Leaders aim high; now they must bring results


LEADER

Mar 06, 2008           
     
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Five years is not long enough to tackle many of the long-standing and complex problems facing the nation. President Hu Jintao and Premier Wen Jiabao have repeatedly had to confront the same issues since taking office in 2003. Governance, education, social welfare, health care, inflation, the rule of law and economic overheating have been recurrent themes in Mr Wen's work reports which mark the opening of the annual parliamentary session. Yesterday was no different. The premier returned to the familiar theme of putting the people first. But added urgency could be detected in his 2-1/2 hour speech as he tied many of the problems commonly cited with the need to help the poor and underprivileged.

Mr Wen cannot be faulted for trying to improve the conditions and prospects of people whom the benefits of the mainland's economic juggernaut have largely bypassed. But the problem has worsened, with inflation running at 7.1 per cent. This has hit the poor especially hard. The government recognises the danger, but it is not clear that administrative price controls on a wide range of commodities and daily necessities will work to push inflation down to the 2008 target of 4.8 per cent. At least the target is more realistic than the 3 per cent of last year. However, it looks likely the economy will, once again, overshoot the target growth rate of 8 per cent, after five years of double-digit expansion.

Mr Hu and Mr Wen are expected to stay in their posts for another five years. Halfway through their stewardship, there is no denying there have been tangible achievements. In 2003, the leaders faced a banking sector in disarray, a huge budget deficit and a moribund stock market. Private businesses and properties were insufficiently protected by outdated laws. Today, big state banks have cleaned up their balance sheets and are listed on stock markets on both sides of the border. All of them - for now - seem to have emerged relatively unscathed from the credit crunch that has hit the global financial sector. New laws provide better protection for commercial operators and property owners. Instead of confronting declining markets, Mr Wen yesterday railed against speculators, insiders and corrupt officials who have pushed the stock and property markets into dangerous bubble territory.

The premier rightly pointed out that spending on education, public health and social welfare had more than doubled in the last five years. Some 145 billion yuan - an increase of more than 17 per cent from last year - will be spent on helping farmers, improving rural areas and enhancing the farming sector. The education budget will jump by 45 per cent, to more than 156 billion yuan. Mr Wen also promised to provide more rent subsidies for migrant workers and more affordable housing, making generous land grants for the lower and middle classes.

Still, Mr Wen faces a long and rocky road. For example, the power supply crisis which marred the Lunar New Year and prevented millions of workers returning home exposed a lack of co-ordination between government departments and transport and power companies. The premier has promised to resolve it by creating "super ministries". Hopefully, they will help also increase energy efficiency and improve the environment, areas in which government efforts have so far proved woefully inadequate. However, it is too soon to say whether they will prove effective. A wide gulf still exists between the aims of the leaders in Beijing and what they have delivered. They need to close the gap to ensure their legacy endures.


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Flu crisis shows need to reform health services


LEADER

Mar 07, 2008           
     
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The circumstances of the death of a three-year-old girl hours after her family took her to hospital for treatment of a cough and fever has, understandably, given rise to public concern. The death has come at the height of the flu season, when hospitals are struggling to cope with an influx of patients.

Health authorities reacted yesterday by introducing sweeping infection controls reminiscent of those taken during the Sars outbreak five years ago. Such measures should have been put in place earlier, given the stresses on the system already caused by the number of flu cases. Overcrowding has left our hospitals ill prepared to cope with a more serious emergency.

The new measures are sensible, if overdue. They do not, however, tackle public unease over the little girl's death, which followed the still-unexplained death of a two-year-old boy in Prince of Wales Hospital hours after he was admitted with vomiting and a fever.

The girl died the same day she was seen by a doctor at Tuen Mun Hospital's accident and emergency department. She was sent home after the doctor diagnosed an upper respiratory tract infection. When finally admitted to hospital hours later, her heart had already stopped. Tests later showed she had a strain of H3N2 flu called Brisbane flu, but that may not be the reason she died. The case will go to the coroner's court, where the circumstances will be examined. But officials should swiftly make public any information which helps explain her death. This is the only way public concerns will be eased.

What we know of her treatment and illness raises troubling questions, not least for her family. Given the pressure on hospitals, the worry is that further tragedies may occur. In the girl's case, there is no suggestion that overcrowding, or the workload that puts on doctors and nurses, were decisive factors in the girl's treatment or the decision not to admit her in the first place for further observation of her condition. It remains a worry, however, that on the same weekend, frontline doctors warned that overcrowding had exposed the inability of Hong Kong's public hospital system to cope with the growing ranks of elderly people or with the possibility of a flu pandemic. Private hospitals report a similar predicament.

It does not take much to tax our hospital system. There are few beds or doctors and nurses to spare at the best of times. The Hospital Authority says the cold weather means occupancy rates on most medical wards are above 100 per cent. At the five busiest hospitals they are above 110 per cent.

The flu season occurs every year, but hospitals were caught unprepared. Some have begun capping accident and emergency admissions and delaying non-urgent treatment to accommodate flu patients. Given their mission of providing affordable care to all, it is difficult to see what more they can do now.

Our massively subsidised hospital system remains the envy of many other countries. But the rising demands of an ageing population, and the cost of modern medical technology, put ever bigger strains on the public purse. The current hospital crisis is a reminder of the urgency of reforming the delivery and financing of health services. Plans for greater participation by the private sector, with more emphasis on preventing illness and disease and promoting the role of the family doctor, call for a new financing model. A consultation expected to be announced next week on six financing options is unlikely to lead to concrete proposals until late this year at the earliest. Reform is needed - and should not be delayed any longer.


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Fresh faces


KITTY POON

Mar 10, 2008           
     
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As the plenary sessions of the new National People's Congress started last week, commentators in Hong Kong marvelled at the fact that nearly 70 per cent of the delegates were newcomers, including two Sichuan province women in their 20s from ethnic minorities. The call for generational change in Hong Kong's political landscape has thus intensified.

This yearning for fresh faces deserves close attention. It underscores the search for a new direction as Hong Kong nears a new decade.

In fact, the rise of youthful political leaders has been a discernable trend around the world. In 1992, the energetic 46-year-old Bill Clinton became president of the United States. Five years later, Britons voted Tony Blair into power, just days before his 44th birthday, making him the youngest prime minister since 1812. Following suit, the Spaniards and Germans also picked their most youthful leaders since the second world war, at the ages of 43 and 51, respectively.

Now, Russians have selected Dmitry Medvedev, 42, as their new president. In mainland China, the leadership reshuffle last year lowered the average age of provincial chiefs to 55, which was accompanied by a massive promotion of young and educated elites into provincial governments and national ministries.

The rise of young political leaders has been attributed to the arrival of the television age. Good looks are said to be more helpful than smart policies and experience when political contenders stand in front of the camera. While there might be some truth in this claim, a more convincing explanation is the call for change.

In many countries, voters are tired of an old political style that is often characterised by partisan voting in the legislature and a cosy relationship between the rich and the powerful. Young leaders are thus seen as possible healers for social wounds. Their inexperience is regarded as an advantage, because they carry no real or imagined baggage, unlike long-time insiders.

The call for generational change in Hong Kong politics also highlights the search for new styles as the city transforms itself into a fuller democracy amid rapid globalisation.

The underlying expectations for Hong Kong's future leaders - should they emerge through the September Legislative Council election, reshuffles in professional associations or the newly expanded political appointment system - are twofold. First, they will be tested on their ability to alleviate the stress of partisan politics that has fermented over the past decades. Parties have played a positive role in ensuring the government's accountability to the public, but excessive party politics weighs on the effectiveness of governance. With universal suffrage for the election of the chief executive on the horizon, the most divisive issue of democratic advancement is now dissipating and the public awaits signs of healing after a turbulent decade.

Second, future young leaders will also be tested on their ability to formulate and implement viable strategies to position Hong Kong in an era of globalisation. The intensified interdependence between Hong Kong and the world economy, as well as between the city and the surrounding territories, calls for leaders with a global vision and a keen awareness of the social impact of economic shifts in the world.

In this regard, new generations of political leaders will have to show an acute sense of social responsibility and a broad world vision. Merely appearing photogenic or being able to master YouTube will help little. Hongkongers will want to see substance in leadership. It is here that younger leaders will be put to the test.

Fortunately, political leaders from the post-war generation have laid the groundwork for the new generation to excel. The social capital, together with the established institutions, are assets for young leaders to work with. But much rejuvenation and reinvention are needed before Hong Kong can acquire new impetus for change.

Kitty Poon, an assistant professor at the Hong Kong Polytechnic University, is author of The Political Future of Hong Kong.

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Time to lay foundation for cities' integration


LEADER

Mar 11, 2008           
     
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Yesterday's agreements between Hong Kong and Guangdong confirm growing mutual interest in cross-border co-operation. A joint taskforce to study possible uses of the Lok Ma Chau Loop and a decision on the border crossing at Liantang follow the green light for the Hong Kong-Macau-Zhuhai bridge and last year's opening of the Western Corridor.

Guangdong, having become prosperous as the "factory of the world" with the support of investment from Hong Kong, has tended to give the impression that it no longer needs this city. The bridge, for example, won the support of Beijing and Hong Kong long before Guangdong came on board. Traffic on the Western Corridor crossing remains sparse because of cross-border licence restrictions on the other side. Nonetheless, the hardware of greater integration is slowly falling into place.

Lately, leaders across the border have conveyed a more positive approach. New provincial party secretary Wang Yang has emerged as a supporter of a "special co-operation zone" between Guangdong, Hong Kong and Macau with lower customs barriers and a liberalised flow of goods, people and funds. Provincial Governor Huang Huahua says Hong Kong and Shenzhen should consider forming twin cities. Shenzhen Mayor Xu Zongheng has called for a consensus on development of the Lok Ma Chau Loop. The long-standing interest in such closer links expressed by Chief Executive Donald Tsang Yam-kuen is being reciprocated.

