Fuel's dirty face
The consequences of the coal boom are severe, both in the shadow of the plants and further afield, writes Michael Casey

BEHIND THE NEWS
Michael Casey
Nov 06, 2007           
     
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It takes five to 10 days for the pollution from China's coal-fired plants to make its way to the US, like a slow-moving storm. It shows up as mercury in the bass and trout caught in the Willamette River in the western state of Oregon. The pollution increases cloud cover and raises ozone levels. Along the way, it contributes to acid rain in Japan and South Korea and health problems everywhere from Taiyuan , in Shanxi province , to North America.

This is the dark side of the world's growing use of coal. Cheap and abundant, coal has become the fuel of choice in much of the world, powering economic booms on the mainland and in India that have lifted millions of people out of poverty. Worldwide demand is projected to rise by about 60 per cent by 2030, to 6.9 billion tonnes a year, most of it going to electrical power plants.

But the growth of coal-burning is also contributing to global warming, and is linked to environmental and health issues ranging from acid rain to asthma. Air pollution kills more than 2 million people prematurely every year, according to the World Health Organisation.

"Hands down, coal is by far the dirtiest pollutant," said Dan Jaffe, an atmospheric scientist at the University of Washington who has detected pollutants from Asia at monitoring sites on Mount Bachelor in Oregon and Cheeka Peak in Washington state. "It's a pretty bad fuel on all scores."

The dilemma facing the mainland is evident in places such as Taiyuan and the surrounding province, the top coal-producing region. Almost overnight, coal turned poor farmers in the city of  3 million into Mercedes-driving millionaires, known derisively as baofahu or the quick rich. Flashy hotels display chunks of coal in their lobbies and sprawling malls advertise designer goods from Versace and Karl Lagerfeld.

Real estate prices have doubled, residents say, and construction cranes fill the skyline.

A museum in Taiyuan celebrates all things coal. Amid photos of smiling miners, coal is presented as the foundation of the mainland's economic development, credited with making possible everything from the railway to skincare products.

"Today, coal has penetrated every aspect of people's lives," the museum says in one of many cheery pronouncements. "We can't live comfortably without coal."

Yet the corn lining a highway outside the city is covered in soot. The same soot settles on vegetables sold at the roadside. Thick, acrid smoke blots out the morning sun. At its worst, the haze forces highway closures and flight delays.

Taiyuan, dubbed the world's most polluted city in the 1990s, is no longer thought to be the worst, thanks to various efforts including phasing out coal-burning boilers. But the level of pollutants in the air remains five to 10 times higher than levels in New York or London. Residents say they see blue skies on fewer than 120 days a year.

They shrug wearily when the talk turns to pollution, fearful that speaking out could get them in trouble. But when pressed, city dwellers' complaints tumble forth and expose a community held hostage by the soot.

Residents seal their windows to keep out the dirty air. Parents are warned not to let their toddlers  play outside for fear of coal dust. Fruit and vegetables must be washed in detergent.

"I'm worried about my children," said a woman who lives in the shadow of a power plant and fertiliser factory. She would only give her surname, Zhang. "We worry about everything. If you get sick seriously, you will die."

Many complain of chronic sore throats and bronchitis, and there are cases of lung cancer and pulmonary fibrosis. A study by researchers from Norway's Centre for International Climate and Environmental Research found that Taiyuan's pollution raised death rates by  15 per cent and chronic respiratory ailments by 40 to 50 per cent.

"I feel terrible and I'm coughing all the time," said William Li, a retired engineer from Taiyuan. His father died of lung cancer and his son has tracheitis, an upper respiratory condition. "The coal produces electric power that we send to other provinces. But we are left with the pollution."

Apart from health problems, there is growing concern about the damage being wrought on some key heritage sites. A few years ago, the Leshan giant Buddha in Sichuan province started to weep. Or so some local people imagined when black streaks appeared on the rose-coloured cheeks of the towering 7th-century carving hewn into the sandstone cliffs.

The culprit was the region's growing number of coal-fired power plants and acid rain. Over time, the Buddha's nose turned black and curls of carved stone began to fall from its head.

"If this continues, the Buddha will lose its nose and even its ears," said Li Xiaodong, a researcher who has studied the impact of air pollution in Sichuan. "It will become just a piece of rock."

More than 80 per cent of the mainland's 33 UN-designated world heritage sites, including the Leshan statue, have been damaged by air pollution and acid rain, mostly from the burning of coal, according to Xinhua.

"The level of pollution that China is creating will be devastating to these monuments," said Melinda Herrold-Menzies, a professor of environmental studies at Pitzer College in Claremont, California.

Mainland officials are starting to acknowledge the downside of unbridled development. Qiu Baoxing, the vice-minister of construction, blamed the devastation of historic sites on "senseless actions" by local officials in pursuit of modernisation, the China Daily reported in June.

"They are totally unaware of the value of cultural heritage," he said, likening the destruction to that of cultural relics during the Great Leap Forward in the late 1950s and the Cultural Revolution from 1966 to 1976.

About 1,200km to the north, clouds of black dust coming off coal trucks have damaged the Yungang grottoes, a world heritage site in the heart of China's coal belt. Professor Herrold-Menzies expressed surprise that caves with such historical and archaeological importance would lie so close to "coal mines and an industrial nightmare of a city".

The 250 caves hold more than 50,000 statues of Buddha dating to the 5th century, their heights ranging from less than 2.5cm to 17 metres.

As visitors weave in and out of the caves, the damaged statues are easy to pick out. Their red, blue and yellow paint is faded, and they look as if they are wearing a black trench coat or skirt.

Under pressure to clean up major cities such as Shanghai and Beijing, particularly in the run-up to next year's Olympics, the central government is turning increasingly to provinces such as Shanxi to meet the country's power demands.

"They look at polluted places such as Taiyuan and say it's so polluted there it doesn't matter if they have another five power plants," said Ramanan Laxminarayan, a senior fellow at Resources for the Future, an American think-tank that found links between air pollution and rising hospital admissions in Taiyuan.

"I visited these power plants and there is no concept of pollution control," he said. "They sort of had a laugh and asked, `Why would you expect us to install pollution control equipment?'"

The mainand is home to 20 of the world's 30 most polluted cities, according to a World Bank report. Health costs related to air pollution total US$68 billion a year, nearly 4 per cent of the country's economic output, the report said. Sheng Huaren, a senior Chinese parliamentary official, said last year that acid rain had contaminated a third of the country. It is said to destroy crops worith some US$4 billion every year.

"What we're facing in China is enormous economic growth, and ... China is paying a price for it," said Henk Bekedam, China's WHO office chief. "Their growth isn't sustainable from an environmental perspective. The good news is that they realise it. The bad news is they're dependent on coal as an energy source."

But the costs go far beyond China. The soot from power plants boosts global warming because coal emits almost twice as much carbon dioxide as natural gas. Researchers from Texas A&M University said research showed that air pollution from China and India had increased cloud cover and major Pacific Ocean storms by 20 per cent to 50 per cent over the past 20 years.

Mercury, a byproduct of coal mining dispersed via waterways, is another major concern. "It's a global problem and right now China is a source on the rise," said Harvard University professor of atmospheric chemistry and environmental engineering Daniel Jacob. "If we want to bring down mercury levels in fish, then we have to go after emissions in East Asia."

A fifth of the mercury in the Willamette River came from China and other foreign sources, said Bruce Hope of the Oregon Department of Environmental Quality. Pregnant or nursing women who eat the fish put their babies at risk of neurological damage.

China has closed some polluting factories and says it will retire 50 gigawatts of inefficient power plants, or 8 per cent of the power grid, by 2010, according to the Pew Centre on Global Climate Change. The government has also mandated that solar, wind, hydroelectric and other forms of renewable energy provide 10 per cent of the mainland's  power by 2010, and ordered key industries to cut energy consumption by 20 per cent.

President Hu Jintao , in a speech to a key party congress last month, promised a cleanup. But the mainland has fallen short of its national targets for using energy more efficiently, and coal remains a major energy source.

"Everyone knows coal is dirty, but there is no way that China can get rid of coal," said Zhao Jianping of the World Bank. "It must rely on it for years to come, until humans can find a new magic solution."

Robert Schock, director of studies at the World Energy Council, said that coal, which is cheap and abundant, would remain a crucial source of energy for many years.

In Shanxi, the authorities have pledged to close 900 coal mines and dozens of makeshift factories that process coal for the steel industry, according to Xinhua. The Asian Development Bank is providing more than US$200 million in loans to improve air quality in the province, through programmes to shift to cleaner-burning natural gas for household heating and a demonstration project to capture methane, a greenhouse gas released in coal mining.

Associated Press


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Voucher scheme: the first step to a healthy system


Michael Somerville
Nov 07, 2007           
     
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For several years, there has been a lot of debate about reshaping our health care system. But there has been only limited progress and not enough priority given to the task. Now, at last, the focus of recent months is bearing fruit, with clearly defined measures on both structural and financing reform, as outlined in the chief executive's policy address. This is a major step forward.

What a shame, therefore, that a really imaginative and potentially groundbreaking initiative has been poorly received in some circles, especially among legislators - on the face of it for all the wrong reasons.

I refer to the medical voucher pilot scheme for the elderly, which has been rubbished as a meagre effort, notwithstanding that there is already a 95 per cent government subsidy on public health services for the elderly.

Few would argue that the elderly, and especially the elderly poor, do not deserve priority in sharing the fruits of Hong Kong's prosperity. But that is a totally different issue.

The commitment to increase government expenditure on medical and health services, from 15 per cent to 17 per cent, is coupled with proposals for supplementary private financing. Together, this could generate additional annual spending close to HK$10 billion. That adds up to a major new commitment.

Allocating extra funds is one thing, spending them wisely is quite another. As the British experience has shown, throwing money at health care before ensuring that it will be well spent generally makes matters worse.

To date, nearly all government funds have been paid to the providers of public hospital services and public preventative care. They have not been used to promote freedom of choice for patients or greater emphasis on private-sector care. Nor has the current method of almost totally subsidy in financing done anything to encourage individual responsibility in health care.

There is now a widespread consensus that this needs to change, over time, and that a new emphasis on "money following the patient" is the right way forward.

This fundamental change is not easily achieved, and is made more complex by the big divide and lack of practical interface between the public and private sectors. As well as redirecting the way money flows within the system, it will involve substantial changes in attitude by both patients and care-giving professionals. It will necessitate far greater sharing of information than is currently possible - hence the high priority for developing a community-wide electronic health record.

Experience overseas has clearly demonstrated that a major and successful tool in achieving such a change is the use of incentive mechanisms targeting the buyers of  services, the patients, and also the providers.

This is a new approach for Hong Kong and it is right that our first pilot project should be limited to a specific sector. It should be judged not by the amount of money that has been committed but by the benefits it can bring. In this case, they are likely to be substantial.

They include more choice, wider services, better access to primary care and some relief for our overstretched public health services.

Furthermore, in the medium term, the pilot scheme should provide valuable experience for a much wider network of incentives to transform our health care system from one founded in curing a patient to one driven by prevention and multi- disciplinary primary care.

