Martial Arts. Kung Fu. Wu Shu. The names have varied but the origins lie unchanged, deep in the temple of Shaolin. But, have you ever wondered why a tranquil Buddhist temple would be famous for fierce martial arts? The Shaolin Temple is historically famous for its Shaolin Kung Fu and the popular belief of Zen Buddhism.

Situated in the Songshan Mountain 50 miles southwest of Zhengzhou, at the capital of Henan Province, Shaolin Temple was built in 495 A.D. for one initial reason: to house Batuo. Batuo, an Indian monk, came to China to spread Buddhism. A strong believer in Buddhism, Emperor Xiaowen made orders to build the temple as a sanctuary for Batuo and a few hundred followers to translate the Buddhist works. The temple was built on land that was previously burned, near Shaoshi Mountain. Here, the builders planted new trees. Thus, the name Shaolin comes from Shao, meaning "young," and Lin, meaning "forest."

Batuo had a great interest in martial arts. Conveniently, two of his disciples were already skilled in the art. These two disciples taught the art form to others and soon it spread through Shaolin. The centralized location of the temple attracted other Kung Fu masters who passed by, and served as a refuge for counter militant leaders who were being chased by local armies. As a way of expressing their gratitude for housing, they often passed on battalion tactics and martial art techniques to the Buddhist monks. As Shaolin Temple grew in recognition and prominence, the Buddhist emperors supported the temple by presenting gifts of gold and land. Its growth in wealth has made Shaolin Temple a target for burglars and foreign bandits. During the Tang Dynasty (618-907), 13 Shaolin monks saved Emperor Li Shimin from invaders. From that point on, Shaolin was allowed to have soldier-monks to protect the temple’s assets. By the start of the Qing Dynasty (1644-1911), Shaolin Temple housed over 1,000 soldier-monks.

The significance of the Shaolin Temple lies beyond its extraordinary reputation for the martial arts. Thirty- five years after the completion of the temple, another Indian monk arrived, following Batuo. This monk was the legendary Bodhidharma (Da Mo in Chinese). Bodhidharma introduced a new type of Buddhism to the Chinese people—Chan, or more widely known as Zen. Zen Buddhism was less strict and more adapted to the Chinese way of life. Zen spread quickly and widely throughout China and is the prevailing form of Buddhism today.

It is said that Bodhidharma hiked through Tibet’s Himalayan Mountains, surviving both the treacherous weather and bandit attacks. Upon reaching China, Bodhidharma met with the Emperor Wu Di. A Buddhist himself, the emperor asked the Indian monk what good deeds he had accomplished, but Bodhidharma could not respond with an answer. He was then rejected from Shaolin Temple and sought out a nearby cave in which he meditated for nine years. Over the nine years, the shadow of his image discolored the far wall of the cave (this site is now a tourist attraction: Bodhidharma’s cave). When Shaolin monks discovered Bodhidharma, they believed that he had proven himself worthy and accepted him into the temple. Bodhidharma spread a new style of meditation and physical training, benefiting both the monks and the soldier-monks.
{mospagebreak}
Today, the Shaolin Temple continues to symbolize the birthplace of Chinese Buddhism. The Shaolin Temple, over 1,000 years old, comprises 230 separate ancient towers. Sadly, 28 of the 230 ancient towers are currently in critical condition and on the verge of collapse due to deterioration and instability of the foundation. Shaolin Temple’s abbot, Shi Yongxin, says that they are currently conducting a well-rounded analysis of each ancient tower and will take all necessary steps to preserve the traditional essence of each structure. As long as the magnificent structures of the temples are kept alive, the world will be able to witness these Chinese traditional beauties that have endured the destruction caused by the Chinese Cultural Revolution.

It is tempting to shrug off the ongoing crackdown against prominent lawyer Gao Zhisheng, who boldly supported China’s underprivileged economic classes, as yet another tantrum typically thrown by the Chinese government against its own people stepping outside the lines. It is equally plausible that the killings in Shanwei, a prosperous town abutting Hong Kong, were almost inevitable due to the brewing tensions between the haves and have-nots in China. Larger questions, however, remain, as to the foreboding significance of the two events, especially when they coincided with another familiar announcement of impressive growth in China’s GDP, which put the country on course to pass France to become the world’s fifth largest economy.

In any modern democracy, rule of law and economic freedom forge a symbiotic relationship that sustains its prosperity and growth. Mr. Gao and casualties in Shanwei highlight the glaring absence of such infrastructures in China, notwithstanding its glowing GDP and unusual absorption of foreign capital. If Chinese lawyers had been given a free hand to operate like Mr. Gao, their mediation would ensure tragedies in Shanwei never happen. On the other hand, if the governance in China had improved so much as to rule out a repeat of a Tiananmen-Square-style killing by the military, Mr. Gao and his colleagues would have been free to go about their business—and China would be a better place for investment opportunities.

Wang Jian, a senior economist affiliated with a premier think tank of the Chinese government, found that up to 54 percent of China’s GDP is derived from investment in fixed assets, a percentage that has never been reached by any other country in history before, not even Japan, which, at 46 percent, was the second highest during its go-go years in the 1960s. Mr. Wang forecast a depression in three years, ahead of the Beijing Olympics, triggered by serious overcapacity and overcompetition when the current excessive investments translate into real productive capabilities. Andy Xie, Morgan Stanley’s top China economist, recently argued that China should choose over GDP to use NDP, which stands for Net Domestic Product—calculated by deducting from GDP such social costs as environmental damages and human lives lost due to unsafe production methods—in measuring its economic development. He believes the GDP has misguided local governments to chase unwarranted economic targets, in a manner reminiscent of meeting the quota for rightists or class enemies in past political movements. These targets decide the officials’ promotion and give them the boasting right at Party meetings. Unfortunately, they are also the reason behind the land dispute that led to 20 killings in Shanwei and fatal accidents that occurred to miners represented by Mr. Gao.

Up until now, cheap labor has attracted foreign capital and has been the engine that drives the juggernaut of the Chinese economy. It is, however, dangerously unknown how long this superiority will last. The Chinese population has shown signs of aging due to the success of the family planning policy, and the foreign capital in search of a higher rate of return could go elsewhere, to places such as India, where the social system is more Westernized. In the longer term, sustainable economic development in China will only be possible when transparency and accountability, as has happened in countries with whom China is trying to catch up, are firmly established to govern its economic activities.

