On February 11, North Korea announced for the first time that it possesses nuclear weapons. The claim grabbed headlines, but it was difficult to substantiate. What follows is an article I dashed off over that weekend (it was finished on February 13, according to my Word file), and which was rejected a couple of times by major newspapers the following week:

If I were President Carter, I would have announced yesterday, swiftly following North Korea’s telling the whole world that it now had nuclear weapons, that "I would like to return my Nobel Peace Prize earned for my work to broker a deal in 1994 to exchange more aid for North Korea’s promise to stop its nuclear program." Making such a statement will be important for Mr. Carter unless he found it savory being placed in history next to Mr. Chamberlain, who brokered the Treaty of Munich, as a naïve appeaser. Time is not on your side, Mr. President, as Chamberlain had hardly ever lived in shame because he was shamed to death not long after the eruption of World War II on the heels of his now infamous treaty, but you are still active on so many ambassadorial duties, trotting around the globe in the halo of that Prize. So hurry up!

If I were President Kim Dae-jung, of South Korea, I would follow suit, giving back my 2000 Nobel Prize for my sunshine policy to engage with my brothers and sisters in the North. Apparently, sunshine, smiles, and shaking of hands can’t keep our Northern siblings from making nukes targeting us. In the 1980s, I once almost drowned off the coast of Hong Kong for my pro-democracy activities; now, I am more than willing to plunge myself into water if only that can wash away this indelible blemish on my name.

If I was heading the selection committee for the Nobel Peace Prize, I would go home and ask my son to slap my face several times, to make sure I am sober whenever I make decisions in the future. Then I would go visit an optometrist to make sure I do have some vision. Stupid me, I had always thought "peaceful negotiations," "dialogues," as cherished by our colleagues at the U.N., are an end in themselves. Now, it seems real peace is more complicated than that. Now, to redeem the honor and prestige of the Prize, which could have been befittingly renamed "Nobel Appeasement Prize" for some of the selections we made in the past decade, we will ask Presidents Carter and Kim to relinquish their rights to the name and financial benefits of the prize. We, however, will ask President Kim Jong-II, of North Korea, to keep the prize and money that he shared with President Kim of South Korea—because we really don’t know he would return them if we ever asked or, if he does concur, as President Carter will testify this time, we are not sure whether he will ever keep his promise.
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If I were that professor from Harvard’s Kennedy School, I would not make that appearance on PBS repeating all that has been repeated thousands of times about China and North Korea, that China is in fear of a refugee problem in case of a showdown in the peninsula and thus would willingly broker a rapprochement between the U.S. and North Korea. You know what, although my title does accord a lot of weight to what I said, I really don’t know much about what I am saying as far as those far-away countries whose languages are beyond my ken are concerned. Our analyses are all based on the assumption that the Chinese government would act like its U.S. counterpart, which we are truly familiar with, but whether that is really what will unfold is really none of our business. You know, we are eminent academics, but we live in our own world, or "Ivory Tower" as someone would call it. And sometimes, I really don’t understand why people keep coming to us for help although our analyses have proven to be wrong one after another. Here, I’d like to avail myself of the opportunity to make it clear that our strength—as well as major source of income—lies in our ability to write books and articles to keep the event in perspective afterward, but not in advance.

Since I am only me, not those dignitaries, I apparently don’t have much to worry about any serious fallout of my words or thoughts. You may call me a Monday morning quarterback, but my friends could be my witnesses that I did yell out many times in front of the TV showing a smiling Carter in North Korea ten years ago, "Stupid, it only takes a ten-year-old Chinese kiddo to understand this is nothing but Yu2 Hu3 Mo2 Pi2 (a Chinese proverb meaning "negotiating with a tiger for the price of his skin)." Okay, if this gives me a little bit credibility—but I would understand if it is still not enough to put me on PBS—let me tell you this: All that theorizing about China having incentives to help the West in curbing the North is nothing but wishful thinking. China needs Kim and the North to make trouble for the U.S. so that it always has the trump card in dealing with the U.S., and the U.S. is always distracted when China and the U.S. don’t see eye to eye on something. The theory that China would worry about that hypothetical huge influx of refugees crossing the Yalu simply doesn’t hold water, either. Remember how they treated their own people at Tiananmen in 1989 and Falun Gong in 1999? There are already credible reports of hundreds of thousands of troops stationed along the Yalu, and when the first batch of North Koreans tries to escape their country in a crisis, such as the fall of the Kim family dynasty, the same machine guns that were releasing lethal fires upon Chinese in 1989 will fire again. And when that happens, do you think there will be a second batch coming? Just check how China treats those North Koreans being smuggled into China, and you will understand what I am saying here. Yes, you are right that if China ever dares to do that it will be put under international sanctions, but weren’t there international sanctions too in the wake of the 1989 massacre? And to Beijing’s amusement, those sanctions have only become the catalyst for the billions of dollars being poured into China every year.
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I don’t know what others might think, but as long as Kim Jong-II keeps his Nobel Peace Prize, and people like Falun Gong members who, by their sheer numbers could have made China a much more messy place if not for their embrace of peace and endurance of deadly persecution against them, are not getting the Prize, I am not sure whether it is an honor or disgrace to get such an award. Besides, I happen not to be a big fan of Kofi Annan, the most recent Nobel Appeasement laureate, either.

.  .  .

I regret that the original title of that article was a sarcastic "Nobel Appeasement Prize?"—which misdirects the attention to the negligible, petty, trifling vanity of the Nobel Prize, relative to what is at stake for the whole world. Even worse, at that time I was so obfuscated by strong feelings that I forgot the editors of those media outlets to whom I sent the article are mostly graduates of Harvard’s Kennedy School. Since that time, however, there have been several developments that suggest more attention might be needed to the issues I raised. So much so that we started hearing voices of concern from think tanks and academics about China’s role in the six-party talk.

Meanwhile, I still can’t understand why so many people still believe China would have big problems with a nuclear North Korea due to its geographical proximity—isn’t Pakistan, a recipient of China’s assistance in building its nuke bomb, China’s neighbor too? I don’t understand all those talks about the limited leverage China has over North Korea, either—Isn’t that true there is a North Korea on the map today only because of China’s involvement in the Korea War, and now the North doesn’t stand any chance of survival if China simply turns off its faucet? From this perspective, China’s declared neutral position between the U.S. and the North clearly shows its favored party, not to mention its manifest intention of vetoing any U.N. move against the North if it were ever proposed.

Indeed, if North Korea is a natural buffer that dilutes the pressure of democratization and a trump card in its deck against the United States in any game of diplomacy, then it would be in China’s best interest to see the continuation of a communist North Korea. Now the question that has to be discussed at the beginning of every discourse of this issue is: Will China want it to happen or not?

John Li is a New-York-based freelance writer on China and Sino-U.S. relations.

[Summary: In 2003, China imported 35% of its crude oil supplies and 36% of its iron ore supplies. The sharp rise in 2003 of the shipping cost of iron ore had greatly impacted China’s iron and steel industries. Therefore, relying on foreign fleets for oceanic shipping of imported mineral resources has become a great challenge. To ensure China’s ability to ship its needed mineral resources, the author makes the following policy suggestions: A) Transport strategic materials using domestic fleets; B) Establish strategic cooperative relationships between the mining and shipping industries; C) Support the following: loans to purchase ships, tax incentives for the purchase of second-hand ships, development of ship chartering, and improvement of the laws and regulations for oceanic shipping.]

China’s Demand for Mineral Resources

Raw materials are fundamental to the nation’s industrialization and modernization. Consumption of mineral products exhibits the following pattern in major developed countries: A) During the rapid expansion period of industrialization, consumption of minerals’ products expands at a correspondingly rapid pace. Bulk mineral’s "consumption elasticity" (the ratio of mineral product consumption growth to GDP growth) is greater than 1. B) When the industrialization period ends, consumption of mineral products such as steel and copper tends to stabilize. C) Energy consumption grows with GDP growth.

The industrialization process has sped up since 1978 when China adopted its reform and open policies. Consumption of mineral products has risen sharply with increasing consumption elasticity. From 1985 to 2000, the average consumption elasticity for each five-year period was 0.46, 0.60 and 0.83, respectively. In 2004, it exceeded 1.0. The average consumption elasticity coefficient for steel, copper and aluminum in the past 10-year period all exceeded 1.0. This is a similar pattern to what other developed countries experienced during their industrialization periods.

The projection of demand for mineral products is based upon the general pattern and trend of the relationship between the growth of the national economy and the consumption of mineral products over the past 15 years. The potential effect of new industrialization paths and advances in technology on the consumption of mineral products must also be considered. By 2010, the total energy demand is expected to reach the equivalent of 1.867 to 2.273 billion tons of coal, including 300 to 350 million tons of crude oil (or 6 to 7 million barrels a day), 1.74 to 1.92 billion tons of coal, 78 to 120 billion cubic meters of natural gas (or 8 to 12 cubic feet per day), and 250 to 310 million tons of steel. By 2020, the total demand is expected to reach the equivalent of 2.6 to 3.2 billion tons of coal, including 470 to 480 million tons of crude oil (or 9.4 to 9.6 million barrels a day) and 2.2 to 2.4 billion tons of coal.
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Crude Oil

By 2010, it is expected that China will have access to 300 to 400 million tons annually of additional crude oil reserves in newly discovered oil fields, with a capacity of 18 to 25 million tons of crude oil per year. In 2010, the production of crude oil is expected to be 168 to 180 million tons, only 51-55% of the demand. By 2020, crude oil production is expected to be 156 to 185 million tons, only 34-40% of the demand. There will thus be a shortage of 275 to 304 million tons.

Iron

By 2010, domestic iron ore output is expected to reach 200 million tons, which will yield 70 million tons of iron. Scrap steel output will be 45 million tons. The demand for steel will be 250 to 310 million tons. Therefore, domestic iron production will only be able to meet 38% of the total steel demand. By 2020, domestic iron ore output is expected to be 156 million tons, yielding only 56 million tons of iron. Scrap steel output will also be 63.3 million tons. However, the demand for steel will be 273 to 334 million tons, so domestic iron production will only meet 29% of the total demand for steel.

Coal

It is estimated that by 2010 and 2020, the demand for coal consumption will reach 1.738 to 1.922 billion tons and 2.173 to 2.4 billion tons, respectively. However, because production capabilities are limited, the shortage of coal supplies will reach 250 million and 700 million tons, respectively. For this reason, beginning in 2004, China changed its coal export policy, and coal exports have been reduced by 10 million tons.