In short, the medical voucher pilot scheme merits our wholehearted support. By all means let's press for an even greater sense of urgency and perhaps a shorter time frame in which to assess progress and possible expansion. But let's not effectively destroy it by turning it into a charity handout. Don't sink the ship by blowing it up before it has left port.

Michael Somerville is chairman of the health care committee of the Business and Professionals Federation of Hong Kong



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A barrel of truth about oil supplies


Gwynne Dyer
Nov 08, 2007           
     
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If a diplomat is "an honest man sent abroad to lie for the good of his country", as author and diplomat Sir Henry Wotton once said, then oil industry executives used to be the business world's equivalent. The big international companies were chronically optimistic about the extent of their reserves, and state-controlled oil companies were even more prone to exaggeration. But now we have the spectacle of oil companies telling the truth about oil supplies - or at least more of the truth than usual.

The occasion was last week's Oil and Money conference in London, and the most spectacular truth-teller was Christophe de Margerie, chief executive of the French oil company Total. Last year his predecessor, Thierry Desmarest, caused a flutter in the industry by predicting that world oil output would peak around 2020. This year, Mr de Margerie said that "100 million barrels [per day] ... is now in my view an optimistic case". He was referring to the International Energy Agency's estimate that world oil output would reach 116 million barrels per day by 2030, and the slightly more optimistic US government prediction that it would reach 118 million barrels per day by then.

Even these acts of faith are really a forecast of crisis, as calculations based on current trends (like a 15 per cent annual growth in Chinese demand) suggest 140 million barrels per day will be needed by 2030.

The implication of Mr de Margerie's remarks is that the crisis is coming a lot sooner than that. World oil output is nearing 90 million barrels per day now, but it is never going to reach 100 million. "Peak oil" may be just a few years away, or it may be right now. (You will never know until after the fact, because it is the point at which global oil production goes into gradual but irreversible decline.)

Peak oil was first forecast by a US geologist, M. King Hubbert, who noticed that the curves for oil discoveries and oil production were a very close match, but with a lag of 30 to 40 years between the two curves. At that point, in 1956, Hubbert was director of research for Shell Oil, and his research focused on American oil production.

Oil discoveries worldwide peaked in the 1960s, so Hubbert's own forecast was that peak oil production worldwide would arrive in the 1990s. The discovery of two giant new oilfields in the 1970s (probably the last two) in the North Sea and the Alaskan North Slope pushed that date further forward, however. One of Hubbert's successors as chief of research at Shell, Colin Campbell, subsequently calculated that global production would peak this year.

The recent surge in the oil price, which may see it reach US$100 a barrel in the near future, is largely a mirage caused by the collapse in the value of the US dollar. But the longer-term trend, which saw the price rise fivefold between 1999 and 2005, was driven by the tightening supply situation as demand raced ahead while production did not.

It will get a lot worse if Mr de Margerie is right, and he almost certainly is.

Gwynne Dyer is a London-based independent journalist whose articles are published in 45 countries



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Hunger pains


PETER KAMMERER

Nov 09, 2007           
     
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Global warming has us all in such a bind that governments are doing some crazy things to placate the worried masses. I would even go so far as to say that a few are committing crimes against humanity. Now, before anyone takes umbrage at this comment, please note that it is not an original sentiment. The originator was the UN's special rapporteur on the right to food, Jean Ziegler. In New York, on October 26, he said: "It is a crime against humanity to convert agriculturally productive soil into soil which produces foodstuffs that will be burned [as] biofuel."

Are biofuels a crime against humanity? For a few years now, officials and scientists the world over have been telling us that oil supplies are shrinking, fossil fuels are polluting the atmosphere and causing temperatures to rise, and that the future lies in energy from corn, soya beans, sugar cane, rape seed and whatever other vegetation is on hand to convert into fuel.

The US and European Union have been so adamant that biofuels are the way forward that they have put in place target dates by which all petrol must contain a double-digit percentage of biofuels. Credits and subsidies are being handed out to farmers.

Hidden by the roar of approval for such schemes have been voices warning about a few fundamentals that the politicians have neglected to talk about. For instance, there is not enough land on Earth to grow the crops to make the amounts of biofuels needed, or that farmers will switch from growing food for the globalised world and instead opt for the more lucrative alternative to oil.

The 2 billion people in the world who live in poverty - 850 million in hunger - have first-hand experience of how poorly thought-out biofuel schemes have been. Less corn, rice and wheat for food means shortages and markedly higher prices.

Western nations do not have enough land to meet their biofuel needs, so companies are moving into Asia, Africa and South America, forcing people off the land. Rainforests are being cut down so that palm oil and sugar cane can be grown. The crops are sucking up water.

Hundreds of millions of people have been affected and many face hardship, hunger and even death. Far from saving us from global warming, some of the practices in its name are worsening it.

This, Mr Ziegler contended, was a crime of the worst kind. He called for a five-year moratorium on biofuel production to allow for an international rethink, so that a clearly defined strategy using the best crops and growing methods could be put in place. Mr Ziegler did not go that extra step and suggest governments at fault should be charged and put on trial. I will.

The worst offender is US President George W. Bush's administration. He knows full well that the US exports corn to the developing world for food. Yet he agreed to give US farmers - who already receive subsidies - another financial benefit if they use the cereal for biofuel production instead.

At least 30 per cent of America's corn crop is now grown for biofuels. Unsurprisingly, there has been an almost 50 per cent rise in the price of corn. Because it is also used as grain for cattle, beef prices have risen sharply as well.

Biofuel demand and increased transportation costs have, according to the UN, been some of the factors that have also led wheat to double in price and the cost of rice to increase by 20 per cent. That such staples now cost more has helped cause food prices to rise 18 per cent in China, 13 per cent in Indonesia and Pakistan, and at least 10 per cent in India, Russia and Latin America, according to the UN Food and Agriculture Organisation.

There are 11 international texts defining crimes against humanity, each differing marginally in their definition of the various crimes and the legal contexts. Broadly, though, the term has come to mean any atrocity committed on a large scale.

Knowingly endangering the food security of some of the world's most vulnerable people, as the US and EU have done, surely ranks as such an offence. The leaders responsible should face justice for the crimes they have committed.

Peter Kammerer is the Post's foreign editor

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The price of attracting new political talent


OBSERVER
Chris Yeung
Nov 12, 2007           
     
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There is never a good time to propose a pay rise for legislators. And, given the public's generally negative image of our lawmakers, the idea of raising their salaries and introducing new benefits now has been greeted with a lot of doubt and scepticism.

It doesn't help that the proposal comes on the heels of an annual report last week by a watchdog group highlighting the dismal record of some Legislative Council members, who have repeatedly been absent from meetings or often abstained during voting. Indeed, with this evidence, even sympathisers for the lawmakers' plight would have difficulty making a case.

However, fair-minded people do agree that legislators are not paid enough. They currently receive a monthly salary of about HK$58,000, with no fringe benefits such as gratuities or a pension.

So, a Legco subcommittee has proposed that their monthly pay should rise to about HK$92,000 - the minimum salary for directorate-grade officials. Subcommittee chairman Patrick Lau Sau-shing has suggested that they should be paid HK$110,000. That figure is based on the salary originally envisaged by the government for an assistant minister.

Under the administration's plan for two extra tiers of political appointees, the monthly salary for the post of political assistant (formerly assistant minister) will be between HK$104,340 and HK$163,963. Undersecretaries will be paid between HK$193,775 and HK$223,586 a month.

Debate about where to peg legislators' pay, in relation to the political appointment system, will be inconclusive. That is because there are no easy, objective criteria to benchmark lawmakers' pay and benefits.

But it is fair to say that there is an unreasonable gap between the pay of Legco members and that of political appointees and senior government officials. It should be borne in mind, too, that the post of political assistant is largely targeted at young, third-tier members of political parties who do not stand a good chance of getting elected to Legco.

The negative implications of unreasonably low levels of pay for legislators are obvious. True, being a lawmaker is more than just a job. It is also a public service and, as such, the rewards cannot be measured solely in monetary terms.

Raising lawmakers' salaries and benefits will not necessarily draw a pool of better-qualified people into politics.

It can be argued, however, that the unattractive pay could further alienate people who may be considering a career in politics. It also sends the wrong message to society; that legislators do not deserve more money than they currently earn.

Much has been said about the dearth of political talent in Hong Kong and the importance of creating more opportunities for people to take part in politics.

If Chief Executive Donald Tsang Yam-kuen is sincere about grooming new talent, raising the salaries of district and legislative councillors to a decent level is an easy first step.

In the long-run, more needs to be done to help create an environment that is conducive to the emergence of additional full-time legislators and district councillors.

There is no denying that pay is only one of the deterrents for those considering a political career. Under the current system, the power of legislators to keep the executive authorities in check is significantly limited.

Looking to the future, talented and committed individuals will only enter the world of politics if they are convinced that their participation will help bring about a better life for Hong Kong's citizens.

Society and the government can do their part to create more favourable conditions for politicians to serve the people efficiently and effectively. And, if they prove to be unworthy of their rewards, they can always be voted out of office via the ballot box.

Chris Yeung is the Post's editor-at-large.

chris.yeung@scmp.com


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Equality denied


LAURENCE BRAHM

Nov 13, 2007           
     
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At 9pm on September 21 in Beijing, Chaoyang district police cordoned off the popular Sanlitun bar district near the diplomatic compounds. They then proceeded to round up any black people in the area, handcuffed them and herded them into detention. Anyone who questioned why they were being treated like animals, without rights, was beaten up. Diplomats' children and international students were caught up in the race-based round-up, and people were hurt in the process.

The foreign diplomatic community was alarmed. It occurred just minutes away from the doors of their embassies, and less than a year before the start of the 2008 Olympics - when China is supposed to show the world how civilised it is. People were being rounded up like cattle, regardless of what nation they were from, and indiscriminately beaten as part of a sloppily executed investigation into Nigerian drug dealers.

China's leaders should realise that such indiscriminate sweeps are not in the nation's best interests so close to the Beijing Olympics. Such action does not show the nation's best side to the foreign media. If police in the Chaoyang district want to do something about drug dealing, they should shut down its plethora of brothels, where crack cocaine is big business.

When a number of diplomats raised concerns about unwarranted police abuse affecting the diplomatic zone and their families, the Foreign Ministry just denied that the incident had ever happened. That is despite the fact there were a number of local and international witnesses, including journalists.

Why would it do this? One problem is that when mainland authorities investigate any matter, the organisation concerned investigates itself. The probe begins at the top, and continues layer by layer - each protecting the others. So, in the case of the alleged police abuse in Sanlitun, the officers assigned to the case will believe their own people's accounts, and report as much to higher authorities like the Foreign Ministry.

Clearly, the central government needs an independent body to investigate abuses at all levels of all departments. Local abuses are protected through local protectionism. This has become the new meaning of "Chinese characteristics". There are signs that the problem has spread like a cancer through the nation. Still, no one expected it to explode in the heart of Beijing's diplomatic community.