Lack of Domestic Demand — A Potential Threat to Economic Growth

Since the beginning of this year, the national economy has stabilized at an average quarterly economic growth rate of 9.5 percent, with a 23 to 24 percent monthly growth rate of fixed asset investment. Export growth is above 30 percent, and the trade surplus has continued to enlarge, with the growth of the residential consumer price index (CPI) down to 2.4 percent. All of these are signs of both high growth and low inflation.

However, there is a huge structural imbalance hidden behind the surface stability, and the situation is getting worse. The imbalance is reflected in the fact that, since 1990, there has been a continuous slide of the ratio of residential final consumption to GDP. In 2004, the ratio was at a record low, even substantially lower than the period from 1960 to 1962, the worst time of the planned economy. A conclusion can be drawn that since the late 1980s, income distribution has undergone a gradual change, resulting in a drop in residential consumption demand. The situation has deteriorated despite the year 2004’s overheating of the economy. A few observations can be offered.

Observation 1: Although the economy overheated in 2004 (the January/February growth rate of fixed asset investment was as high as 53 percent), the monthly produce product index (PPI) growth was never higher than 9 percent, and the monthly CPI growth was never higher than 5 percent. Starting from July 2004, the CPI has been declining month by month, with the CPI growth in January 2005 down to 1.8 percent. The retail price index (RPI) growth rate was down to 0.6 percent, with prices of many consumer goods actually dropping. At present, the positive growth rate has been sustained by the prices of housing, recreation and education, and food. High-income households drove the rise in price of the former two items, while the prices of most consumer goods have been falling. The price of food has been affected by fluctuations in the supply and demand of agriculture products.

Observation 2: High savings ratio. At the end of 2004, the residential savings deposited in financial institutions amounted to 120 trillion yuan (US$15 trillion), the equivalent of one year’s GDP. This was double the number at the end of 1999. However the nominal GDP only grew 66.8 percent from 1999 to 2004, while residential savings doubled. There is over saving in comparison with GDP. With the rapid rise of deposits, the ratio of total loans of financial institutions to total deposits was 74 percent in 2004, lower than the 86 percent in 1999, a troubling phenomenon indicating that the utilization of capital was less efficient. At present, the growth in savings deposits is gaining momentum. By the end of May 2005, the total amount of residential saving deposits in all financial institutions was over 130 trillion yuan (US$16.2 trillion), and it will certainly surpass 140 trillion by the end of the year.
{mospagebreak}
Observation 3: A lack of domestic demand puts pressure on exports. Since 2004, the monthly growth rate of total exports has never been lower than 33 percent. By contrast, from January to May 2005, the import growth rate dropped to 13.7 percent. The trade surplus for the first five months of 2005 was as high as US$30 billion, equaling the annual total for all of 2004. At the end of the first quarter, the foreign reserves amounted to a record high of US$659 billion, about US$50 billion more than the 2004 year-end figure. In the second quarter, that number was still climbing. The rapid growth of foreign reserves is posing a serious challenge to the effective use of resources.

Exports have been one of the pillars of economic growth. However, unrestricted export growth will lead to friction between China and other developed and developing countries, and intensified international pressure for appreciation of the Chinese currency RMB. Finally, exports have to slow down in the face of restrictions from the world market, and they have.

Observation 4: Because of the lack of consumer demand, economic growth is more and more dependent on investment. From January of 2000 to May of 2005, the annual growth rate of fixed asset investment (in constant price) is 9.1, 12.5, 16.7, 25, 19.1, and 24.2 percent, respectively. The expanded capacity induced by rapid investment has been assimilated by the low consumer demand. The conflict between drastic expansion of production capacity and slow growth of personal consumption will lead to periodic depression.

Currently, the key elements of high investment are real estate development, public debts and local metropolitan construction projects, and energy and raw material industrial investment. The above are important driving forces for economic growth in the long run. However, without a corresponding growth in personal consumption, those investment projects are not sustainable.

Reasons for the Drop in Personal Consumption

Major reasons for the drop in personal consumption are as follows:

Ever since the late 1980s, with structural change in income distribution, the gap between the incomes of urban and rural residents has been widening. In 1984 the Gini coefficient for residential income was 25.7. That figure climbed to 35.5 in 1990, and was up to 44.7 in 2001. In the 2005 World Development Report published by the World Bank, ranked by the Gini coefficient from lowest to highest, China is 85th out of the 120 countries and regions so ranked. That is, China’s inequality is the 35th lowest (32 of the lowest are Latin American and African countries) of the socially polarized countries.
{mospagebreak}
With such a large income inequality, the consumption level of middle and lower income families is restricted. High-income families have already reached a high level of consumption and are less likely to put more of their income into consumption. The Chinese people have a tradition of high savings. Savings will only increase as the income gap widens.

The high risks during the economic transition have also put a brake on personal consumption. For many years, the rapid increase in the cost of health care, education, and housing expenditures has far surpassed the affordability of many rural and urban residents. Urban employees who face an immediate threat of unemployment, and farmers who have lost their normal income source when they lost their land have no choice but to save more and consume less.

The urban system of lowest living standard security and unemployment insurance, to some extent, has alleviated the burdens of the people mentioned above. However, the other parts of the social security system may not help as they should. Investigations have revealed that the portion of health expenditures that are covered by health insurance for middle and high-income families is higher than for low-income families, who still need to pay for the majority of their own health care costs. The pension system should cover poor and low-income families. However, the current social security system is not hedging against income uncertainty for low-income families, and even widens the gap to a certain extent. Most rural families are not even covered by the social security system.

Unemployment or under employment is still a major reason for the depressed personal consumption of low-income families. Historically, most nonagricultural job opportunities are provided by small enterprises. Because of the poor economic environment, they are creating fewer and fewer jobs. Firstly, the current system of "big banks" is not geared to enable small enterprises to obtain loans; secondly, the policy implementation is usually in favor of middle-size enterprises instead of the small ones; thirdly, the unhealthy legal and institutional environment, causes small enterprises to be faced with trivial, unnecessary, and nontransparent administration; finally, there are few services to provide management, technology, and legal and financial training for small enterprises. The current statistical system does not cover the enterprises that are under a certain size. Thus the government finds no reason to care about the development of small enterprises.

