the bank rescued but that a systematic collapse was averted.

There are no prizes for noting the differences here. One case involves the lives of people at the lower end of the workforce, waste clearers with no influential connections. In the other instance, we are talking about hard cash and banks run by very influential people.

Here lies the heart of the scandal and it is a scandal that will hardly be relieved by suggestions that official sloth is not a matter of deliberate design, merely a reflection of official incompetence.

This is an extreme example of how Hong Kong's bureaucracy works. There is one type of response for the rich and powerful and quite another for the powerless and poor. It can be viewed at many levels. Take the most commonplace example, seen in government offices where ordinary citizens are forced to stand in long queues to receive the attention of bureaucrats dealing with everything from dishing out licences to accepting payments for various levies.

The rich and powerful have no experience of this treatment because when they or their representatives interact with the bureaucracy, they do so by appointment, are ushered into offices, seated and provided with refreshments. It is a different world, one infamously described by the notorious American heiress Leona Helmsley as setting her apart from the "little people".

The reality is there will never be a perfect level playing field that makes no distinction between rich and poor, but it is the duty of the government to narrow the gap in its own dealings. As long as differential treatment is perceived to prevail, trust in the government will diminish.

Stephen Vines is a Hong Kong-based journalist and entrepreneur


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Out of sight
It remains to be seen whether the political appointment system in Hong Kong has been a success

Anthony Cheung
Sep 21, 2009           
     
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Ever since the controversy last year surrounding their nationality and remuneration, Hong Kong's undersecretaries and political assistants have been subject to frequent ridicule and have sometimes been blamed for poor performance. The present system of political appointments is by no means flawless, but criticism needs to be put into perspective.

Many critics use popularity polls to rate political appointees' performance. While this may be fine for ministers, who appear in the media almost daily to explain policies, respond to public queries and comment on issues and incidents, their deputies and assistants do not have the luxury of such exposure. Without knowing what they do in support of their ministers, it is difficult to fairly assess their performance.

One could still blame the government: if undersecretaries and political assistants don't feature prominently in policymaking and public debates, how can people know what they are really doing? This is indeed something for the administration to ponder.

The political reality is that legislators and parties all prefer to talk to the very top, and undersecretaries are not perceived as carrying enough weight. Where even ministers have to compete for the media limelight, how can undersecretaries, who are not given charge of specific portfolios, as in other jurisdictions, be recognised for their role and impact?

Many subscribe to the theory that, since undersecretaries and political assistants are "outsiders", they are naturally not welcomed by civil servants who may see them as competing for policy influence. Without underestimating the problems of transition and mutual accommodation, one must not simplify matters.

In the new Civil Service Code, the role of civil servants vis-a-vis politically appointed officials is clearly spelled out - civil servants support them in formulating policies and are responsible for executing policies. Permanent secretaries are responsible to the ministers, and heads of departments and agencies are responsible to ministers through the permanent secretaries.

Though undersecretaries may, on behalf of their ministers, convey to civil servants the latter's views and work priorities, and may ask civil servants to prepare and provide information and data, such working contact is in the spirit of partnership and does not constitute a supervising or subordinating relationship. This is in line with international practice. Interestingly, while many would defend the power of civil servants, few have asked if undersecretaries are given sufficient support to do their job well.

In other systems, rivalry between political appointees and career bureaucrats seldom leads to systemic tension because there are well-established constitutional conventions and political ethos. If civil servants disagree with ministers, the latter's will prevails; however, ministers can't afford to ignore the honest advice of their civil servants, otherwise they pay the political price for any ill-conceived decisions.

Unless we go back to the pre-2002 system, where all ministerial posts were taken up by senior civil servants as career postings, extending and improving the political appointment system is the only way forward.

Politically appointed officials are most often not experts in the field of their bureaus. This is not necessarily a problem - British Prime Minister Gordon Brown was a lawyer but nobody questioned his competence to take charge of the Treasury for more than 10 years as Chancellor of the Exchequer. Their authority is not questioned because the doctrine of political appointment is accepted by all who see the benefits of the political executive being in charge but balanced by a career bureaucracy. Hong Kong has been so used to long years of government-by-civil-servants that people have yet to undergo a shift in mentality. However, ministerial appointees have to demonstrate their political capabilities to win public confidence.

The question comes back to whether the logic and purpose of political appointments are generally supported in Hong Kong and, more crucially, whether there is a suitable infrastructure to support them - such as the capacity of political parties and think tanks to groom, supply and support talent for political appointment.

If not, those appointed as undersecretaries and political assistants are left with an impossible mission.

Anthony Cheung Bing-leung is an executive councillor and founder of SynergyNet, a policy think tank


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Voice of the public heard in RTHK decision


LEADER

Sep 23, 2009           
     
  |   

  



Radio Television Hong Kong's future has at last been made clear. It will remain a government department and our public service broadcaster. New resources will help it better serve the community. The components for a strong, independent voice have been put in place.

The government has, sensibly, followed public suggestions in making this decision. It could have adopted the three-year-old recommendation of an independent review panel and set up a new public broadcaster. No role for RTHK was spelt out in that document; a hiring freeze in its wake meant job insecurity for staff, which eroded morale. The uncertainty has now been removed.

There has been no explanation as to why the panel's advice has been ignored. The long delay in making a decision had created concern about the future of RTHK. The process could have been more sensitively handled. Speculation had been rife that the review would be used to transform RTHK into a broadcaster that provides only government information. Such a step would have found favour among some in pro-Beijing circles, but would not have been in Hong Kong's best interests.

The commitment by the government to maintaining RTHK's public broadcaster role is, therefore, welcome. But suspicions linger and every effort must be made to ensure its editorial independence is upheld when the new policy is implemented. Surveys have consistently shown the high regard in which RTHK is held. But its programming has been allowed to slide in quality. Secretary for Commerce and Economic Development Rita Lau Ng Wai-lan promises the new-look RTHK will have the resources and support mechanisms to provide the best-possible programming.

A bottom-up approach has been adopted. New headquarters will be built. RTHK will enter the digital era with radio and television channels. More funding should ensure better local productions and mainland and overseas programmes. RTHK's remit will be laid out by the government in a charter to be signed by the chief secretary. Its relationship to the government and responsibilities will be made plain.

One concern, though, is the creation of a new advisory body whose members will be appointed by the chief executive. It is to provide advice on, among other things, editorial policy. There is a danger this will lead to pressure being applied in areas which should be strictly within RTHK's editorial autonomy. This must be avoided. In whatever framework is laid down, measures must ensure the advisers are not able to impinge on the broadcaster's editorial independence or the integrity of its news-gathering process. Members of the advisory body should be chosen with good governance and transparency in mind.