It is very easy for a perceived race-based round-up to be interpreted as "racist", and the story to be spun as an extension of Chinese chauvinism and nationalism, clearly not the image China wishes to portray to the rest of the world. The police abuses in Sanlitun cannot be ignored by the international community, mainly because the government clearly chose to ignore the reality. Someone at the Foreign Ministry should read the Vienna Convention of 1961, which enshrines the principle of "diplomatic immunity". Clearly, though, diplomats and their children should realise, after this incident, that Beijing's police force either does not understand this principle - or doesn't care about it.

Many wonder whether the Foreign Ministry would have responded differently if it had been citizens from a member of the Group of Eight nations who were rounded up. Does China see all people as equal? China's officials, from President Hu Jintao down, like to repeat the slogan: "All countries are equal". Indeed, given its tragic history of foreign "spheres of influence" and the Japanese invasion, China has a right to demand equality. But it also has a responsibility to stand by such a principle.

That begs the question of whether China wishes to use its economic clout to serve as a voice for developing countries. Or is it only saying what these leaders want to hear in order to secure energy resources, as some have accused it of doing in Africa? Many people feel disappointed that China has not stood up for developing countries' interests more in international forums. Moreover, diplomats in Beijing of those same developing nations feel let down when the Chinese government fails to protect the rights of their citizens, especially when they are victims of officially sanctioned racial abuse.

Laurence Brahm is a political economist, author, filmmaker and founder of Shambhala Foundation



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Tougher curbs needed to cool economy


LEADER

Nov 14, 2007           
     
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Evidence that inflation is worrying the central government is to be found in the timing of Premier Wen Jiabao's visit to Beijing's poor on Monday. It came two days after a stampede to buy cut-price cooking oil at a Chongqing supermarket resulted in three deaths and many injuries, and a day before yesterday's release of last month's inflation figure. The consumer price index was up 6.5 per cent on October last year, a decade high, following similar rises in the two previous months.

The main driver was again soaring food prices, which hit the poor hardest. Promises by Mr Wen to rein in food prices by increasing supplies are unlikely to bring early or significant relief. Higher prices can no longer be laid entirely at the door of short-term factors such as blue-ear disease in pigs, floods and high feed costs. Structural forces within a high-growth, overheating economy are also making their presence more widely felt. This has been evidenced by rising food prices generally in recent months and the 3.2 per cent rise in last month's producer price index for manufactured goods.

The government is right to be worried. Inflation is a danger sign, indicating that incremental macroeconomic measures aimed at ensuring that development is sustainable in the long term are not working. This is also shown by the failure of the measures to slow the double-digit growth rate or cool rampant stock and asset markets. Higher prices for staples such as pork - up 70 per cent since January - and cooking oil have serious implications for the poor, and therefore for Beijing's overriding goal of social harmony and stability. Soaring global oil prices are only just beginning to have an impact on the mainland economy and its insatiable demand for energy. The recent 10 per cent price rise in the cost of fuel at the pump has yet to feed through to producer and consumer prices.

Beijing's macroeconomic and monetary measures have had temporary effects at best. Growth shows no signs of abating and a record October trade surplus does nothing to ease trade tensions with the United States. Given that a one-off revaluation of the yuan is unlikely, the government needs to take more decisive domestic measures to cool the economy.


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Quality counts


CHRISTINE LOH

Nov 15, 2007           
     
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Macau, Asia's casino town, isn't everyone's cup of tea, just as Las Vegas is not all things to all people. It is not very different from Disney theme parks. Despite its fame, there are plenty of people who have not rushed there. This is why Hong Kong officials don't have to be so nervous about competition from its neighbour.

That is not to downplay Macau's rapid development and success. After all, Macau was always a gambling town. It's just that now it is on a much larger scale. With China's economic liberalisation, many more people are allowed to travel outside the country, and even gamble, which has enabled Macau to expand its casino facilities with US investments.

As a result, copies of Las Vegas-style gaming establishments have sprung up; enormous in scale, loud in style and unseen in Asia until now. Today, people who like to gamble have a lot of choice in Macau, and they will have even more choice in the future, as more casinos and hotels are built.

As with Las Vegas, part of the business is to attract shows and conventions. For those of us - the vast majority - who do not gamble, there is really nothing to get us into the casinos except curiosity, which is usually satisfied after one visit.

Nevertheless, we may still go to Macau to watch a special show, dine in one of the many restaurants, and to spend a night there. This adds, not subtracts, to the attraction of living in Hong Kong. In just the past fortnight, Macau has hosted a famous international singer, and a convention of mobile-phone service operators.

While government officials lament the competition from Macau, they might start by examining what Hong Kong is doing and should do. Hong Kong also plays host to many entertainment shows and conventions.

Much of the convention and exhibition business in Hong Kong is controlled by the Trade Development Council (TDC), a public-sector body. It operates the Convention and Exhibition Centre in Wan Chai and organises trade shows.

Private-sector entrepreneurs have been muttering for years that they have trouble getting space. Thankfully, the AsiaWorld-Expo facility near the airport has introduced more capacity and a measure of competition.

If officials want to quickly add convention and exhibition space in Hong Kong, isn't the quickest and cheapest way to enlarge AsiaWorld-Expo, which has already set space aside for expansion? The current expansion of the Convention and Exhibition Centre was never really a good solution because the Wan Chai waterfront is already very congested. When more facilities are squeezed into the area, things will only get worse. In other words, the site is "full".

Now, the TDC wants to build another large venue on the waterfront. It is easy to understand why it wants a site nearby; it would be easier to manage. Officials appear sympathetic to the idea - despite the fact that, in town planning terms, there is no capacity left along the waterfront.

As I have noted, there is an alternative that makes sense. Indeed, officials need to revisit why they didn't make AsiaWorld-Expo bigger in the first place, as this may tell them something about the short-sighted approach to their decision-making.

Nevertheless, there is a limit to the amount of convention space and number of hotel rooms Hong Kong can add. However, we can be selective about the kind of business we compete for. We need to remember that not everyone wants Las Vegas-style facilities.

Hong Kong needs to be cool headed about how to retain and attract premium businesses, because we are able to provide top services. Let's not overlook the fact that Hong Kong's economic activities are in fact diverse, unlike those of Macau and Las Vegas. We have a choice about what kind of events and what type of customers we want to attract.

We have a lot going for us. It has taken us decades to be able to provide consistent high quality, and that is the strength we should bank on.

Christine Loh Kung-wai is chief executive of the think-tank Civic Exchange

cloh@civic-exchange.org


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A Europe in denial over US economic links


Melvyn Krauss
Nov 16, 2007           
     
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The fact that America's economy is slowing is bad news for Europeans, regardless of claims that their economy has successfully decoupled itself from the United States.

Decoupling is an idea that is based on bad economics - and on some Europeans' reluctance to accept the fact that their short, but sweet economic expansion is also coming to an end.

True, the US market has become less important for European exports as Asia's trade significance has grown for Europe. So what? Trade is just one of many linkages between the US and European economies.

In today's interconnected global economy, uncertainty about the US economic outlook increases one day and Dutch consumer confidence, for example, takes a tumble the next.

The links between Europe and America are, frankly, much more complex than the advocates of decoupling appreciate. The US Federal Reserve, for example, is aggressively cutting interest rates to forestall a possible recession.

As a consequence, the euro is rising not only against the US dollar, but also against Asian currencies, whose central banks intervene in the foreign exchange markets to fix their currencies' value against the dollar.

This damages European exports to both the US and Asia. Reduced European dependence on America's export market can hardly protect Europe from the effects of the US economic slowdown if the euro appreciates as much against the Asian currencies as it has against the US dollar.

The decoupling argument also assumes that recession in America has no effect on Asia. This is nonsense. Asian income will certainly decline if Asians export less to the US - and this, in turn, will reduce Asian imports from Europe.

So, Europeans should not be tempted to think they are somehow "decoupled" from America's foibles and woes. Until recently, many Europeans thought they were insulated from the US housing and mortgage crisis.

Decoupling arguments, whether applied to relations between Europe and America or Europe's financial sector and the rest of the economy, should be seen as having a single purpose - to deny the very real threats to the continued expansion of the European economy.

Some of this, no doubt, is wishful thinking on the part of economically unsophisticated people. Others have a special interest.

After all, a strong economy makes it easier for the European Central Bank hawks to sell rate rises. It makes it easier to sell stocks and other investment vehicles. It makes it easier for politicians to sell their policies, themselves, and their parties.

But ordinary Europeans should not be fooled. The very existence of decoupling arguments is a warning that they should be concerned about the continuing robustness of Europe's economy.

Special interests would not be peddling such dubious statements if they felt confident about the economy's future.

Melvyn Krauss is a senior fellow at the Hoover Institution at Stanford University. Copyright: Project Syndicate


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No pain, no gain
264 days to go
OLYMPIC COUNTDOWN
Peter Simpson
Nov 18, 2007        
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Spare a thought today for British Olympics Minister Tessa Jowell and pray that her frayed nerves hold out for the next 1,713 days until the opening of the 2012 London Games.

As the minister - who was last week on a fact-finding mission to Beijing - sat down to dinner with foreign correspondents at the British Embassy last Monday night to hear their concerns about press freedom in China, her Olympic watch back home was going up in smoke ... literally.

Fire broke out at derelict warehouse on the proposed Olympic green in east London, sending a black plume of smoke across London's iconic skyline, inspiring headlines writers at the British tabloids, perpetually poised to pounce on the beleaguered minister.

Jowell planned to do a live interview with a British camera crew from the steps of the ambassador's residence after coffee, to outline how her meeting went with Beijing Olympic counterpart Liu Qi, the head of Bocog.

But her advisers said it was not a good idea, what with the 2012 preparations seemingly ablaze for reasons then unknown.

After a decade of trying to spin the British media this way and that - and losing badly - Jowell's ruling Labour Party can smell cunning media juxtaposition a mile off.

The flames back in London were fuelled further when more highly flammable material was poured on to Jowell's red-hot Olympic file a few days later.

The British media went into mocking, scolding, wagging-finger and tongue-lashing mode, after it was revealed the London Olympics would cost a whopping ¢G9.3 billion (HK$148 billion) - an over-spend that exposed what one politician described as "the most catastrophic piece of financial mismanagement in the history of the world". The admission means the final cost is more than double the original bid figure.

Jowell also has a vast pride of feral cats and a collective of irate vegetable gardeners blocking development on the London Olympic site to contend with.

Both groups are protected by the rule of law and have the backing of Britain's gnashing media pack.

The questions over the cats' future dominated a recent popular BBC current affairs programme called Question Time; worried members of the studio audience demanded answers from the Government.

"We have a lady who is allowed to sleep on the Olympic site because she is part of the Cat Rescue Charity - and already 174 lactating or pregnant cats have been taken from the site and delivered to good homes," Jowell said in Beijing.

The minister is used to controversy. She unwittingly became the centre of a media scrum called "Jowellgate" in early 2006 when her then husband, David Mills, was embroiled in alleged money laundering and tax fraud in Italy and linked to then Italian prime minister Silvio Berlusconi.