The ongoing gradual consumption drop is leading to an internal balance of the economy, which will not only lead to serious economic slides, but will threaten the sustainability of economic growth. It’s vital to correct the income inequality and increase the percentage of personal consumption in GDP.
{mospagebreak}
Possible strategies can include the following:

• Further reform the taxation system and strengthen the taxation on the high income class

• Advance governmental reform so as to establish a systematic, standardized, and transparent administration

• Improve the operation environment of small enterprises so as to facilitate job creation

• Strengthen the social security system and provide a basic guarantee for low income people

• Introduce a competition mechanism into important sectors such as health care, education and housing, and strengthen the supervision of the public service sector to protect the public’s interests

Wang Xiaolu is the Vice Director of National Economic Research Institute, China Reform Foundation.

Translation by CHINASCOPE from Internal Reference for Reform, Issue 22 , 2005

On November 18, the Chinese Communist Party (CCP) held a symposium to commemorate the 90th anniversary of the birth of Hu Yaobang (Hu became general secretary of the CCP in 1980 and CCP chairman in 1981. He was then sacked in 1987). However, the initiator and architect of this commemoration, the incumbent Party Secretary Hu Jintao, not related to Hu Yaobang, was noticeably absent. At the same time the symposium was brief, about one hour, and the attendance shrank dramatically. Many analysts argued that Hu Jintao’s absence was a political compromise—Hu used his APEC trip in South Korea to pacify the opposition.

This has posed an interesting question: Why did the CCP commemorate Hu Yaobang? Was the commemoration a matter of formality or did it have a significant meaning to the CCP leadership?

A Controversial CCP Leader

Among few controversial figures in CCP history, Hu Yaobang was an outstanding one. On the one hand, he was viewed as a civilized leader and one that was inclined toward reform after the death of Mao Zedong. Hu was widely recognized for his sympathy for the 1986 student movement and his role in reinstating millions of Chinese who were purged during the 1957 Anti-Rightist Movement as well as the catastrophic 1966-76 Cultural Revolution.

On the other hand, for the last 16 years Hu Yaobang had been under criticism by the CCP for his indirect encouragement of challenges to the communist system. Hu was forced to resign in 1987 for his leaning toward "Western, bourgeois" principles of democracy following the 1986 student movement. Hu’s sudden death in 1989 prompted the large-scale Tiananmen Square protests that led to the June 4 Tiananmen Massacre. The ambivalence that Deng Xiaoping held toward Hu was legendary. Evidence showed that Hu’s involuntary resignation was a plot by Deng to remove Hu as a deviator from the conservative CCP lines.

It is not difficult to see that the controversy around Hu came from an irony: As a CCP leader Hu was supposed to regulate the CCP by CCP principles; on the contrary, he took the lead to break CCP principles to what was viewed by the CCP collective leadership as an unbearable peak. It was exactly this "violation" of CCP lines that won him popularity as a civilized leader.

Political Reasons to Reinstate Hu

Hu Yaobang’s name has become a taboo since his death in 1989. Any mention of Hu could elicit unforeseeable consequences. Then why did Hu Jintao, the current CCP chief bother to run the risk of commemorating Hu Yaobang? Why did reinstating Hu Yaobang matter to Hu Jintao?
{mospagebreak}
Some argued that Hu Jintao was repaying Hu Yaobang for the latter’s political favor because Hu Yaobang had helped promote Hu Jintao. A careful examination of Hu Jintao’s political career showed that the two men had a working relationship, but no close personal friendship. Hu Jintao had worked his way up the CCP ladder and proved himself a master of playing CCP internal power games. A seasoned CCP bureaucrat, Hu would never risk his political career by promoting a disputable figure such as Hu Yaobang. Hu Jintao’s decision was an act of political expediency.

There were two main reasons for Hu Jintao to reinstate Hu Yaobang’s reputation. First, Hu Jintao attempted to utilize Hu’s popularity to save the CCP from disintegration. Since the end of 2004, there has been an unprecedented growing movement among CCP members to withdraw from the Party. The movement was a combined result of long-time CCP corruption, its brutalities and killing of the Chinese people, and loss of legitimacy in the eyes of the public. To save the CCP from being abandoned, Hu Jintao tried various measures, such as launching "the movement to maintain the advanced nature of the CCP members" and adopting a slogan of "being kind and closer to the people." However, none worked effectively. Since the aura of a civilized leader such as Hu Yaobang could be attractive to people inside and outside the CCP, Hu Jintao gambled on Hu Yaobang’s esteem in saving the CCP though much of Hu Yaobang’s liberal characteristics could adversely be a double-edged sword against the CCP itself. Hu Jintao’s concern about Hu Yaobang’s liberal inclination partially explained why he conducted the reinstatement half-heartedly.

Secondly, Hu Jintao tried to use Hu’s reputation to consolidate his power base. The rise of Hu Jintao was based on Deng Xiaoping’s nomination in 1992. Jiang Zemin, the retired CCP chief, was quite jealous of Hu’s strong endorsement by Deng and never stopped in finding fault with Hu. In countering Jiang’s residual yet looming influence, Hu put forward a slogan of being "more kind and closer to the people." Many mistook Hu’s slogan as a symbol of political liberalization. In fact Hu was to seek popular support in his power struggle against Jiang, as Hu did not have many personal supporters within the top levels. As a matter of fact, Hu rejected ideas for political change and pursued a sustained crackdown on popular demands, including shutting down the liberal newspapers and suppressing religious groups. Hu thus did not win the battle against Jiang on popular support. Hu also tried to encroach on Jiang’s power base by replacing Jiang’s people with his protégés. However, it took time for this to take effect. Hu Yaobang once reinstated millions of cadres and many of them are at high levels. By reinstating Hu Yaobang, Hu Jintao planned on winning over the supporters of Hu Yaobang, thus speeding up the power consolidation.