The role of a public broadcaster is to serve its community. Taxpayers fund its operations; it has to fulfil their needs. Editorial independence, cultural diversity, upholding democracy and political balance and providing a wide range of views are cherished cornerstones. These pillars must be enshrined by the government in the charter. The government has made the right decision in keeping RTHK and bolstering its position. It must now ensure that the seeds of suspicion that have been sown as a result of the review process do not persist. The results of a public consultation starting next month into how the new RTHK should fulfil its mission and the direction it should take should be followed. A new, happier chapter in RTHK's long, proud and respected history has, it is hoped, begun.


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Two birds, one stone


CHRISTINE LOH

Sep 24, 2009           
     
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Even as the world's political attention is focused on global warming, air pollution remains widespread and dangerous. It poses a daily threat to people, animals and plants, and leaves a brown-black haze that affects visibility. This is the right time for our government to lay the groundwork to ensure its climate change and air pollution policies dovetail. It is already consulting the public on tightening air quality standards, and another study under way seeks views on what the city can do to fight climate change.

The public clearly supports reducing air pollution and improving public health. The climate change study needs to discuss two aspects of air pollution with large climate-heating effects - black carbon and ozone. Reducing them is relatively easy, cheap and politically feasible compared with mitigating carbon emissions.

Black carbon is a form of particulate pollution that turns things brown-black. It results from inefficient and incomplete fossil-fuel burning, such as from poorly maintained vehicle engines and heavy bunker fuel for ships. Power plants and factories that burn coal inefficiently also contribute to the problem.

Black carbon's warming effect is equal to between 20 per cent and 50 per cent of the effect of carbon dioxide, making it the second or third largest contributor to global warming. Ozone, a natural occurrence in the upper atmosphere, filters ultraviolet radiation, and its depletion can have serious effects on humans, such as dramatically higher rates of skin cancer.

However, ozone can also occur at lower levels. It is formed when gases such as carbon monoxide and nitrogen oxide - which are derived from burning fossil fuels - react with sunlight. It is a heat-trapping greenhouse gas whose warming effect is equal to about 20 per cent of the effect of carbon dioxide, and is bad for our health.

The major sources of these emissions locally are vehicles, ships and power plants. While carbon stays in the atmosphere for centuries, black carbon and ozone remain for only a matter of days or weeks. Nonetheless, they are both widespread and being emitted continuously. Reducing them would see rapid improvements to air quality and global warming.

Black carbon and ozone can be reduced with existing technologies at relatively low cost compared to mitigating carbon. Fossil-fuel use, especially diesel, is responsible for 35 per cent of global black carbon emissions. Particulate filters for vehicles are a first line of defence. Air pollutants that form ozone come mostly from transport and industrial processes. Solutions to the transport problem - most relevant to Hong Kong - include fuel additives and catalytic converters. Hong Kong already has programmes for trucks to use filters and catalytic converters. The government's climate change study needs to assess any benefits these have produced and how they can be enhanced.

The government's consultation on air quality standards includes proposals to deal with diesel engines. Should Hong Kong shift away from diesel fuel?

This is not easy to answer but some experts think cleaning up diesel to remove more pollutants may be a losing proposition. Much energy is used to produce each cleaner grade and, during the refining process, more carbon is emitted. Moreover, filters, additives and catalytic converters are not ideal.

Thus, switching to natural gas, biodiesel, hybrids and low-carbon electricity may be better in the long term. A move away from dirtier fuels has many benefits, and this issue will be increasingly debated around the world. The government's study to develop a climate strategy shouldn't ignore this question.

Once the government recognises that black carbon and ozone have key environmental, public health and climate effects, officials will have to tackle them in tandem, rather than treat them separately. A new policy should focus on reducing air pollution in ways that also slow global warming.

Christine Loh Kung-wai is chairperson of the Clean Air Network and chief executive of the think tank Civic Exchange. cloh@civic-exchange.org


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The short march
Ironically, as democratic capitalism stumbles in the West, planned economics looks to be serving China well

Orville Schell
Sep 25, 2009           
     
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The Chinese government is making massive preparations for a grand National Day parade in Tiananmen Square to celebrate both the 60th anniversary of the founding of the People's Republic and the 30th anniversary of Deng Xiaoping's programme of "reform and opening up". Walking through the square the other evening, I found myself thinking back to when I first began following China's amazing odyssey. The iconic, Mona Lisa-like visage of Mao Zedong still gazes out from the Gate of Heavenly Peace, but what was happening all around me suggested how much things had changed.

When I first began studying China, at Harvard half a century ago, its leaders trumpeted the superiority of their socialist command economy, which controlled every aspect of life. Hostility between the United States and China, however, prevented students like me from actually travelling there.

But in 1975, while Mao still lived, the Cultural Revolution still raged, class politics still held sway, and there were no private cars, shops, advertisements or private property, I arrived in Beijing. Even we visiting foreigners - all dutifully clad in blue Mao suits and caps - were expected to attend regular political "study sessions" to purify our bourgeois minds with proletarian tracts written by the Gang of Four. That trip set an indelible baseline against which I have been able to measure all the changes China has undergone.

As Deng began to encourage individual incentives over the next several decades - embodied in such slogans as "To Get Rich is Glorious" - I watched with wonder and amazement as China's private economy began to rise from the ashes of Mao's revolution. As this process unfolded, it became fashionable for market fundamentalists in the West to bask in a sense of vindication. After all, were the scales not falling away from the eyes of Chinese leaders, and were they not now turning for salvation towards the God of capitalism that they had once so militantly denounced?

This "end-of-history" interlude, when "communism" was either failing or recycling itself into its opposite, also encouraged many latter-day American political missionaries to proselytise for democracy as well as capitalism - to urge China's leaders to abandon state controls not only over their economy, but over their political system as well.

Of course, China's leaders vigorously resisted that evangelism, especially after the collapse of communism in Europe in 1989, often berating the West for "intruding in the internal affairs of China" and clinging even more defiantly to their Leninist, one-party form of governance. As the imbalance between China's ever more dynamic, modern and globalised economy and its opaque, single-party system of political rule deepened, many Western specialists predicted that the contradiction would inevitably trip China up. Instead, it was America and the West that went into an economic tailspin.

When, after the eight catastrophic years of George W. Bush's presidency, Barack Obama entered the White House, it seemed for a moment as if America might be able to arrest its downward slide. But then an unwelcome thing happened. Obama ran right into a perfect storm of the worst aspects of American democracy: red-state provincialism and ignorance, fearful conservatism, Republican Party obstructionism and even some Democratic Party dissidence.