The change in mindset reflects the stiffer competition being felt by the Pearl River Delta, especially from the Yangtze River Delta. Industry is defecting from the delta in the face of soaring costs of raw materials and labour and tougher pollution controls, not to mention worsening power cuts and government policies aimed at transforming the mainland into a service-based economy. In these circumstances, greater cross-border integration is an ideal whose time may be drawing closer than it seemed.

The ultimate goal of a Hong Kong-Shenzhen world-class metropolis surfaced in Mr Tsang's plan for a strategic partnership in his election platform last year. That calls for a degree of institutional integration that remains a long way off. But now that the infrastructure for closer links is taking shape, it is time for political leaders on both sides of the border to address practical obstacles to integration. For example, we should be planning for a time when vehicles from both sides can cross the border more easily. The present restrictions on people from Shenzhen coming to Hong Kong could not be maintained in a twin-city metropolis. A gradual liberalisation of the flow of people, such as extended visits to Hong Kong and a limited right to work, would extend our city's virtual boundary ahead of integration.

With the "one country, two systems" policy guaranteed until 2047, some experts, officials and businesspeople have understandably adopted a cautious approach to integration. But if it is going to happen eventually, it is in our interests to at least start thinking seriously now about putting sound stepping stones in place.


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US vies with China in the new scramble for Africa


Hagai Segal
Mar 12, 2008           
     
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Many people are likely to assume that the current tensions between the US and China are firmly centred in Asia - with Taiwan, North Korea or Central Asia as the likely area for any future conflict. But another less-headline-grabbing continent is starting to dominate Sino-American rivalries: Africa. Echoing the struggle between European colonial powers over African territory and resources in the late 19th and early 20th centuries, there is once again a "scramble for Africa".

Last week, US President George W. Bush embarked on a multistate African tour, a very visible sign of America's growing recognition of the strategic and economic importance of the continent, and its determination to catch up with China.

China's investment in Africa in the past few years has been little short of remarkable. China-Africa trade has increased tenfold from 1999 to 2006, to US$55.5 billion, according to the most recent official Chinese figures. China also satisfies just short of one-third of its oil needs from  Africa.

The US has been slower to embrace Africa and is now playing catch-up. Yet Mr Bush was last week at pains to play down Sino-American rivalries on the continent, assuring local leaders and the media that America's intentions are honourable.

In Ghana, Mr Bush said he wanted to "dispel the notion that, all of a sudden, America is bringing all kinds of military to Africa ... our policy is aimed at helping people".

He insisted that China was not the reason for his trip to the continent. "We can pursue agendas without creating a sense of competition," he said.

Despite these pronouncements, the Chinese march into Africa has seriously focused US minds, and is undoubtedly towards the forefront of US policy priorities on the continent.

On the back of Mr Bush's tour, the presidents of China and oil-rich Nigeria met on February 28 in Beijing ahead of the signing of new energy deals. Trade between the two states has more than tripled in the past six years. It has also been reported that the state-controlled China Development Bank is in talks to buy a US$5 billion stake in Nigeria-based United Bank for Africa.

China's most controversial African partnership, however, is with the government of Sudan, a regime accused of direct involvement in the genocide of more than 200,000 local Africans at the hands of government-backed Arab militia. Steven Spielberg recently said he had resigned from his role as artistic adviser to the Beijing Olympics over China's refusal to use its significant influence - as the single-largest purchaser of Sudan's oil - to apply pressure on the government in Khartoum to end the  genocide.

China has begun taking a more active role in Darfur, for example by despatching engineers to help prepare for the arrival of African Union and United Nations peacekeepers. Liu Guijin , China's special envoy to Darfur, held talks in Khartoum last week with Sudanese President Omar al-Beshir and the peacekeeping force chief, Rodolphe Adada, calling for a "concerted effort from the international community" on Darfur. But, in a statement that has dismayed China's detractors, Mr Liu reiterated that Beijing's traditional non-interventionist approach would remain a "cornerstone of Chinese foreign policy".

So, many are convinced China will remain unwilling to jeopardise its significant military, economic and diplomatic standing with Sudan by pushing too hard on Darfur.

A very 21st-century scramble for Africa is under way, with direct competition between China and the US now a reality. And, with the growing need for both to secure reliable long-term sources of energy and resources, the interest in Africa will only grow. Whether the average African citizen, never mind regional stability, will benefit from America's and China's courtships of African states remains less clear, however.

Hagai Segal, a terrorism and Middle East specialist, lectures at New York University in London


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Paranoia reaches Olympic proportions


OBSERVER
Alex Lo
Mar 13, 2008           
     
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For a paranoid person, it is often difficult to distinguish real foes from imagined ones. Politicians who have struggled for a long time in the trenches frequently display similar characteristics and have trouble telling the difference between real terrorists, political enemies and mere critics. It is telling that Wang Lequan , Xinjiang's party chief, was denouncing "terrorists, saboteurs and splittists", all in one breath. According to Mr Wang, terrorist hijackers, Uygur human rights activist Rebiya Kadeer and even the Dalai Lama all belong to these groups.

Mr Wang was speaking on Sunday on the sidelines of the National People's Congress in Beijing, where he first disclosed a police raid in January against an alleged terrorist cell run by the East Turkestan Islamic Movement, a Uygur group with links to al-Qaeda. He said the group was plotting to disrupt the Olympics. It is, evidently, not an easy job governing as a Han Chinese in a province where the ethnic Muslim minorities are the majority. The Dalai Lama, however, has reaffirmed his support for the Beijing Games this summer. It is not clear whether he was sincere.

At about the same time and in the same venue, Mr Wang's colleague, Xinjiang region chairman Nuer Baikeli, revealed that four Uygurs had been arrested last Friday for allegedly trying to blow up a China Southern flight from Urumqi to Beijing. Suddenly, Muslim terrorists are running amok in China. Or at least that was the impression the two senior Xinjiang officials have created, as their stories were splashed the next day on the front pages of most mass-circulation papers in Hong Kong.

Most ran bold headlines describing the incident last week as a "9/11-style hijacking". But since the terrorist mission, if there really was one, was thwarted, the September 11 scenario must remain hypothetical.

Actually, the controlled release of information and the hysteria in the media were very different from the terrorist attacks on the World Trade Centre. If one must draw a September 11 analogy, it was more reminiscent of the US media frenzy over Jose Padilla, one of the few terror suspects who made it to open trial and was originally accused of trying to build and explode a radioactive dirty bomb on US soil. Years after his arrest, it's clear that he was a misguided and incompetent foot soldier, "the wrong Muslim [caught] in the wrong airport on the wrong day", as one US lawyer put it.

Since there were no independent witnesses in the Xinjiang episode, we must place our trust in the official versions. We can, however, rely on our critical sense to gauge the political effects these official stories are creating. For one, they hook onto the same or roughly similar terror narrative familiar to Americans and Europeans: the threat of Muslim extremism. And they help justify an unprecedented security blanket that will envelope Beijing in the run-up to the Olympics and during the Games. But, in reality, it's hardly necessary to justify extreme security and unchecked displays of police power at important events these days, even in western democratic countries.

Ever since the mass protests and violent police response at the 1999 World Trade Organisation conference in Seattle, every international gathering has become an exercise in riot control, whether the situation calls for it or not. Ordinary citizens in western countries now tolerate police barricades, de facto curfews across whole city blocks and overwhelming use of force against protesters, during international meetings of very important people.

The Olympics is, arguably, even more significant and sensitive than any Group of Eight summit or WTO meeting. There will always be critics, but most officials and people from around the world will go along with whatever security arrangements are put in place for the Olympics. Still, Beijing is, understandably, paranoid about its most important (inter)national event in years.

Alex Lo is a senior writer at the Post


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No way forward on the Iran sanctions treadmill


Bennett Ramberg
Mar 14, 2008           
     
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The approval of fresh sanctions on Iran marks the third time that the UN Security Council has been galvanised to stem the nation's feared uranium enrichment efforts. Unfortunately, the new sanctions are unlikely to be any more effective than the first two rounds.

The United States has been on the sanctions treadmill for years. Between 2003 and last year, the US Treasury Department brought litigation against 94 companies for violating the ban against trade and investment with the Islamic republic. The State Department imposed sanctions 111 times against foreign entities that engaged in proliferation or terrorism-related activities with Iran. And both departments have used their power to freeze financial assets or access to the US financial system.

The results were barely a pin prick. Iran's nuclear programmes continued to be financed by international commerce.

Not only have sanctions failed to halt Iran's fuel cycle programmes, so have other avenues. The European Union's political and economic inducements went nowhere, as did cajoling by the International Atomic Energy Agency.

To be sure, Iran offered, in 2005 and subsequently, to tether its programme to international co-management, which arguably could have placed resident international monitors on site. But both the international community and Iran failed to follow through.

Some hope that the next US administration can stem Iran's nuclear ambitions through bilateral diplomacy. But Europe's negotiating experience raises doubts about that prospect.

Assuming that concern over Iran's nuclear "breakout" capacity mounts, this leaves the US and its allies with three options, each with its own risks. First, a naval blockade (reminiscent of the Cuban missile crisis) that halted both Iran's oil exports and imports of refined fuel would cripple the country's economy. But the US military would have to be able to prevent Iran from closing the Strait of Hormuz, through which much of the world's oil supply passes. A halt in Iran's oil exports alone would dramatically upset international markets and the Iranian leadership would probably dig in its heels to continue, if not accelerate, nuclear development.