Internal Power Politics on Reinstating Hu

Contrary to the popular rumor that Premier Wen Jiabao was among the opponents of the reinstatement of Hu Yaobang, Wen twice supported Hu Jintao’s proposal to reinstate Hu Yaobang in the March and August 2005 meetings of the CCP Political Bureau Standing Committee members. It was Jiang Zemin who wrote a letter to the Political Bureau, in which he strongly accused Hu Jintao of violating Deng’s decision to oust Hu Yaobang.
{mospagebreak}
Hu Jintao’s absence at the symposium to commemorate Hu Yaobang was a calculated political stratagem, using his trip to attend the APEC meeting in South Korea to come to terms with the opposition. As a result, Jiang’s protégé Vice-President Zeng Qinghong addressed the event and Wu Guanzheng, Secretary of the CCP Central Commission for Discipline Inspection, presided over the commemoration. Zeng’s speech on evaluating Hu Yaobang largely echoed the official CCP conclusion on Hu.

Leading to Democratization? Hardly

What Hu Jintao did was draw a line: reinstate Hu Yaobang, but not Zhao Ziyang. (Zhao succeeded Hu as general secretary of the CCP and was expelled from the Party in 1989.)

There are some key differences between Hu Yaobang and Zhao Ziyang. Zhao went further beyond the CCP lines than Hu did by claiming he gave up the proletariat dictatorship. Zhao even talked about a multi-party system, something that Hu never did. More importantly, Zhao never admitted that he had committed any mistake in dealing with the student protests while Hu involuntarily admitted his "mistakes."

Given the differences, by drawing a line between the two men, Hu Jintao was sending a clear message to the public: the CCP has no intention and has made no movement to reverse its verdicts on the 1989 Tiananmen Protest and Zhao Ziyang who supported the student protesters. It is thus not far-fetched to conclude that restoring the stature of the late Hu is unlikely to lead to a democratic political change.

Dong Li holds a Ph.D. in Political Science from Columbia University. He is a China specialist who provides news analysis for New Tang Dynasty Television based in New York City.

The U.S. president, George W. Bush, completed a week-long trip to four Asian countries in November. During his visit to Beijing, Bush openly raised freedom of belief and democracy as discussion topics. He called for more political and religious freedom for the Chinese people. These are believed to have been the most positive aspects of Bush’s Asia visit. Mr. Hu Ping, a famous political writer and chief editor of Beijing Spring discussed the implications of Bush’s Asia trip and his meeting with Hu Jintao during an interview with a reporter from The Epoch Times newspaper. Below are excerpts from the interview.

Question (Q): Bush visited temples in Japan and Korea. He went to a church in Beijing. What message does he want to send?

Hu: Bush is a devoted Christian. He wanted to convey the message that he regards freedom of belief and religion very highly. After he became president, he raised these subjects several times in his meetings with Hu Jintao.

There are several noticeable points in Bush’s visit to China. First, he openly talked to Hu Jintao about the issues of democracy, and freedom of belief and religion.

Bush raised the question of freedom of belief in particular. I believe this has to do with the Falun Gong issue. More and more people realize that the persecution of Falun Gong was a terrible mistake. Although many individuals within the communist government circle also believe this, it’s very difficult for them to rectify the mistake due to the limitations of the CCP[Chinese Communist Party]’s system.

Falun Gong is an especially striking example of the CCP’s suppression of freedom of belief. The CCP also harshly attacks family churches and other religious groups. The world is paying more and more attention to this problem. Therefore, I believe it is with this background that Bush places freedom of belief in such a special position.

Bush Could Have Done Better and More

In addition, Bush also raised the issue of human rights to Hu Jintao, who also expressed his opinion. We don’t know what Hu’s opinion was. Bush said in the press conference that Hu’s views on human rights are interesting, and that the Chinese communist leaders couldn’t possibly have said the same words ten years ago.

Due to international pressure and the Chinese people’s ever increasing human rights awareness, the CCP today no longer takes the attitude of complete refusal to talk about human rights. Instead they give it a completely different connotation in their argument. This demonstrates that the CCP continues to deny the issue of human rights. Under this circumstance, I believe as the leader of the free world, President Bush should take further steps to criticize the CCP’s twisting of human rights concepts.
{mospagebreak}
This time although the U.S. government asked that China publish President Bush’s speech without any changes, the CCP still deleted the parts about belief, freedom, democracy, and human rights. During Bush’s visit, China also put some dissidents under house arrest. The U.S. government should strongly protest such conduct and request a stop to this type of behavior.

I think that the U.S. government should have done more. Back when Bush senior was the president, he invited Fang Lizhi to a banquet during his visit to China. President Bush could have invited some political dissidents such as Mr. Liu Xiaobo and others. That would have shown his support for Chinese dissidents and for the democracy movement.

During his visit, Bush also asked the CCP to have an open dialogue with the Dalai Lama. He emphasized that the Dalai Lama does not seek independence; he only requires a high degree of autonomy. The CCP had no interest in Bush’s proposal. In the past, the CCP always said that the Dalai Lama was seeking Tibetan independence. In fact, the Dalai Lama always says that he doesn’t seek independence. The CCP thus has no excuse to refuse to meet with the Dalai Lama, so they play the trick of saying nothing. The CCP is good at making excuses. The international society should pay attention to this point.

Using Taiwan as a Model, Bush Says Freedom and Democracy Also Apply to China

Q: During his speech in Japan, Bush emphasized that a free society fits China’s greatest interests. What do you think?

Hu: In his speech to Japan, Bush particularly pointed out that Taiwan is a model for freedom and democracy. His reference to Taiwan had a twofold purpose. After Bush was re-elected, he repeatedly mentioned his plan to promote freedom and democracy in the world. His Japan speech exemplified his strategy on this matter. Bush specifically discussed China. The CCP is always opposed to freedom and democracy, using China’s special situation and unique features as an excuse. For Bush to use Taiwan as a living example demonstrates that freedom and democracy apply very well to China. In my opinion, Bush’s praise of Taiwanese democracy is a strong criticism of the CCP. It is a clear statement that the foundation of U.S. policy on China-Taiwan relations is freedom and democracy.

Q: Can you please tell us about these two scenarios: the rise of a free China and the rise of Communist China, and their implications for the world?