The US Congress became paralysed by partisan politics. Seemingly lacking a central nervous system, it has become a dysfunctional creature with little capacity to recognise any common national, much less international, interest. Under such circumstances, even a brilliant leader, with an able staff and promising policies, will be unable to pursue his agenda.

As governments across the West have become increasingly bogged down trying to fix a broken economy, China has been formulating a whole series of new, well-considered policies and forging ahead with bold decision-making to tackle one daunting problem after another. Triumphant from the 2008 Olympic Games, its leaders have undertaken the most impressive infrastructure programme in history, implemented a highly successful economic stimulus package, and now are moving into the forefront of green technology, renewable energy and energy efficiency - the activities out of which the new global economy is certain to grow.

In short, China is veritably humming with energy, money, plans, leadership and forward motion, while the West seems paralysed.

As I strolled through Tiananmen Square, the paradox that struck me was that the very system of democratic capitalism that the West has so ardently believed in and advocated now seems to be failing us. At the same time, the kind of authoritarianism and state-managed economics that we have long impugned now seems to be serving China well.

It is intellectually and politically unsettling to realise that, if the West cannot quickly straighten out its systems of government, only politically unreformed states like China will be able to make the decisions that a nation needs to survive in today's high-speed, hi-tech, increasingly globalised world.

Orville Schell is director of the Centre on US-China Relations at the Asia Society. Copyright: Project Syndicate


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The book ban that serves no purpose


LEADER

Sep 28, 2009           
     
  |   

  



Journalist Xiao Jiansheng's academically inclined book Chinese Civilisation Revisited was sure to cause a stir among mainland leaders. Intellectual debate always prompts disquiet in Beijing. Sensitivity was heightened by the volume being put out to coincide with the 60th anniversary of the Communist Party taking power and links to a Hong Kong publisher perceived as controversial. Predictably, it has been banned.

The decision raises the usual issues of the party's fragility and the lack of freedom of speech. If such works were allowed to openly circulate, the nation would be so much the richer. Discussion of issues raised - in this case, traditional values - would further development. A single book will not mean the downfall of 5,000 years of Chinese civilisation.

Xiao's work has suffered the same fate as the similarly controversial book The Ugly Chinaman and the Crisis of Chinese Culture and the documentary River Elegy. Its banning on the mainland does not mean it will go unread, though: authorities' rejection of it has ensured it will now be eagerly sought. Copies published in Hong Kong will make their way across the border. Digital versions will spread virus-like through the internet.

The book was approved for publication two years ago by the publishing arm of the prestigious Chinese Academy of Social Sciences. It looks broadly at Chinese history and does not touch on the past six decades. Bao Pu, of Hong Kong's New Century Press, wants to publish it; he is the son of Bao Tong , the most senior official jailed over the 1989 Tiananmen protests.

Book bannings are self-defeating. The academics who were going to be Xiao's main audience will still find a way to read his book. But attention beyond learning and research institutions has been drawn to it by the ban. Sales and demand will increase. A publication that may otherwise have caused only small ripples will now be a must-read. Authorities would have done much better to have practised what the constitution itself stipulates: allow freedom of speech and the free flow of information. The nation will be richer for it.


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去年今日貧窮中
人面荷包傷淚痕
荷包今天無心看
人面依舊變青黃！唉！！

Cause for celebration


FRANK CHING

Sep 30, 2009           
     
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Tomorrow is the 60th anniversary of the establishment of the People's Republic of China. This is a major landmark and a time for reflection for both the Chinese leadership and the people. Looking back, they have much to be pleased about. Unlike the United States, which is involved in two debilitating wars, China is at peace. Indeed, this is a situation that Beijing has worked hard to bring about over the past three decades, as Chinese leaders forswore class struggle and world revolution to focus on economic development.

Ten years ago, when the nation celebrated its 50th anniversary, it had just recovered Hong Kong from Britain after a century and a half of colonialism and was poised to take back Macau from Portugal. The late paramount leader Deng Xiaoping's agenda for national unification was making progress. The only exception was Taiwan, then governed by Lee Teng-hui, its first directly elected president, who had declared relations between the two sides to be "special state-to-state relations".

Today, Taiwan is no longer pushing the independence envelope. Under its president, Ma Ying-jeou, Taipei is anxious not to rub Beijing the wrong way and has just denied a visa to exiled Uygur leader Rebiya Kadeer, whom Beijing accuses of fomenting violence in Xinjiang . The two economies are becoming increasingly integrated. While reunification is still a distant prospect, from Beijing's standpoint, it seems closer than at any time since the two sides separated six decades ago.

Ten years ago, China was still feeling bitter that Sydney, not Beijing, was going to host the 2000 Olympics. The prize had seemed so close but, in the end, it eluded China's grasp. This year, however, China is still basking in the adulation for its hosting of the summer Games last year. It was, in a real sense, China's coming-out party, and what a party it was. Soon, it will be Shanghai's turn as it plays host to Expo 2010.

Ten years ago, China marked 20 years of continuous growth after the launching of its reform and opening-up policy. Gross domestic product had reached US$1 trillion, putting China in 6th place worldwide.

Since then, the country's GDP has more than quadrupled and today China is the world's third-largest economy, behind only the United States and Japan. Its growth seems inexorable. While the US and Japanese economies are shrinking this year, as a result of the global financial crisis, China continues to grow at 8 per cent per annum.

While many see the US as being in long-term decline, China's rise seems unstoppable. Increasingly, it is seen as a global engine of growth. Virtually all countries are courting Beijing.

So there is much to celebrate. And, as the rehearsals leading up to the grand military parade in Beijing show, the leadership is leaving nothing to chance to ensure its success. Just as in 1999, the leadership has approved 50 slogans to be used. Some are the same as a decade ago while others reflect new realities.

Thus, while in 1999 Chinese were exhorted to: "Stress study, stress politics and stress healthy trends" - a campaign launched by then-leader Jiang Zemin - this year's slogans emphasise harmony, a concept favoured by President Hu Jintao.

In 1999, there was a slogan relating to Taiwan that said: "Adhere to the policy of 'peaceful unification, one country two systems' and complete the mission of national unification!"

Interestingly, this slogan no longer appears this year, perhaps to take account of Taiwanese opposition to "one country, two systems". There is still a slogan about "one country, two systems", but it refers only to Hong Kong and Macau. Where Taiwan is concerned, there is a slogan that calls for adherence to the "One-China principle" to bring about peaceful reunification. But the formula "one country, two systems" is conspicuously omitted.

And so, while Beijing often appears to be unchanging and immoveable, the slight differences in slogans between those approved for this year's use and the ones for 1999 show that the Chinese government does change and is prepared to make adjustments - to its slogans at least, if not to its policies.