Natural Gas

In 2001, the remaining exploitable natural gas reserve was 1.8345 trillion cubic meters. The estimated long-term reserve of natural gas is expected to be 12 to15 trillion cubic meters. By 2010 and 2020, the demand for natural gas is expected to be 78 to 120 billion cubic meters and 180 to 280 billion cubic meters, respectively. The production will be 130 and 165 billion cubic meters, respectively. So demand can be basically met domestically in 2010. However, there will be a shortage of 65 billion cubic meters in 2020.
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Importation and Transportation of Iron Ore and Crude Oil

In 1993, China’s import volume of iron ore was about 33 million tons. In 1995, 41.2 million tons were imported, and that number increased to 55 million tons in 1999. The average annual growth was less than 5% during those years. There was even a negative growth of 7% in 1998. In 2000, the importation of iron ore grew more than 10% and reached 70 million tons. From 92.4 million tons in 2001, the amount increased to 111.5 million tons in 2002 and reached 148 million tons in 2003. Approximately 36% of China’s iron ore was imported. China has become the world’s largest importer of iron ore. While the total amount of the world’s iron ore shipments increased by 43 million tons in 2003, China’s import of iron ore increased 33 million tons in that year alone. China’s iron ore imports accounted for nearly 30% of the world’s oceanic shipping of iron ore. Even so, China’s fleets have shipped a very limited share of the imported iron ore due to the limitations of scale and structure of China’s shipping fleets. This is one of the main reasons why shipping prices of imported iron ore have risen sharply since 2003.

Since 1996 China has been a country with a net import of crude oil. In 2003, the net import of crude oil was 97.41 million tons, accounting for 15% of China’s demand for crude oil. In general, countries with huge demands for imported crude oil usually control a powerful crude oil carrier to handle shipping for its imported crude oil. For example, almost all of Japan’s crude oil is imported. Its annual import volume exceeds 250 million tons. The tonnage of large crude oil carriers controlled by Japanese ship owners exceeded 20 million tons and is able to handle the shipping of more than 80% of Japan’s imported crude oil. All the large crude oil carriers were leased to crude oil importers with long-term contracts, ranging from a minimum of 5 years to as long as 18 years. In Japan, in addition to the close cooperation between ship owners and crude oil companies, a stable, cooperative environment has been established among other relevant businesses, such as the shipyards, banking and finance industries, and insurance companies.

All of China’s imported iron ore was shipped by fleet and mainly came from Australia, Brazil, India and South Africa. Two major import routes for oceanic shipping are from West Australia to Beilun Port in Zhejiang Province and from Brazil to Beilun Port. China’s role has become increasingly more important in the world’s oceanic shipping of iron ore. In 2001, China’s iron ore imports grew by 22.4 million tons. That same year, the world’s oceanic shipment of iron ore grew only 6 million tons. There would be a 3.8% decline in shipments of the world’s iron ore without the growth of China’s imports. In 2003, China’s iron ore imports grew to 33 million tons, while the world’s iron ore shipments grew only 43 million tons.

In recent years, China’s import of iron and steel materials and products has grown by 50 to 60 million tons a year. With such rapid and continuous growth, supply and demand, as well as the overall structure of the world shipping market, have changed. This has brought the world’s dry bulk shipping market to China. Although the Western economies have not fully recovered, the international dry bulk shipping market has been vigorous for an unprecedented period since 2002.
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The Baltic Exchange Dry Index (BDI) reached a peak of 5,681 on February 4, 2004, 2.4 times the previous historic high in May 1995. The BDI started to ease down after the Chinese government released a series of macroeconomic policies when some industries in China appeared to show signs of over-investment. However, the world’s dry bulk shipping market is still a seller’s market. The market began to stabilize in late June and the BDI stayed at 4,000 points. China has become the driving force for the growth of the shipping market (see table 1).

The Sharp Rise of Iron Ore’s Ocean Freight Charges

In view of the freight charge, the fast increase of China’s iron ore imports is the cause of tension between the supply and demand for marine transportation. The year 2003 was the first time in history that cost of the freight was higher than the price of the commodity. In 2003 the global iron ore FOB price rose 9%. In 2004 the contracted FOB price grew 18.6%. In the "2004 Yearly Ores Price Agreement" signed between the six Japanese steel mills and the Australian mining company BHP BILLITON, the average FOB price for the BHP’s high-grade fine ore (with 65% iron content) rose from US$20 per ton in 2003 to US$23.78 per ton in 2004.

However, according to the freight index of the Baltic Shipping Exchange, the rate for iron ore marine transportation between West Australia and Beilun was US$6.7 per ton for 15,000-ton freighters at the beginning of 2003. It rose to US$18.78 by the end of the year, a 180% increase. On New Year’s Day in 2004, it rose to US$21, a 213% increase, much higher than the ore trade price increase. In two years, the transportation freight from Brazil to China rose from US $8 to US$40-50 per ton. Therefore, the freight cost is almost twice as much as the price of the ore.

Compared with the situation in 1999, the market has seemed to fluctuate to a greater extent. At that time the freight was only US$3 to US$4 per ton from West Australia to Beilun, while it was US$20 per ton at the end of 2003. For a Cape-of-Good-Hope ship that carried 168,000 tons of iron ore and transported it from Australia, the entire freight cost was only US$500,000 in 1999, but in 2004, the freight cost reached as high as US$3.43 million.

This kind of situation changes the international iron ore trade, with the trade terms changing to Cost and Freight (C&F). China used to use the FOB price to import the iron ore, but in recent years, several multinational corporations, through merger and reorganization, have controlled the international iron ore market, forming a "seller’s monopoly." At present Australia’s Hammersley, BHP BILLITON, and Brazil’s CVRD control more than 70% of the global iron ore trade. The more united the cargo owners, the more able they are to negotiate prices. The overseas cargo owners have expanded their contract volume under C&F and seized the right to dispatch ships, taking advantage of their control over resources. For example, 50% of Australian Hammersley’s export of iron ore to China changed the trade terms to C&F. In 2003, some Chinese iron ore consumers were unable to purchase the ore even if they had the money, pushing up the price of domestic iron ore even higher.
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The freight increase has seriously burdened the steel and iron industry in China. Moreover, the high freight costs will ultimately be shifted to downstream industries, adding to production costs. Take twisted steel as an example. When the price of upstream iron ore products rises from 300 yuan (US$35) to 900- 1,000 yuan (US$105-117) per ton, the billet price rises from 1,000 yuan to 3,700-3,800 yuan (US$433-445). The cost increase to the steel and iron industry will be transferred to further downstream industries such as construction, shipbuilding, and real estate. It will also impact agriculture and the chemical fertilizer industry, causing an imbalance in the entire economic system.

Factors That Influence Iron Ore Importation Freight Charges, and Chinese Shipping Companies’ Countermeasures

First, due to the insufficient capacity of domestic fleets, the foreign fleets usually take control of import transportation. Second, ocean transportation for the domestic ore import is almost completely exposed to the spot market, with no long-term contracts. Third, the purchase of iron ore from scattered suppliers gives the foreign ore exporter the opportunity to exploit the situation. Lastly, the harbors become overstocked, and railroad transportation is unable to take over.

COSCO’s (China Oceanic Shipping Company) bulk cargo transportation fleet has 210 ships with 12.3 million deadweight tons. It also has 120 rented ships with 10.46 million deadweight tons. Among them, COSCO owns and controls nearly 50 Cape-of-Good-Hope vessels for iron ore transportation, nearly 25% of the total transportation capacity of the spot market. Nevertheless, foreign-owned shipping companies hold the majority of marine transportation contracts for China’s imported iron ore. According to preliminary statistics, of China’s overall iron ore imports in 2003, Chinese transportation companies ship approximately 25%. In this 25% transportation volume, only 10% is a highly profitable first-hand contract. In other words, the Chinese marine transportation company only enjoyed 10% of the total Chinese transportation of iron ore imports, while the foreign transport companies have taken the majority. We should learn from the Japanese experience in this respect. The Japanese government implements a very favorable policy toward the Japanese shipping enterprise, giving them subsidies and low-interest loans to buy ships. They also give tax incentives. Japanese steel mills, business organizations and Japan’s shipping companies have established close relations by share-holding and making long-term agreements. It is very difficult for foreign ship owners to infiltrate the Japanese large bulk cargo marine transportation market. Chinese ship owners find it difficult to transport iron ore imported from Japan, as well as China’s coal exports to Japan.

China’s iron and steel enterprises and the shipping enterprises should strengthen their ties by means of signed agreements and transportation contracts or even cooperation at the level of property rights. If domestic ship owners purchase ships according to the demand, and the steel mills, aided by ship owners’ ocean transportation superiority, take control of ocean transportation power, it will be impossible for the international mining businesses to continue to maintain the high profit margin over ocean transportation that they now enjoy.
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Current Status of China’s Crude Oil Ocean Transportation

There are about 60 shipping companies that are engaged in crude oil transportation operating out of mainland China. The total fleet of 660 oil tankers can carry nearly 5 million deadweight tons. At the beginning of 2000, COSCO formulated a strategic plan to rapidly develop large-scale oil tanker fleets to meet the large increase of crude oil demand. It is estimated that by 2007, COSCO’s fleet will reach 31 tankers, with 4.2 million-deadweight tons. Adding the oil tankers ordered by other mainland companies, it is estimated that by 2007, the mainland shipping companies will have 23 Very Large Crude Carriers (VLCC) and six 100,000-ton tankers. If 50% of the 29 oil tankers are used in crude oil import transportation, 30 million tons of crude oil import can be shipped. Compared with the total import transportation need of 120-135 million tons, China’s shipping capacity will still have a large shortfall.

In recent years, as a result of not applying the "domestic products transported by domestic companies" policy, our own fleet has only been able to transport less than 10% of total imports. Despite increasing import concentrations in the Middle East and West Africa, the capacity of middle- and large-sized Chinese oil tankers has not grown correspondingly. Transportation by our own fleet occupies only a small portion of the total. In 2002 for example, COSCO transported 1.6 million tons of China’s crude oil imports, which only equaled 2.2% of the total import volume. If COSCO put three VLCC and three SUEZMAX oil tankers into full service on the Middle East route, the annual transportation volume would be about 10 million tons. Together with other transportation, the total volume of transportation could reach about 12 million tons, less than 13% of the 100 million tons of total imports in 2004.

Suggestions and Measures to Strengthen Oceanic Shipping of Mineral Resources and to Improve Ocean Transport Capabilities

1. Speed up the construction of large-scale petroleum-loading wharfs. Transform or build seven to nine 200,000-ton mooring berths by 2010 to secure crude oil import transportation. Confirm a second batch of petroleum strategic reserves projects as soon as possible, besides the four currently approved petroleum strategic reserve bases.

2. Establish a large-scale oil tanker fleet alliance to share profit and risk. A joint oil tanker alliance can be established by COSCO, China Marines, and other shipping companies with long-term transportation contracts with China National Chemicals Import & Export Corporation, China Petroleum Corporation and China Marine Petroleum Corporation. With an alliance created, shipping capital and management companies can be established.
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3. Actively participate in international organizations and the international affairs related to international petroleum transportation. At present, the Malacca Strait, an international channel, has not been subject to an internationally recognized management organization. Japan, as the main user of the channel, started cooperating with the countries along the Strait in 1968. Japan has gradually become involved in the administration of the Malacca Strait. An entire package has been formulated for Japan to participate in the construction and shipping management of the Malacca Strait. As the second largest country after Japan to use the Malacca Strait, China should begin to participate in the management of the Strait as soon as possible and establish a Malacca Strait Construction and Management Fund.