Second, while a military strike would slow Iran's nuclear programme, facilities could be rebuilt in the absence of inspectors. The attack shock could trigger Iranian vengeance, regionally and elsewhere, with a global economic impact far exceeding that implied by a blockade.

This leaves an unsettling fallback option: an Iran on the cusp of becoming a nuclear-armed state confronting a nuclear-armed Israel. In that event, there remains the hope that mutual nuclear deterrence would promote mutual common sense.

With no dramatic improvement in the Middle East's grim political landscape, the failure of deterrence would bring the sum of all the fears of our nuclear age upon us.

Bennett Ramberg served in the US State Department's Bureau of Politico-Military Affairs during the George H. W. Bush administration


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Adroit officials duck the tough questions
145 days to go

OLYMPIC COUNTDOWN
Peter Simpson
Mar 16, 2008           
     
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The Olympics briefly took centre stage at the National Party Congress this week and government and Games organisers Bocog held a press conference in the Great Hall of the People. The event was a media crowd-puller, given that the annual government rubber-stamping sessions were occurring just 150 days before the Games.

For foreign correspondents tracking the long road to the Beijing Olympics, the opportunity to visit the citadel of Chinese politics was welcomed. Inside the Great Hall, elbow room was as tight as the security blanket that falls on the capital when the Communist Party bigwigs roll into town in their blacked-out sedans.

For fun, silly bets were placed on a new syndrome recently discovered at Bocog press conferences: It's called "Beijing Duck Question", or BDQ.

A BDQ is usually a question planted by Bocog or the government and asked by a correspondent from one of the state-media outlets. They are designed to allow the answering official to "state-the-bleeding-government-approved-obvious" in a rambling dialogue that eats up precious, serious news-hunting time.

Alternatively, a BDQ can be a random question that affords the Bocog respondent the same answer - a fortuitous opportunity to repeat statistics and platitudes.

Variants of BDQs have been around for years, of course. The new strain was so-named at a press conference two months ago. Then, 2008 Olympic promotion film directors, Briton Daryl Goodrich and Hong Kong's Andy Lau, were asked by a reporter just after Hollywood Oscar winner Steven Spielberg decided to quit his Olympic role over the Darfur situation: "Do you like Beijing duck?"

What the state media reporter of course couldn't ask, or didn't want to ask (or was oblivious to), was what the directors thought of Spielberg's snub.

Wagering on who will ask the first BDQ (and it's normally the usual suspects) and who can answer for the longest (ditto) helps quell frustration. In the Great Hall the odds were muddled, however. There were too many new faces from unknown media organisations.

As Beijing vice-mayor and Bocog vice-president Liu Jingmin led out opening-ceremony director Zhang Yimou, Bocog's deputy director of the Olympic Village Department, the former Olympic table tennis champion Deng Yaping, and vice-president of the General Administration of Sport, Cui Dalin, for questioning, all bets were off.

The presence of Zhang piqued interest, and not because he is the celebrated director tasked with raising the curtain on modern China during the opening ceremony.

Vice-mayor Liu explained with a liberal peppering of ubiquitous statistics that all was progressing smoothly with the Olympic effort. The conference was then opened to the floor, and Cui was asked the first question by a CCTV reporter.

"Will China top the gold medal table and meet the people's high expectations?"

Obviously the CCTV reporter had not seen the station's reports, nor read the many newspaper stories about the NPC Olympic sideline committee meeting held in public a week earlier.

There, Cui gave a passionate 50-minute speech urging the people to expect only a well-organised Games and not pressure athletes to beat the Americans on home soil, "because China is not very good at sports".

He all but repeated the same speech and then repeated details of the same, widely reported anti-doping measures China is planning. His total BDQ answering time was 13 minutes.

The next BDQ was directed at Deng.

"What is your specific portfolio?" asked a state-radio reporter.

BDQ answering time was just over seven minutes.

Reporters from various media organisations managed a slew of BDQs to fill the slotted probe time.

Most mainland journalists know the tough questioning adopted by foreign reporters - those designed to put officials on the spot and catch them off guard - never work in the mainland because the respondents are elusive and too well rehearsed.

Moreover, a leading question designed to ascertain truth is not worth the sacking from a hard-won job. The spectre of detention for humiliating the government is a real threat and no laughing matter.

Perhaps the mainland journalists have a name for the syndrome suffered by the international press: "Awkward But Unanswerable Show Boat Questions", or ABUSBQs.

These are the abrupt questions asked by foreign journalists - probes that act as half-reminders of real reporting yet yield the same non-news as BDQ answers in a shorter time.

"What discussions have you [during the NPC with your seniors] had on the recent terrorist incidents linked to the Olympics?" this column asked vice-mayor Liu. "I haven't any details [on this] ... I guarantee safety for all," he said.

ABUSBQs answering time was just over two minutes. Another to Cui on medal counts didn't clock 60 seconds.

Of course, the international press will never stop asking tough questions, but rarely rile officials into answering with something meaningful.

As one Bocog official told us, the likes of Liu and Cui can expect "a tsunami" of probes when the rest of the world's press arrive in town in a few months. Then, the days of the BDQs will be numbered.

As it was, it was left to Zhang to give some credence to the routine theatrics this week. He answered the awkward questions with sincerity, if not aplomb. He even had sympathy for all the interrogators.

"I feel as though I should offer you some answers," he said, and handed out a headline by revealing the opening ceremony would end with an image of 10,000 smiling children.

To counter claims that celebrities in cahoots with governments diminish politics, it should be stated - briefly: "Not in Olympic China, they don't."


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China trade a boon to US


Geoffrey Garrett
Mar 19, 2008           
     
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In the heat of the Democratic race for the presidential nomination last month, Senator Hillary Rodham Clinton summarised well the prevailing US sentiment about China: "China's steel comes here and our jobs go there. We play by the rules and they manipulate their currency."

But in reality, China is actually doing what America has long demanded on trade and exchange rates. In addition to reducing barriers to imports and export subsidies, Beijing has allowed the yuan to appreciate significantly against the dollar - by more than 14 per cent since the middle of 2005.

So why isn't the Bush administration silencing the Democrat's China bashing by trumpeting this apparent exchange rate victory? It's because the bilateral trade deficit with China, which a stronger yuan was supposed to reduce, continues to hit all-time highs - US$256 billion last year, a 10 per cent increase over 2006.

But playing to American insecurities about China is not the way to stabilise what will be the US' most important bilateral relationship over the next several decades. What the US needs is a new vision for its relations with Beijing, one based on further economic integration, not protectionism. This is the best way to sustain America's long 20th century economic boom well into this century.

Here are three trade secrets that should inform a "straight talk" revolution in Washington where China is concerned. First, the trade deficit with China will not go away soon. But this has more to do with macroeconomics than trade barriers in China.

Chinese domestic investment has boomed over the past decade, while the US economy has been driven by consumer spending. China has bought hundreds of billions of dollars to keep its currency down. But this has helped keep US interest rates low, allowing Americans to buy homes and to borrow against the real estate appreciation they expected.

All these trends have now been reversed. Beijing has allowed the yuan to appreciate against the dollar. It has also put the brakes on domestic investment for fear that its economy is overheating. In the US, the subprime meltdown has brought the economy to a near standstill in growth terms. The combined result of these abrupt macroeconomic reversals is that US exports to China have grown twice as quickly as Chinese exports to the US in the past two years.

So why does the US-China trade deficit continue to climb? The US exports to China less than one-fifth as much as it imports from China. The much faster growth on the much smaller exports base is still overwhelmed by the slower growth in the much larger import volume. Even if US exports continue to grow twice as quickly as imports from China, the bilateral deficit will increase for years to come.

But the rapid growth in US exports to China should be cause for celebration in the US. And rising Chinese imports provide affordable goods to Americans. Focusing on the trade deficit conceals this fact.

A second secret is that the bulk of Chinese exports to the US are not really made "by China". They are not even really "made in China". The Chinese economy today is in large measure an assembly platform for foreign firms to turn components designed and made elsewhere into final products, and then to export them to the rest of the world. More than 60 per cent of Chinese exports are in fact the sales outside China of multinationals operating in China.

Consider the iconic Apple iPod. Every iPod shipped from China and sold in the US adds to the country's trade deficit with China. But what Apple says on the back of every iPod is true: "designed by Apple in California, assembled in China" from chips, hard drives and screens made in the US, Korea and Japan. Chinese assembly adds only a tiny amount to the value of each iPod.

US manufacturing jobs are no doubt lost as a result. But these are in assembly - the lowest tech part of the production process. Jobs are also created, and they are in the highest tech and most innovative parts of the American economy - design, marketing, finance and logistics. This is not only a positive trade-off for the US economy, it is also positive for the US labour force.

A final secret is that the US has benefited from the vast quantities of dollars and Treasury bills (estimated at three-quarters of a trillion dollars) China has purchased in recent years to manage the dollar-yuan exchange rate. Ample China-funded credit kept US interest rates low after September 11 and the dot-com bust, fuelling both consumer spending and the run-up in housing prices.

It is time for US leaders actually to lead on China, rather than pander to understandable insecurities in middle America. Turning trade secrets into widely understood facts of life is a very good place to start.

Geoffrey Garrett is president of the Pacific Council on International Policy and Professor of International Relations at USC


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A financial crisis of confidence


Robert Samuelson
Mar 20, 2008           
     
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Some say it's the worst financial crisis since the Great Depression, but that judgment seems premature. What distinguishes this crisis is that it involves the entire financial system, not just depository institutions.