Frank Ching is a Hong Kong-based writer and commentator. frank.ching@scmp.com


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Off the rails
Taiwan's loss-making high-speed railway is reason enough not to build one in Hong Kong

Jake van der Kamp
Oct 02, 2009           
     
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Political heavyweights from across the border have been loud recently in telling us that we will be left behind unless we immediately rush to pour tens, perhaps hundreds, of billions of dollars into fancy new transport projects. Our bureaucrats in Hong Kong may still be a little deaf to this call to action, thank heavens, but in Taiwan the authorities have long had their ears open to it and welcomed it.

They have poured NT$450 billion (HK$107 billion) into a 345-kilometre high-speed railway from Taipei to Kaohsiung, a marvel that speeds passengers between the two cities in little more than an hour.

And the result? Taiwan has been left behind. The full scale of the debacle only became apparent last week with the news that a fresh civil servant has been appointed to sweet-talk banks into throwing good money after bad on a loser that has already seen NT$70 billion vanish since the service began in early 2007.

The convenient culprit for the mess is the obvious one, a villain named "the economy". By common agreement, it is the economy's fault that barely 80,000 people a day use the service, although initial estimates projected 180,000 daily, rising to 400,000 daily in 30 years. It has also been decided to preserve the fiction that this is purely a private project - a build, operate and transfer scheme - and therefore the government is not to blame, although it will now step in to twist the arms of the lenders.

There are several lessons for Hong Kong here. The first is that multi-year passenger forecasts for new transport projects are highly uncertain and tend to be influenced by special interests. For instance, a frequent fast hop by air is already available between Taipei and Kaohsiung and there is an existing four-hour rail service for people less pressed for time.

Rail planners dazzled by the glitter of a high-speed line pooh-poohed all this, however. The former chairwoman of the railway company even said, in a recent magazine interview, that overly optimistic estimates were adopted to make the project more appealing to investors.

Likewise, there are already a multiplicity of existing transport services between Hong Kong and Guangzhou, leave alone Shenzhen, and no detailed studies were done on the need for a new 48-minute rail service to an outlying Guangzhou suburb, with a cost that has now climbed to HK$60 billion for the Hong Kong portion alone.

The stated official reason for doing it is to "reinforce Hong Kong's position as the transport hub in southern China and integrate Hong Kong into the country's rapidly growing express rail network".

That's it. That's all. You look in vain for any reasoned studies on how this was determined or what lay behind the guess that this line will carry 100,000 passengers a day in the year 2020.

You would look in vain anyway, as it is the very unusual hub that is located at the rim of the wheel rather than in the centre of it. Hong Kong is actually not particularly well placed to be a transport hub for southern China.

Hong Kong is, nonetheless, already integrated into China's rail network. The rail connection is simply a little slower and a great deal cheaper. If you need speed, go to the airport. That is why we have air travel.

Contrary to what the rail boosters now argue, this new rail proposal is not like the decision 30 years ago to proceed with the Mass Transit Railway. The construction of the MTR's modified initial system was thoroughly studied and soundly based. It made excellent sense both as a transport project and a commercial venture. The new rail link to the border has been only skimpily studied and is based on political convenience alone.

The parallels with Taiwan High Speed Rail are many, and the danger of suffering the same fate is acute. The big difference is only that we have not yet committed ourselves fully and can still step back from this mistake.

We particularly need to rethink it because, if it goes wrong, this is no minor slip-up, a mere gaffe or oversight. We are talking of a project that could easily sink HK$10,000 per person for every member of Hong Kong's population. It will not be banks, shareholders or foreign investors that will carry this if it happens. They will have run and been long gone by the time the rest of us see our fate coming. The burden of it will fall squarely on Hong Kong working families through higher taxes and lower returns on savings.

That's the way it is now happening in Taiwan. Look and shudder.

Jake van der Kamp is a former Post columnist


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Contradiction in terms
Few could have foreseen the paradox presented by capitalism with Chinese characteristics

Pranab Bardhan
Oct 05, 2009           
     
  |   

  



After the 60th anniversary of the People's Republic of China, one is prone to reflect on its dramatic recent history, including the historic irony of the development of today's arguably most vigorous capitalism in an avowedly communist country. The contradictions involved here are much more than were dreamed of in Mao Zedong's philosophy when he famously speculated on the nature of contradictions, first in a 1937 essay, where he stated: "The law of contradiction in things, that is, the law of the unity of opposites, is the fundamental law of nature and of society."

While the Communist Party retains the monopoly of power, the market mechanism is the major allocator of resources in the economy. While most people agree that the private sector is now the more dynamic part of the economy and creates most of the jobs, to find out how much of the (non-farm) economy is actually under private ownership is not straightforward: it is not easy to classify Chinese firms by their ownership or to distinguish between private and public, or semi-public, control rights.

This is, of course, part of the legacy of the development of the private sector under the shadow of the party-controlled state. As late as 1988, private firms with more than eight employees were not permitted. Many private firms operated below the radar and used various subterfuges and covert deals with local officials as they adapted to the changing permissible mores. Many of the smaller and regional state-owned enterprises (SOEs) were privatised and often their managers became the new owners. Today, probably more than half of the non-farm output (though not of fixed capital investment) is primarily privately owned or controlled. About one-third of the private entrepreneurs are members of the party; membership helps them get state finance, more protection and legitimacy.

Of course, it is well known that some of the entrepreneurs are in fact friends or relatives of party officials. Many SOEs are also controlled by powerful political families. Thus, there is a new political-managerial class, which over the last two decades has converted their positions of authority into wealth and power.

The vibrancy of entrepreneurial ambitions combined with the arbitrariness of power in an authoritarian state has sometimes given rise to particularly corrupt or predatory forms of capitalism, unencumbered by the restraints of civil society institutions. Perhaps nowhere has the predation been as starkly evident as in land seizures in cities as well as the countryside.

This corrupt or predatory form of capitalism also has some obvious global implications. When foreign companies try to invest in China, or Chinese companies try to acquire holdings abroad, the decision-making process can be vitiated by arbitrary political interference, underhand dealings, kickbacks and influence-peddling.

While the state has relaxed its earlier control over prices and allows markets and profit-making to be the major organising principle of domestic economic life, it is still predominant in the capital goods sectors and in transport and finance. Some of the SOEs are now important players in the global market competition. In general, in recruiting professional managers, broadening their investor base, and shedding their traditional social and political obligations, many SOEs do not conform to the usual stereotypes.

The state still controls the larger and often more profitable companies in the industrial and service sectors. The state's role in regulating the private sector also goes far beyond the usual functions in other countries. Apart from exerting indirect control rights in private firms, during the current global recession, some SOEs - flush with abundant loans from state banks - have even taken over some of the financially strapped small and medium-size private enterprises.