4. Shipping enterprises should continue to expand their fleets. Because of the large capital investment required to build ships, China’s shipping companies have difficulty obtaining ship purchase loans and paying them back with interest. With shortage of capital being a bottleneck for China’s shipbuilding industry, the government may need to intervene to encourage the development of a ship chartering industry.

The article was based on a research report published on the website of Beijing Dajun Research Center of Economy (http://www.dajun.com.cn/kuangchan.htm).

[Editor’s note: The article below was written by the famous Chinese philosopher and essayist Hu Shih (1891-1962) in 1947 before the Communist Party took over in mainland China. The article analyzes the fundamental differences between the two different types of political parties. The Kuomintang, the ruling party in China before losing the battle with the Chinese Communist Party in 1949 during the civil war, has completed the transition of giving up one-party control after settling down in Taiwan. Although more than half a century has passed, the nature of the Communist Party has remained the same. At a time when the Taiwan Kuomintang leaders are trying to sit down with the Chinese Communist Party again, this article may be useful in helping people understand what might be expected from the talks between the two parties across the straits.

Hu Shih studied in the United States at Cornell University and later at Columbia University. He received his Ph.D. in philosophy in 1917 and returned to China to lecture at Beijing University. During his tenure there, he began to write for the New Youth Journal, quickly gaining much attention and influence. Hu soon became one of the leading and influential intellectuals during the May Fourth Movement and later the New Culture Movement.

He was China’s ambassador to the United States (1938-1942), chancellor of Beijing University (1946-1948), and later (1958) became president of the Academia Sinica in Taiwan, where he remained until his death.]

In any discussion about constitutional governance, democracy, the conflict between the Chinese Communist Party (CCP) and the Kuomintang, ending one-party politics, and the conflict between two worldviews embodied by the United States and the Soviet Union, we should first clearly recognize that there are two fundamentally distinct types of political parties in the world.

Thirty years ago, people who discussed politics were only familiar with one kind of political party — the kind of party in Great Britain, the United States and Western Europe. In the past thirty years, however, another kind of political organization has emerged. Even though it has also labeled itself a "political party," this type of party has fundamentally different characteristics from those in America and Western Europe. Russia’s Communist Party, Italy’s Fascist Party, and Germany’s Nazi Party all belong to the latter kind, because they have similar party disciplines at the organizational level, in spite of the differences in their goals.

For convenience, let me call the political parties in Britain, the United States, and Western Europe Type I parties and designate the later-emerging political parties in the Soviet Union, Italy, and Germany as Type II parties.
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The characteristics of the Type I parties can be described as follows:

1. Type I parties have no fixed number of members nor are membership records even kept. Everyone can register as a member of the party or withdraw from it at will. For example, British Prime Minister Winston Churchill used to be a member of the Freedom Party but later became a member of the Conservative Party. Woodrow Wilson was a Democrat in the United States but later became the Republican Presidential candidate.

2. The votes in a Type I party are anonymous and their membership is confidential. Every party member is free to speak; there is no party discipline to constrain the votes of its party members; there are no spies or detectives to interfere with the speeches and actions of its members. As a good example, in the United States, Henry Wallace, a Democrat, criticized the policies of his own party. In Great Britain, it is common for the MPs of the Labour Party to criticize, often harshly, the policies of their own party. Regarding such criticism, there is simply no policy in place to punish a party member. In fact, society accepts critics of the party and calls them "independent," "non-partisan" or "unbiased."

3. The strategy of the Type I party is to contend with one or more other parties for the majority status in order to attain its goals. For that reason, every political party strives to become the majority. Once a party attains majority status, it must tolerate and respect the rights of the minority parties, because today’s minority party may become the majority next year. Likewise, this year’s majority could lose next year’s election and become the minority. People’s votes are the final determination of who is the majority. Before the election, no political party knows the nation’s final decision, and no party can control the people’s votes. For instance, in the 1928 presidential election in the United States, Republican Herbert Hoover won the Presidential election with 21 million popular votes. Four years later, Democrat Franklin Delano Roosevelt won 21 million popular votes and became President. Each became President as the result of the American people’s freedom of choice.

4. Once the election result is finalized, on the official day, the winning party takes over the government and power from the losing party. The losing party cannot and dares not use the police or army to maintain its power by violence, or to destroy the winning party. This is because the countries with Type I parties know that, in a few years, they will have another opportunity to win. They understand that "victory is certainly joyful, but loss is also acceptable with pleasure." It is interesting to look back at the 1945 British election, when Prime Minister Winston Churchill was highly anticipated as the winner. Nevertheless, the election resulted in the Conservative Party losing badly, and Mr. Churchill had no choice but to turn over power to the winning party and become the minority leader.
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Described above are the styles of any Type I party as an organization. Type II parties are totally different and can be characterized as follows:

1. The Type II parties are well-organized, have an exact number of members, and have a detailed and precise membership. Before a person is admitted to party membership, he is closely investigated and scrutinized. After admission, a member can be punished or expelled but cannot freely withdraw from the party.

2. The members of the Type II parties must obey the party’s discipline. Party members do not have freedom or privacy. Well-organized spy and detective organizations not only investigate and guard against non-members, they also keep watch on the speech, thoughts, and actions of the party’s own members. The party members must follow the party’s orders, and even their thoughts and speeches must follow the party’s line.

3. The goal of the Type II parties is to achieve a one-party dictatorship. Before gaining power, they use any means to fight for it. Once they gain power, they use any means to consolidate and maintain it. They use any means because they cannot rely on the electorate to freely choose them. Type II parties are themselves minority parties. Because of the means they use and their tightly controlled organizational structure, they often can control the entire nation by suppressing the majority.

4. Type II parties absolutely do not recognize any opposition parties and do not allow them to exist. Any opposition forces are regarded as a threat, and thus must be thoroughly suppressed and eradicated in order to maintain and strengthen their one-party dictatorship.

The characteristics of the two kinds of political parties summarized above are merely my common sense understanding of politics, which political scholars might very well ridicule.

When people and even scholars have a shallow understanding of the differences between these two types of "parties," they often ignore them. For example, in a recent debate of the differences between the two conflicting worldviews exemplified by the United States and the Soviet Union, some people said, "America gives its people one vote per person, while Russia gives one piece of bread to every one of its people." This is certainly an unfair and inappropriate comparison. The American people do not necessarily lack bread, while the Russian people do have votes. Yet the fundamental difference between these two worlds lies in how each vote is used. In 1936, because there was no opposition party, under the new constitution, Russia witnessed a unanimous or over 99% vote for the Communist Party. In contrast, with free competition from opposition parties in the United States, when Franklin Delano Roosevelt won 60% of the vote in the 1936 election, it was considered a great victory. In the 1932 and 1940 elections, he won 57% and 54% respectively. The great victory of 60% represented free politics. It represented independent thought and action as well as great tolerance for opposition parties. What differentiates the "two worlds" are the differences between freedom and no freedom, independence or dependence, tolerance and intolerance.
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Mr. Sun Yatsen, the founder of China’s Kuomintang (Nationalist Party), was a politician who embraced freedom and tolerance. During the most difficult time of his revolutionary cause, however, feeling the need for an "organized and powerful revolutionary party," he reorganized the Kuomintang and turned it from a Type I party into a Type II party. Nevertheless, since he embraced freedom and tolerance, Mr. Sun pictured the one-party dictatorship as a temporary, interim solution to the constitutional government, not the final solution.

Recently the Kuomintang has been preparing to end one-party politics and to begin governing by constitutional law. Such a move not only comes from the need to accommodate the current situation but is the inevitable result of Sun Yatsen’s political principles. It is very rare in China’s modern political history for a governing party to invite other political parties to participate in politics and give away some of its power. Therefore, members or non-members of the Kuomintang should think about the significance of such a change. In my own opinion, this is a move to turn a Type II party into a Type I party. It signifies a fundamental reform in the party’s content and style. It is not just a redistribution of the various votes among a few parties or the rebalancing of power between the central and local governments. If the end of Type II party politics leads to a new political style of embracing freedom, advocating independent thinking, and tolerating opposition, it certainly signifies the beginning of a great revolution in China’s politics.

For about the past 13 years, Chinese-speaking media outlets have seen a steady and systematic expansion in the United States. This development is mostly attributed to investments by the Chinese government since the majority of these outlets, especially for TV programs and newspapers, are either directly backed by the Chinese government or carry content that is in line with the Chinese government’s agenda.

It appears totally legal for the Chinese government-backed media groups to acquire a foothold in the United States and continue to expand. Of course, while these media outlets are free to spread Chinese government rhetoric and propaganda in the United States, the Chinese mainland has remained closed to outside news sources.

With state-owned media monopolizing the news sources in China itself, the Chinese government is able to carry out anti-American campaigns in China without any check-and-balance from independent news sources outside of China. At the same time, it is able to continuously broadcast pro-government propaganda and anti-American sentiment in the United States through its overseas media outlets, without interference from the U.S. government.

What’s more, the Chinese Embassy and Consulates in the United States have been able to gain dominance within the Chinese communities on American soil and promote the Chinese Communist Party’s (CCP’s) agenda.

Global Expansion of CCTV

During the last decade, the systematic expansion of Chinese propaganda began to occur in communities abroad at an accelerated pace. Take China Central Television (CCTV) as an example. According to its Chinese language web site, "CCTV is the important news agency of China. It is an important mouthpiece of the [Chinese Communist] Party, government and people. It is an important base of mind and culture." "The safe broadcast of CCTV is an important political task." CCTV is a state monopoly. It offers 16 channels, delivered terrestrially and by satellite, broadcasting 329 hours of programming a day, 596 hours per day if paid channels are included. In China, it oversees 36 provincial stations and more than 700 city stations. These stations mix their own local programming with CCTV’s. Through 10 satellites, its broadcasting covers the entire globe. The CCTV website, cctv.com, has a daily page views of over 15 million, and is one of the top six strategically important government websites in China. In America, CCTV is on nationwide satellite network and cables in at least 15 metropolitan areas (see Table 1).

CCTV began its global expansion in 1992 by carrying out a systematic, global growth plan aimed at reaching Chinese audiences around the world. The focus from 1992 to 1995 was Asia Pacific, United States, and Middle East. The target group in 1996 was European overseas Chinese. The year 1997 saw the expansion into Africa; and in 1998, more expansion into the United States. Currently, CCTV plans to establish a 24-hour news channel and make itself available on satellite and cable TV systems. The expansion steps completed within the United States (see Table 2) are as follows:

• Establish global satellite channels: CCTV-4 (Chinese) and CCTV-9 (English), CCTV-E&F (French and Spanish, 12 hours programming each per day)

• Purchase cable channels or hours in major U.S. metropolitan areas

• Provide CCTV programs, especially news, to public and private stations for free

• Contribute to TV stations on campuses of American universities

Infiltration of Chinese-Language Media in America

The method of infilitrating the American Chinese-language media is twofold: One is to sponsor local Chinese media groups that are registered as independent media, and then impose news censorship through direct and indirect financial control or ownership; the other is to suppress independent Chinese-language media in the United States through political and economic pressure.