Previous financial crises so weakened US banks, and savings and loans institutions, that they lost their primacy. As recently as 1980, they supplied almost half of all lending - to companies, consumers and homebuyers. Now, their share is less than 30 per cent. The gap has been filled by "securitisation": the bundling of mortgages, credit card debt and other loans into bond-like instruments that are sold to all manner of investors (banks themselves, pension funds, hedge funds and insurance companies).

With a traditional "bank run", the object was to reassure the public. The central bank - the Federal Reserve in the US - lent cash to solvent banks to repay worried depositors and pre-empt a panic that would spread to more and more banks, ultimately depriving the economy of credit. But now the fear and uncertainty centre on the value of highly complex, opaque securities and the myriad financial institutions that hold them.

At the epicentre of the crisis are the subprime mortgages made to weaker borrowers and subsequently securitised. On paper, the financial system seems to have ample resources to absorb losses. Commercial banks have US$1.3 trillion in capital; US investment banks in 2006 had an estimated US$280 billion in capital - and other investors, including foreigners, may hold half or more of subprime loans. But no one knows who or how much. Recent estimates of subprime losses range from US$285 billion to US$400 billion. They might go higher. Ignorance breeds caution and fear.

The stunning fall of Bear Stearns reflects these realities. America's fifth-largest investment bank funded most of its operations with borrowed money. On average, the ratio of borrowed money to underlying capital for investment banks and hedge funds is 32:1, according to a recent study. Many of these loans - commercial paper, "repurchase agreements" and bank credits - are backed by the securities owned by the borrowing financial institutions.

What this means is that if lenders became worried about the worth of these securities, they might ask for more collateral or pull their loans. That's what happened to Bear Stearns. Deprived of its credit lifeblood, Bear Stearns either had to collapse or be sold to someone with credit. JP Morgan Chase bought Bear Stearns for US$236 million. It was valued at US$20 billion in January 2007.

Whether Bear Stearns was the victim of unfounded rumour or of genuine rot in its securities portfolio is unclear. But the very uncertainty defines the nature of the modern financial crisis - and the difficulties facing the Fed in trying to contain it. Financial institutions are interconnected through networks of buying, selling, borrowing and lending. These require confidence that commitments made will be honoured. If the confidence collapses, the processes of extending credit for the economy and of trading - for stocks, bonds and foreign exchange - may also collapse.

In trying to calm the markets, the Fed has spewed out huge sums of money and credit that have depressed the US dollar's exchange rate and could aggravate inflation. The effort to fix one problem may lead to others.

Robert Samuelson is a Washington Post columnist


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Deadly dilemma


KITTY POON

Mar 24, 2008           
     
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The murder of four female prostitutes in Hong Kong recently has brought the safety of sex workers into the spotlight. It has also exposed the community to the controversy surrounding the issue of legalising the sex industry.

Although some advocates believe that sex workers would be better protected if the industry was given legal status, the rights of sex workers must be weighed carefully against prevailing social norms and legal order in the city.

How to maintain a delicate balance between these two sets of values presents a huge test for the community as a whole.

The killings illustrate the downside of one-woman brothels, a prevailing form of prostitution within Hong Kong's legal limits. Due to their relative isolation and invisibility, sex workers in these brothels can - and do - fall prey to violence, robbery and even murder.

Yet, to legalise the sex industry, as it is practised in other countries, still needs to be thoroughly debated. The viability of this model has to be considered within context: Hong Kong is facing an influx of migrant sex workers - most of them from the mainland, on tourist visas.

It has been estimated that more than 10,000 mainland women have been arrested, prosecuted and sentenced in Hong Kong from 2001 to 2006; many of them were involved in criminal and/or immigration offences related to sex work. And it is reckoned that Hong Kong's female prison population has expanded beyond the capacity of the government facilities.

Moreover, these figures do not take into account those who are able to evade detection, or those who arrived in the city legally, with work permits, and who are employed as hostesses in restaurants or entertainers in karaoke bars.

The massive shift in prostitution trends since the 1990s illustrates the impact of the influx of migrant sex workers. The price of going to a prostitute has dipped, from more than HK$400, to an average of HK$200, in one-woman brothels.

Yet, owing to their short stays in Hong Kong and the high cost of a visa - estimated at between 10,000 yuan and 20,000 yuan (HK$11,000-HK$22,000) for a three-month visa - migrant sex workers are willing to work from morning until night while tolerating exploitation and abuse. This results in cutthroat competition and an increased propensity for risk-taking for both local and migrant sex workers.

Thus, legalising the sex industry may not be a viable solution. Legalisation implies that local sex workers would have to pay licensing fees, taxes and for medical examinations.

This added burden for local prostitutes would further increase the lure of underground sex workers. Meanwhile, it could send the wrong signal to owners of restaurants and karaoke bars involved in human trafficking. As their profitability increases, so would the burden on the law-enforcement agencies.

In fact, the increasingly blurred border between Hong Kong and the mainland already makes the preservation of law and order within the special administrative region extremely challenging.

The huge income disparity between Hong Kong residents and those from poor mainland provinces means that more women will take risks for financial gain while they stay here.

Moreover, legalisation may cause jitters among ordinary citizens who are not yet ready to see the sex industry move beyond a very limited scope.

Though tragic, the recent killings have at least raised public awareness of the poor conditions endured by sex workers. The incidents have also prompted sex workers to adopt self-defence measures.

While the public, activists and the government all need to share responsibility to effectively protect sex workers as a marginalised group, the huge leap to a legalised industry can only come after careful deliberation.

Kitty Poon, an assistant professor at the Hong Kong Polytechnic University, is author of The Political Future of Hong Kong


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A clean slate


FRANK CHING

Mar 26, 2008           
     
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The landslide victory of Ma Ying-jeou ushers in a new era of hope for Taiwan - hope that the island can develop its economy rather than be bogged down in endless ethnic conflicts, hope for improved relations with the United States but, most of all, hope that cross-strait relations may finally improve after eight years of tension and suspicion.

Beijing should be hugely reassured by the outcome of the election, which shows that Taiwan's people have no desire for confrontation. The defeat of Frank Hsieh Chang-ting, the ruling Democratic Progressive Party's candidate, shows there is nothing to fear from most people on the island identifying themselves as Taiwanese. Mr Hsieh was defeated despite this ethnic identity.

The Taiwan electorate wants change from the politicisation of the past eight years, and from former president Chen Shui-bian's constant harping on about national identity, ethnic differences and historical issues. But these could resurface if the Kuomintang fails to show that it, unlike the DPP, can govern efficiently and effectively.

At the same time, Mr Ma will have to show the 23 million people of Taiwan that he is not going to sell them down the river while improving relations with the mainland, both economically and politically. Mr Ma insists that he will not negotiate the future of Taiwan but, rather, wants to end the cross-strait hostility.

The US can help by signalling that it recognises the importance of the sea change that has taken place in Taiwan. It can bolster the new leader's standing by inviting him to visit Washington before his inauguration, knowing that, as serving president, it will not be possible for him to visit. Such an invitation should not be offensive to Beijing; rather, it should send a signal that the US has high hopes for the Ma administration and that, under the new dispensation, the envelope will no longer be pushed in support of de jure independence.

But it is Beijing, by far, that can ensure the success or failure of the new Ma administration. It should realise that the time is not ripe for any talk of unification. Instead, this is a time for restoring trust on both sides.

If Beijing attempts to push unacceptable preconditions on Mr Ma before there can be a dialogue, or sees his presidency as an opportunity to bring Taiwan to heel, then the cross-strait deadlock will probably worsen, and Mr Ma's position will become untenable. In that case, the DPP may well return to power. Beijing clearly welcomes Mr Ma's victory, despite some of his public utterances, including raising the possibility that Taiwan might boycott the Olympics if the crackdown continues in Tibet.

Beijing should be satisfied that Mr Ma has promised not to seek independence, even though he has ruled out the possibility of talks on reunification.

The mainland should understand that this is a window of opportunity for ending the poisonous atmosphere in cross-strait relations. The next four years are a time for it to be flexible and reasonable rather than doctrinaire. This is the time for President Hu Jintao to show that it is possible for a cross-strait dialogue to take place on the basis of equality and not attempt to browbeat Taiwan and hem it in on all sides.

The mainland can show that it does understand Taiwan's need for international space. One obvious move is to end its opposition to Taiwan's bid for observer status in the World Health Assembly, a status that is not limited to sovereign states, while continuing to oppose full membership for the island.

Beijing can show its peaceful intentions by announcing that it will halt its build-up of missiles on the coast opposite Taiwan. Better yet, it can announce a redeployment of these missiles. The move would be largely symbolic since the missiles are mobile and can be put back in position at any time, but the mainland should understand that symbolism is highly important.

This election has gained time for both sides to work out an acceptable accommodation. They have four years in which to make progress. There is no time to waste.

Frank Ching is a Hong Kong-based writer and commentator

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It's time for Beijing to rethink Tibet policy
LEADER

Mar 21, 2008        
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Eleven days after violence broke out in Tibet , two contending versions of what happened have emerged. The central government has put the blame squarely on the Dalai Lama's government-in-exile for starting riots in Lhasa and other parts of the country that have claimed the lives of 13 people. But Tibetan exiles have claimed they merely staged peaceful demonstrations, and that close to 100 protesters died in a crackdown by security forces.

With the international media barred from reporting on the ground, reports in the western media have tended to draw heavily on the Tibetan exiles' accounts. Meanwhile, the mainland's state-controlled media has been dominated by official accounts, which focus on the violence the rioters have inflicted on innocent people. The conflicting reports have left a cloudy picture of what really happened. Far more worrying is their adverse effect of reinforcing the west's image of Beijing as a repressive government, and ordinary Chinese people's view of the west being keen to demonise China.

Whatever the truth, the central government's policy towards Tibet has clearly failed. After almost half a century of direct rule, Beijing has failed to win over the hearts and minds of its people.