She was investigated by both the government and by the media because of a potential clash of interest between her personal life and ministerial duties. She was cleared of any wrongdoing, and last year got a divorce. As culture minister, she went on to court various policy controversies before being made Olympics minister.

To date, there is little the UK public doesn't know about the Olympics chief.

The Chinese, however, - and the world - are allowed to know only that her Beijing 2008 peer, Liu Qi, has a an MA in iron smelting; is a professor of engineering; was once mayor of Beijing; is a member of the political bureau of the 17th Communist Party of China (CPC) Central Committee; and is secretary of the Beijing Municipal CPC Committee.

His Olympic high points are widely publicised by the state propaganda machine, yet you'll never know about his mistakes.

He is just another smiling technocrat in a suit promising to deliver the best games ever. And the Chinese are inclined to believe him, if not publicly give their support.

Yet despite the soaring bills and compensation to be paid to dispossessed vegetables growers, tabloid headlines, allegations and probes, the British public also backs the under-fire Jowell - or at least supports her Olympic vision.

Despite a year and more of controversy, the UK public support for the Olympics is still high, latest polls suggest.

"That's something [positive] at least, as you get whacked everyday about something or other in our media for failing to do this or that," said Jowell.

As she dined, Jowell listened to the concerns of the Foreign Correspondents Club of China.

Tangible media freedom remains elusive on the mainland, despite all the promises, she was told, despite a relaxation of media rules - overseas journalists and their Chinese assistants are still routinely harassed, imprisoned and generally hindered as they try to enjoy the pledges by the Chinese in the name of the Olympic Charter.

It looks increasingly likely the 2008 Olympics will fail to deliver the changes many - including the IOC - had hoped for.

But Jowell disagrees. She thinks many legacies will be left behind in China - including greater media freedom, and subsequent government accountability and transparency.

During her meeting with Liu, she said she warned him: "Media freedom is like a genie. Once you've let it out of the bottle, it's then very hard to put it back in again."

She then added: "I said it was my hope, and the hope of many people around the world, that this will be a new era of press freedom that was precipitated by the Olympics.

"He replied ... by referring to the greater transparency seen at the recent 17th Communist Party Congress.

"[Liu] said nothing that led me to think he was going to look at reversing the changes that have taken place . . . and is nothing more than sincere in ensuring Beijing honours its commitments.

"You can be as staged-managed as you like. But if the substance is not measurably there, then you fail in your obligations. China gave commitments . . . but the commitments that you make when you become a host city are not negotiable."

However, Jowell called for modest expectations from Beijing 2008, as the Olympics has only so much "leverage".

"It will not solve every human rights contravention and abuse that China practises. But what the Olympics can do . . . is produce progress,' she said.

Does Jowell secretly day dream of a London governed along Beijing government lines - one where the actions of its rulers are rarely called into questions, and obstacles like feral cats and residents on Olympic sites are bulldozed out the way without fear of a media-informed public backlash?

As smoke began billowing across east London 600 miles away and headlines writers started rubbing their hands in glee, the beleaguered British Olympics minister offered no hesitation in her retort.

"The government in the UK gnash their teeth every day at the way the press use their freedom. But it's better than the alternative, I can tell you," she said.


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Kevin Sinclair's Hong Kong
A veteran SCMP reporter, Kevin examines the good, bad and ugly sides of life in the city. E-mail him at kevin.sinclair@scmp.com
KEVIN SINCLAIR'S HONG KONG

Nov 21, 2007        
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From the tarmac at Chek Lap Kok, Brian Butt Yiu-ming casts his eyes onto the rearing peaks of Lantau and his saddest memories.

In August 2003, a Government Flying Service Eurocopter on a routine medical evacuation mission crashed a few minutes after taking off to pick up a sick person on Cheung Chau. The pilot and aircrewman aboard were killed.

Four years later, the controller of the Government Flying Service remembers his proudest moment. He saw 20 of his fliers receive bravery medals at Government House for risking their lives rescuing 91 people a year earlier from a wild typhoon.

"I felt like a proud father," recalls the man who has headed the service for 11 years.

In a very brief announcement recently, the government said Mr Butt would be taking earlier retirement, starting in March next year. The veteran airman with more than 30 years of service leaves the official aviation unit in a superb state. But much more needs to be said apart from "arrangements are being made to fill the vacancy".

With a mere 220 staff, two long-range fixed-wing aircraft and seven helicopters, the service is a small but vital element in the city's security and economic structure. It allows us to cast a vast shadow in the field of protection over most of the South China Sea.

Every time the aircrews take to the skies, even on the most routine of missions, they dance with death. They are our saviours in the skies and make us proud.

Nobody is more aware of this than Mr Butt, which is one reason why he is stepping down earlier than necessary.

"I've got the best of jobs," he messaged me yesterday from London, where he is collecting on behalf of the service a major international bravery award from the Guild of Air Pilots and Navigators.

"I manage a team of true professionals who are devoted and motivated and I'm also able to fly as an operational pilot."

There has been a lot of speculation about why he is leaving when he could serve up to four more years. Some rumours talk about eight senior staffers retiring or resigning in the past year.

Mr Butt muses that he has chosen the time to step down; the service has a strong and sustainable succession plan in place, he adds.

"There is a Chinese saying that I habitually tell my colleagues," Mr Butt says. "As aviators, I tell them we must not be a frog sitting in the bottom of a well. You cannot see the sky."

Pilots can scan the far horizons when they do training with airmen on visiting warships from Britain, France, America and other nations. There are particularly strong links, naturally, with mainland military and civilian aviation services.

Within government, the service is noted as an agency with extremely high levels of morale. Comradeship is extraordinary, especially at the sharp end where the pilots and aircrew risk their lives in often horrifying and almost unbelievable conditions.

Imagine being 200km off the China coast in a full typhoon dangling from a cable above a 20,000-tonne vessel pitching and rolling in a force-10 gale trying to persuade terrified seamen one by one to put themselves into unfamiliar tackle that will lift them to safety.

The unforgiving deck is rising and crashing the equivalent height of a five-storey building in the unforgiving fury of the open sea. This is raw courage. It is part of routine life for this group of quiet young Hongkongers.

It is this routine vigilance and constant taut training that makes people, including myself, writhe in fury when thoughtless members of the public misuse the service.

That is a sin. Yes, a sin! It is sadly becoming more common. A bunch of ill prepared hikers find themselves stuck on a lonely mountain hiking track after dark.

They have no torch, no maps, no equipment. They are on a recognised path but do not know where to go. They want a lift home so they call 999 and ask for a helicopter as if they are in Nathan Road wanting to go to a karaoke bar.

These and other shameful people put extra strain on an admirable government lifeline that was set up to rescue people in need and to provide an air-sea rescue set-up that is the envy of much of Asia.

After decades of service, Mr Butt is about to take his hands off the cockpit controls. They will be taken up by a new generation of aviators whom he has helped nurture, train and discipline in a unique role.

We owe them our gratitude.



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A pall hangs over China's pre-Olympic growth
Joseph Quinlan
Nov 23, 2007        
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While financial markets remain focused on the swooning US dollar, sky-high oil prices and the ongoing credit crunch in the United States, another market-rattling problem could be brewing in China.

Many investors expect some type of post-Olympic economic slowdown next year, as mainland infrastructure spending trails off and activities related to the run-up to the Games wane. A pullback, however, could come sooner rather than later.

A pre-Olympic slowdown may be on the cards if the government is forced to act aggressively to reduce the level of pollution in and around Beijing before the Games.

Because of the Olympics, mainland China has worked hard to go green during the past few years, spending billions of dollars on a host of environmental initiatives.

Around Beijing, a number of polluting industries have been either relocated or refitted with more energy-efficient technologies. Coal-burning plants have been converted to cleaner fuels, and more stringent vehicle-emission standards have been instituted. Sizeable funds have been pumped into Beijing's public transport facilities. As a result of these and other measures, there are tangible signs of Beijing going greener.

However, doubts persist about the nation's environment, and for good reason. The challenge before it is Herculean considering that China is home to 16 of the world's 20 most polluted cities, while as much as 10 per cent of farmland is polluted.

Meanwhile, China is close to surpassing - or has already surpassed - the US as the world's largest contributor of carbon dioxide to the atmosphere, a dubious honour that no nation wants.

Against this backdrop, the UN issued a report last month claiming that high levels of air pollution were a "legitimate concern" for anyone participating in the Games. The International Olympic Committee has also expressed concern about air quality and has gone so far as to say that some events may have to be rescheduled. More importantly, there are even signs that the Chinese government, after initially downplaying pollution fears, has come around to acknowledging the urgency of the problem.

In Beijing, speculation is mounting that the government may mandate the closing of numerous factories in and around the capital for up to two months prior to the Olympics.

It is also expected to ban more than 1 million cars from the capital's streets before and during the Games, and construction activity is expected to be scaled back sooner rather than later ¡X again, all in the name of improving air quality.

To what extent these measures slow the pace of growth remains anyone's guess. However, there is little doubt that, should the government mandate a two-month, pre-Olympic reduction in industrial output, the general economy will feel some of the pain.

In the end, the more the mainland struggles to raise its air quality and improve its environment, the greater the potential for more draconian measures in the months leading up to the Olympics. The event is simply too big, too important and too symbolic to risk any sort of glitch or, worse still, embarrassment.

Hence, if the air does not start to improve by the spring of next year, leaders may have no other choice but to slam on the industrial brakes.

Such a scenario would stun a global financial community long accustomed to annual economic growth of 10 per cent or more on the mainland.

A pre-Olympic slowdown could result in a deflationary shock to the global commodity markets, triggering an abrupt and unanticipated downturn in commodity prices. If that happens, real growth in many high-flying commodity nations will decelerate, undermining global economic growth in the process.

Joseph Quinlan is chief market strategist for Bank of America Capital Management and a Pacific Council on International Policy adjunct fellow



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Shifting winds may cloud Beijing's patriot Games
Ian Bremmer
Nov 26, 2007        
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When the International Olympic Committee awarded Beijing the 2008 Summer Games in July 2001, the announcement ignited wild celebrations across the country. The Communist Party hoped to use the Games to showcase the country's emergence as a dynamic, modern nation. But, as China's leaders begin final preparations for the Games next August, they may be wondering if hosting the event was such a good idea after all. They have significant reasons for doubt.

The mainland's senior leaders always closely monitor spontaneous public expressions of nationalist fervour, fearful that shifting winds might blow an unwelcome storm in their direction.

Of course, what they hope is that the Games will channel these energies towards national solidarity, which will allow the leadership to deliver its people a moment of achievement and patriotic glory.

But, the Olympics will also bring international scrutiny of the nation's weaknesses at a delicate time in its development. The world already knows of China's success and its attractiveness as a destination for foreign investment, but few outsiders have seen the steep price the country is paying for its new prosperity.

The most obvious signs of that cost flow through the mainland's waterways and contaminate its air. Runaway growth and development have left about 70 per cent of its lakes and rivers severely polluted, many unfit for human use of any kind. Indeed, nearly half a billion Chinese lack access to clean drinking water.