In the Boston area alone, five out of the eight local Chinese-language newspapers are either controlled by, or under the heavy influence of, the Chinese government. Dr. Pengfei Wei, a physicist working at MIT who is familiar with the Boston-area Chinese community, revealed:

"Beginning with the Sino American Times, this is a free weekly newspaper previously called the Boston Chinese Report. It is believed that the Chinese government funded its expansion in August 2002. The director of this newspaper, Mr. Liping Liu, had worked for the Xinhua News Agency for many years before he and his wife came to the United States. From different sources I learned that the editing and typesetting of the Sino American Times main pages are conducted in mainland China and then forwarded to Boston for publishing."

Daily newspapers in the Boston area include China Press, Mingpao, Singtao Daily and World Journal. These newspapers are distributed across the United States, and are known to be influenced by the Chinese government, as revealed by a report in an issue of the Jamestown Foundation’s China Brief (How China’s government is attempting to control Chinese media in America, by Mei Duzhe, CHINA BRIEF, Volume 1 , Issue 10, November 21, 2001).

Inside sources revealed that the news of China Press is directly from the Xinhua News Agency or the China News Agency, which are the two major official government news agencies. "Mingpao and Singtao Daily did not have the authority to report on Hong Kong’s Article 23 legislation or SARS in a timely manner," observed by Ms. Jiang Zhu, a local reporter for The Epoch Times. Managers of these newspapers told Ms. Zhu that news is censored, such as the news about Jiang Zemin and other Chinese government officials being sued in the United States and in other countries. They also told her that, as ordered by their headquarters office, they cannot report any positive information with the words "Falun Gong," in it, or run any advertisements provided by a Falun Gong group in their newspapers, Ms. Zhu went on to say.

Dr. Samuel Zhou, Vice President of Programming at New Tang Dynasty Television (NTDTV) and a prominent scholar on media policy in China, summarized the Chinese government’s methods for infiltrating and dominating the overseas Chinese-language media as such:

"One popular way is to build up a ‘United Front’ by inviting selected overseas media to contribute at overseas Chinese media forums. The Chinese government runs these types of conferences every year or two, and invites over 100 overseas media to attend. Individual meetings are arranged with some of the owners and/or chief editors of the local newspapers, television stations, and radio stations. Through purchasing shares, the government can gain complete ownership or own the majority of shares."

One typical example is the Singtao Newspaper Group (STNG). STNG was established in Hong Kong in 1938. In the 1960s, regional offices were established in San Francisco, New York, and Los Angeles to publish Singtao Daily in North America. In the late 1980s, the Chinese government bought shares from STNG’s owner Sally Aw Sian. The past decade or so has seen the transformation of Singtao Daily into a pro-Communist newspaper. Sally Aw Sian has since become a member of China’s National Political Consultative Conference. The current owner, Global China Group, established Greater China Media Services Limited, a joint venture with People’s Daily’s Da Di Distribution Center in September 2002.

"Other strategies include purchasing broadcast time and advertising space from existing independent media and to influence what they can and cannot report," said Dr. Zhou. "They also deploy government personnel to work in independent media, achieving influence from within their ranks."

Suppression of Independent Overseas Chinese Media

As for those few Chinese-language media agencies independent from the control of the Chinese government, the Chinese Embassy and Consulates have used political and economic means to suppress them. According to John Yu, a cameraman for NTDTV, during the visit of Chinese Premier Wen Jiabao to the United States, a staff member at the Chinese Embassy pressured White House officers to block his team of reporters from entering a U.S.-China joint press conference on December 9, 2003. On December 10, 2003, Chinese Consulate staff members from New York tried to block Radio Free Asia and The Epoch Times reporters from attending a seminar at Harvard University in Boston.

The Epoch Times has also encountered theft that specifically targeted the newspaper’s distribution. According to the newspaper’s reports, in late February 2005, The Epoch Times’ Los Angeles staff noticed that a man was stealing hundreds of copies of the Chinese-language edition of The Epoch Times, which was free at distribution sites in Chinese communities throughout the L.A. area. They began following this man, whom they learned was named Mr. Lum, and found the situation was far worse than they had imagined. Mr. Lum spent full time, every day, driving to distribution points throughout L.A., and stealing every single paper at each location, totaling thousands of copies each day. After finishing his route, Mr. Lum would take his pick-up truck full of papers to a recycling center, where he would earn a few extra dollars by selling those collected papers. He would only steal The Epoch Times, although other free Chinese newspapers were just as easy to take. When a reporter from The Epoch Times attempted to videotape him at the recycling center, Mr. Lum saw him and drove his truck into the reporter’s leg. Later that day, Mr. Lum was arrested for assault with a deadly weapon.

Infiltrating the Chinese Community

Media infiltration goes hand-in-hand with the CCP’s effort to control the Chinese communities in the United States.

Again, we can use an example from the Boston area. At the same time when Sino American Times expanded in August 2002, the Boston Asian Culture Center (BACC) was also founded. It turns out that the Sino American Times and the BACC belong to the same parent company. Officials from the Chinese Consulate in New York are often present at BACC-held activities.

Besides business entities, community-based Chinese associations are the main targets for the Chinese Embassy and Consulates to infiltrate in order to extend CCP influence. There are many types of Chinese associations in the United States, such as student and scholar societies, cultural exchange organizations, business groups, alumni associations, and even associations of people who come from the same hometown in China. The Chinese Embassy and Consulates actively support, organize, and finance the establishment and activities of such associations in order to gain control over them. For example, on the CSSA (Chinese Scholars and Students Association) Union website (http://www.cssa-union.org/aboutus.html), it says, "This web site has signed an official agreement with the magazine Shen Zhou Xue Ren (Chinese Scholars and Students, an official magazine by China’s Department of Education), and has obtained great support from the Chinese Embassy and Consulates." Three out of the five named advisory board members are Chinese Consulate officials. Another one was formerly a high-ranking government official in mainland China. During the second meeting of CSSA’s Presidents in the areas serviced by the Chinese Chicago Consulate (http://www.chisa.edu.cn/newchisa/web/2/2003-11-24/news_13539.asp), student leaders hoped to have more financial support from the Consulate, and vowed to continue supporting the Consulate in its struggle against anti-China forces.

Regional Chinese associations in the United States often attract their members along lines of origin. People originally from Taiwan, people from Hong Kong, and new immigrants from the mainland, for example, have their own separate associations. These associations have come to understand that they can receive funding, directly or indirectly, in whole or in part, from the Chinese Embassy or Consulates, as long as they are willing to maintain "friendship" with the Embassy and observe the Party line laid down by the CCP. The Chinese Embassy and the Consulates in general tend to dominate the mainland associations, while further expanding into the other associations.

Leaders of these associations are motivated by various benefits that the Chinese Embassy or Consulates offer, ranging from dinner party banquets and free movies, to cheap housing for student leaders and special treatment or business favors in mainland China. A regional union of associations is formed when the number of local associations has grown sufficiently large. Once under the Embassy and Consulates’ wing, these types of associations can serve as effective tools for the Chinese government in influencing the Chinese American communities.

Mr. Jingning Li, former president of the Chinese Student Association in the Catholic University of America said:

"The system of ‘uniting’ Chinese Americans around the Chinese Embassy has already been consolidated and is achieving great efficiency. For instance, since the persecution of Falun Gong began in July 1999, the Chinese Embassy organized and sponsored many dinners, parties, and forums through which to defame Falun Gong. Their influence in the associations guaranteed attendance of such activities and reinforced the extension of Communist policies in mainland China into U.S. territory."

One example can be taken from a criminal case tried in the Circuit Court of Cook County in Chicago in 2002. Mr. Bill Fang, a victim in the case, told this story:

"The Chicago America-China Fujianese Association (CACFA) has close ties with the Chinese Consulate of Chicago. Its president, Zhang Liguang, said at a celebration party for CACFA’s third anniversary that the Association had been like an infant in its cradle, and thanks to the care from the Chinese General Consulate in Chicago, the Association was able to grow healthily and fast. When the Chicago Consulate was working on defaming Falun Gong, Zheng Jiming and Weng Yujun, respectively listed as the Standing Vice President and Vice President of the Association, assaulted Falun Gong practitioners in front of Chicago’s Chinese Consulate, and the two were subsequently sentenced in the Circuit Court of Cook County in Chicago on Nov. 13, 2002, and on January 14, 2003.

"A similar incident happened in July 13, 2001. Alexander Hugh (also named Chaolian Qiu), who was the Vice President of the Chinese American Association of Greater Chicago (CAAGC), was involved in attacking Falun Gong practitioners in front of the Chicago Chinese Consulate. After the incident, Hugh was appointed in 2003 by the Chinese Consulate in Chicago to be the overseas consultant for the National Association of Returning Overseas Chinese. This National Association of Returning Overseas Chinese is led by the Chinese Communist Party and its first source of funding is from the Chinese government budgets."

Student associations in U.S. universities usually serve their members by providing social activities to promote diversity and take care of students’ interests. Yet in the Chinese Students and Scholars Association (CSSA) of American University, Mr. Jun Yu, the person in charge of CSSA, told all CSSA members that they must abide by China’s law. When a student posted an email on the Listserv to initiate an activity that sought to promote freedom of belief, Mr. Jun Yu told her that she would be de-listed, and that, "We also report our situation to the Chinese Embassy by memorandum."

If the Chinese Embassy and Consulates rely only on their own staff, it is impossible to control the entire Chinese community in a country. The number of ethnic Chinese totals more than 2.4 million according to U.S. Census 2000 data. The Embassy must rely on agents and informants to monitor the Chinese community. Chen Yonglin, the former consul for political affairs at the Chinese Consulate in Sydney who defected in late May, disclosed to media that the Embassy and the Consulates "have over 1,000 agents in Australia." Mr. Chen’s claim was confirmed by another recently defected Chinese state security officer, Mr. Hao Fengjun, who arrived in Australia at the beginning of this year from his station city of Tianjing. Mr. Hao told The Epoch Times reporters, "What Chen Yonglin said about 1,000 Chinese agents in Australia is true. If we take all types of agents into account, the number is even larger."

The Chinese Embassy has various ways to punish those who object to the Chinese government’s control. From denying passport renewal for Chinese students and scholars to rejecting visa applications for Chinese Americans wanting to visit China, the Chinese Embassy has a lot of leverage against the Chinese people. In extreme cases such as the one against Ms. Jun Guo, described later in this article, relatives in China are harassed and family safety is threatened.