In terms of economic well-being, Tibet has long been the country's poorest region. But the nation's economic growth in recent years has given it the opportunity to pour in billions of dollars to push forward development. Building houses and infrastructure has been a key policy, most visibly with the opening in 2006 of a high-speed rail connection to Lhasa that has finally made fast and economic travel to the isolated region possible.

Yet material benefits have obviously failed to impress the Tibetans, whose culture is based on religion and whose traditional political system is a theocracy. While the Communist Party, which upholds atheism, has ceased being so hostile towards religion, there is no question of it loosening control over the way Buddhism is practised in Tibet. As the influx of Han Chinese to the region increases, the materialism they bring along has upset Tibetans, who feel they are being sidelined. Add to it the pull of the Dalai Lama, and a fertile ground for dissent has been created.

Tibet is officially an autonomous region but its degree of autonomy has been disputed by Tibetans. Last year, 60 per cent of government workers in the region were Tibetans and ethnic minorities, down from 70 per cent in 2005. Han Chinese held virtually all the top Communist Party posts at the county and prefecture levels. No wonder Tibetans do not feel they are masters of their own destiny. The Dalai Lama is ageing. What will happen if he goes ahead with threats to quit his political post in the face of the radicalisation of his cause by young Tibetans is unclear.

For the good of the people of the region and China's international standing, Beijing needs to rethink its policy on Tibet. Ideally, Hong Kong's model of "one country, two systems" might be a solution. But the central government is clearly concerned its application to Tibet might also spark similar demands from Xinjiang and Inner Mongolia, which are also regions with ethnic minorities. But real efforts need to be made to let Tibetans truly run Tibet in order to calm sentiments and breed stability in the restive region.

With the country's coming-out party, the Olympic Games, just five months away, such a shift would give Beijing a golden opportunity to markedly alter perceptions that it is a repressive regime that tramples on rights.

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Rude awakening


PETER KAMMERER

Mar 28, 2008           
     
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The best place to observe humanity at its worst is on public transport. Whether it is the battle to get on or off at rush hour, guessing which passenger in a packed carriage is likely to be a sexual harasser or trying to get the attention of a seated teenager pretending to sleep so that the pregnant woman can have a rest, etiquette seems to go out of the window when it comes to commuters.

Manners vary between cultures. But there are basic ones that people the world over are taught as children, among them not to push and shove, good sportsmanship, opening doors for others, and respecting the elderly and disabled. To do otherwise is to be rude.

These simple social skills are falling by the wayside the world over, if a quick scan of internet blogs is any guide. From London to New York and Tokyo, people are lamenting that manners, particularly among the young, seem to have gone the way of bygone eras.

Hong Kong is not immune. We have intricate eating and business etiquette, but the basis of politeness clearly does not extend to train carriages or buses and trams.

While the majority of passengers abide by the social rules instilled by parents and schools, there is a sizeable number who were either not taught such rules, did not listen to them or have had a memory lapse.

There is ample backing for this claim in observations I and my colleagues have made of late. Most usually, the lack of regard for others is in the form of people pushing onto a train or into a lift before passengers have got out, and someone speaking overly loud on a mobile phone. But there are any number of other displays of rudeness. There is the woman who slipped off her shoe on the MTR and started cutting her toenails, which cannot fail to illicit disbelief. Or the young man who thought that his commute was an ideal time to tone his arm muscles by doing chin-ups on the bar above his seat without regard for the people sitting on either side. Ignoring those carrying babies and the aged is common, as is the person with an MP3 player blaring so loud through ill-fitting headphones that nearby passengers are also treated to the cacophony.

These instances may sound like the petty whines of middle-aged perpetual complainers, but then, those who have made them are mere residents. What must a tourist or a businessperson think of our city if such indiscretions are frequently witnessed? A burp of appreciation at a banquet or a handshake that is too firm can be readily passed off, but public displays of bad manners give a poor general impression of a society.

Then there is our own view of ourselves. To abandon caring about others is to lose an essential part of a city's fabric. Self-centredness breeds, at the least, disregard and, at worst, contempt.

Transport officials in the Japanese city of Yokohama know this only too well. They have introduced a model which Hong Kong would do well to follow: a team of people well versed in politeness who travel the city's trains issuing gentle warnings to people who are out of line. Wearing easily identifiable bright green uniforms, the 11 mostly 60s-plus men and women officially known as "manner upgraders" are accompanied by bodyguards - just in case a commuter does not like being ticked off.

Just exactly what "good manners" are is a debatable point. A spokesman for Yokohama's transport bureau told the Weekly Yomiuri magazine that authorities would be looking into the matter in considerable detail. In the meantime, though, those aspects of polite society that were being ignored in the rush to get from one place to another would be dealt with by the manners team, he said.

The revelation that Japanese, widely considered to be among the world's politest people, are worried about the state of manners should be a wake-up call to other governments. It should be even more so for Hong Kong, especially as being an international city with global values is so integral to our economic evolution.

Peter Kammerer is the Post's foreign editor

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Unity needed on cross-border divorce


LEADER

Mar 31, 2008           
     
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For all the efforts by authorities to bring cross-border systems more in line, outstanding gaps remain when they come to marriage and divorce between Hong Kong and mainland people. It is time such gaps, which are the source of constant agony for the parties concerned, are plugged.

As we report today, one mainland woman is at wit's end because she is unable to see the child her Hong Kong husband has custody of. The Guangdong court that approved their divorce gave her visiting rights, but her husband has reneged on the agreement and is preventing her from spending time with her daughter. Because of the inflexibility of immigration regulations and the lack of a mechanism to enforce the mainland ruling, she is being denied her legal rights.

Her plight springs from immigration rules that stipulate that a newlywed mainlander has to wait five years before being able to apply to permanently join their partner in Hong Kong. This does not happen when a wedding involves a permanent resident and a spouse-to-be from another country; in such a case, residency can be applied for automatically and it is inevitably granted in short order.

When marriages break down before five years, enforcement of divorce orders by courts on either side can be difficult. Visiting rights are often a bone of contention among divorced and separated couples even when they are living in the same city. So, too, are payments of child support and maintenance, which can easily be stopped. The barriers that exist between Hong Kong and the mainland exacerbate these already trying situations.

As integration between Hong Kong and the mainland deepens, it is inevitable that cross-border unions will continue to rise. There is clearly a need for a government mechanism to help smooth over these issues. Without such provisions on both sides of the border, marriage and divorce will be fraught with frustration and uncertainties. Separation will increase the chances of marriages breaking down, and children born early in such unions will not have both parents caring for them for the majority of their formative years.

Going to court over divorce is never easy. Resolving marital conflicts through mediation is preferable because it reduces the possibility of entrenching attitudes on both sides and creating greater animosity. But sometimes, people are unable to budge and reach an amicable agreement. Ensuring that the couple has every opportunity to resolve differences and, if divorce does take place, recognise and enforce court orders, is essential.

Hong Kong's rules on cross-border marriages are grounded in trying to prevent weddings of convenience. In light of the economic attractiveness of our city to mainland people, there is still a need for wariness. Nonetheless, with the number of marriages registered in Hong Kong involving mainland spouses rising eight-fold since 1997, the five-year requirement should be relaxed, perhaps to three years, before it is eventually abolished.

An increasing number of marriages inevitably means more divorces. Regulation of matters pertaining to divorce need strengthening. Alimony payments could be made through a publicly administered fund which could disperse the money to the beneficiary. A government body could deal with custody issues to ensure that they are enforced.

Enforcement of civil judgments has always been problematic in Hong Kong. Mechanisms to ensure that agreements are honoured would go a long way to correcting the flaws that exist.


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Politics has no place at the Olympics


LEADER

Apr 01, 2008           
     
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The Olympic torch relay is the symbolic start to the world's greatest event. In keeping with China's aim of the Beijing Games being a showcase of the nation's emergent might, what will be the most grandiose such run ever kicked off in Tiananmen Square yesterday amid fanfare and celebration.
Tight security and the acknowledgement by Premier Wen Jiabao that protests could disrupt the relay highlighted another facet of the event. Protests by Tibetan activists that marred the lighting ceremony for the torch in Greece last week were a likely foretaste of what runners could expect along the 137,000km route through 20 countries. Large demonstrations are planned by critics of China's human rights and environmental records along the way.

Concerns about China's social development amid its burgeoning economic growth are justified. But there are well-established mechanisms through which these can be pointed out. The Olympics are not such a place. Never before in the 72-year history of the torch relay has it been targeted in such a manner.

But Beijing should not be surprised that such efforts are being made to hijack its coming out party. Like any big country, China naturally attracts criticism for some of its domestic and foreign policies both at home and overseas. The country needs to learn how to deal with them with confidence, taking suitable measures to address shortcomings and articulate its position with eloquence.

For too long, mainland officials' instinctive response to any attempt to challenge authority was to crack down on those who dared to speak out and to denounce them as having ulterior motives. That is a certain recipe for a public relations disaster. The leadership has to realise that maintaining stability does not mean keeping a lid on those who hold different views or values. A modern society has to learn to live with diversity. This can only come about through respecting the rights of citizens to air their grievances. The media has to be allowed to operate freely so that there can be transparency. For their part, critics need to know that these are changes that cannot take place overnight. They will certainly not come about through protests at the Olympics; such measures are guaranteed to only harden Beijing's resolve to not listen.

Although the Olympic Games are a sporting event, their role in building national pride and projecting an international image can also be perceived as making the occasion a political one. That is why governments and groups opposed to the policies of the host nation have in the past resorted to snubbing the opening ceremony or withdrawing their athletes. Such occurrences were common during the cold war between the former Soviet Union and the United States, most notably for the Olympics in Moscow in 1980 and in Los Angeles four years later.