But air quality will prove the more embarrassing problem. Television coverage of athletes gasping for breath will hardly provide Beijing with the signature Olympic image it had in mind. Growing international anxiety over climate change and other environmental hazards will ensure such issues receive considerable media coverage.

There is also the risk that the Games will become a political circus, as the international spotlight generates irresistible opportunities for public protest. China's leadership has demonstrated many times that it can quell domestic dissent, but the unique scale of the Olympics will require round-the-clock vigilance.

The Games will generate significant foreign-policy risks, as well. In Taiwan, the outgoing president, Chen Shui-bian, is stirring the independence pot, knowing the Olympic spotlight will limit Beijing's ability to respond forcefully.

Then there is the matter of how the Games will be received in the west. Since 2001, the mainland has increasingly become the focal point of much anxiety in the developed world. Huge bilateral trade deficits, accusations that Beijing keeps its currency undervalued, and a rash of defective and dangerous exports have fuelled a protectionist backlash in the US and Europe.

China, too, has changed since it "won" the 2008 Games six years ago. The party leadership has become more self-assured in its growing international role, but its ability to manage the pace of change at home has become more uncertain.

In 2001, then president Jiang Zemin hoped the Games would herald China's arrival as an industrialised power. But his successor, Hu Jintao , has focused on the damage that has come from unrestrained growth.

Mr Hu and Premier Wen Jiabao have also championed a more "harmonious" society, because they understand they can no longer neglect the growing wealth gap, social tensions, environmental and public health problems, and the Party's tenuous relationship with the less advantaged people.

As China's leaders scramble to address these challenges, will they still relish the idea of providing an international audience with front-row seats? How they look back on the Games once the confetti is swept from the streets is far from certain.

Ian Bremmer is president of Eurasia Group and a senior fellow at the World Policy Institute. Copyright: Project Syndicate



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Money and power talk - more than ever today


Philip Bowring
Nov 27, 2007           
     
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"There has been a gentrification of triad society." It was a stark assessment of Macau by former Hong Kong policeman Steve Vickers, who now heads the security and investigation agency International Risk. Mr Vickers cited undocumented gambling visits by mainland officials to launder illegally obtained cash, the appearance of murdered bodies along the nearby Chinese coast and graft charges against senior government figures as examples of the worsening situation.

Perhaps the situation is now beginning to turn around as a result of the trial of former transport and public works minister Ao Man-long. Whatever the trial result, the depth of the problem is obvious from the sheer number of charges and the identities of those companies and individuals named in the allegations. Beijing is clearly keen to see a cleanup, but whether one can be achieved is another matter, given the involvement of so many mainland officials and firms with the Macau gambling and entertainment industry.

Of course, Macau has always had some of these problems, a natural outcome of an economy so dependent on gambling, loan sharking and sex. But Hong Kong must not become too complacent about the potential for the gentrification of sleaze, as those with money or assumed connections to power become able to ignore the law.

From small beginnings such habits can easily grow. I could hardly fail to notice the apparent unconcern both for the law and the interests of ordinary citizens last week on Wyndham Street in Central, close to both Government House and the Central Police Station.

On three successive evenings I noticed that, outside a new entertainment establishment, a desk had been set up, manned by receptionists and bouncers. This occupied at least half the narrow pavement. And, on an adjacent road, ignoring large "No Parking" signs and a bus stop, several expensive vehicles had been parked.

On one occasion, I approached the staff and complained about the obstruction on the pavement. I was told to mind my own business. There were, I was told, "very important people inside".

So there we have it. The police can hardly be unaware of the situation. Nor can the bus company, whose drivers and passengers are so inconvenienced by the obstructions. Somebody high up must have told the police not to interfere with these continuing breaches of the law, and behaviour which has potentially placed pedestrians in danger.

Pandering to the self-importance of the rich and powerful is not new. But it seems to be getting worse. Last week also saw what was supposed to be a high-profile sail through Hong Kong harbour of a replica of the three-masted sailing ship The Bounty. Made for the 1984 movie The Bounty, the vessel, previously based in Sydney, has been acquired by Hong Kong Resorts International.

Discovery Bay ferry crews and local volunteers were given training in the complexities of hoisting and managing some of the 19 sails of an 18th-century vessel so that it could make a suitably impressive debut. But, alas, the invited dignitaries didn't have time for a real sail. So, The Bounty sat broadside spewing diesel fumes at Pier Three in Central, invisible to all but those in nearby buildings. Speeches were made about boosting tourism but a large media attendance was not reflected in the coverage of a singularly unphotogenic event.

Hong Kong Resorts International has set up the Zheng He foundation with a view to eventually build a replica of the great Chinese sailor's flagship, believed to have been three times the length of The Bounty. But, given events last week, one has to wonder whether The Bounty replica will ever be seriously sailed. That would require spending money on acquiring an experienced crew and maintaining the sails and rigging, rather than allowing it to become another party boat to be motored around Hong Kong waters.

Philip Bowring is a Hong Kong-based journalist and commentator


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Do the right thing


FRANK CHING

Nov 28, 2007           
     
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The November 15 white paper on the mainland's political party system, which emphasises the role of the eight so-called "democratic parties", comes at a historically appropriate time. This year marks the 50th anniversary of the anti-rightist movement, during which the leaders of these minor parties were denounced, persecuted and purged.

In 1956, Mao Zedong launched the "Hundred Flowers Campaign" in which intellectuals were encouraged to speak up and criticise the Communist Party. They were assured that there would be no reprisals.

However, the next year, Mao reneged on his promise and cracked down on those who had spoken out, saying that all he was doing was "luring snakes from their holes".

There then followed a nationwide campaign to seek out and denounce so-called "rightists", who had vented their dissatisfaction at the communists. Hundreds of thousands of people were purged.

Among the prominent victims was Zhang Bojun, then minister of communications and chairman of the Chinese Peasants and Workers Democratic Party, one of the eight "democratic parties". He was classified as the "No.1 rightist" by Mao and stripped of his ministerial post.

Another major victim of the purge was Luo Longji, a founder of the China Democratic League - another of the "democratic parties" - who had been minister of the timber industry.

In 1981, five years after Mao's death, the party issued a "resolution on certain questions" in the party's history that held Mao responsible for the Cultural Revolution. However, it skipped lightly over the anti-rightist movement, saying simply that there were "serious faults and errors in the guidelines of the party's work". No doubt the party was more concerned about the victims of the Cultural Revolution - who were Communist Party members, after all - than victims who were members of the "democratic parties".

Now that 50 years have gone by, it is time for the Communist Party to openly apologise to these eight political parties and compensate the victims or their descendants.

It is good that, this year, Wan Gang of the political party China Zhi Gong Dang has been named minister of science and technology, and Chen Zhu , who is not a party member, is now minister of health. But the Communist Party should explain why it took 50 years to appoint such people to high office and why it purged their predecessors.

In 1978, after his return to power, Deng Xiaoping convinced party members at a key meeting that they should make economic development, rather than class struggle, their main focus. And he put forward the guiding principle to "emancipate the mind, seek truth from facts, and unite as one in looking to the future".

At a talk to the Central Party School in July, the current party leader, Hu Jintao , again gave top priority to emancipation of the mind.

Next year is the 30th anniversary of Deng's crucial guideline, and the party should demonstrate that it is truly adhering to this principle by conducting a thorough reappraisal of the anti-rightist movement.

Clearly, however, it is not ready to do this. It still preserves Mao's image and legacy, and does not allow public discussion of his mistakes. This is, no doubt, because too many other people would be implicated. Mao, after all, did not act alone. Deng was his hatchet man in the anti-rightist movement, although he did try to make amends later in life by posthumously rehabilitating some of the victims.

But, as long as the Communist Party is reluctant to face its own past truthfully, others will have difficulty believing that it is different from the party of 50 years ago, and that the views of the leaders of the "democratic parties" will be given credence.

To begin with, the Communist Party must abandon the requirement that all other political parties have to support its leadership. As long as this remains the case, there is no chance that other parties will feel comfortable about expressing their views truthfully.

Frank Ching is a Hong Kong-based writer and commentator


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The impossible American dream


Robert Samuelson
Nov 29, 2007           
     
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Few phrases are more abused than the "American Dream". The standards for achieving it have become so open ended and expansive that, inevitably, we must fail. Does it mean becoming a homeowner? Enjoying increased living standards? Having "opportunity"? Rising above your parents' class? Achieving economic security? Or all the above - and more?

It's a mushy concept that inspires endless debates. What's lost is the bedrock reality that we Americans are more prosperous than at any time in our history. But the selective and highly critical reading of economic and social trends distorts our vision. Consider, as a case in point, a report from the Economic Mobility Project, a group established by the Pew Charitable Trusts.

"The dream that one can rise up from humble beginnings and achieve a comfortable middle-class living ... transcends racial lines," the report begins. "But is this a reality for black and white families alike?" Well, no, it concludes. The study compared the adult incomes of whites and blacks whose parents were middle-aged in the late 1960s. As adults, only 31 per cent of the black children born into middle-income families had inflation-adjusted incomes exceeding their parents' at a similar stage. Yet, 68 per cent of the comparable white children had higher incomes than their parents. Somehow, the report said, middle-class black parents couldn't protect their children from downwards mobility.

The message was that the already small black middle class is in eclipse. The reality, however, is different: since the 1960s, the black middle class has steadily expanded.

Although blacks' economic status lags behind that of whites, the advances are still sizeable. In 1972, only 6.2 per cent of black households had incomes exceeding US$75,000 in inflation-adjusted "2006 dollars"; in 2006, that figure was 16.8 per cent. Over the same years, the share of non-Hispanic white households with incomes above US$75,000 went from 18.4 per cent to 33.8 per cent. Yet, in 1972, the ratio of whites to blacks in this income bracket was three to one; now it's two to one.

Reconciling these apparent contradictions is easy. In the late 1960s, the black middle class was tiny. The group cited represented only 8 per cent of black children. Whatever happened to them has been overwhelmed by the gains of other blacks.

The high degree of intergenerational economic mobility is Pew's most interesting finding. What happens at the bottom of the income scale also happens at the top. About 60 per cent of children born to the richest fifth of parents do not end up among the richest fifth; parents influence their children's destiny but do not determine it.

Everyone knows that economic inequality has increased in the US. But the people at the top are not all the same people - or even the children of the same people. This vindicates one version of the American Dream: there is opportunity.

But there's a rub. The possibility that their children will move down the economic ladder is one of the great anxieties that assaults the vast middle class.

Mobility is a great thing, but it often comes at someone else's expense. To some extent, the American Dream is inherently an impossible dream because it cannot fulfil people's expectations of both opportunity and peace of mind.

Robert Samuelson is a Washington Post columnist


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Do the Singapore rap


PETER KAMMERER

Nov 30, 2007           
     
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Civil servants are generally staid, conservative and rock-solid people. As a result, they are perceived as being dull, humourless and lacking innovation. Attempts to break the mould, in the interests of making Hong Kong's civil service more approachable and in touch with the needs of the people it serves, have mostly failed. There is hope, though, and it comes from an unlikely source: Singapore.