The degree of control that the Chinese Communist government can exercise is illustrated in another example, which occurred in October 2002. At the request of the Chinese Consulate in Houston, the Friendship Association of Chinese Students and Scholars (FACSS) at the University of Houston organized a welcome team for the visit of then CCP General Secretary and PRC President Jiang Zemin. FACSS required all participants to sign a legal agreement. The agreement: 1) asked participants to report on activities of Falun Gong; 2) asked participants to waive their legal rights in connection with Jiang’s visit; 3) threatened to sue those who violated the "agreement."

The following is the "agreement" that the FACSS asked members to sign.

Totalitarian Control on the Mainland Extended Overseas

The gradual take-over of American Chinese media is no surprise to some Chinese Americans who have been on the receiving end of the Chinese Communist government’s tactics. Chinese Embassy and Consulate activities in the United States demonstrate that they are run by people who are not hesitant to use strong-arm methods to get their way even on the free soil of the United States. Here are two instances.

Case One

Anne Yang, an economist working at The World Bank during the day, and an amateur independent documentary film producer at night, is a woman without a nation.

"The Chinese Embassy refused to renew my passport, and I cannot go back home," Anne Yang said in an interview in Washington DC on June 4, 2005. She is not alone. Since 1999, there are 140 written cases of Chinese citizens being denied passport renewal by the Chinese embassies and consulates in more than 20 countries, according to a report by The Epoch Times. In 2004 alone, 12 written cases were denied passport renewal in the United States. Among the applicants were electrical engineers, accountants, as well as students from Stanford, Ohio State, and the University of Southern California. The reasons given by the Chinese Embassy and Consulates in the United States were the applicants’ political opinions, religious beliefs, and sometimes just a blunt answer of "no reason."

Case Two

In February 2005, Jun Guo, The Epoch Times Chief Editor, was threatened. Her family in Guangzhou, China, was visited by agents from the Chinese National Security Bureau, which functions like America’s FBI. During the conversation with Jun’s sister, who is a Psychology Professor and the Vice-Chair of the Department of Psychology at Zhongshan University in Guangzhou, the agents told her that their visit was a direct order from the central government in Beijing. They told Professor Guo to tell her sister in the United States to pay attention to her safety and the safety of her own family. The agents was very specific: "Jun’s four children go to school in Washington DC, and we are very clear about that."

This is not an isolated case either. In the greater Washington DC area, there are more than a dozen people who had similar experiences. Their parents or family members in China were visited and threatened by agents from the Chinese National Security Bureau.

June 4, 2005, marks the 16th anniversary of the massacre of pro-freedom activists at Tiananmen Square in Beijing. For the past half century and even before the take-over in 1949, the Chinese Communist Party (CCP) has engaged in violence to rule China. In The Black Book of Communism, a 1999 Harvard University Press release, socialist researchers established that Mao Zedong and his successors murdered 65 million Chinese. This number was based on recently opened archives from former Communist countries.

How Propaganda Brainwashes the Chinese People

How can the Chinese people live under a regime like this? Dr. Samuel Zhou said in a recent interview:

"The Communist government stresses the need to maintain stability and social order, and is committed to perpetuating the rule of the CCP and its hierarchy. To achieve this goal, it has continuously utilized propaganda that brainwashes the Chinese people. In recent years, the CCP-controlled media spread anti-American propaganda worldwide to discredit values such as freedom and democracy. This propaganda has been disseminated through Chinese-language media in mainland China, as well as Chinese media in the United States and throughout the world. Such propaganda is designed to block the Chinese people from knowing the facts and keep them away from ideas of freedom of speech and democracy.

"Along with its propaganda, the Chinese government has successfully influenced and infiltrated American societies, especially the Chinese community and Chinese—language media. Such infiltration secures an audience for the propaganda outside of China. The United States—as leader of the free world-has not done very well in penetrating the political ‘Firewall’ to reach the Chinese people with uncensored news and information and to urge them toward political reform."

The Insidious Influence of Propaganda on American Chinese

While it is hard to assess the impact of media, the influence of propaganda on people’s viewpoints can certainly accumulate and has manifested in some incidents in the past.

During the Iraq War, Chinese Central Television (CCTV) used footage provided by major foreign media, but associated the footage with a different story than what the rest of the world heard. CCTV fabricated the death tolls of Iraqi citizens and quoted many media articles from the Arab press against the Iraqi War to make it appear to the Chinese audience that the war was being supported by no one and causing tremendous death of Iraqi people.

According to a Voice of America report by Dong Fang on Feberury 2, 2003, some Chinese people who were influenced by the government-controlled media, rejoiced over the Columbia Disaster, calling it the most beautiful fireworks of the New Year (Analysis of some Chinese’ Anti-American Sentiment by Dong Fang, Voice of America, February 2, 2003).

Another example comes from an official survey conducted by the Chinese government shortly after September 11. In the survey, while 98% were sympathetic to the victims of 9/11 in the United States, 80% of the people thought the United States was a hegemony. In many of the chat rooms on the Internet, many young people expressed the opinion that it "serves the U.S. right."

Dr. Samuel Zhou commented:

"These people are not bad people; their thoughts reflect what they see and hear from state-controlled media. Unless the United States, as the leader of freedom and democracy in the world, provides an alternative, making available objective, accurate and timely information, the Chinese people will probably continue to believe the hateful anti-American propaganda that targets the United States by the Communist Government."

As to community infiltration and control, the consequence can be even bigger. For example, when the accidental bombing of the Chinese Embassy in Belgrade happened in May 1999, over 120,000 Chinese in America were mobilized in the streets on the east coast, protesting on the same date. The event was selected for the Ten Top International News of that year by CCTV and the Xinhua News Agency.

The influence and control over the community associations by the Chinese Embassy and Consulates guarantees attendance of such activities and consequently extends CCP policies into U.S. territory. The Chinese government also uses such networks to influence American policy, as evidenced by its instruction to lobby the U.S. Congress in March 2004.

At issue was a "Dear Colleague" letter circulated in Congress that called on lawmakers to go on record supporting Taiwan’s March 10th referendum. The referendum called for peaceful means to settle the China-Taiwan issue. The Chinese Consulate organized the lobby starting with an email in Chinese, dated March 12, 2004, marked "Urgent" to Chinese Students and Scholars Association (CSSA) chairpersons in universities throughout the United States. The letter started with "The Consulate General has an important task to assign," and asked Chinese students and scholars to personally email each state’s Congress persons, urging them not to support Chen Shuibian’s "wrong action." A copy of the email is shown below.

Each Chairman,

The Consulate General has an important task to assign below:

We heard recently, Florida Congressman Peter Deutsch is trying to convince all Senators and House Representatives in the United States to co-sign and support the so-called "Defense Vote" on March 20 held by Chen Shuibian. Now please write on behalf of the Chinese Scholar/Student Associations, and also encourage Chinese students and scholars to personally write to each State’s congresspersons with e-mail, and urge them to not support Chen Shuibian’s wrong action, and hurt Chinese people’s feelings. (I put the outline of letters to congresspersons in the attachment. You can read carefully, do necessary editing, make sure your tones are sincere. Congresspersons’ e-mail addresses are also included in the attachment).

Please finish this task before March 20, definitely, and e-mail me about the situation before March 16 (especially tell me how many Chinese students and scholars you mobilized to write their personal letters to Senators and Representatives of U.S. Congress).

Hope all work with our love to the country, express our strong wish to unite our motherland with peaceful means.

Zhang Zhigang

3/12/2004

The email was forwarded to CSSA/FACSS members in several states, and many members followed the instruction and reported to leaders in CSSA/FACSS that "Action is taken."

Moreover, the freedom offered by the U.S. political system is at great contrast to the totalitarian control in China. Free society may fail to differentiate political propaganda from cultural programs. For instance, the CCTV channel or programs on different cable networks in major metropolitan areas are treated as cultural programming and often shown on public access channels. Yet, given the content and the news manipulation in CCTV programming, it is more political than cultural. However, according to Dr. Samuel Zhou, "Oftentimes news from China’s state-owned media is considered just another point of view, and enjoys freedom of speech in the United States."

An Unequal Contest

The Chinese government is actively taking advantage of freedom of speech in the United States to spread Communist propaganda, but it does not grant U.S. media the same rights in China.

The United States is fighting its opponent with one hand tied behind its back.

Several other asymmetries are notable in China and U.S. engagement, or, competition.

Aggression vs. Reluctance

The Chinese Communist regime made systematic and consistent efforts in the past 10 years to utilize and increase its propaganda influence. By contrast, there lacked concrete policy and financial support by U.S. administrations to seriously influence China in becoming a democratic society (see Table 3).

Progressive vs. Reactive

WorldNet TV was first launched in June 1989 as a response to the Tiananmen Square Massacre (U.S. International Broadcasting Chronology: http://www.ibb.gov/bbg/chron.html). However, its current broadcasting power from the United States to China falls short compared to that of CCTV. While CCTV broadcasts 24-hour programming every day in China, WorldNet TV has only 30 hours of Mandarin programming each week. CCTV also has significant influence over the broadcasting and programming of local U.S. Chinese-language cable TV stations by providing free programs or other financial support. By contrast, WorldNet TV programs do not even focus on promoting democracy in China. The station fails to act as an alternative information source, as it does not have a news program. The impact of WorldNet TV is further diminished given the fact that the Chinese government effectively bans personal ownership of C-band receiver dishes, which are needed to pick up WorldNet TV’s signal.

State-Sponsored Infiltration vs. Insufficiently Protected Independent Media

The Chinese Communist regime’s effort to spread propaganda worldwide is backed up by its state resources, including its political, financial, and human power. The few independent Chinese-language media groups in the West are often created and run by traditional businessmen, political dissidents, and new immigrants who seek to promote education and American values to the Chinese people. These groups often lack financial resources for large-scale operations, often find it difficult to make ends meet, and are much less equipped to battle state-sponsored suppression. Independent media also lack resources for public relations and political lobbying activities. Furthermore, they are not in a very strong position to acquire legal protection when their businesses are interfered with. The consequence is that many Chinese media organizations that intended to be independent at the beginning have eventually been bought up or influenced by the Chinese government (see Table 4).

So far, it’s been a big victory for a totalitarian regime when China’s propaganda machine is allowed to freely exploit the freedom of speech in the United States and influence American citizens. In doing so, the United States is unwittingly legitimizing Beijing’s power over its own people as well as the Chinese people residing in the States.