Hu: The difference is huge. People are talking about the rise of China. The question is, under what social form will China become a world power? Will it rise under a totalitarian party or will it rise as a democratic, free nation? This question not only affects the Chinese people; it has a big impact on the peace and security of all the people in the world. One simply cannot emphasize this enough.
{mospagebreak}
The Success in Mongolia Suggests That the Economy Is Not the Predicator of Democratic Change

Q: Bush also visited Mongolia. He praised Mongolia for setting up a model to the world in their effort to remove communist rule. What do you think?

Hu: Mongolia transformed their country into a democracy 15 years ago. The success of Mongolia proves the following theory wrong: The transformation to democracy must be built on a market economy and a middle class, among other conditions. In actuality, the East European countries and Mongolia all successfully transformed into a democracy without a market economy and without a middle class.

Bush’s speech, to some degree, still has an element of the theory that the economy determines social change. In his words, a free economy will give birth to a free society, and economic freedom will lead to democracy. In my opinion, this conclusion is wrong.

The economic determinism theory is popular among Western politicians and academics. In my opinion, this viewpoint hinders their understanding of China.

Like I have mentioned many times before, the so- called economic reform and privatization under the communist dictatorship is in fact just powerful interest groups protected by violent government agencies robbing all of the Chinese people of their property. The more deeply this reform is carried out, the less likely it will lead to freedom and democracy. On the contrary, economic reform in China is actually a roadblock to political reform.

The CCP’s White Paper Indicates It Has No Intention to Move Toward Democracy

We don’t know the details of the Bush-Hu meeting. As Bush expressed in a press conference, Hu is trying to make changes in a very prudent way.

I believe that will be the case. Recently, the Chinese government published a white paper on China’s democracy. The paper insists on a one-party dictatorship. It did not accept the universally adopted standard and definition of democracy. It also failed to provide an agenda for China’s democratization. The white paper is in fact a non-democracy or anti-democracy white paper. We all know that even if the CCP wrote something in their official documents, they might never follow it. Clearly, they don’t even want to put it in writing.

After President Bush repeatedly raised his concern for China’s democracy, the CCP’s foreign minister Li Zhaoxing said, "China doesn’t listen to other’s irresponsible comments." Li’s comment shows that China could not find any reason to counter-attack Bush’s appeal. According to Hu, China has its own agenda and will not follow the U.S. agenda. Of course, the problem is that the CCP has never had any agenda (for democracy).
{mospagebreak}
The West Lacks Knowledge of Chinese Society

People in the West, including government officials and academics, don’t have a clear understanding of China. This lack of understanding was partially due to the fact that Chinese society is a very abnormal one. In a certain respect, it doesn’t look like a communist country, nor does it resemble a free country. It is neither a state-owned, planned economy, nor is it a market economy. Therefore, an analysis of China’s current affairs and its future direction is the key to understanding China.

Q: Talking about the CCP’s future, the persecution of Falun Gong is a striking example. Before the persecution began, many people didn’t believe the CCP would do so. They reasoned that if [the CCP] arrested the old men and women who meditate in the parks, it would be a most ridiculous joke. But the CCP did so.

Hu: What they did was unthinkable. Their tactics are so dirty and cruel. From our private contacts with the CCP officials, we know that many of them disagree with the persecution. Take Hu Jintao as example; he is not the one who launched the persecution of Falun Gong. After he assumed the top job, why didn’t he correct the mistake? That way he could win people’s support. But he could not find a way to correct this obvious mistake. This example says a lot about China. It really helps people to deepen their understanding of the CCP system.

The Resemblance and Discrepancies Between Terrorism and Communism

Q: Bush said in Mongolia that the ideology of terrorism and communism are the same. Can you tell us in what way they are the same?

Hu: Terrorism and communism are the same in one regard, because both are evil, and are heading to extinction. Communism, however, is different in that it is more deceptive and therefore it has spread to half of the world.

Bin Laden’s terrorism is elusive; they hide in the dark. Cracking down on this group is difficult, but Bin Laden’s terrorism is easier to recognize. Compared to communism and fascism, terrorism’s damage and development are unlikely to be as widespread. They are like bandits. Although very bad, their evil nature is different from that of a bad communist regime.

Communism used to be adopted as official ideology in many countries. They were state terrorists, openly persecuting dissidents and religious believers using the police, the military, and other state apparatuses. This kind of state terrorism is much more damaging to humanity than Bin Laden’s. Fortunately, communism as a banner for people to follow has completely lost its luster in the world.

Translation by CHINASCOPE

Allen Zeng is the president of the Sound of Hope Radio Network (SOH). The following is from a Chinascope interview with Mr. Zeng

CS: Please give us a "heads up" on your new initiative with Radio Free China.

Zeng: The Radio Free China initiative at SOH aims to provide the Chinese public access to uncensored, free information. It aims at becoming the most reliable information source for the Chinese people, especially at critical periods of history. It will help to promote, in China, freedom of information, freedom of the press, and freedom of speech.

The project includes three dynamic fronts for information access. The first is shortwave radio broadcasting. It can cover a vast area and most of the Chinese population. We would like to add more channels and to use more powerful transmitters so that the Chinese regime cannot effectively jam our signal.

The second is Internet access of the SOH programs for the 100 million Chinese online users. We provide advanced Internet access programs for Chinese users to evade the Chinese regime’s blockade. Once they download our program they can safely visit our website for content-rich audio and text files.

The third is satellite radio broadcasting to China, which we plan to launch very soon.

CS: Radio broadcasting is an expensive operation. How will you fund it?

Zeng: SOH is a not-for-profit company. Our funding comes from three major sources: private donations, air-time advertisements, and program sponsorships. Most of our employees are volunteers and they save us a lot of money in salary expenses, but that won’t show on the balance sheet.

CS: Given the existence of such big players as VOA and RFA in the field of broadcasting to China, why would SOH want to squeeze into this crowded business?

Zeng: I disagree with that. This is not a crowded field. Rather, the Chinese people are underserved. The 1.3 billion Chinese don’t have their own voice because the Communist Party maintains tight control over the Chinese media. The people have very limited sources for uncensored information. Even the Internet is constantly censored and monitored by the government. We acknowledge the presence of VOA and RFA, and I appreciate their work. However, we believe that SOH is unique in its value to the Chinese people.
{mospagebreak}
CS: Could you please explain how SOH is unique?