An important question arises in cases where an enterprise is managed on essentially commercial principles, but the state still has control rights over a large share of the assets: is this a capitalist enterprise? Some may describe it as capitalist if the principle of shareholder value maximisation is followed. Others may point out that, as long as substantial control rights remain with the state, the internal dynamic logic of capitalism is missing. Late last year, when China's richest man, Huang Guangyu, was arrested, many thought his biggest crime was that he was getting too powerful for the leaders' comfort (shades of Vladimir Putin's Russia).

Nevertheless, it is probably reasonable to guess that, while the party can undo individual capitalists at short notice, it will be much more difficult for the leadership to unravel a whole network of capitalist relations.

Individual entrepreneurs have a clientelistic relationship with the state, but the state is now sufficiently enmeshed in a profit-oriented system that has been identified with legitimacy enhancing international economic prowess and nationalist glory - a tiger that the political leadership may find difficult to dismount.

At the local level, the central leadership often finds it difficult to rein in officials, as they collude with local business to commit some of the worst capitalist excesses (in land acquisitions, product safety or pollution). By one official account, the party composition itself has drastically changed, most members now are no longer workers or peasants, but professionals, students and businessmen.

Such are the ambiguities and contradictions of Chinese capitalism that Mao never foresaw, nor did the capitalist corporations in the West now dealing with this strange hybrid.

Pranab Bardhan is professor of economics at the University of California, Berkeley. Reprinted with permission from YaleGlobal Online

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Turn down the heat before it's too late


LEADER

Oct 06, 2009           
     
  |   

  



The government now knows where the hottest parts of Hong Kong are. As the climate map its researchers have produced reveals, it is generally the main commercial and industrial parts of the city. The findings are not surprising; anyone who works or lives in the dozen districts identified already knows this. Confirmation therefore has to be not a starting point for further investigation, but a springboard from which to implement rules, regulations and policies that will keep temperatures down.

Authorities have a long record of responding slowly to sensitive matters. The four-year study from which the map has been drawn falls into this category. Much of the problem of what researchers call the "heat island" effect is caused by high-density property development. The government has adopted a generally laissez-faire approach towards property developers; they are, after all, by far the biggest contributor to public revenue.

Allowing developers a more or less free hand has benefited both sides. With rising lifestyle expectations and concerns about the environment and health, though, this is obviously no longer sustainable. Authorities are well aware of the need to make Hong Kong more liveable and have been encouraging developers to lower the density of projects and include more green features. This has to be extended beyond new developments to existing ones.

Hong Kong is, as is often the case, behind the global curve on such efforts. Singapore, Tokyo, Los Angeles and countless other cities long ago produced temperature maps. Policies have, for years, been in place to ensure the use of heat-lowering materials on buildings and road surfaces and the planting of roof- and street-level trees and gardens. Rules govern distances between buildings to ensure airflow and where this is hampered, such as on Tokyo's Kanni Road, demolition crews are called in.

Authorities now have valuable data to strengthen Hong Kong's planning rules. They know exactly where the temperatures are least comfortable. Every effort has to be made to take the heat off our streets. The government and developers have to change their ways.


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Unemployment crisis is Obama's blind spot


Bob Herbert
Oct 07, 2009           
     
  |   

  



The big question in the US right now is whether President Barack Obama understands the gravity of the employment crisis facing the country. Does he get it? The signals coming out of the White House have not been encouraging.

The Beltway crowd and the Einsteins of high finance who never saw this economic collapse coming are now telling us with their usual breezy arrogance that the Great Recession is probably over. But their focus is on data - abstractions like the gross domestic product, not the continued suffering of living, breathing human beings struggling with the nightmare of joblessness.

Even Obama, in a New York Times interview, gave short shrift to the idea of an additional economic stimulus package, saying a few weeks ago that the economy had probably turned a corner. "As you know," Obama said, "jobs tend to be a lagging indicator; they come last."

The view of most American families is somewhat less blase. Faced with the relentless monthly costs of housing, transport, food, clothing, education and so forth, they have precious little time to wait for this lagging indicator to come creeping across the finish line.

Americans need jobs now, and if the economy on its own is incapable of putting people back to work - which appears to be the case - then the government needs to step in with aggressive job-creation efforts.

Nearly one in four American families has suffered a job loss over the past year, according to the Economic Policy Institute. Nearly one in 10 Americans is officially out of work: the real-world rate is worse.

Something approaching 10 million new jobs would have to be created just to get back to where we were when the recession began in December 2007. There is nothing currently in the works to jump-start job creation on that scale.

A massive long-term campaign to rebuild the nation's infrastructure - which would put many people to work establishing the industrial platform for a truly 21st-century US economy - has not been considered seriously. Large-scale public-works programmes that would reach the inner cities and hard-pressed suburban and rural areas have been dismissed as the residue of an ancient, unsophisticated era.

We seem to be waiting for some mythical rebound, magically equipped with robust jobs creation, a long-term bull market and paradise regained for consumers.

It ain't happening. The number of people officially unemployed - 15.1 million - is, as The Wall Street Journal noted, greater than the population of 46 of the 50 states.

The administration seems hamstrung by the unemployment crisis. No big ideas have emerged. While devoting vast amounts of energy to health care and Afghanistan, the president has not even conveyed the sense of urgency that the employment crisis warrants.

The staggering levels of joblessness have the potential to cripple not just the well-being of millions of families, but any real prospects for sustained economic recovery and Obama's political prospects, as well. Unemployed voters are unhappy voters.

Bob Herbert is a New York Times columnist


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Reading revolution a welcome chapter


LEADER

Oct 08, 2009           
     
  |   

  



Americans have for two years been able to download and read books at any time and place using wireless electronic readers. That amenity will come to Hong Kong after October 19 when the online retailer Amazon.com starts shipping the international version of its Kindle e-reader. The event is as important for our community as it is for the firm's business expansion plans. Any new means of facilitating reading and learning is good.

Amazon.com says that books can be downloaded in about a minute from an ever-expanding catalogue of hundreds of thousands. A voice feature will give the visually impaired access to titles of some publishers. The price for each will be US$9.99 and there will be no downloading charge. Obtaining the printed word has never been less expensive or easier; it will presumably become increasingly so as competitors like Sony and Apple launch rivals.

There are those among us who would never think of trading the feel and smell of hard-copy books, magazines and newspapers for ones that can only be read on a hand-held screen. The march of technology, environmental concerns and convenience dictate that ways have to change. But wireless e-readers open vistas for younger generations, who overwhelmingly prefer comics, computer games, tinkering with mobile phones and watching television to curling up with a book. Making the printed word more accessible to our children in a means they are comfortable with will help society.