Footnotes:
[1] Seven days a week unless specified.
[2] Regular 24 hr. program unless specified.
[3] From CCTV International web site.
[4] "CHINA BRIEFS: CHINA CENTRAL TELEVISION" by Telenews Asia, May 18,1995 published by 3rd Wave Communications Pty Ltd.
[5] "Worldwide Chinese TV service" by Music & Copyright: February 15,1995, published by FT Information Online Ltd.
[6] "PanAmSat, CCTV Eye Expansion" by Space News, April 8,1996, published by Army Times Publishing Co.
[7] "CCTV to Africa" by Hollywood Reporter, June 10,1997, published by BPI Communications, Inc.
[8] CHINA’S CCTV-9 TO BE LAUNCHED IN PHILIPPINES" by Asia Pulse News, November 8, 2000, published by Asia Pulse Pte Ltd.
[9] "MTV’s clearance for 24-hour China channel" by Television Asia, April 4, 2003, published by Cahners Business Information.
[10] "China Central Television Chooses GlobeCast’s DTH Platform" by Satellite Today, March 13, 2003, published by PBI Media, LLC.
[11] "CCTV extends Latin American influence" by Asia Image, June 10, 2003, published by Reed Business Information.
[12] CCTV Chinese language web site.
[13] "AUDIOVISUAL SECTOR: CHINESE TELEVISION POSTS INTERNATIONAL AMBITIONS" by Tech Europe, December 10, 2004, published by Europe Information Service.
[14] "China’s media: radio, TV expand and newspapers hold readers" by Market Asia Pacific, December 2000, published by PRS Group.
[15] From CCTV International web site.

Over the past four years, Chen Yonglin, a senior Chinese diplomat from the Chinese Consulate-General in Sydney, had attended every rally commemorating the June Fourth anniversary of the Tiananmen Square Massacre in Sydney. Chen would normally stay behind the crowd, covertly taking photos of participants and then sending them back to the security department in China. This year, however, Chen stepped forward to the front, publicly announcing his defection and criticizing the Chinese Communist government.

"The current regime is just a power representing those who already have power. All those people who join the Communist Party, it’s not for the people, it’s for their own individual purpose," Chen said, "I believe this undemocratic government will finally be overthrown by the people in China."

A week ago, Mr. Chen left his consulate post as "consul for political affairs" and sought political asylum in Australia, saying that he could no longer support his country’s refusal to embrace democratic reform or its persecution of Falun Gong members. He said that his job in Sydney had been to "monitor" political dissidents and Falun Gong practitioners in Australia and implement countermeasures against those groups.

The Australian government didn’t extend a warm welcome to Mr. Chen, turning down his application for political asylum almost immediately. Before granting Chen any protection, the immigration official even contacted Chen’s consulate for an identity check, effectively informing them of Chen’s defection.

Fearing for the safety of his wife and 6-year-old daughter, Chen went into hiding and then made his position public at the rally.

Chen revealed that there are 1,000 Chinese spies in Australia. He said that Chinese spies had previously kidnapped critics of Beijing in Australia and returned them to China.

"They have successfully been kidnapping people in Australia back to China," he said. "Each year they have kidnapped a good number." He detailed several cases of what he described as confidential consular information, including the case of former vice mayor of Xiamen City, Lan Fu, who entered Australia on November 27, 1999, on a tourist visa.

To get Lan back to China, Chinese security agents kidnapped Lan’s son, who was studying in Australia. Lan’s son was drugged and put on a boat for the "high seas," where a Chinese cargo ship took him back to China. Mr. Lan eventually went back to China in January 2000, and was tried and sentenced to death three months later.
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The information provided by Chen didn’t generate much interest from the Australian government. "I told this to the Australian government when the immigration and foreign affairs officials interviewed me on the 31st of May, but they didn’t care," he said at the rally.

In contrast to the government’s indifference, the public showed great interest in Chen’s defection and his exposure of China’s overseas espionage. In the following week, a number of major media interviewed Chen or published articles about his story.

Many private groups also expressed support for Chen’s defection. In Chen’s daughter’s school, parents signed a petition letter asking the government to provide help for Chen’s family.

Chen’s public appearance prompted another Chinese official, Hao Fengjun, to break his silence. Hao was a police officer of the 610 Office (an agency set up to handle Falun Gong issues) in the Tianjin Bureau of State Security and sought political asylum in Australia after he fled China in February 2005. He backed Chen’s claim of Chinese spies in Australia and revealed that he personally handled Australian Falun Gong practitioners’ information collected by agents in Australia. Hao left his work because he no longer wanted to be involved in the persecution of Falun Gong and other religious groups.

A third, anonymous defecting official now seeking asylum in Australia also made similar statements through his attorney.

Australia’s handling of Chen’s case has drawn concern and criticism. Bob Brown, the leader of the Australian Green Party, criticized the government for not giving Chen immediate protection and requested a hearing of the event, saying that the government had put trade above human rights.

In recent years, China has become the third largest trade partner of Australia, and now the two nations are seeking to hammer out a free trade deal they say would be worth billions more.

Professor Hugh White, head of the Australian National University’s Strategic and Defense Studies Center, said China has made it clear that the development of the economic and trade relationship was dependent on Australia being sympathetic to China’s concerns on political and security issues.

"I think it does potentially put the government in a tough diplomatic position," he told ABC, "The concerns in the Australian community about the human rights of this individual are significant and valid; on the other hand, China I think will want this guy back and would tend to view a decision by the government to grant him political asylum or even refugee status … as a fairly adversarial thing to do."
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As the government’s human rights obligation comes under public scrutiny, more news in connection with China’s vast network of spies broke out. It was reported that almost 50 Chinese people held in Australian immigration centers were put in isolation for more than two weeks last month and interrogated by Chinese government officials from the embassy.

Refugee Action Coalition spokesman Ian Rintoul said smuggled letters had revealed some of those interviewed were asylum seekers who now feared persecution. "If it is not illegal, it is certainly reckless," he said.

The agents are targeting Chinese dissidents and are also being used to influence political thought "to turn Australia into a political colony of China," former Beijing University law professor Yuan Hongbing, the fourth Chinese defector to surface in Australia in the past month, told ABC radio.

"The term ‘political colony’ means the Chinese Communist Party will use its ideology to influence Australia’s politics and gradually turn Australia to betray its fundamental principles of freedom and democracy," Yuan said.

Along these lines, Australian Foreign Minister Alexander Downer has issued certificates each month over the last two-plus years to prevent Falun Gong members from using banners in their human rights appeal outside the Chinese Embassy in Canberra. Mr. Downer indicated that the banners "impair the dignity of the [Chinese] mission."

After repeated requests to Mr. Downer to reconsider the decision fell upon deaf ears, Falun Gong practitioners lodged a lawsuit against Mr. Downer in the Australian Capital Territory’s Supreme Court. The lawsuit is seeking a ruling from the court that deems Mr. Downer’s certificates to be illegal and to have infringed upon their right to freedom of expression.

So far, public reaction in Australia to the moves by the local government has been quite negative. By siding with the Communist government in the balance between trade and human rights, Sydney is taking a big gamble that the Communist regime will continue to prevail in China for the years to come, or that changes, if any, will only happen from within the Party.

The surprising defection of senior Chinese diplomat Chen Yonglin to Australia sent shockwaves from Sydney to Beijing. Chen subsequently gave insight to a vast Chinese spy network in Western countries and its inner workings. Many elements of his statement were later confirmed by a couple of other former Chinese security officers who were also seeking asylum protection in Australia.

In a friendly environment, spying can be achieved completely "legally," as in the case of Mr. Chen. He professed to work as an agent to monitor pro-democracy activists, Falun Gong, and various dissident groups. It was revealed that many espionage activities are carried out with the assistance of students and pro-government individuals in the ethnic Chinese community, and collected information is sent to the Chinese consulates and embassies or directly transmitted to the security department on the mainland.

With the help of international investment, China is gaining increasing economic clout, but has not brought about the political reform the world has been hoping for. Instead, the Communist government is utilizing its growing economic power as leverage to consolidate control domestically, silencing critics from democratic countries and using international corporations to help its cause. Australia’s reluctance to offend Beijing in handling Chen’s asylum application is a prime example. Another good example is the fact that Microsoft recently complied with Beijing’s demands to install filters in its Internet blogging portal MSN Spaces in China, blocking users from using "democracy," "freedom," "human rights" and other sensitive words.

Domestic control is only the first step, as overseas infiltration and expansion has always been a part of the CCP’s long-term goal. Ideology control has traditionally been first and foremost. Fully exploiting the freedom of speech in democratic countries, the Chinese authorities are dominating the overseas Chinese media market, including Chinese-language TV programs and newspapers. English-based programs can also be viewed 24 hours a day through satellite and some cable channels, as well. All in all, this media blitz signals an alarming trend, and the current issue will be focused on this topic.

Over 16 Million Acres of Tillable Fields Lost in China 

[Central News Agency, June 26, 2005] Li Yuan, Vice Minister of the Chinese Land Resource Department, revealed in the "Constructive and Economical Society International Seminar" conference held in Beijing that China has lost 100 million mu (16.47 million acres) of tillable fields over the past 10 years, and by 2004, the average tillable field per person was only 1.41 mu (0.19 acre), nearly 40 percent of the world’s average.

Li Yuan said that although the main reasons include ecological retrograde, agricultural reorganization, and disaster impact, construction taking up excess land has caused a permanent loss of tillable fields.

Drug Abuse Costs China 27 Billion Yuan (US$3.4 billion) per Year

[Xinhuanet, June 25, 2005] Since the 1980s, 33,975 people have died in China due to drug abuse. To date, more than 2,102 counties, cities, and regions, which account for 73.5 percent of the total, have found drug addicts among their population. Nationwide there are 791,000 people addicted to drugs, consuming at least 27 billion yuan (US$3.4 billion) of heroin every year. The government, consequently, is forced to invest at least 3 billion yuan (US$0.375 billion) per year in drug control. Zhang Xinfeng, the Deputy Director of the National Drug Abuse Control Committee and Vice Minister of the Public Security Department, stated that, between 1998 and 2004, the Chinese government reported more than 638,000 drug-related crimes, arrested 320,000 drug-related suspects, seized 62 tons of heroin, 60 tons of ice (methamphetamine hydrochloride), 14 tons of opium, and 1,538 tons of chemicals that are used in drug products.

China’s Land Desertification Accelerates

[The Beijing News, June 17, 2005] By the end of 2004, the amount of land in China that suffered from desertification was 2,636,200 square kilometers, accounting for 27.46 percent of the national territory. Zhu Lieke, the Vice Director of the National Forestry Bureau, stated on June 14, 2006, that 320,000 square kilometers more land has desertification potential. This land, if not utilized appropriately, will then become new sandy wasteland. The Director of the Desertification Control Office, Liu Tuo, stated that in China, five sand storms occurred in the 1950s, eight in the 1960s, 13 in the 1970s, 14 in the 1980s, and 23 in the 1990s. By the end of 2004, 32 sand storms had already occurred.