I recommend that our colourless officials, Chief Executive Donald Tsang Yam-kuen foremost among them, check out a video posted on the internet homepage of the city state's Media Development Authority, the government branch responsible for censorship and promoting the growth of media. In its four minutes and 34 seconds, they will find a valuable lesson.

The offering, that has also found its way to the video-sharing website YouTube, shows the suit-wearing authority's senior management rapping words of wisdom to a hip-hop beat while swinging their hips in time. Their performances are gob-smackingly terrible and the lyrics unimaginative.

Despite this, the video has, in a week, become one of the most watched on YouTube, with more than 100,000 views. Traffic to the authority's website, www.mda.gov.sg, has doubled.

Reactions from viewers have been mixed. Many found it cringe-inducing, while a distinct minority have praised it. Recent YouTube postings include: "What a waste of money"; "I like it - you need a lot of courage and a young heart to do it"; and "Amateurish in concept, poorly written and performed."

Singaporean gay rights advocate Alex Au told me he was "flabbergasted" when he set eyes on the video. Not being a fan of the authority - it prevented him from putting on public display a collection of his photographs showing same-sex couples kissing - he might be expected to be less than enthusiastic about the statutory body. The authority, he determined, was Orwellian in its outlook and language, and he detailed a list of other decisions to back up his claim, including: banning a video game because of a scene in which a woman and an alien female kiss; the pre-screening of offerings for a poetry reading; and the editing of movies.

Mr Au may be right about the authority being out of step with global practices, but he is not so accurate when it comes to how it uses language, if the video is any guide. From the opening chorus of "Yes, yes y'all / We don't stop / Get creative, can do, rock on", the conservatively dressed officials show that, although middle-aged, they do have a sense of humour.

You see, what the critics do not understand is that this is not a serious attempt by the authority's senior management to show that they are hip and cool. Rather, it is self-parody.

The authority's communications director, Cassandra Tay, explained that the video had originally been shown at a staff conference in April "as an informal and light-hearted way to communicate our future directions for the media industry, with the production quality pegged accordingly". It was so well received that it was screened in the office reception area, and to new staff, and bundled with an interactive annual report.

"We are amazed at the response and pleased that much discussion has been generated, and we hope this will raise greater awareness of Singapore's media industry," Ms Tay told me.

I venture that the idea has generated far more discussion and achieved its aims much better than the silly effort by InvestHK with its 2005 offering of businessmen dancing on the roof of the HSBC (SEHK: 0005, announcements, news) headquarters to the band Queen's hit We Will Rock You. This is one instance where Singapore has got one up on Hong Kong.

The reason has nothing to do with the merits of the Singaporean video. What stands out is the underlying concept of trying a daring and innovative approach.

Rhyming a few words, well or poorly, and then speaking them to a foot-tappable backbeat, is not difficult. Shaking your hips while doing so is a natural instinct.

Singapore has already come up with the idea, so copying it would not be innovative. Nonetheless, our officials have to do something about sprucing up their image and that of our city.

Dare I suggest a break-dancing competition?

Peter Kammerer is the Post's foreign editor

peter.kamm@scmp.com


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Good fuel economy
Beijing can learn from America's failures, particularly with regard to oil pricing policies

David Donadio
Dec 03, 2007           
     
  |   

  



Any country pursuing economic liberalisation could learn much from America's successes. But, these days, China might learn more from America's failures. In booming Guangdong, energy price controls have forced lorry drivers to wait in long lines for diesel fuel. Because Beijing forces oil refiners to sell their products at prices well below what it costs to produce them, the refiners have cut back production capacity, resulting in long queues at the pumps. "Oil futures are near US$100 [a barrel], but the price we sell at is only US$60. We are still losing money," a Sinopec (SEHK: 0386) executive told The Wall Street Journal last month.

For 17 months, planners kept Chinese oil prices fixed, while the true market cost skyrocketed. Now, thankfully, the government seems to have got the message. At the beginning of last month, Beijing raised fuel prices by roughly 10 per cent, in the hope of ending the shortages. It helped - but only allowing prices to return to market levels will restore a healthy equilibrium of supply and demand.

China's policies have precedents in America, and they're not pretty. In 1973, the oil crisis induced the US government to pass oil price controls, which most Americans knew better as long queues at petrol stations. Then, in 1979, the Iranian revolution disrupted world oil supply for the second time in a decade, creating another big spike in prices. US president Jimmy Carter instituted price controls again, resulting, as before, in long queues.

Drivers waited hours to fill up their cars, often in lines hundreds of vehicles long. In the state of Maryland, governor Harry Hughes proposed an "odd-even" system of rationing, under which cars with odd-numbered licence plates could fill up on odd days, and cars with even-numbered plates did so on even days. It was bizarre, and it certainly wasn't popular.

And, of course, once a government begins to control prices and ration scarce goods, it's hard to stop. It didn't take Beijing planners long to recognise that the price controls were hurting their own oil companies but, instead of allowing them to charge what the market would bear for the products, they tried to compensate the companies for the losses. And, so, the lunacy of the controls compounded itself.

"The government forces state-owned or state-controlled firms to absorb losses that analysts say are now running at up to US$10 a barrel on imported crude," John Ruwitch wrote recently in the International Herald Tribune, so "for the past two years, [Beijing] also doled out hefty year-end compensation to Sinopec, the worst hit".

Sinopec controls about 80 per cent of the Chinese market for refined petroleum products, and the China Daily reports that, last year, the bailouts cost the government more than US$1.2 billion. So, Beijing essentially forced consumers to pay for the inconvenience of queueing. The Chinese government knows how much it paid out to aid ailing firms, but it will never really know how much harm it dealt the overall economy. In May last year, Beijing allowed petrol prices to rise 10.6 per cent, and diesel prices to go up 12.3 per cent. No doubt, governing bodies made those decisions on the basis of some economic analysis but, as anyone familiar with the laws of economics has to wonder, what did these economists know about demand that the consumers themselves didn't?

Often, spiking prices aren't pleasant, but they're not the end of the world, either. As my colleagues at the Cato Institute, Jerry Taylor and Peter Van Doren, point out, in the last week of September 2003, oil was selling in US spot markets for US$23.86 a barrel. Five years later, prices are four times higher, but the inflation, unemployment and recession that supposedly follow oil price shocks are nowhere to be seen.

The Communist Party has staked its legitimacy on the ability to continue delivering economic growth at what, by historical standards, is a blistering pace. Party officials seeking to ameliorate popular discontent no doubt want to shield ordinary people from spiking prices but, like them or not, market prices are a reality.

Allowing prices to rise and fall, as they will in the market, can actually relieve pressure on governments. Scarce goods are scarce goods, and even an all-powerful party can't control everything. By recognising certain adversities as facts of life, a government can absolve itself of the onus of having to put an end to them. After all, putting an end to them sometimes creates bigger adversities elsewhere.

David Donadio is a writer and editor at the Cato Institute in Washington


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Green growth
The fight against global warming could herald an eco-friendly transformation of the world's economy

Ban Ki-moon
Dec 04, 2007           
     
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We have read the science. Global warming is real, and we are a prime cause. We have heard the warnings. Unless we act, now, we face serious consequences. Polar ice may melt. Sea levels will rise. A third of our plant and animal species could vanish. There will be famine around the world, particularly in Africa and Central Asia.

Largely lost in the debate is the good news. We can do something about this - more easily, and at far less cost, than most of us imagine.

These are the conclusions of the latest report from the Intergovernmental Panel on Climate Change (IPCC).

This week, world leaders gather for a summit in Bali. We need a breakthrough: a comprehensive climate change agreement that all nations can embrace. We must set an agenda - a road map to a better future, coupled with a tight timeline that produces a deal by 2009.

We do not yet know what such an accord might look like. Should it tax greenhouse gas emissions, or create an international carbon trading system? Should it provide mechanisms for preventing deforestation, accounting for 20 per cent of carbon dioxide emissions, or help less-developed nations adapt to the inevitable effects of global warming - effects weighing disproportionately on them? Should it emphasise conservation and renewable fuels, like biomass or nuclear power, and make provisions for transferring new "green" technologies around the world?

The answer, of course, is some variation on all the above - and much, much more. If the negotiations get bogged down in the sheer breadth and complexity of the issues, we lose our most precious resource: time. In this, it helps to have a vision of how the future might look, if we succeed.

That is not merely a cleaner, healthier, more secure world for all. Handled correctly, our fight against global warming could set the stage for an eco-friendly transformation of the global economy - one that spurs growth and development rather than crimps it.

We have witnessed three economic transformations in the past century. First came the industrial revolution, then the technology revolution, followed by our modern era of globalisation.

We stand, now, at the threshold of another great change: the age of green economics. The evidence is all around us, often in unexpected places.

Visiting South America recently, I saw how Brazil has become one of the biggest players in green economics, drawing 44 per cent of its energy needs from renewable fuels. The world average is 13 per cent; in Europe, it is 6.1 per cent.

Much is made of the fact that China is poised to surpass the US as the world's biggest emitter of greenhouse gases. Less well-known, however, are its more recent efforts to confront grave environmental problems. China will invest US$10 billion in renewable energy this year, second only to Germany. It has become a world leader in solar and wind power.

At a recent summit of East Asian leaders in Singapore, Premier Wen Jiabao pledged to reduce energy consumption (per unit of gross domestic product) by 20 per cent over five years - not so far removed, in spirit, from Europe's commitment to a 20 per cent reduction in greenhouse gas emissions by 2020. This is the way of the future. According to some estimates, growth in global energy demand could be cut in half over the next 15 years simply by deploying existing technologies, yielding a return on investment of 10 per cent or more.

The new IPCC report lays out the very practical ways, from tougher standards for air conditioners and refrigerators to improved efficiency in industry, building and transport. It estimates that overcoming climate change may cost as little as 0.1 per cent of global GDP a year over the next three decades.

Growth need not suffer and, in fact, may accelerate. Research by the University of California at Berkeley indicates that the US could create 300,000 jobs if 20 per cent of electricity needs were met by renewables. The UN Environment Programme estimates that global investment in zero-greenhouse-gas energy will reach US$1.9 trillion by 2020 - seed money for a wholesale reconfiguration of global industry.

Already, businesses in many parts of the world are demanding clear public policies on climate change, regardless of what form they might take - regulation, emissions caps, efficiency guidelines. The reason is obvious. Business needs ground rules.

Our job, in Bali and beyond, is to shape this nascent global transformation - to open the door to the age of green economics and green development.

What's missing is a global framework within which we, the world's people, can co-ordinate our efforts to fight climate change. The scientists have done their job. Now it's up to the politicians. Bali is a test of their leadership. What are we waiting for?

Ban Ki-moon is UN secretary general


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Trade trouble


FRANK CHING

Dec 05, 2007           
     
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The message was delivered in European tones, but it had a distinctly American flavour: Beijing must lower its import barriers, raise the value of its currency, protect intellectual property rights and create a level playing field. "The EU exports less to China than to Switzerland, a country of 7 million people," said the European Commission president, Jose Manuel Barroso, last Wednesday in Beijing after their annual summit meeting.