Times have since changed markedly. The world has become globalised and the tensions that marked the cold war have dissipated. China's economic growth has it marked by some governments as a rival, but they must not use this as a reason to push agendas through events like the Olympic Games. Politicising the Olympics is wrong. The event is a celebration of sporting excellence in which the world's elite athletes in their field of endeavour compete against one another to determine who is the best. Their careers centre on achieving the ultimate goal of an Olympic gold medal; they train long and hard for the opportunity.

But the Games are also about unity. They bring together nations under a common banner of which politics is not a part. Politics is for the United Nations and other international bodies set up to deal with the world's concerns, not the Olympics. As the torch-relay runners make their way around the world towards their target of the August 8 opening of the Games, governments and activists need to keep this firmly in mind.


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McCain's road to a war without end


Eugene Robinson
Apr 02, 2008           
     
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Quite a "defining moment" in Iraq, wasn't it? At this rate, John McCain is going to be proved right: the war will last a century.

That is indeed what Senator McCain said, by the way, no matter how his apologists try to spin it. Those who claim that, by "a hundred years", he was talking about a long-term peacetime deployment, like the US military presence in South Korea, are being disingenuous or obtuse. In and around Seoul, citizens aren't shooting at American soldiers or trying to blow them up with roadside bombs - and US combat forces aren't taking sides in bloody internecine battles over power and wealth.

It was US President George W. Bush who called the fighting in Basra and other Iraqi cities a "defining moment" for the fledgling government. By that standard, Prime Minister Nouri al-Maliki has been defined as an impulsive leader and an inept general - and his government as a work barely in progress.

Mr Maliki's decision to send troops into Basra and root out the "criminal gangs" that controlled the city was praised by the White House as a bold move to assert the Iraqi government's sovereignty. In reality, though, it looked more like an attempt to boost Mr Maliki's political standing by dealing a blow to the Mahdi Army and its leader, the cleric Moqtada al-Sadr.

Iraqi forces launched their offensive and were immediately met by what Mr Maliki's defence minister called unexpectedly strong resistance. The government might have suffered a humiliating defeat if not for face-saving US and British intervention.

Mr Maliki was forced to sue for peace, Mr Sadr magnanimously accepted, and the fighting ebbed. The Mahdi Army remains entrenched, and armed to the teeth. Mr Maliki's regime looks less like a government than just another faction. All of which illustrates the insanity of the open-ended Iraq war policy that Mr Bush has followed and that Senator McCain vows to perpetuate.

What, exactly, did the US use its military might to accomplish last week? It intervened in a struggle among various Shiite power centres for control of a city where much of Iraq's oil industry - and, thus, much of its potential wealth - is based. It supported a political figure who was trying to weaken another political figure in advance of the coming elections. It boosted the morale and fervour of the most implacable opponents of continued US occupation.

Does any of this have anything to do with America's vital interests? You could argue that Basra is important because of the oil, but the city is no more under Baghdad's control today than it was two weeks ago.

Please note that, throughout this episode, you haven't heard the name al-Qaeda. According to Mr Bush and Senator McCain, isn't Iraq supposed to be the central front in the "war on terrorism"? Wouldn't the only plausible reason for continuing the occupation of Iraq be to fight terrorists - rather than help one Shiite leader against another?

Mr Bush's troop surge was supposed to buy time for Iraq's leaders to achieve reconciliation, and for Iraq's armed forces to improve so they could operate on their own. On both counts, we see the results.

If Democrats need several more months settling on a presidential nominee, they had better find some way to stop giving Senator McCain a free ride on Iraq. He should have to explain why he wants to keep us on Mr Bush's long, winding path to nowhere.

Eugene Robinson is a Washington Post columnist


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Mortgage rescue plan is a house of cards


Robert Samuelson
Apr 03, 2008           
     
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In politics, it is imperative to be seen as "doing good". The US housing crisis is a case in point, as Congress now seems increasingly intent on aiding millions of homeowners who may face foreclosure. This sort of rescue looks good, even though it is a bad idea and might perversely delay the housing recovery.

No reasonable person takes pleasure from seeing people lose their homes, and Congress is upset. Estimates of defaults this year go up to 2 million. That would be about 2.7 per cent of the 75 million owner-occupied homes - the highest rate since the second world war, says economist Kenneth Snowden.

The best-known congressional plan comes from democrat Barney Frank, chairman of the House Financial Services Committee. (The Bush administration is reportedly considering a similar plan.) It would authorise the Federal Housing Administration (FHA) to guarantee US$300 billion of new loans to strapped homeowners, allowing them to refinance their existing mortgages at lower rates and lower outstanding amounts. Under it, homeowners who borrowed from January 1, 2005, to July 1 last year would be eligible for new loans if their monthly payments exceeded 40 per cent of their income.

Existing lenders would have to take a sizeable writedown to qualify. The FHA would pay no more than 85 per cent of the property's appraised value; it would then charge the homeowner for a loan at 90 per cent of that value. The extra 5 percentage points are a cushion against losses.

Everyone wins, say supporters. Homeowners stay in their houses. Neighbourhoods don't suffer the potential blight of numerous foreclosures. Housing prices don't go into a freefall. Although lenders take a loss, the losses are lower than if homes went into foreclosure.

But, there are two problems: one moral, the other economic. About 50 million homeowners have mortgages. Who wouldn't like the government to cut their monthly payments? But Mr Frank's plan reserves that privilege for an estimated 1 million to 2 million - the most careless borrowers.

The justification is to prevent an uncontrolled collapse of home prices that would inflict more losses on lenders and postpone a revival in home buying and building. This gets the economics backwards. From 2000 to 2006, home prices rose 50 per cent or more. Affordability deteriorated, with buying sustained only by a parallel deterioration of lending standards. With credit standards tightened, home prices should fall, to bring buyers back and reassure lenders that they're not lending on inflated properties.

If saving distressed homeowners delays this process, the aid the government gives some people will be offset by the adverse effects on would-be homebuyers and overall housing construction.

None of this means that lenders and borrowers shouldn't voluntarily agree to loan modifications that serve the interests of both. Although the process is messy, promising to lubricate it with massive federal assistance may retard it, as both wait to see if they can get a better deal from Washington.

Robert Samuelson is a Washington Post columnist


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Enemy of the state


FRANK CHING

Apr 09, 2008           
     
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In recent weeks, Beijing has been telling the whole world that the "Dalai clique" has been guilty of inciting violence in Tibet , resulting in arson and death. However, this does not mean that non-violent protests are acceptable; far from it. The headline on the front page of Friday's International Herald Tribune tells the story: "Dissident in China gets prison for essays." There you have it: 34-year-old Hu Jia was sentenced to 3-1/2 years in prison for nothing more than writing five essays and giving two interviews. And, according to Xinhua, this was a "lenient" sentence.

Maybe it is time to remind Chinese officials and judges of what is in their constitution. Article 35 says: "Citizens of the People's Republic of China enjoy freedom of speech, of the press, of assembly, of association, of procession and of demonstration."

What kind of protection does the constitution offer if a man can be sent to prison simply for expressing his political views, writing them down, disseminating them on the internet and telling other people what they are? Such actions - non-violent expression of a person's views - are precisely what freedom of speech is all about, but apparently this is not the case in mainland China.

Asked about Hu's case at a press conference before the verdict was announced, Premier Wen Jiabao said that it would be "dealt with according to the law". He added that Beijing was still studying the implementation of the International Covenant on Civil and Political Rights and hoped to ratify it "at an early date".

That would be good news for Hu and his family because the covenant, which is accepted by the vast majority of members of the United Nations, makes an individual's freedom of expression crystal clear. Article 19 says: "Everyone shall have the right to freedom of expression; this right shall include freedom to seek, receive and impart information and ideas of all kinds, regardless of frontiers, either orally, in writing or in print, in the form of art, or through any other media of his choice."

This is precisely what Hu did. He exercised his freedom of expression, which is protected under international law. The problem is that China has not ratified the covenant, even though it signed it a decade ago.

China has been saying for a long time that it will "at an early date" ratify the international treaty. Only last December, at the latest China-European Union summit, Mr Wen also made that promise, and the EU "welcomed China's commitment to ratify as soon as possible".

If China is really planning to ratify the covenant soon, it should be moving to amend existing laws that are inconsistent with the covenant, instead of using them to throw people in prison.

So, how can a man be jailed simply for writing some essays? According to Xinhua, Hu had "libelled the Chinese political and social systems, and instigated subversion of the Chinese state".

Why should a great country like China, with the world's fourth-largest economy, a permanent seat on the UN Security Council and a powerful military second to none in the region, be afraid of one individual, even if he was being critical of the government? Is China so weak, so fragile, that the words of a few political dissidents can shake the foundations of the country?

Now consider the things that Mao Zedong used to write and say. On the eve of the Cultural Revolution, he wrote his now famous call to "bombard the headquarters" that unleashed the Red Guards. That was incitement. It was a call to overthrow the leadership. As a result, countless numbers of people were imprisoned, tortured and killed by Red Guards, including the head of state, Liu Shaoqi .

Was Mao ever arrested and charged with incitement? No. He became the Great Helmsman. Today, his embalmed body is enshrined in a mausoleum in Tiananmen Square, his picture hangs atop Tiananmen Gate and thousands of people bow reverently when they silently file past his body every day.

Why send Hu to prison when someone far more guilty was never prosecuted? Is there one law for the powerful and one for everyone else?