Zeng: First, SOH is the first international Chinese radio network founded by Chinese people independent of any government. It is a totally grass roots initiative by and for Chinese people. VOA and RFA were established by the American Congress.

Second, SOH has a broader scope than simple news broadcasting. SOH offers a variety of cultural programs that reconnect the Chinese people to their culture, history, and traditional values, and bring them wisdom and food for thought and self-examination.

Third, SOH has a uniquely motivated and highly qualified team of volunteers. Most of them grew up in China and were educated first in China and then in America. They understand both the Chinese and American societies; appreciate the values of freedom, human rights, and democracy; and are keenly aware of the Communist Party’s tactics and nature. This team is our invaluable asset and our source of strength.
Fourth, because our staff members have deep roots in China, our reporters also have extensive networks there and can obtain Chinese news and facts efficiently. They understand precisely the feelings and concerns of the Chinese people, so they make good programs that meet Chinese needs and interests.

CS: What are your major challenges?

Zeng: My number one challenge is funding. As a new company, our advertising sales and program sponsorships have yet to reach a level able to sustain our operations. Currently we rely on private donations a great deal, but that cannot be our long-term solution. We are also applying for grants from various agencies and hope for a breakthrough soon.

Because of funding difficulties, most of our employees get no remuneration for working for SOH. They have to have another, paid job to make a living. They work very hard because they are motivated by a good cause, but in the long run I would like to have enough funds to pay them salaries. That way they would be able to spend more time and energy producing more and better programs.

We at SOH are confident that we will be able to overcome the challenges and that our network will thrive. We are encouraged and inspired by the many feedback messages we receive from our Chinese listeners. We are proud of what we are doing. The good cause is worth all of the effort.

Victor Gu is a correspondent for Chinascope.

We all recognize the value of whistleblowers in our society, and often admire their courage. In reality, not all of us want to be a whistleblower for fear of possible reprisal, even when we know it’s for a good cause. Allen Zeng, a software engineer in Silicon Valley, has decided to devote his efforts to creating a business that helps the Chinese to "blow the whistle."

The business, called the "Sound of Hope Radio Network" and of which Mr. Zeng is the president, focuses on broadcasting to China. Modern technology has made it easy to broadcast to China from Silicon Valley, despite the fact that they are almost on opposite sites of the world, and the political and social environment in the "Middle Kingdom" makes the Sound of Hope very appealing to millions of Chinese.

The political system in China is harsh for whistleblowers; even journalists often face reprisal if they report things that the communist government does not like.

One example is Cheng Yizhong, the former editor-in-chief of Southern Metropolis Daily and the winner of the 2005 UNESCO/Guillermo Cano World Press Freedom Prize. Under Cheng’s professional guidance and independent spirit, the Southern Metropolis Daily was one of the most successful daily newspapers in China and often reported on "sensitive" issues. In December 2003, it reported a suspected SARS case in Guangzhou before the government publicly released information about the situation. The newspaper also revealed in April 2003 that a college student was beaten to death while in police custody. Public outcry over the death led to the arrest of several local government and police officials and encouraged the Chinese to advocate for the protection of their rights.

The great success of the Southern Metropolis Daily, however, resulted in the communist regime retaliating against Cheng and his staff. The authorities conducted a spurious investigation into Southern Metropolis Daily’s finances. In 2004, Cheng was detained for five months but never charged. He was released in August 2004 and barred from practicing journalism. His colleagues, deputy editor-in-chief Yu Huafeng and editor Li Minying, were charged with bribery and sentenced to respective jail terms of eight and six years. According to the Committee to Protect Journalists, more than 40 Chinese journalists are in prison, mostly for revealing corruption among high-level government officials, advocating political reforms, or reporting on other banned topics.

For the ordinary Chinese, who are certainly less privileged than the journalists, the chance that they can make their voices heard is even more remote. There were 78,000 cases of social unrest in China in 2004, involving more than 3.7 million people. Even this large number likely represents only the tip of the iceberg, because it often takes months for a civil dispute to develop into a full-blown violent conflict. When conflict occurs, it is because less-confrontational actions have failed to resolve the matter.
{mospagebreak}
The Communist Party’s current campaign of "ideological strengthening" and control of information, which has taken place alongside a push for a "harmonious society," further weakens the ability of ordinary citizens and Chinese journalists to "blow the whistle."

This dark reality that is today’s China was the catalyst for the birth of the Sound of Hope Radio Network on the other side of the globe. Allen Zeng, like many other Chinese immigrants who have graduated from American universities and settled down in the United States, saw the need for free media and uncensored reporting in his mother tongue and in his mother country. The Silicon Valley software engineer conducted a careful study of the technical issues with a dozen of his friends, and in 2003 they founded the Sound of Hope Radio Network (SOH).

The radio network is a not-for-profit organization registered in California. One part of its business is the AM/FM radio broadcasting of news and entertainment to cities across North America, Asia, and Australia. The programs are in Chinese and local languages for different target audiences. They try to offer a unique perspective on Asia and its people and serve as a bridge between Asian and Western cultures.

The other part of its business is broadcasting directly to China through shortwave radio and connecting with audiences in China with toll-free telephone lines.

An Old Technology Still Thriving Today

SOH uses AM and FM broadcast frequencies to provide the best quality for its city broadcasts. However, the more familiar AM/FM middle-range radio frequencies are not useful for the long-distance broadcast to China. This is because the Earth is round and electromagnetic waves can travel only in a straight line. For international broadcasting, shortwave radio is the choice. This technology uses electromagnetic waves in the frequency range of 3 to 30 MHz, which can transmit for long distances by bouncing off the layers of charged particles in the Earth’s ionosphere.

The success of using shortwave radio for worldwide communication goes back to the late 1930s. Since then, nation-to-nation broadcasts have used shortwave radio most of the time, so that one nation does not need to get permission to set up its broadcast station in another nation and yet can still make its voice heard.