The European Union is growing increasingly impatient. The EU's trade deficit with mainland China has tripled in the past six years, reaching US$190 billion last year, and is expected to increase more than 30 per cent this year, to US$253 billion.

For many years, Brussels handled Beijing with kid gloves, depicting Europeans as more sophisticated than crude Americans who knew no better than how to twist arms and impose sanctions. Now, however, the Europeans have decided that the soft approach simply does not work, and have opted for confrontation.

And, it seems, this American-style approach gets results. Washington's call for an increase in the value of the yuan has seen the currency rise almost 12 per cent since July 2005.

However, during that period, it has actually fallen 8 per cent against the euro, making Chinese exports to Europe cheaper and fuelling Beijing's trade surplus.

Moreover, while Europe until recently was reluctant to bring action against China in the World Trade Organisation, the US has not been similarly deterred. And, last week, Washington triumphantly announced that Beijing had agreed to terminate prohibited subsidies that gave an unfair advantage to Chinese products while denying US manufacturers the chance to compete fairly. The agreement came nine months after the US, together with Mexico, took action in the WTO.

The new European approach was demonstrated by trade commissioner Peter Mandelson who, on the eve of the summit, delivered no-holds-barred speeches denouncing the safety of mainland exports, its "tidal wave" of counterfeits, its "theft" of European technology and its controlled currency.

Little was achieved in the summit meeting. In the end, the two sides agreed to set up two panels to study trade and currency issues.

Relations have been strained by political issues, as well. European leaders who were more sympathetic, such as Germany's Gerhard Schroeder, Jacques Chirac of France and Britain's Tony Blair, have been replaced by others less inclined to tiptoe around Beijing. Opinion polls show European perceptions of China are plummeting, with protectionist sentiments rising. Its standing has dropped 15 per cent to 20 per cent in surveys in France, Germany, Italy, Spain and Britain.

Up to last year, both China and the EU trumpeted their special relationship, which was described as rising to a comprehensive strategic partnership. Even now, Brussels is by no means antagonistic. In fact, the EU last week openly opposed Taiwan's plan to hold a referendum on joining the UN.

But, on the trade front, Europeans are adamant that Beijing must act. "China has understood our messages and our concerns - no question about that," said a senior European official. "At the highest level, this has been taken on board."

This means it is up to mainland leaders to take action. But economic growth is still Beijing's top priority, and it is unlikely to be willing to slow that growth by respecting intellectual property rights or allowing its currency to appreciate substantially.

If it does not act quickly and decisively, protectionism will certainly rise in Europe. Then, Beijing may well be confronted by a united western front, with the US and Europe sharing common concerns and increasingly co-ordinating their actions.

The mainland is now between a rock and a hard place. Its honeymoon with Europe is over. It has to decide whether it will play by the rules or continue to plead that it is a developing country to which ordinary rules should not apply.

Frank Ching is a Hong Kong-based writer and commentator

frank.ching@scmp.com


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When the drive for peace only heightens tensions


Donald Kirk
Dec 06, 2007           
     
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In the search for peace, the Middle East rivals Korea as a global flashpoint where a lasting solution seems elusive if not impossible. Fighting in the Middle East has probably cost as many lives as wars for control of the Korean peninsula, beginning with the Sino-Japanese war in the early 1890s, the Russian-Japanese war in the early 1900s and on to the Korean war of 1950-1953 and its aftermath.

That litany of suffering does not begin to count the second world war. The slaughter in Europe and the deaths of millions in Nazi concentration camps had much to do with the birth of Israel as the Jewish state, while the slaughter in Asia drove the Japanese from Korea, leading to the division of the peninsula in 1945.

It may be pointless to try to compare the numbers killed in wars, mass executions and political reprisals in both regions. Still, the eagerness of US President George W. Bush to leave a legacy of achievement between Israelis and Palestinians seems to parallel his hopes for reconciliation on the Korean peninsula. If six-party talks to get North Korea to abandon its entire nuclear weapons programme appear difficult, the process of getting Arab states to ever endorse an Israeli-Palestinian settlement seems infinitely more complicated.

One common bond between the Middle East peace process and that on the Korean peninsula may be the lack of realism on the part of America. It's not likely that Israel and the Palestinian state will come to terms any time soon and, even if they were to find some basis for agreement, what about Gaza, the strip of land that  has fallen into the hands of Hamas? What, exactly, do Middle East talks have to do with the discussions on North Korea's nuclear weapons or North-South reconciliation?

A common denominator is Iran. As a Shiite Muslim state, Iran exerts tremendous militant influence among Shiites in Iraq and elsewhere, including southern Lebanon. Tehran poses a threat not only to Israel but also to the Korean peninsula. Its refusal to talk about giving up its nuclear programme betrays its long-term interest in emerging as a nuclear military power.

Towards this end, Iran has collaborated with North Korea on technology. Iran's nuclear programme relies on highly enriched uranium, an area in which Pyongyang steadfastly denies having dabbled, while building warheads with plutonium at their core. North Korea may shut down the ageing facilities at its Yongbyon complex, but it's hard to subscribe to US envoy Christopher Hill's claim that the regime will acknowledge all it has done to develop a warhead with highly enriched uranium.

Nor is the Iran-North Korean link the only one between the Middle East and Korean talks. Nobody has come up with a definitive explanation for the Israeli raid on a mysterious Syrian base in September. The assumption is the target was "nuclear related" and that North Koreans were killed. Since North Korea is a nuclear state and Syria is not, we may assume that Pyongyang was providing expertise, and possibly equipment, for a Syrian nuclear facility. It seems highly unlikely, however, that details will emerge.

What is most frustrating is that all these talks raise false hopes without resolving underlying problems. True, the Middle East peace conference in Annapolis was the first in seven years. And, the six-party talks on North Korea - when they resumed in 2005 - broke an impasse that had existed since the breakdown in 2002 of the 1994 nuclear agreement over the North's highly enriched uranium programme. In a shrinking world, peace processes are intertwined.

They may, however, only deepen confrontations. What if Iran escalates threats against Israel? And what if North Korea, gorged on aid, goes on developing nuclear warheads in secret after acknowledging its "entire" inventory? These are dangers that Mr Bush, pursuing his "legacy", prefers to ignore.

Donald Kirk is the author of two books and numerous articles on Korea for newspapers, magazines and journals


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Can we really justify burning food for fuel?


Hans-Werner Sinn
Dec 07, 2007           
     
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When UN Secretary General Ban Ki-moon recently visited Brazil, he was impressed by the country's use of biofuel to power a quarter of its vehicles. The UN and many countries share the view that biofuel is one option in fighting climate change.

The United States subsidises production of ethanol from maize, with output there growing 12 per cent annually, and almost 10 per cent worldwide. European Union countries subsidised biofuel production with £á3.7 billion (HK$42.5 billion) last year, and intend to cover 8 per cent of their motor fuels from biological sources by 2015 and 20 per cent by 2020.

But is it really wise and ethically acceptable to burn food rather than eat it? If we allow food to be used to produce biofuels, food prices will be linked to the oil price, as the head of the German farmers' association happily announced. Indeed, food prices are increasing in Europe, because more and more farmland is being used for biofuels instead of for food production.

This is not sustainable. The so-called tortilla crisis, which led to protests in Mexico City in January, foreshadows what we can expect. The price of maize, half of which is imported from the US, more than doubled in a year, primarily because of production of bioethanol.

The problem is that advocates of biofuel production have not made it clear where the land will come from. In principle, there are only three ways to procure it: by withdrawing it from food or fodder production, from the production of natural materials - particularly wood - or from nature. The perversity of the first alternative is obvious: there is no surplus food production in the world. Whoever wishes to grow biofuels on land previously used for food production must recognise that this would increase food prices, harming the poorest of the poor.

Similarly, to cultivate biofuels on land otherwise used to produce sustainable construction materials would drive up the prices of these materials and encourage their substitution by non-sustainable materials, like concrete and steel. This may be all right on ethical and social-policy grounds, but it certainly would not help the environment.

Because of photosynthesis, wood stores carbon. The larger the stocks of trees, the less carbon dioxide there is in the atmosphere and the cooler the Earth remains.

It makes no sense to use land in whatever form to produce biofuels. Only producing them without the use of additional land is justifiable in terms of environmental and social policy.

This would mean using agricultural and other waste, which would otherwise rot and produce nearly equal amounts of carbon dioxide and methane - an even more dangerous greenhouse gas.

That option should be supported. However, official encouragement of the production of biofuels on land that would have been used for other purposes must be brought to a halt.

Hans-Werner Sinn is professor of economics and finance at the University of Munich, and president of the Ifo Institute. Copyright: Project Syndicate


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Back to school for rabble-rousing fans
243 days to go

OLYMPIC COUNTDOWN
Peter Simpson
Dec 09, 2007           
     
  |   

  



They're considered the extra man and can make or destroy sportsmen and women on the field of play by their bizarre, humorous, eccentric and, sadly, occasionally violent acts of passion and loyalty. From Liverpool to Lisbon, Beijing to Brisbane, Manchester to Melbourne, Soweto to Seoul and Rio to Rotterdam, fans are at the heart of the sporting matter, if not the final score.
The anatomy of the fan has kept postgraduate students burning the midnight oil, pontificating on what makes the terraces tick in theses a thousand pages thick.



Sports fans on the mainland are no different from their counterparts the world over, when given the chance to show their colours.

But government officials are concerned the overly patriotic spectating masses might let the country down when the Olympic flame is lit next year.

Chinese sports fans have a tradition of committing a net-full of spectating faux pas. If they're not spitting obscenities to make grandmothers from Harbin to Kunming choke on their rice, or waving inciting banners to freeze international relations, they're loudly answering a blaring mobile phone, or taking flash camera shots during breath-stealing sporting moments - exposing not only their rudeness but their sporting ignorance.

As any international golfer, snooker or tennis player who has competed on the mainland will testify, the Chinese often behave as if they are enduring a long-distance bus ride sat on an open box of irate scorpions; fidgeting away, oblivious to events and easily distracted by a call inquiring if they're heading to the karaoke bar.

So worried is the Beijing government, that in fine communist tradition it has started to conduct spectating lessons at factories, on the farm, in offices and at other work units. It hopes the teachings by the "The Beijing Civilised Workers Cheering Squad" - which includes 20 government-approved chants - will prevent a huge embarrassment in the Bird's Nest stadium.

There will be a collective slap to the forehead among the dark suits if the public education programme fails, and Old Wang's mobile goes off with The East Is Red ringtone just as Liu Xiang prepares to spring from the blocks in the Bird's Nest, or if a bandana-wearing revengeful fan proclaims justice for Nanjing when Japan's divers take to the high board in the Water Cube.

"Zhongguo, Zhongguo - ha, ha, ha. Zhongguo, Zhongguo bi sheng. Jia you! Jia you!" shouted one group of office clerks during their sportsmanship class - like a reconstructed struggle lesson reminiscent of regimented mass education and participation favoured by Chairman Mao during the Cultural Revolution.

The clerks' chants of "China, China - ha, ha, ha. China, China must win", and "Fill her up! Fill her up [Let's go China]", are preferable to those heard during the recent, nail-biting Super League soccer end-of-season matches.