Reading has a host of benefits that comics, games and television can only partially provide. Through books, readers develop creativity and an ability to comprehend concepts and ideas, increase vocabulary and language fluency, and broaden interests. Spelling and writing standards improve.

The Kindle's availability will provide fresh competition for booksellers, who will need to adapt. It may even lead to lower book prices. Schools may consider electronic textbooks, as is happening in the US. The changes are worrying for Luddites, but for the sake of our city's learning and education they are more than welcome.


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Bright prospects for renewable energy


Kandeh Yumkella
Oct 09, 2009           
     
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A decade ago, renewable energy was viewed as an unwelcome offspring of fossil fuels, but the recent establishment of the International Renewable Energy Agency (Irena) indicates that governments worldwide are taking "renewables" seriously. With mounting concerns about climate change and volatility in oil and other fossil-fuel prices, renewables are finally becoming a viable proposition.

Irena will have its headquarters in the United Arab Emirates, in Masdar City, the world's first carbon-neutral city, which will be constructed in the desert by 2011. The agency will also have two arms in Europe: in Bonn and Vienna.

Close to US$155 billion was invested in 2008 in renewable energy companies and projects worldwide, not including large-scale hydroelectric projects, according to a UN Environment Programme report. On a global scale, the renewable energy sector has created 2.3 million jobs in the past few years.

Big business is spending billions of dollars to explore opportunities that renewables can bring. There are plans to turn the Sahara desert's heat and sunlight into Europe's major power source, supplying energy to half a billion people. Renewable energy costs will drop in step with technological innovation and mass production.

As a new global platform for renewables, Irena will provide policy advice and assist in capacity building and technology transfer. This will contribute to giving the poorest nations affordable access to clean energy, a key step towards lifting millions out of poverty. Yet sceptics might ask: must we add another set of letters to the alphabet soup of global bureaucracy? My answer is "yes". This new agency already has immense potential.

First, Irena will hit the ground running in developing policy and spreading technology, partly because the countries instrumental in its birth - Denmark, Germany and Spain - have impeccable "green" policy credentials.

Second, the new agency's wide membership - 136 states - is keen to benefit from the opportunities that renewable energy will create for growth, jobs and helping meet UN Millennium Development Goals.

Third, Irena will be based in a developing country, a vote of confidence in the quality, expertise and dynamism that exists in the developing world. A headquarters in Abu Dhabi sends an unequivocal message that promoting renewable energy is not "anti-oil". At the same time, we must face the facts: fossil fuels will not last forever. So let's plan for the inevitable, and develop the relevant policies, technologies and institutions as soon as possible.

Irena may not be a component of the UN system, but it should be regarded as part of the family from the outset. We have learned from both the climate change debate and the economic crisis that only by working together can we achieve genuine change.

Irena is solid proof that our world has the will to turn away from the carbon-clogged past and to fuel a clean, prosperous future for all.

Kandeh K. Yumkella is director general of the UN Industrial Development Organisation. Copyright: Project Syndicate


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Quick action required in lawmaker's case


LEADER

Oct 12, 2009           
     
  |   

  



A lawmaker sacks a female political assistant. She complains to party leaders. A media leak alleges she was dismissed after rejecting his advances. He denies it. It sounds like a case for consideration by the Equal Opportunities Commission under laws against sexual harassment. Instead, it has become a political scandal involving parties and politicians from all sides that has dragged on for a week. Some lawmakers have, predictably, sought to make political capital out of it. This is all part of the cut and thrust of politics. But it should serve the public interest, rather than being politics for its own sake.

A decision on Friday night by the Legislative Council's House Committee to launch a formal investigation into the complaint by Kimmie Wong against Democrat lawmaker Kam Nai-wai should be approached in that spirit. We are entitled to expect high standards of our lawmakers. If the committee finds Kam's conduct to have been sufficiently serious to disqualify him from being a lawmaker, he can be censured for misbehaviour under Article 79 of the Basic Law. That may satisfy public concerns, but only if the investigation is fair and free from political bias.

Indeed, the public could be forgiven for wondering whether our politicians have nothing better to think about. That is not to make light of the complaint or allegations of sexual harassment. The controversy has, no doubt, caused trauma and distress to the people involved and their families. Wong is entitled to seek an investigation of her complaint. But Legco is not best placed to decide on what is essentially a dispute between employer and employee.

Lawmakers surely have more important matters to deal with. It is not yet clear whether we have emerged from the economic downturn. Meanwhile, Hong Kong is approaching a pivotal moment in its political development. The government is soon to unveil a consultation on arrangements for the election of the chief executive in 2012, ahead of a road map towards universal suffrage for the next election in 2017. Regrettably, the Kam controversy has been allowed to develop into an unedifying distraction.

Democrats were divided over whether Kam should resign for the sake of the camp's credibility in the debate over political development, and opponents sought to exploit their dilemma by accusing them of stalling. Kam initially denied making advances to Wong, before admitting he had told his former assistant that he had feelings for her. He did not consider this amounted to making advances. He said he sacked her in a temper months later over another matter. Wong has remained silent about the circumstances and is taking legal advice on whether to participate in the inquiry. It is easy to sympathise with her claim that her ordeal has been aggravated by the escalation of the controversy.

The Democratic Party leadership considers Kam's actions not to be serious enough to warrant his resignation. Such a step certainly should not be forced upon him to serve purely political motives. Kam has served the Democratic Party loyally as a founding member, district councillor and, since last year, as a member of the Legislative Council. By resigning now, he could save his party further embarrassment and, more importantly, spare Wong the ordeal of having to give evidence in an inquiry. But that would also amount to an admission of wrongdoing. He is entitled to a fair hearing.

Whatever the outcome, the matter should be resolved as swiftly as possible, so the truth is established, justice done and our lawmakers able to fully focus on the many challenges facing our city.


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Global warning
The choices on emissions are stark: reduce them and prosper, or ignore them and face catastrophe

Nicholas Stern
Oct 13, 2009           
     
  |   

  



The United Nations climate change conference, to be held in Copenhagen in December, should provide the climax to two years of international negotiations over a new global treaty aimed at addressing the causes and consequences of greenhouse-gas emissions.

A global deal on climate change is urgently needed. Concentrations of carbon dioxide and other greenhouse gases in the atmosphere have reached 435 parts per million (ppm) of carbon dioxide-equivalent, compared with about 280ppm before industrialisation in the 19th century.

If we continue with business-as-usual emissions from activities such as burning fossil fuels and cutting down forests, concentrations could reach 750ppm by the end of the century. Should that happen, the probable rise in global average temperature, relative to pre-industrial times, will be 5 degrees Celsius or more.