While advances in communication technology have made great strides since the 1930s, restriction of free information is still the law of the land in many totalitarian countries today. While China Central Television (CCTV), one of the Chinese communist government’s six top national press media agencies, uses American cable channels and satellite TV to broadcast in the United States, there is no such equal right for the American media. For years, the Voice of America (VOA) and Radio Free Asia (RFA), all funded by the United States Congress, have had to rely on shortwave radio to broadcast to China.
{mospagebreak}
Due to tight control of the Chinese press by the Communist Party propaganda department, Chinese citizens do not trust the state media and have developed a healthy appetite for foreign information on shortwave radio broadcasts. Such a trend is particularly strong in times of political uncertainty. For example, in the early summer of 1989, before and after the Tiananmen Square Massacre, Voice of America (VOA) became the top choice for news, and people were talking about VOA on the streets in Beijing.

Shortwave radio broadcasting has its disadvantages. Its signal is not as stable and clear as middle-range AM/FM radio frequencies, and it can be "jammed" by the receiving country. The Chinese communist government has its own network of shortwave radio stations that are programmed to broadcast noise on the same frequency bands as VOA and RFA. The jamming noise can make listening to foreign broadcasts difficult and unpleasant. Such jamming noise normally is strong in the populated cities but less effective in the vast rural areas of China, far away from the jamming stations. In politically stable times, the Chinese regime may relax its jamming efforts, but they intensify when people’s dissatisfaction runs high.

Jamming can be partly overcome by the broadcaster’s use of stronger transmitters and the addition of more frequency channels.

As for the listeners, better-equipped radio receivers can help a great deal. Better quality radio receivers at an affordable price are extremely popular in China for listening to shortwave radio broadcasts. China manufactures the greatest number of radio receivers in the world. In 2004, its production of radio receivers amounted to 100 million, and half of them were equipped with the shortwave frequency band.

That number hints at the size of the potential Chinese audience for shortwave radio broadcasting. The remaining challenge is to have programs that interest the Chinese public. SOH has found its own niche in connecting to its audience in China.

Telecommunications Shorten the Distance

The wide availability of telephone service in China, including mobile phones, enables SOH to communicate with its audience as easily as in North America. The radio network announces its toll-free numbers that the Chinese can use to call in to voice their opinions or tell their personal stories.

One listener called in to a live SOH program to complain about local officials taking away her family home but refusing to pay a fair price. Her story went out on the air right away. A month later, the same woman called SOH to thank the station for getting her problem resolved. It turned out that the government officials in her region also listened to the SOH, and they became worried when their unlawful dealings were exposed on a foreign radio station. They chose to settle the matter by paying the lady a fair price.
{mospagebreak}
Not all callers get such positive results, but the Chinese people find the radio station a useful channel through which they can be heard and a place to get uncensored information and to feel connected to the outside world. In listener feedback to SOH, many expressed their appreciation to SOH for serving as a voice for the Chinese people.

Reporters for SOH go a step further than just recording call-in messages. They follow up on news leads and conduct investigative reports on Chinese events. Many eager-to-help listeners send in news leads to SOH. Some of them become reporters for SOH inside China. After receiving an important lead, the overseas SOH staff start their investigation with telephone interviews. Because of concerns over its Chinese reporters’ safety, SOH rarely asks them to do investigations on site.

SOH reporters in the United States or in other countries make numerous phone calls to China to talk with witnesses and key persons involved in the event. Then they produce reports and broadcast back to China. In this way, SOH can "blow the whistle" loud and clear on behalf of the Chinese people and provide its audience with detailed and uncensored information. Their report on the gas explosion in Sunjiawan Coal Mine is a typical example.

On February 14, 2005, a severe explosion occurred in Sunjiawan Coal Mine in Liaoning Province. Xinhua, the state media, reported that 214 miners had been killed, but other information from China indicated that the disaster was more severe. The government used the paramilitary armed police to seal the entire Sunjiawan area, a routine practice for the Chinese communist regime, and they allowed no independent reporters to get into the site.

Reporters with SOH had their own way to break up the information blockade: They made numerous phone calls and conducted extensive telephone interviews. By talking with eyewitnesses, family members of the explosion victims, and other people with inside information, SOH discovered many details and contradicted Xinhua on the severity of the explosion. The SOH reports revealed that the explosion at Sunjiawan killed most of the miners working at the time and that the actual death toll was as high as 300 or more. SOH also found out that Sunjiawan Coal Mine had had a deteriorating safety record over the previous few years. The managers were only interested in making money by increasing coal production and had no concern for the safety of the miners, most of whom were migrant workers from the poor regions of the country.

SOH’s detailed report on the Sunjiawan Coal Mine explosion was like a slap in the face to the communist authorities, who had always been used to covering up industry disasters. The pain this caused the Chinese leaders has likely motivated them to address the real problem. On February 23, six days after SOH made the detailed reality known to the world, Premier Wen Jiabao personally chaired the State Council’s executive meeting to discuss coal mine safety problems. The State Council decided to suspend Liu Guoqiang, the deputy governor of Liaoning Province in charge of industry production and safety, from his job. The State Council also noted in a news release by Xinhua that "the large gas explosion in Sunjiawan Coal Mine caused very severe damage to people’s life and property and made a very bad impression both domestically and internationally."
{mospagebreak}
A Chinese Initiative

The Sound of Hope Network has enjoyed a fast-paced expansion since it was founded in 2003. Advances in technology and the growing need for independent Chinese radio broadcasting are two major factors that have benefited this new organization. Another important factor in the success of SOH is the people running the operation—Chinese immigrants who know well both the Chinese and Western cultures. 

The population of Chinese immigrants in North America has increased significantly. A significant fraction of them are first-generation Chinese immigrants from the mainland, many of them arriving as overseas students. After settling down in the United States and getting over their initial culture shock, they started to feel the urge to bridge the two cultures — their native Chinese culture and their newfound Western culture. Delivery of uncensored information and views to China is one of the many things they choose to do.

Allen Zeng has found many Chinese Americans who share his dream and views, thanks to the social network he established while practicing Falun Gong. Together they have made the Sound of Hope Network a successful endeavor.

The SOH staff team consists of mainly part-time volunteers. Many of them hold advanced degrees in science, medicine, and management as most of them came to America as overseas students. Reporters and program hosts span a variety of professional occupations, and they have brought with them rich skills and diverse experiences.
{mospagebreak}
Looking Forward

The SOH’s strength is its staff, who know China very well and can choose the right program topics. In November 2004, The Epoch Times, a multi-language newspaper founded by overseas Chinese, published the Nine Commentaries on the Communist Party, an editorial series that reviews Chinese history under Communist Party rule. The people in SOH immediately recognized the value of the Nine Commentaries, and they immediately made the decision to make it a major product for broadcast to China.