Frank Ching is a Hong Kong-based writer and commentator

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Fok puts positive spin on a prickly subject
114 days to go

OLYMPIC COUNTDOWN
Peter Simpson
Apr 13, 2008           
     
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Image counts for everything in the instant culture dominated by the electronic media. For example, control-obsessed China has been seen by the world to be floundering in its handling of the Olympic torch relay and - literally - running away with itself.

Your mother might advise: "Don't believe in first impressions." The International Olympic Committee (IOC) is heavily reliant on its image as a major event-maker - an organiser that wishes to bring to the world harmony, unity and peace through fair and open human endurance, otherwise known as sport.

Another image-conscious Olympian is Hong Kong sports supremo Timothy Fok Tsun-ting, who looked very dapper this week dressed as he was in a blue blazer emblazoned with the Hong Kong National Olympic Committee badge, worn proudly on the left breast pocket, white chinos and highly polished shoes.

Indeed, his business card presents an image of a busy man obsessed with helping his community. His various positions include IOC member and president of the Hong Kong Sports Federation and Olympic Committee, to name but a few.

However, observed from the other side of the vast lobby at the China World Hotel in Beijing, where the IOC held crunch 2008 Beijing Olympic meetings all week, Fok gave the image of man preoccupied.

"I'm very nervous," he admitted. As he spoke, he was waiting for the IOC executive board to decide the fate of nine overseas passport-holding athletes hoping for special dispensation to allow them to compete for Hong Kong.

Just two hours later, Fok learnt that only three would be allowed to go for gold on Hong Kong's behalf this summer.

With disappointment looming, Fok was keen to look to the future. He conjured up in his mind's eye a time when his native, beloved Hong Kong would not be known as a hotbed of capitalism, but instead famous as a Mecca for sports fans; a place where state-of-the-art venues and training camps churn out medal-winning athletes.

Back on earth - and before Fok's candid discussion reached the topic of his proposed promised land - another burning issue was on the agenda.

Images of the doused iconic torch and protesters scuffling with security officials was at the forefront of delegates' minds - including Fok's - hours before the crunch IOC decision that crushed the dreams of six Hong Kong hopefuls.

"The Olympics has become a victim of its own success. Now it's become the most important and high-profile sporting event. And it's also become a platform for everybody to vent their personal agenda," concluded Fok as a week of Olympic trouble ended.

"Ever since I joined the IOC, I have remembered the pledges you must take - that any decision I take as a member will not be based on any political or financial considerations.

"Now, demonstrations are in fashion. But we must maintain that decree. We are here to look after the sports and the welfare of the athletes."

He added: "We should remind everyone that this torch is part of the Olympic history. It does not belong to Beijing or London, or to anyone country or person. We must remember that in ancient Greece - where the Games were founded - they stopped wars to hold the Olympics."

Of course, it is reasonable for Fok to recall history in order to justify his Olympic aim. He is a passionate believer in the Olympic movement, so all power to him for taking up the fight for Hong Kong's Olympics quests and sporting aspirations.

Amid the calls for calm - echoed all week by both Bocog and the Olympic family - an obviously upset Fok said: "It broke my heart to see somebody snatch the torch out of the wheelchair-bound athlete's hand.

"Beijing, and China, has changed greatly. The capital has gone through a huge transformation."

He winced as another horrible image raced through his mind. Was it images of Falun Gong members or free Tibet protesters grabbing the flame from the hands of another disabled runner on Nathan Road and dousing it in the harbour that so upset him? He inhaled a deep breath... "If somebody in Hong Kong gets ..." he says, unable to describe the rest of the horrors flickering away in his mind's eye.

"We must have adequate protection around the torch," he said.

"Oh, why", you can imagine the IOC leadership and Bocog asking this week, "is it that all the Olympic followers are not like image-conscious Timothy Fok."


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Why stop at China?
The fury vented at Beijing over Tibet could be harnessed into a global war on wrongdoing

Michael Chugani
Apr 15, 2008           
     
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Now that there is such renewed passion over human rights leading up to the Beijing Olympics, why waste all this new-found fury by aiming it at China alone? Why not mount a global war on rogue behaviour by tapping into all this anger over China's heavy-handedness in Tibet?

There must be plenty of other worthy targets if we put our minds to it. Just imagine what we can achieve in the name of human rights by socking nations in the eye through threats, humiliation, street riots and boycotts.

We can do this by harnessing the righteous rage we are now seeing from Londoners, Parisians, San Franciscans, German Chancellor Angela Merkel, French President Nicolas Sarkozy , British Prime Minister Gordon Brown, Australian Prime Minister Kevin Rudd, American President George W. Bush, United Nations Secretary General Ban Ki-moon, and others.

The US Congress can get us all started on this crusade, since it considers itself to be the conscience of the world. It has voted 413-1 to condemn China's handling of the Tibet riots. That is indeed a grand display of its fervour for human rights. But why stop there? We need more unanimous votes of this kind if we are to have a global crusade.

So, if the US Congress can take its eyes off China for a moment and cast its conscience elsewhere, as well, it will find there is much work to be done. Take the Palestinians, for example, who must be wondering why no one, not even Mr Sarkozy - who has reportedly laid down conditions for attending the Olympics - has threatened boycotts when Israeli bombs flatten their women and children.

Well, actually there have been quite a number of lopsided votes by the US Congress on the issue. But it seems to have got its conscience all muddled up. Instead of voting to condemn the oppressor, as in the case of China over Tibet, it has voted consistently to condemn the oppressed Palestinians rather than the Israeli occupiers. Maybe it's got something to do with the fact that Israel is a US ally. It wouldn't do to be righteous towards a friend.

That may also explain the US friendliness with oil-rich Saudi Arabia, where human rights are non-existent, alleged robbers have their hands chopped off, women aren't allowed to drive, and religious freedom are dirty words.

While Palestinians struggle to survive under a brutal Israeli blockade and Saudi robbers wonder why no one cares about their hands being chopped off, Pakistanis must also be wondering why the Chinese are getting so much flak over Tibet, yet their own president, Pervez Musharraf, is spoken of in glowing terms by Mr Bush. This is despite the fact Mr Musharraf seized dictatorial powers by overthrowing a democratically elected government.

Maybe it's because Mr Musharraf has joined Mr Bush's "war on terror". Those who sign up for this war can throw judges in jail, rig elections, torture terror suspects and still get a free pass on human rights. It's all got to do with the muddling of conscience.

The US Congress is not alone in casting lopsided votes. The European Parliament voted 580-24 on a resolution urging European Union leaders to boycott the Olympics opening ceremony. Not to be outdone, US lawmakers are pushing for a binding vote that actually requires Mr Bush to skip the ceremony. But, again, why stop there? If we are to have a war on human rights abuse, why make only symbolic gestures like targeting the opening ceremony? Let's make this more meaningful. Mr Bush, Mr Sarkozy, Mr Brown, Mr Rudd and Dr Merkel should snub China altogether. No more missions to win trade deals. Let's teach those Chinese a real lesson.

But cash is king even when matched against conscience. So let's not ask silly questions such as why Mr Sarkozy, Dr Merkel, Mr Brown and Mr Bush can make such a big deal about Tibet, yet don't mind visiting Beijing to sell Airbus and Boeing planes. Or why they scramble for lucrative weapons deals with Saudi Arabia where alleged murderers are beheaded in public.

Michael Chugani is a columnist and broadcaster

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Political games
Given the blatant manipulation of the Olympics, a drastic overhaul is needed to save its reputation

Philip Bowring
Apr 16, 2008           
     
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Call me a spoilsport if you will, but the Olympics has become a monster, undermining values for which it is supposed to stand. Thus, Hong Kong's Olympic representative, Timothy Fok Tsun-ting, is a son of a famous father, rather than someone known for active participation in sports - let alone at a high level. Thus, it is hinted by the government that the chief executive, Donald Tsang Yam-kuen - another non-sporting dignitary - may take part in the torch relay for these "non-political" Games.

Thus, large sums are spent on hosting equestrian events, despite the almost non-existent local participation in the sport. To enable Mr Tsang, Mr Fok and other dignitaries to preen themselves as Olympic hosts, Hong Kong's real athletes have their training disrupted, and money that could have gone into improving sporting facilities in schools, or for the general public, funds a brief event in which less than 10 per cent of Olympic teams compete.

Thus, a huge fuss is made of the Olympic torch relay, quietly forgetting that this was not an ancient Greek institution; it was invented for Hitler's Berlin Games of 1936, the apogee of racist nationalism thinly disguised as sport.

The most blatant politicisation was the US boycott of the 1980 Moscow Olympics, following the Soviet occupation of Afghanistan. That was followed by a Soviet boycott of the 1984 Los Angeles Games. But Beijing cannot claim innocence, given its use of the Games to boost China's image abroad and its image at home. It should not be surprised that critics should seek to draw attention to grievances. That is not to say that unruly demonstrations about Tibet , Darfur or other issues will do any good. More likely, they will stir nationalist sentiment in China and lead to even harsher measures against Tibetan and other dissidents. But until politicians everywhere stop trying to be associated with the Olympics, they will attract dissenters.

The bigger the Olympics becomes, the more public money must go into it and, thus, each Games requires top-level political support. In addition to bribery of delegates, political lobbying plays an important role in the awarding of the Games - as Tony Blair showed on London's behalf.

The costs of providing for so many events and so many athletes have become prohibitive for most of the world. The proliferation of medals for often obscure sports, practised by tiny numbers of people, intensifies the nationalist competition for position in the medals table. At each Olympics, the number of events expands.

In principle, it should not be difficult to trim the Games to a more manageable and affordable size, with minimal impact on global public interest. We should:


Cut the grandiose opening ceremony, a costly spectacle and grandstand for politicians more than athletes;

Abolish all team games and revert to the original Olympic ideal of competition between individuals, with a focus on athletics. For most of these sports, the Olympic event is unimportant - who cares about Olympic football compared with the World Cup?