Last month, Beijing Guo'an failed to clinch the championship during their last game of the season. The fans' vitriol was akin to an annual Tourette's sufferers' convention. It was only thanks to a huge security presence that the mouthfuls of bilious threats were prevented from being carried out.

Anyone who attended the Asian Cup soccer final in 2004 between China and bitter rivals Japan can attest to what appeared to be a careful orchestration of the home fans' reaction to the 3-1 loss on the hallowed turf of the Worker's Stadium in Beijing.

While most fans were ushered from the stadium, a few thousand were allowed to remain behind to shout the worst expletives and insults known in the Chinese language.

The 3,000-odd Japanese fans - surrounded by hundreds of plain-clothed and uniformed PLA - watched their heroes lift the cup in a stunned, worried silence.

The Japanese women's soccer team suffered similar torment just three months ago - booed and jeered by 40,000 Chinese fans during their match against Germany at September's World Cup clash in Hangzhou.

Bitter rivalries are to be expected in sport and can add a priceless edginess to performances. However, xenophobia bordering on racism is a worry at international and domestic sporting events held in China. Black soccer players are often booed - a throwback to the terraces of 1970s and early '80s Britain.

More worrying, perhaps, is the average Chinese fan has his or her emotions continuously juggled by a government that uses sport to either promote and actively encourage patriotism bordering on nationalism, or to order respect, restraint and politeness in front of "foreigners".

Recall, if you will, the riots outside the Japanese embassy in Beijing in 2005. Seething over Tokyo's wartime past and its bid for a permanent UN Security Council seat, it was reported the Chinese government authorised coaches to pick up students and other approved activists and drive them for a banner-waving, stone-throwing protest.

After the riot, which saw embassy windows smashed and drew condemnation from around the world, the protesters were ordered by shadowy figures in the mob to stop with the stones.

"We were told on the first day that throwing stones was okay, and the next that it was not," said one of the protesters, a Chinese university student who plays for an expat soccer team in Beijing.

Beijing Guo'an's stadium is, like much of the capital, decorated with government sloganeering banners such as "Be civilised when you watch the match. Don't get angry about the results" - all part of the mass campaign to whip Beijingers into shape.

And it's working.

"We are not going to shout profanities in front of foreigners because the Olympics is a show for foreigners," Lui Wei, a 21-year-old spectator attending a recent Guo'an game, told an Associated Press reporter.

"The government has told us it's not polite. The government wants to show a good image of the country," Lui said.

How parliaments and police forces managing hooligan-plagued football matches across Europe must be turning green with envy.


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A dangerous pattern of US presidential fraud


Laurence Brahm
Dec 11, 2007           
     
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"China measures national success by GNP [gross national product] while Bhutan measures it by GNH [gross national happiness]; America measures it based on GNF [gross national fear]," a Tibetan lama said at a Buddhist forum in Bangkok recently.

His thoughts seemed to be underscored by a US intelligence services report last week vindicating Iran's nuclear programme as peaceful. According to the National Intelligence Estimate, Iran stopped its nuclear weapons programme in 2003, and has no apparent intention to renew it.

Suddenly, Iranian President Mahmoud Ahmadinejad seems both reasonable and credible, certainly compared with US President George W. Bush. All along, Mr Ahmadinejad has insisted on Iran's right to diversify its energy sources away from polluting oil - the nation's main export and revenue earner - to non-polluting, uranium-fuelled sources.

On the falsified assumption that Iran's programme is defence related, Mr Bush's brinkmanship has brought the world to the edge of what the president himself proclaimed as "world war three".

But Mr Bush seems unshaken in his convictions. He continues to justify escalating sanctions and possibly turning the Middle East into another apocalypse through false or contrived intelligence - as was the case with Iraq. Facts have been suppressed, to make way for opinion.

As Mr Bush said: "Look, Iran was dangerous, Iran is dangerous and Iran will be dangerous." Such rhetoric is echoed by Secretary of State Condoleezza Rice, who said: "I continue to see Iran as a dangerous power in international politics." The question that the media should be asking is: which power is really the dangerous one today?

As Senator Barack Obama explained lucidly, Mr Bush "continues to not let facts get in the way of his ideology". So, have we traded one form of fundamentalist-driven brinkmanship for another? Is there any difference between blinkered thinking in Tehran and in Washington? The irony of this latest intelligence revelation is that it brings tremendous credibility to Mr Ahmadinejad.

"Any security problem that could happen in one country will have a negative effect on the security of all countries," he said. "These situations cannot endure more pressure, otherwise they will be out of control. We wish, at the same time, that all those concerned with regional and international affairs [would] reconsider their positions before it is too late."

Now, it seems that Mr Ahmadinejad was telling the truth all along, and Mr Bush was lying. These lies continue the dangerous pattern of presidential fraud proved by the false evidence that coerced the American public into supporting an invasion of Iraq. Mr Bush has something in common with al-Qaeda - mainly the persistence of single-minded fanaticism.

Almost immediately after the release of the intelligence report, US Defence Secretary Robert Gates rushed off to Kabul, claiming there were rumours of rising al-Qaeda influence and Taleban popularity. The Taleban is popular, due to skewed and unrealistic US policies which have failed in Afghanistan, like in Iraq, making the situation for local residents even worse than before.

Nevertheless, Dr Gates blamed it all on Iran. But al-Qaeda is essentially the militant wing of a Wahabi fundamentalist movement which, like the Taleban, is Sunni. Iran is Shiite. So, a connection seems tenuous.

The only conclusion is that Dr Gates needs a crash course in Islam, and the western media needs to ask more independent-minded questions instead of just repeating White House press announcements.

Washington has now been seen to be falsifying intelligence about Iraq and Iran (repeating the pattern of lies seen with Laos, Cambodia and Vietnam). With countless lives lost - meaninglessly - isn't it time to say "enough"?

Laurence Brahm is a political economist, author, filmmaker and founder of Shambhala Foundation


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Size is everything in Swede's business-led battle with poverty


BEHIND THE NEWS
Sarah Monks
Dec 12, 2007           
     
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Mention a scale model and most people think of a miniature train, car or an iconic building in perfect replica. But for Swedish industrialist Percy Barnevik, scale - huge scale - is the right model for raising the world's "bottom billion" out of poverty, including hundreds of millions in China.

Since stepping down in 2001 as chairman of one of the world's leading engineering companies, ABB, formerly known as Asea Brown Boveri, he has been on a mission to mobilise the world's poorest into entrepreneurship and job creation.

Unlike many people his age, Mr Barnevik, 66, is unwilling to "retire to Spain to drink gin and tonic". He is the founding donor and international chairman of Hand in Hand, an Indian charitable trust run by 4,000 local Indian employees and 9,000 volunteers to deliver large-scale results rapidly - and which is growing fast.

"Where we differ from other charities is that we build scale. I don't want to help a thousand downtrodden women. I want to help 1 million. I don't want to get just 100 children into school in India but 300,000," he said during a visit to Hong Kong last week.

In little over three years, the organisation has given entrepreneurial training and business coaching to 262,000 impoverished women in the southern Indian state of Tamil Nadu and facilitated their access to cheap credit. As a result, the women have started 95,000 family businesses and 500 medium-sized enterprises. The target is 1.3 million new jobs by 2010.

The new enterprises cover a wide range of products and services, from looms to laundries to foodstuffs. In addition, Hand in Hand has set up medical camps and health awareness campaigns that reach 250,000 people annually. More than 12,500 children have passed through Hand in Hand's residential schools.

The programme is being replicated in South Africa and Afghanistan, where its self-help model for the poor is being adopted by governments and NGOs with the aim of creating 1.3 and 2.2 million jobs, respectively, within five years.

Now, Mr Barnevik is turning his attention to the mainland and applying his model to help lift the 500 million poorest Chinese out of poverty. He visited Hong Kong last week and sees a possible role for the city in supporting a job creation initiative in one of the mainland's poorest areas.

Mr Barnevik is no stranger to China, having first visited Beijing on business in 1970. Some years later, he signed "the biggest order of my life" with then premier Li Peng for ABB to supply generators and transmission systems for the Three Gorges hydroelectric scheme.

"China is ahead of India because it started reform 30 years ago. But the need for creative, productive employment for poor people left behind is identical," he said. "In western China tens of millions live in very poor conditions. It is necessary to raise employment levels, create jobs where people earn better money and to limit the migration to the big cities.

"China works hard to stimulate companies to move west, but bringing companies there can't do it all. A hundred million jobs won't easily come out of big business. You also need cottage industries."

London-based Mr Barnevik recently spent a week in northern Yunnan visiting poor villages close to the border with Sichuan to find out what the situation is like on the ground and to meet officials and NGOs.

"Some of these villages without roads are comparable to the worst in India," he said. "The poorest are used to receiving grants. The idea is to help them start enterprises and move higher than the absolute bottom. I focused on the opportunities to start enterprises, the available market and possible products to develop."

Mr Barnevik is adamantly opposed to what he calls "the feeding tap" which can quickly run dry when aid or donations stop flowing. "The idea of help to self-help with loans instead of grants is at times difficult to carry out, but it is the only sustainable way out of poverty," he said, citing the success of Nobel Prize-winning Bangladeshi banker Muhammad Yunus and his Grameen Bank in championing microcredit loans to entrepreneurs too poor to qualify for traditional bank loans.

"The basic idea is to stimulate poor people to stick out their necks, start enterprises, employ other people and grow from there. You need strong local partners. We train them and then they train those who become the entrepreneurs."

Hand in Hand invests heavily in education and capacity building - and allows little scope for any "sitting on hands". Family-based businesses must be up and running on their own almost immediately. Medium-sized companies must survive on their own after an initial period of hand holding. Hand in Hand "citizens' centres", which provide village-level internet connections and other business support facilities, must be owned and run by entrepreneurs as service companies after six to 12 months.

The tough approach replicates the management style that made Mr Barnevik a corporate titan in Europe and a key player in global business. He demands high efficiency, strict targets, tight quality control, low costs (hence no "expensive" western staff), maximum leveraging and, above all, scale.

"The potential for China is, of course, huge. We want to see the beginning of something that can be scaled up to 1 million people and jobs over a certain period of time," he said, adding that the Tamil Nadu experience showed the self-help model could work on a large scale.

"The Chinese have the people and they have money to expand it themselves throughout the province into other provinces."

He said the mainland already had a good system for lending to small enterprises through community co-operatives and agricultural banks, but that donor money from inside the country and elsewhere would be needed to invest in training.

Mr Barnevik donated about US$17 million of his own cash to get Hand in Hand off the ground. In Hong Kong, he met with heads of potential NGO partners from whose experiences Hand in Hand could learn. He also began meeting potential donors interested in financing a job creation programme on the mainland.

"We have all the reason in the world to believe the successful job creation model can be implemented there with proper co-operation and local partners," he said.

"That's what makes it attractive to me, that you can participate as a catalyst, as a pilot and it can have a big impact since you have well-organised government in China with their own funding to carry on. Like rings on the water."

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