Time has proved it a correct decision. Their Chinese listeners really liked the program and sent in many positive messages as feedback. They felt that the Nine Commentaries addressed their history with facts and was provocative enough to make people rethink the Communist Party. Soon after SOH aired its audio version of the Nine Commentaries, the SOH website saw a three-fold increase in visits from the mainland, and the most frequently downloaded file was the Nine Commentaries. When SOH reporters talked to people in China, they heard many interesting stories. They were told that late last year, when many residents in Beijing went to buy shortwave radio receivers in order to listen to the Nine Commentaries on SOH, the receivers were soon sold out in many stores.

The successful program also brought new challenges to SOH. By mid-2005, the Chinese regime intensified its jamming of SOH broadcasts. Many listeners sent SOH messages complaining about the jamming. Supportive insiders told SOH reporters that the communist government had started to use military equipment to jam the SOH signal. In the past, only the Chinese Air Force radar system was used to jam foreign broadcasts, and it did so only occasionally and for selected content. But after the Nine Commentaries became the hot topic and many Chinese people symbolically renounced their affiliation with the Communist Party on the overseas "Quit the CCP" website, the government ordered the PLA to use its advanced electronic system to jam SOH. Insiders said that the equipment was recently imported from France and belongs to the Chinese special missile force commonly known as "er-pao" or "the second artillery force."

To overcome the new technical challenge, SOH has several options. It can add more channels and increase its broadcasting time to make jamming less effective. It can frequently change its broadcasting frequency and time, playing a cat and mouse game with the communist government. It can improve its Web broadcast capability to serve the Chinese Internet users better. And it plans to add satellite radio broadcasting, which is hard to jam via an on-the-ground signal.

While all of these options may work, they will mean higher operating costs. Funding for SOH has been tenuous. It relies heavily on individual and private donations for its basic operations. Income from advertising and program sponsorships has yet to pick up in its metropolitan broadcast areas. Because Western companies that are interested in the Chinese market are also afraid of the Chinese communist government, it is very unlikely that SOH’s broadcasts to China will attract any advertising.
{mospagebreak}
Besides advertising sales, grants from various foundations are another possible source for funding. As SOH builds its record of accomplishments and continues to receive support from its Chinese audience, this three-year-old, not-for-profit company may have a good chance of receiving some grant funding. There are a few foundations in existence that are interested in supporting the promotion of freedom, human rights, and democracy in China.

Victor Gu is a correspondent for Chinascope.

On November 13, an explosion occurred in the Benzene Production Plant of the Jilin Petroleum Company, a subsidiary of the China National Petroleum Corporation.The blast killed five workers, injured more than 70 people, forced 10,000 to flee their homes, and spewed about 100 tons of cancer-causing benzene into the nearby Songhua River, which is only a few hundred yards away from the plant.

The dangerous 50-mile-long slick silently floated downriver toward many farms and residential areas. In its path were Harbin, a metropolitan city 165 miles downstream with a population of 4 million, and the Russian city of Khabarovsk, having more than 500,000 residents. Instead of warning them of the oncoming danger, government officials were busy covering things up.

The following timeline tells the tale of the crisis:

• November 13 — An explosion at the petrochemical plant in Jilin City

• November 14 — China Daily reported, "the local government has kept monitoring the air and water quality in the area," with no hint that this event had resulted in a severe toxic release.

• November 16 — Xinhua News Agency reported with this headline, "Chemical Plant Blasts Releases No Toxic Substances."

• November 19 — It took six days before Jilin informed provincial authorities about the danger to Harbin.

• November 21 — It took two more days before the city of Harbin issued its first notice, telling the public that the water supply would be cut off temporarily for approximately four days for "routine maintenance and repair."

• November 22 — China Daily reported, "Water stoppage in Harbin sparks panic buying," vaguely mentioning that water could have been contaminated after the blast.

• November 22 — Jilin government said that the local environmental bureau found that the water quality was barely affected by the blast.

• November 22 — The Harbin city government issued its second notice, mentioning the November 13 explosion for the first time. The notice stated that there was nothing abnormal with the quality of water in the Songhua River, but in order to "ensure safety," the water supply would be temporarily cut off for approximately four days.{mospagebreak}

• November 22 — The Harbin city government issued its third notice, announcing the official cut off of the water supply as a result of the blast.

• November 23 — A Xinhua report for the first time confirmed that the explosion had polluted the river. The article made several interesting statements. It quoted an official with the State Environmental Protection Agency (SEPA) by saying that, right after the explosion, "Jilin quickly blocked entry of the pollutants into the river and discharged water from a reservoir to dilute pollutants in the river," suggesting that the Jilin government knew exactly what was going on.

• November 23 — The authorities reported that 100 tons of benzene emptied into the Songhua River.

• November 24 — China Newsweek reported that Governor Zhang Zuoji of Heilongjiang Province told 400 officials in a closed meeting that the city of Harbin lied about the water-supply shutdown because it was "awaiting instructions from senior Party leaders" to disclose the spill and didn’t want to contradict Jilin official reports.

• November 25 — The New York Times reported, "China Blames Oil Company for Benzene Spill in River."

• November 26 — China apologized to Russia, where the pollution was expected to arrive in a few days.

• November 27 — Xinhua News Agency reported that Harbin’s water supply resumed. Provincial Governor Zhang Zuoji put on a public show by taking the first drink.

• December 2 — Xie Zhenhua, the director of SEPA, resigned.

• December 6 — Wang Wei, the Deputy Mayor in charge of Jilin City’s safety and environmental protection, is reported to have committed suicide at home, one day before the Central Government’s investigation team arrived in Jilin.

The current crisis is temporarily over with the death of a deputy mayor and sacking of three executives of the petroleum company. However, after being widely criticized for an initial cover-up of the SARS virus in 2003 and amidst fresh concerns that the communist government has concealed bird flu outbreaks in several provinces for many months this year, the same pattern just keeps repeating. Such a consistent way of handling crises makes one wonder what will be the next.