It has been more than 30 million years since the earth's temperature was that high. The human species, which has been around for no more than 200,000 years, would have to deal with a more hostile physical environment than it has ever experienced.

Developing countries recognise and are angered by the inequity of the current situation. Current greenhouse-gas levels are largely due to industrialisation in the developed world since the 19th century. Yet developing countries are the most vulnerable to the consequences of climate change, which threaten the economic growth that is necessary to overcome poverty. At the same time, emissions cannot be reduced at the extent required without the central contribution of the developing world.

Climate change and poverty, the two defining challenges of this century, must be tackled together. If we fail on one, we will fail on the other. The task facing the world is to meet the environment's "carbon constraints" while creating the growth necessary to raise living standards for the poor.

To avoid the severe risks that would result from a rise in global average temperature of more than 2 degrees, we must get atmospheric concentrations below 450ppm. This will require a cut in annual global emissions from about 50 gigatonnes of carbon dioxide-equivalent today to below 35 gigatonnes in 2030, and less than 20 gigatonnes by 2050.

Today, per capita annual emissions in the European Union are 12 tonnes, and 23.6 tonnes in the US, compared to 6 tonnes for China and 1.7 tonnes for India. As the projections for 2050 suggest that the world's population will be about 9 billion, annual per capita emissions must be reduced to about 2 tonnes, on average, if the global annual total is to be less than 20 gigatonnes.

Most developed countries are targeting reductions in annual emissions of at least 80 per cent - relative to levels in 1990 - by 2050. If they are to convince developing countries that the 2050 goal is credible, they must be both ambitious and realistic about the domestic political challenges they face in adopting and implementing demanding targets for 2020, 2030 and 2040.

Developing countries need substantial help and support from rich nations to implement their plans for low-carbon economic growth, and to adapt to the effects of climate change that are now inevitable over the next few decades. Developed countries should also provide strong support for measures to halt deforestation in developing countries, and for reducing emissions substantially, quickly and at reasonable cost.

Based on recent estimates of the developing world's extra requests as a result of climate change, rich countries should be providing annual financial support - in addition to existing foreign-aid commitments - of about US$100 billion for adaptation and US$100 billion for mitigation by the early 2020s. Some of the latter can come through the carbon market. Rich countries must also demonstrate that low-carbon growth is possible by investing in new technologies, which should be shared with developing countries to boost their mitigation efforts.

We are already seeing extraordinary innovation by the private sector, which will drive the transition towards a low-carbon global economy. Investments in energy efficiency and low-carbon technologies could also pull the global economy out of its economic slowdown over the next couple of years.

More importantly, in driving the transition to low-carbon growth, these technologies could create the most dynamic and innovative period in economic history, surpassing that of the introduction of railways, electricity grids or the internet.

There is no real alternative. High-carbon growth is doomed, crippled by high prices for fossil fuels and killed off by the hostile physical environment that climate change will create. Low-carbon growth will be more energy-secure, cleaner, quieter, safer and more bio-diverse.

We should learn from the financial crisis that, if risks are ignored, the eventual consequences are inevitably worse. If we do not start to combat the flow of greenhouse-gas emissions now, the stock in the atmosphere will continue to grow, making future action more difficult and costly. Other public expenditure can be postponed, but delaying climate-change measures is a high-risk, high-cost option.

Climate change poses a profound threat to our economic future, while low-carbon growth promises decades of increased prosperity (SEHK: 0803, announcements, news) . The choice in Copenhagen will be stark, and the stakes could not be higher. We know what we must do, and we can do it.

Nicholas Stern is chair of the Grantham Research Institute on Climate Change and the Environment. He was formerly head of the British Government Economic Service and chief economist at the World Bank. Copyright: Project Syndicate


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Brain power
The time is ripe for closer co-operation with the mainland on education, science and technology

Tony Chan
Oct 14, 2009           
     
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The government, through its Task Force on Economic Challenges, is harbouring visions of glory for our future. As the new president of Hong Kong's purpose-built university of science and technology, I am happy to see that technology and innovation will be promoted as one of the six new pillars of our economy to lay the foundations for a sound economic diversification.

Professor Charles Kao Kuen's Nobel Prize for physics is a timely reaffirmation in Hong Kong's ability to pursue science and technology at the highest level.

Nations the world over are acutely aware of the pivotal role of science, technology and innovation in driving socio-economic progress. In a sweeping statement, China's National Science and Technology Development Plan aims at nothing less than the building of an "innovation nation", as it faces the challenges of the future. It plans to increase its research and development spending from 2 per cent of gross domestic product by 2010 to 2.5 per cent by 2020.

Across the Pacific, the US government has reaffirmed its faith in the primacy of new knowledge in fuelling vital economic growth and development through scientific research.

Through its commitment to science, technology, engineering and mathematics, it is putting innovation front and centre to create a nation of engaged and creative citizens.

Financial crisis or not, its National Science Foundation, where I previously worked, was given a 50 per cent one-time budgetary increase in economically dismal 2009 as part of the American Recovery and Reinvestment Act, the so-called "stimulus package". The key Department of Energy and the National Institutes of Health received similar budgetary injections.

Thus, both the Chinese and US governments have shown that they are going beyond paying lip service to support for science and technology. They have bulked up the financial muscle of their research and education institutions to keep their respective nations at the forefront of innovation.

Here in Hong Kong, the situation is no less challenging and urgent. If we are to successfully transform our society into a centre of innovation, then the cultivation of science literacy among our citizens is of paramount importance. So is investment in the infrastructure of science and technology. This is an area that cannot and should not be left solely to the initiative of private industry.

The success of Taiwan, Korea and Singapore has demonstrated the decisive leadership role played by government in their economic transformation. To this end, I suggest that the government create a highly visible agency to promote science, technology, innovation and education, across traditional departmental boundaries, and staff it with visionary and expert leaders.

The task force is on the right track in recommending that Hong Kong and Shenzhen collaborate in science and technology, taking advantage of the existing Shenzhen-Hong Kong Innovation Circle. This mainland collaboration can be taken one step further, by extending it to include the entire Pearl River Delta region and beyond.

Hong Kong has the proven capability to lead major science and technology projects in collaboration with top institutions on the mainland. Already, there is a strong interest across the border at the grass-roots level, such as between individual universities and faculty members.

What we need is top-level policy validation and agreement at the government level to encourage closer partnerships, much in the spirit of the Closer Economic Partnership Arrangement (Cepa), but extended to education, science and technology. This would foster a robust increase in the flow of funds and personnel across the border.

I believe this will release a torrent of creative energy and entrepreneurship. Our national leaders have already called for collaboration between the mainland, Hong Kong, Macau and Taiwan in science and technology.