Top CCP Authorities Issue Secret Order to Launch a "100-Day Strike Hard Campaign"

[Secret China, June 16, 2005] In March 2005, the Chinese Communist Party (CCP) determined Falun Gong to be a "Reactionary Political Organization." The top authorities of the CCP issued a secret order to launch a 100-day strike hard campaign that would include the six-year anniversary of the April 25 (Falun Gong peaceful appeal), the 16th anniversary of June 4th Massacre, and the sixth anniversary of July 20 (the day of the CCP crackdown on Falun Gong began), in order to prevent people from downloading and spreading the forbidden book Nine Commentaries on the Communist Party as well as other prohibited information.{mospagebreak}

China Secretly Tightens Control of Officials Going Abroad

[The Epoch Times, June 11, 2005] Three Chinese officials sought refuge from the Australian government successively within a week. They exposed the Chinese Communist Party’s persecution of overseas Chinese as well as its huge overseas spy network. China’s response to this took the form of a secret tightening on officials going abroad and of increasing checkpoints and procedures.

According to a report by the British paper The Times on June 10, 2005, sources in China’s Public Security Department confirmed the same information: that China has secretly tightened its policies regarding officials going abroad and increased checkpoints and procedures. China requests that all government and army officials obtain a workplace permit before applying for a passport from the Public Security Department, and submit their passport to their workplace after returning. They have to re-apply for permits if they need to go abroad again. The new policy not only applies to officials who are going abroad for the first time, but also to officials renewing their passports.

Laborers’ Pay Short by 100 Billion Yuan (US$12.5 Billion)

[China Youth Daily, June 9, 2005] According to statistics done by the Beijing Youth Center of Aid and Law Study, by mid-November 2004, the payment of laborers from the countryside was short by around 100 billion yuan (US$12.5 Billion). To compensate for this shortage, the whole society would have to pay at least 300 billion yuan (US$37.5 billion).

This investigation was done through 8,000 questionnaires in eight provinces in China. Among these laborers, 48.1 percent cannot get any part of their salary at all, 30.6 percent reported that their pay was short by from 100 yuan (US$12.50) to 1,000 yuan (US$125), 5.7 percent were short by 1,000 (US$125) to 5,000 yuan (US$625), and 1.6 percent were short by 5,000 yuan (US$625).

"Land Revolution" in Premier Wen Jiabao’s Hometown

[Asian Times, May 22, 2005] Land belonging to villagers in Premier Wen Jiabao’s hometown, Yixingbu Town in Tianjin City, has been taken by force in recent years. Indignant because they have not received proper compensation for their land, around 600 farmers have gathered around the local government compound. They hope that Premier Wen will come back to see what has happened to the village where he grew up. Villagers say that the local government has refused to give any compensation for the land seizures under the pretext of financial insolvency. As much as 100 million yuan (US$12 million) was paid for the villagers’ lands, but currently no one can say for sure where it went.{mospagebreak}

Huang Qi, Creator of the Tian Wang Website, Released

[The Epoch Times, June 5, 2005] Huang Qi, the first Chinese webmaster ever arrested, was released on June 4, 2005, after serving five years in prison. Huang is the creator of the Tian Wang website, which helped more than 70 people locate missing friends and relatives by publishing information and research on cases of missing persons in China. The website also opened a column for those who had been treated unjustly to "speak for themselves," a topic that must have offended the authorities. On June 3, 2001, the day before the 12th anniversary of the 1989 Tiananmen Square Massacre, he was arrested in Sichuan Province and charged with "subversion." He was sentenced to five years in prison that August. In an interview with the BBC, Huang said he was ordered to sleep on the floor next to the toilet for the first year he was in jail. He was also severely beaten, resulting in several lost teeth and serious bodily injury. He suffered from headaches, eczema, and heart disease. His request for treatment at a hospital in Chengdu was refused. He denied the criminal charge of subversion and insisted it did not apply to him.

Huang said, "If someone in China fights for democracy and freedom, he is then accused of being a member of the June 4th incident, Falun Gong or pro-democracy activists. I am definitely going to tell the Chinese regime that I am one of them and proud of it."

Shi Tao Given Chinese Youth Human Rights Award

[Radio Free Asia, June 2, 2005] Shi Tao, a Chinese poet and reporter, was named the recipient of the Chinese Youth Human Rights Award. The award committee in the United States declared on June 1, 2005, that the winner of the fifth Chinese Youth Human Rights Award would be Shi Tao, commending his conscience and courage in spreading the ideology of freedom and democracy. Shi Tao used to be editorial director of The Modern Business News in Changsha City, Hunan Province. In 2004, the Central Propaganda Department sent a summary to the editors of the paper specifying that certain items could not be reported, including specifically, information about the commemoration activities for the 15th anniversary of the June 4th democracy movement, and about strictly preventing pro-democracy activists from crossing the border. Shi Tao took some notes, wrote some critical comments about these violations of the freedom of the press, and then submitted them to the U.S.-based Democracy Net. He was arrested in October 2004. In March 2005, Shi Tao was sentenced to 10 years in prison for "Illegally providing national secrets to foreigners." He received the Chinese Youth Human Rights Award while in prison.{mospagebreak}

Anti-Corruption Reporter’s Health Deteriorates in Prison

[The Epoch Times, May 25, 2005] The Committee to Protect Journalists, headquartered in New York, issued a statement concerning the health of reporter Jiang Weiping, who has been imprisoned for exposing corruption within the Chinese Communist Party. The prison authorities have barred Jiang from reading books or making phone calls.

Jiang Weiping was the northeast China bureau chief for Hong Kong-based Wenhui Bao newspaper. In 1998, he wrote a series of reports about corruption in the high-level leadership in Liaoning Province. By the end of 1999, Jiang was dismissed by Wenhui Bao under pressure from China’s National Security Department. In December 2000, he was arrested by the National Security Agency in Dalian and arraigned for "revealing state secrets." In May 2001, Jiang was sentenced to eight years in prison during a secret trial for, among other crimes, "damaging national security." The Committee to Protect Journalists awarded Jiang an International Press Freedom Award on November 20, 2001.

Twenty Branch Managers from the Bank of China Dismissed

[China Youth Daily, June 3, 2005] In a recent move involving personnel reshuffling at the Bank of China, 20 second-level branch managers have been dismissed from their positions. Most of these branches are in the Northeast and Guangdong Province, with a few in Shangxi Province, Hebei Province, and Shenzhen City. The bank’s spokesperson claimed that the main reason for the massive layoffs was because of inappropriate management that had a negative influence or caused huge monetary losses.

812,000 in Western Guangdong Lack Drinking Water

[Information Times, May 23, 2005] Drought in western Guangdong is causing drinking water difficulties for as many as 812,000 people. A water information update from the Guangdong Hydrology Bureau indicates that the biggest "flood" since the rainy season occurred at noon on May 21 in the North River in southern Guangdong. Yet, the water came and left in a hurry. The water levels in the major rivers in the province—the West, East, and Han rivers—fell again in just two days. Normally, spring and summer are rainy seasons in southern Guangdong. Thus, the insufficient water this year forecasts a severe drought.

Chinese People Dislike the China-Russia Border Agreement

[The Epoch Times, June 6, 2005] On June 2, 2005, the Ministers of Foreign Affairs from China and Russia officially exchanged the Supplemental Border Agreement, which had been approved by the supreme legislative bodies of both countries. For consecutive days, China’s media was reporting, "China has peacefully resolved the China-Russia border issue," and "China takes back Heixiazi Island," omitting the fact that China will relinquish the 1.5 million square kilometer (0.56 million square mile) national territory occupied by Russia. Some people appealed on the Internet to establish the "China Outer North East History Study Association" aiming at long-term recovery of the national territory bordered by Heilongjiang, Outer-Xinan Mountain, and the Wusuli River.{mospagebreak}

Milk Powder Causes "Big-Head" Baby Disease

[Xinhuanet, May 25, 2005] Eight-month-old Wang Mingyu from Handan, Hebei Province, developed what Chinese doctors have called "big head disease," a condition in which the baby’s head swells due to malnutrition and has been found in babies fed with fake milk products in China. Despite two weeks of treatment, little Mingyu still had a swollen face and gray hair. She has gained less than six pounds since birth. Her grandma says that Mingyu has been consistently fed with the same Hailaer brand powdered milk. According to state media, as many as 200 babies have developed "big head disease" from drinking fake infant formulas and milk powders.

Underground Churches in Jilin Province Searched and 600 Christians Arrested

[Voice of America, June 10, 2005] Recently the Chinese authorities launched a surprise attack on more than 100 underground churches in Jilin Province and arrested 600 Christians, including university professors and students attending Bible studies held in the universities.According to the China Aid Association (CAA) headquarters in the United States, on May 25, 2005, every local police station in Changchun City launched a surprise attack on 100 unregistered underground Christian churches and detained 600 Christians, most of whom were students and university professors. On June 27, CAA reported that it had received several credible reports from China that a nationwide campaign against unregistered house churches was also underway. Numerous house churches have been raided in recent weeks, hundreds were arrested and many are still in prison.

210 Million Counterfeit Yuan Seized in First Quarter in Mainland China

[The Epoch Times, May 25, 2005] In the first quarter of 2005, 210 million in counterfeit yuan (approximately US$25.4 million) was seized in mainland China, with counterfeit money activities mostly concentrated in Guangdong and Henan provinces.

Many farmers in eastern Guangdong Province are reportedly involved in printing the counterfeits; some are even incorporated into printing lines set up like domestic workshops. Counterfeiting technology is increasingly advanced. Some counterfeit bills even carry the anti-counterfeiting technology.

The Drunk Man’s Mind Is Not on Textiles

[Editor’s note: This is a translation from an article published on Xinhuanet.com, a website of the Chinese government official news agency, on June 2, 2005]

After China announced the removal of export duties for 81 types of textiles, European Union reacted strongly. On May 30, European Union Executive Committee expressed firm opposition to massive imports of Chinese textiles. On May 31, European Union delegation to China stated that they hoped China would voluntarily limit its export within 15 days. Otherwise European Union may unilaterally impose limits on imports from China.

It appears that a textile trade war between China and the United States/Europe is inevitable. China will not fear a trade war if it is indeed inevitable. In order to reduce conflicts caused by integration of the textile industry, China has twice voluntarily raised duties on textile exports. China has fulfilled its responsibilities as a sovereign state. However, the United States and Europe have disregarded China’s efforts. Instead they view China’s efforts as a sign of weakness and hopes China will accept "the treaty signed under coercion." Therefore, we must have the courage to "come face to face with adversaries" as we have no other choice.

On one hand, we must be prepared for the worst, which is to fight a trade war with the United States and Europe. On the other hand, we need to clarify why they would throw away their idealism of free trade when it comes to China textiles. This would help us observe clearheaded the international trade and understand China situation.
The author believes we can look at it at two different levels. On the textiles issue, the United States and Europe myopically view China as the shortsighted "scapegoat." The global elimination of textile trade quota has been proposed over 10 years ago. The U.S./European manufacturers and governments should have foreseen the changes in global textile market and taken appropriate measures. However, many U.S./European manufacturers and governments have ignored this issue. This is reflected in their last-minute cancellation of trade quota. In other words, the failure on the part of U.S./European governments and manufacturers to take appropriate measures is the major cause of unemployment in their textiles industries. Yet they put the blame on the massive influx of low-priced quality Chinese merchandise, misdirecting the workers’ dissatisfaction with manufacturers and governments toward China textiles. The United States and Europe have been exercising this "scapegoat" technique for the past two centuries and with much success.