Abolish events such as tennis, where there are better-established venues for global competition;

Reduce the number of medals for swimming/diving, which enables one person to collect multiple medals;

Set more stringent criteria for event inclusion that would eliminate many medals - from shooting to wrestling and synchronised swimming - practised by only a tiny number of people worldwide, and;

Eliminate events requiring very costly facilities such as indoor velodromes available only in a handful of countries.
Drastically cutting the cost of the Olympics would make it less political and possible for many more countries to play host. It would also leave the Games less hostage to commercial interests, sponsorship deals, television rights and the like, which play such an important behind-the-scenes role in the organisation and coverage of the Games. I hope the Beijing Games is a success, not disrupted by either pollution or protest. But it is my hope, too, that the sheer cost of the Beijing investment in the Games, and the level of politicisation it has attracted, will force the Olympic movement into a fundamental rethink.

Judging by the vested interests at work, that is probably a vain hope.

Philip Bowring is a Hong Kong-based journalist and commentator


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No sweet medicine for our inflation's ills


OBSERVER
Lau Nai-keung
Apr 18, 2008           
     
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The consumer price index has jumped: everybody knows this because it is eating into their wallets. Basically, there are just two factors: food prices and rent. Few have been screaming at landlords and property tycoons - all attention is on rice. There has been panic buying at supermarkets. It's ridiculous.

Most of our rice is imported from Thailand. Hong Kong is a city of just 7 million people, so small a market that Thailand can safely guarantee supply. We don't have to worry about the supply of rice any more than we have to worry about that of spaghetti. But the price is going up.

The Hong Kong dollar is pegged to the US dollar, which is constantly slipping; but we have to pay in yuan for most of our daily necessities, and the yuan is appreciating. This exchange differential alone drives up prices here. Now is not the time to consider de-pegging, and we will have to live, for now, with this uncomfortable situation of being squeezed from both sides.

Those who have had a pay raise may come out even, or ahead. A small price rise is not going to hurt. But there will be some hardship for retirees and fixed-income earners, who are usually not well off in the first place. The government acknowledges that about 1 million people in Hong Kong live below the poverty line. While many of these less-fortunate people do not have much money, they do have a vote. They are easy targets for some politicians who are now scratching their heads for issues to be used in the Legislative Council election in September.

Inflation is definitely going to be a major election issue in the coming months. The government will have to do something, or its popularity ratings will fall. Everybody, politicians in particular, knows that the administration watches its ratings closely, and bends over backwards to keep them high. This is good governance, Hong Kong style. Its pro-establishment allies expect the government to do something, too, knowing that their votes will move in the same direction as the opinion polls.

In fact, few governments in the world can do much about food prices. Our pro-market, small-government island economy is especially ill-placed to do anything to control inflation. It can do nothing about the widening exchange differential between the US dollar and the yuan, and worldwide rising prices of grains and other food, which are the major causes of the current wave of inflation.

Fortunately, our government's very deep pockets are full after last year's HK$120 billion budget surplus. There was a plateful of sweets from the budget, ready to be doled out to calm anxiety over inflation. If needed, more will be forthcoming, and all our vote-hungry lawmakers will say "aye". The more aggressive ones, along with some aspirants, will ask for still more. This is another characteristic of good governance, Hong Kong style: sweets for the asking.

So, some politicians demand, and get, handouts, look good and get elected. The government concedes to these demands, looks good and gets high popularity ratings. People get the handouts, and look favourably on the politicians and government who provide them. This is a classic win-win situation. Everybody wins, everybody is happy, and Hong Kong's style of good governance carries on as usual.

But have we solved any real problems? Not at all. All our social and economic ills remain, and tackling them is just as troublesome. It is easy to just sweep them under the carpet and, hey presto: they're gone.

The first chief executive, Tung Chee-hwa, was a known procrastinator. Since 2005, we have had a caretaking government. How long can this continue? Will we see some real action after September?

Lau Nai-keung is a member of the Basic Law Committee of the National People's Congress Standing Committee, and also a member of the Commission on Strategic Development


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India's advantage in Africa: democracy


N. V. Subramanian
Apr 21, 2008           
     
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Contrary to Indian Prime Minister Manmohan Singh's assertion at the recently concluded India-Africa Forum Summit, India is in competition with China for Africa's oil, precious metals and minerals. But, while China is engaged in unconcealed, neocolonial resource extraction from Africa, which has already produced its backlash, India wishes to be - and has to be - gentler in its engagement with the continent. This is because of its own democracy and historical good relations with the African leadership.

In November 2006, China hosted its Africa summit and paraded more than 40 African leaders, not all of them elected. While the US and the European Union were alarmed, India did not appreciate the full significance of the event until later. In February 2007, President Hu Jintao visited eight African nations, ending with a high-profile stopover in the Seychelles.

That revealed China's growing strategic interest in the Indian Ocean, through where most of its - and the world's oil - passes. This, together with China's "string of pearls strategy" - to project naval power in the Indian Ocean through bases around India - finally awoke New Delhi to Chinese strategic and economic interests in Africa. While the Indian strategic establishment has been awed by the Chinese doctrine of a "peaceful rise", it is unable or unwilling to accept its limitations as state policy for a democracy like India.

For form's sake, nearly everyone in government and in the strategic community avers that India cannot copy Chinese-style resource extraction in Africa. Privately, most admire China's no-holds-barred approach. But it is unsustainable.

India's biggest strength is its democracy, and this is the commodity it must primarily export to Africa. The US has abused that concept, most lately in Iraq, and Europe's colonial exploitation of Africa has destroyed its case to speak for democracy there. India, in comparison, enjoys a far better image in Africa, due to Gandhi's and Nehru's contributions to the continent's anti-colonial struggles, and it is appreciated that Indian communities settled in Kenya and Uganda were wrongly persecuted in the 1960s and 1970s.

But China's and other states' competition for African resources will unavoidably demand a hard-nosed approach from the Indian side. In the past, New Delhi has not been the most ideal mediator in such situations, in part because it is wedded to democracy, and has international commitments to meet and an image to protect. India's trump card is its private sector, now enjoying a glowing international reputation. The market view of Africa is sober.

While China's mammoth presence in Africa for resources has spurred India to follow, its own engagement has to be democratic, equitable and a model for the rest of the world to emulate.

On issues like military, energy and food security, India has to be bold, innovative and determined, but democratic. Africa is a good place to start.

N. V. Subramanian is the editor of NEWSInsight, an Indian public affairs magazine. Copyright: OpinionAsia


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Cultural deficit


LAURENCE BRAHM

Apr 22, 2008           
     
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On April 7, the Indian embassy in Beijing hosted an evening of Indian food, dance and music in the old section of the Beijing Hotel. There is nothing unusual about countries promoting cultural exchanges with China. But this event was different. It was filled with juxtaposing ironies: the different paths of social and economic development that India and China have taken.

The performances were held in the banquet room, a magnificent merging of Chinese architectural detail with Soviet proportions, which served as a place for the National People's Congress to host state banquets in the early 1950s, when Mao Zedong and Indian prime minister Pandit Jawaharlal Nehru were forging an independent path for the developing world, different from Washington's. This venue was chosen as an alternative to the glitzy China World Hotel, which was booked for Olympic-related activities.

So, on the night in question, this grand arena, now all but forgotten and discarded, came alive again with the power and pulse of Indian dance and music. South Asian ethnicity filled the room, making the Chinese present ask themselves about their own culture, where ethnicity is now reduced to a superficial, Disneyesque imitation of its past.

Today, in Beijing, there is only one dream - the Olympics - which is in danger of quickly becoming a nightmare. Ironically, China's own cultural roots continue to be uprooted, in a self-perpetuating cycle. It is becoming a western clone. Embracing, wholeheartedly, George W. Bush-style neoconservative politics and economic policy, China has displaced its culture with the globalisation of Las Vegas.

The message that night was that India had not forgotten its own cultural roots as it seeks its own path of development. Several years ago, Shyam Saran, India's then ambassador to China, and a former foreign secretary, told me that "China's hyper economic growth is admirable, but probably not sustainable. We are taking a more careful approach to development that will be sustainable."

Why has China's own culture become eclipsed? Is it that creative thinking threatens a state with a single ideology, while consumer passion does not? Or does the problem lie in an economic and legal system that does not reward or even protect creative works? Or is it corruption? One problem is that China invests in hardware: big airports, lots of roads and factories that help produce steel and cement while polluting the environment. This "output" factor, which has come to be known as "GDP growth economics", is the central focus of China's blind pursuit of economic and social policies that fail to consider the human costs and benefits. Ethnic diversity and expressions of culture are buried under the quest for more cement and steel. The propaganda and rigid media controls leave artists and composers with little choice except conformity to survive.

This lack of respect for creativity is showcased in preparations for the Olympics. Beijing has spent lavishly on costumes, props, lighting and the physical infrastructure for its grand opening ceremony while calling on the nation's leading composers and choreographers to produce the music and performances for free. Aside from a gratuity to director Zhang Yimou , all the others remain unpaid; they were told it was their duty to serve the motherland.

China's leaders spend money on tangible things like buildings and infrastructure. This feeds corruption; government spending involves kickbacks. In such an environment, how can anyone respect an artist's or composer's creativity? So creativity becomes something to be copied; just steal it, then produce a million, all exactly the same.

As one Beijing-born Chinese lamented at the conclusion of the Indian evening: "I am ashamed to be Chinese. We have lost our culture. We have destroyed every aspect of our own culture. But they [in India] still have theirs."


Laurence Brahm is a political economist, author, film maker and founder of Shambhala


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