It is not just a patriotic duty but an act of enlightened self-interest for Hong Kong to seize the initiative to make these mechanisms living organisms of innovative collaboration.

Tony F Chan is president of the Hong Kong University of Science and Technology


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Is US democracy having a nervous breakdown?


Alex Lo
Oct 15, 2009           
     
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For once, I find myself agreeing with John Bolton, the hard-right former US ambassador to the United Nations. He was on TV expressing disgust at the Nobel committee for awarding the peace prize to US President Barack Obama.

"President Carter in 2002, Al Gore in 2007, and President Obama in 2009," he said. "The Nobel committee is preaching at Americans, but they won't be deceived."

Bolton is right that the committee is trying to make a statement - not only that, but to influence American policy. The peace prize is deeply politicised, just like the literature prize. And then there is the one for the dismal science, which includes recipients whose theories directly contributed to the financial crisis. It appears some Nobel Prizes, notably those in the hard sciences, are far more worthy than others.

But Bolton also spoke of Americans and how "they won't be deceived". Really, does anyone still think there is a single America speaking in one voice any more? The US is so polarised and its body politic so divided and poisoned that its first black president - winning office on a platform of civility, unity and moderation - has provoked the exact opposite among large swathes of the US electorate. How ironic that this president, so popular and admired around the world, has proved to be more divisive at home than his much criticised predecessor George W. Bush. A polity blinded by rage - whether from the left or right - is just a step away from political violence.

But this is how democracy works, you might say. Actually, this is how democracy stops working.

"We in democracies have to suffer the indignity of public debate and pleading, the whims of markets and elections and the free media," an erudite critic of my columns wrote recently. "China goes its own way."

True, but the blind rage that now animates much of what passes for political discourse in the US may have crossed the line from vibrant democracy to a dysfunctional one.

"Something very dangerous is happening," Thomas Friedman wrote in The New York Times recently. "Criticism of the far right has begun tipping over into delegitimation and creating the same kind of climate [in the US] that existed in Israel on the eve of the Rabin assassination."

Friedman observes that Bush's father may have been the last "legitimate" president in the sense that Americans who didn't vote for him still accepted him as their president.

When opponents across the ideological divide question each other's right to debate, to formulate policy and to rule, they are questioning each other's legitimacy. Many Americans think Obama is a socialist, a closet Muslim and a non-native-born American who should be disqualified from being president. They want to disown their president.

"What makes authority legitimate?" asked Rousseau, who considered it the key question of politics.

If the primary virtue of western-style democracy is that it has resolved Rousseau's question about political legitimacy, US democracy looks like it's starting to crack. By contrast, what is most disturbing - to Western democracies - about the Chinese Communist Party is not the military hardware or economic prowess, but the possibility that it has figured out a way to make autocratic rule legitimate among many Chinese.

Americans, whether ordinary citizens or policymakers, cannot assume their intense divisions can have no consequences in the way other people and countries perceive and interact with the US. The lack of political unity or domestic tranquility, wrote Alexander Hamilton, invites foreign interference.

Americans can count themselves lucky that they are still so powerful and rich that foreigners try to interfere in their affairs by handing a Nobel Prize to their president. But keep up the divisions and domestic antagonisms. They are starting to look like symptoms of decline and fall. Before you know it, outside interference may take on a far less benign form.

Alex Lo is a senior writer at the Post


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Modest to a fault
Devoid of inspiration, Donald Tsang's policy address showed he is still unwilling to tackle the big issues

Stephen Vines
Oct 16, 2009           
     
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Chief Executive Donald Tsang Yam-kuen had a thankless task when he rose to deliver his policy address on Wednesday; unfortunately, he chose to make the worst of it. It is not his fault that he is not a natural orator; it is not his fault that he owes his job to the grey men in Beijing who have no idea how a pluralistic society like Hong Kong works; and it is only partly his fault that he stands alone in the legislature constitutionally deprived of a political party to back him.

Yet, why does he have to underwhelm so thoroughly on these occasions? Can it be that the lifelong bureaucrat simply does not understand that the task of setting out the government's policy programme requires a degree of inspirational encouragement to the people and that a stolid determination to ignore reality is all very well in internal government committees but goes down very badly out on the streets?

Anyone coming from another planet to listen to Tsang's speech would be under the impression that the economic difficulties Hong Kong faced were somehow a force of nature, indeed the product of a tsunami, as he put it many times.

But they would have been heartened to learn that everything is absolutely fine now and will be even finer soon, once applications have been delivered to Beijing begging for more visitors, asking for more permits to conduct financial services for the mainland, more permits to do business across the border and even permission to import more schoolchildren from the mainland.

There may, however, have been some confusion over assertions that Tsang's administration adhered to the mantra of "big market, small government" while, at the same time, there were many references to how this small government had ambitious plans for shifting the emphasis of Hong Kong's economic development by developing six key industries.

All very confusing, I'm afraid to say. But then again the speech, carefully picked over many, many times in Lower Albert Road, had no real central theme and contained nothing unexpected. This left Tsang as the quintessential "modest man with much to be modest about" as Winston Churchill, Britain's wartime prime minister, cuttingly said of his main rival Clement Atlee.

Lamentably, we are also reminded that prevarication and a reluctance to tackle the big issues has been developed into a curious art by the chief executive.

Earlier in the year, when he didn't want to deal with constitutional reform, he bleated about why it was not possible to cope with this big subject while the so-called financial tsunami was under way.

He is still highly reluctant to mention the dreaded word "democracy" but managed to use a similar excuse to dodge dealing with reform of charging for public health services. This, he said, has to be put on hold because of the outbreak of swine flu. It is quite a clever trick to take two vaguely connected circumstances and bunch them together as an excuse for inaction.

The crux of the problem is not merely that the Tsang administration follows a policy of "no issue too big to dodge", but that it is impossible to serve so many masters at once. The big master is, of course, sitting in Beijing. Then there are the powerful tycoons who can tell tales in Beijing if they feel that the chief executive is not adequately looking after their interests. There are also his tenuous political allies who, as Lenin famously said, offer the same support as that given by the rope that holds the hanging man.

Somewhere down the bottom of the list are the pesky members of the legislature who do not support him but can be a nuisance.

Finally, there are the great unwashed, better known as the people, not trusted to elect their own government and consulted, so it seems, only by a series of mysterious secret opinion polls whose results are selectively released when Tsang wants to claim that "most people" are backing him on this or that.

Somewhere in all this, the government is supposed to formulate coherent policy. Unsurprisingly, this does not happen and this policy address only served to underline that reality.

Stephen Vines is a Hong Kong-based journalist and entrepreneur


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