However, there is another unspoken reason for the United States/Europe insisting on trade quota for China textiles, which is to delay the rise of China. The U.S./Europe governments are well aware that the rise of China is inevitable. With this in mind, the best strategy would be to slow down the process of China rising so as to reap as much benefits as possible. The textile industry simply happens to be a breakthrough that the United States/Europe finds may delay China rising to power.
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Yet another breach is the issue of Chinese currency exchange rate. Although the textile industry is a dying industry in the West, it is an important industry for China. Textile exports account for 16 percent of total exports. More importantly, the Chinese textile industry is a labor-intensive industry, directly employing 19 million workers. Taking into consideration workers of related professions, the industry affects the interests of more than 100 million employees. The quota imposed by the United States on seven classifications of textiles has already cost China US$ 2 billion of exports and 160,000 jobs. European Union quota will also affect more than US$ 300 million of exports and a corresponding number of jobs.

Providing jobs for the huge population will continue to be one of the most important tasks facing China for a long time. The textile industry is a major channel for redirecting rural labor. Therefore imposing quotas on China textiles is in fact no different from stirring up social conflicts.

In this regard, the United States/Europe are indeed quite "forward-looking." In order to get China into the United States/Europe controlled international free trade system, they have proposed harsher conditions for China joining the World Trade Organization: (1) China is not considered a free economy for anti-dumping law; (2) There are special safeguard provisions for China exports; (3) China’s promise will be examined each year for 15 years after China joins the WTO.

Therefore, in order to guard against the rise of China and its influence on the present international trade system and international power balance, the United States and Europe have taken deliberate measures. Only with this broad background can we understand the United States/European unusual measures that are "harmful to others yet not beneficial to themselves." In an opportunistic market the best strategy for dealing with big clubs is to strike back with big clubs. Of course, this strategy is based on self-confidence.

http://news.xinhuanet.com/fortune/2005-06/02/content_3035606.htm

U.S. Administration and Congress Act Together to Create Trade Friction and Pressure China

[Editor’s note: This is a translation from an article published on Xinhuanet.com, a website of the Chinese government official news agency, on June 5, 2005]

Recently the U.S. government made several moves in trade relations with China, causing frictions between China and the United States and concerns among the international community. These activities also cast a shadow on the bilateral relationship between the two countries. First, the U.S. Senate passed a legislative amendment about Chinese RMB exchange rate, demanding that Chinese RMB appreciate or the United States will impose 7.5 percent import duty on all Chinese imports. Then the House of Representatives passed a "Chinese Currency Bill" which asks the Bush Administration to investigate and determine if the Chinese government "manipulated the exchange rate." Also, the Commerce Department announced special restriction on seven textile imports. Using trade as a stick, the Bush Administration and the Congress are acting together to attack China.
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It’s clear to seasoned observers that the ever-increasing trade imbalance between China and the United States is the result of the difference in economic systems. The root cause is not China. Even a huge appreciation of RMB will not solve the problem. In addition, the bilateral trade is mutually beneficial; large amount of "Made-in-China" in the U.S. market brings benefits the U.S. consumers. The trade has brought business opportunities to importers and retailers. It also helps to curb inflation. Further the U.S. government’s behavior hurts its image: the United States that has always advocated free trade is now promoting protectionism. Can we say that the United States is applying double standards on international trade? Also, RMB exchange rate is China’s internal affair. The United States has gone too far trying to tell what China should do. In fact, it’s a mistake to assume that the U.S. government and its think tanks are too naïve to know all these. But why did the U.S. government insist on pushing the wrong buttons? The United States did this on purpose to serve a hidden agenda. They are talking about trade issues, but thinking something else. In fact, the United States is playing a poker game using trade as one of the cards.

The sequence of the performance by the Administration/Congress was that the Congress came on stage and acted first, followed by the Bush Administration. From this, the White House was probably making the move in response to the pressure from the Congress. On one hand, the U.S. foreign policy making was always influenced by the power struggles between the While House and the Congress. The Congress has now gained an upper hand and the White House is playing defense. It is because a second term president will always have the lame duck problem. On the other hand, the episode reflected some Congress members’ dissatisfaction with the China-U.S. trade relations. These members want to express the views of the interests of the groups they represent—the mid-term election is only a year away. To these Congress members, votes are their political lifeline. Interestingly, many members of the Congress abandoned their partisan fights and came together. The Democrats represent the union; they claim that they will defend workers’ interests. The Republicans are loudly supporting the businesses. They came from different backgrounds, but now have reached the same conclusion. They formed an alliance against China.

One might ask, aren’t these members of Congress "seasoned observers" as we mentioned earlier? Objectively, some Congress members are indeed not that clear about the issue; they tend to focus on issues related to their home districts; they don’t know much about international issues and foreign affairs; they tend to not care either. So when they are asked to make a decision on international affairs, they became biased and failed to see the big picture. On the other hand, many members of Congress are indeed "seasoned observers" who know all the facts and understand the consequences. They took their position for their own interests and joined the crowd to cheer each other. In addition, some Congress members are very conservative. They hold on to their cold war ideology and their views on China are based on stereotypes. They just don’t like China no matter what. These people have many sticks ready at their disposal, such as human rights, democracy, military buildups, trade, and etc. People of this group are few in number and isolated. Usually they don’t dare to lead an assault without popular support, lest they tarnish their images and lose votes. Right now, they are more than happy to join the "Anti-China" crowd, wagging the stick of trade to make noises. There are yet others who were influenced by the traditional power politics. They don’t want to see the rise of China. In their thinking, a stronger China would be strategic competitor of the United States. They would do anything to curb China’s development and delay China’s eventual rise. Trade disputes are one important weapon to hit the target.
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Actually, some Congress members and the Administration, especially those in the White House inner circle, shared the last two kinds of ideology. Right now, the new and old conservatives who are major influence to Bush Administration somehow share the "Contain China" mentality based on different motivations. The new conservatives want to promote democracy. They just cannot tolerate a China under Communist Party walking on a socialist road. The old conservatives base their policy on geo-political consideration. They believe that China after rising to the power will challenge the superpower status of the United States, even endangering U.S.’s national security. These two policies came to the same conclusion: Contain China’s development. They never forget about "containing" China while working on the overall bilateral cooperation. When they see China’s rapid economic development and its rising comprehensive strength, they have a sickening worry. But to their dismay, the global anti-terrorism campaign is not over, the United States cannot afford to "offend" China. Therefore, they resort to play some sneaky tricks that would not jeopardize the overall China U.S. cooperation. For example, they pressure EU from selling weapons to China, and have added Taiwan’s security as a common "strategic goal" in the U.S.-Japan alliance and etc. Now when the Congress is looking for excuses to blame China, the new and old conservatives are ready to go along. On one hand, they can defend themselves when explaining to China. On the other hand, they can also get back to the American people and the international community. They can innocently say: we have to do it because of the high pressure from Congress. The White House and Congress are supposed to be opponents. But in reality, they are more like friends who complement each other like actors playing different roles in the drama. In the old days, when the U.S. Congress passed the "Taiwan Relations Act," President Carter signed it right away—he never considered to veto. The truth was the Congress and the White House shared the same view all along except out of diplomatic consideration, it was better for the Congress to lead. Similarly, the current frictions in trade relations are just another such act in a drama.

http://news.xinhuanet.com/world/2005-06/05/content_3047202.htm

U.S. Commerce Secretary Was Sweating Buckets While Questioned by Qinghua University Students on The Textile Export Quotas

[Editor’s note: This is a translation from an article published on Xinhuanet.com, a website of the Chinese government official news agency, on June 3, 2005]

On the first day of his visit to China, U.S. Commerce Secretary Gutierrez was under "waves of bombardments" by students on the "issues of textile trade between China and U.S." at Tsinghua University. He was constantly wiping off sweat and finally left the conference hastily amid the questions.
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Gutierrez gave a speech at Tsinghua University yesterday in the afternoon and discussed with 60 Tsinghua students. Although his acts paid much respect for Tsinghua students, students apparently took advantage of him and peppered him, the guest from far away, with questions. Gutierrez started to wipe off sweat after 15 minutes. He did it again after 30 minutes and again after 45 minutes. One hour into the discussion at around 4 pm, he broke students’ questioning and ended the trip to Tsinghua in a hurry.

Compared to his hard-line position toward China prior to the China visit, Gutierrez’s attitude has become much soft while making the speech. He emphasized that the U.S. government hoped to continuously improve trade relations with China. Since China is playing a more prominent role in the world, the United States hoped to solve the problem of the textile dispute between China and the United States through negotiations.

He also said, however, the quota on the import and export of textile products after one’s market opened is well regulated in the world trade rules and the measure that the United States adopted to comply with those rules. Now it is necessary for both countries to have a common understanding of the rules. Accordingly, the main purpose for his trip to China was to explain these rules to officials from China’s Ministry of Commerce. But maybe he "forgot" that, in accordance with WTO rules, the United States should carry on a 90 days negotiation with China after its investigation of special safeguards on China’s textile products. However, it was less than half a month from its launching the investigation to imposing the quota.

China’s Ministry of Commerce did not respond to Gutierrez’s statement yesterday. Earlier China’s Ministry of Commerce strongly protested against the quota unreasonably imposed by the United States and requested the United States to correct its mistake as soon as possible.

Gutierrez Took a Hard Line-Issues of Intellectual Property Rights Are Non-Negotiable

Yesterday morning, while giving a speech to the Chinese American Chamber of Commerce, Gutierrez emphasized that the issues of intellectual property rights could not be solved by negotiations and Chinese government has to adopt effective measures to protect intellectual property rights.

He stated as the result of piracy activities in China United States has lost tens of billions of U.S. dollars. Chinese government must promulgate tough measures to crack down on the piracy and counterfeit. Gutierrez added the United States refused to put both issues of textile products and intellectual property on the same negotiating table. China and the United States may discuss the dispute of textile product, but the intellectual property issue is non-negotiable. Since the former is the problem of contract, but the latter is a crime, which cannot be treated as the same.
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As to Gutierrez’s opinion above, Xu Guowen, Director of An Pu Da Intellectual Property Representative Company in Beijing, commented: "The issue of intellectual property is a worldwide problem, which should not be as emotional as what Americans have criticized. China has paid attention to the issue of intellectual property. Recently, Chinese government has taken a lot of efforts to protect intellectual property. Along with the further globalization of economy, the problems with intellectual property will increase because enterprises in each country apply patents in their own countries and bring the patents to other countries, which often times would cause conflicts. Therefore, to unilaterally blame Chinese enterprises is obviously not fair. The American government always takes the intellectual property as an issue, which in fact is a kind of tactic. Its purpose is to increase its advantages in the trade negotiation."

http://news.xinhuanet.com/newscenter/2005-06/03/content_3039116.htm