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Chinese Military,Political and Social Superthread

Students have uncovered China's nuclear weapons tunnels.Quite a find. I was trying to cut the images but got the page instead. :o

w-chinaTunnels30.jpg


http://tinyurl.com/cscrf6c

Georgetown students shed light on China’s tunnel system for nuclear weapons

The Chinese have called it their “Underground Great Wall” — a vast network of tunnels designed to hide their country’s increasingly sophisticated missile and nuclear arsenal.

For the past three years, a small band of obsessively dedicated students at Georgetown University has called it something else: homework.

Led by their hard-charging professor, a former top Pentagon official, they have translated hundreds of documents, combed through satellite imagery, obtained restricted Chinese military documents and waded through hundreds of gigabytes of online data.

The result of their effort? The largest body of public knowledge about thousands of miles of tunnels dug by the Second Artillery Corps, a secretive branch of the Chinese military in charge of protecting and deploying its ballistic missiles and nuclear warheads.

The study is yet to be released, but already it has sparked a congressional hearing and been circulated among top officials in the Pentagon, including the Air Force vice chief of staff.

Most of the attention has focused on the 363-page study’s provocative conclusion — that China’s nuclear arsenal could be many times larger than the well-established estimates of arms-control experts.

“It’s not quite a bombshell, but those thoughts and estimates are being checked against what people think they know based on classified information,” said a Defense Department strategist who would discuss the study only on the condition of anonymity.

The study’s critics, however, have questioned the unorthodox Internet-based research of the students, who drew from sources as disparate as Google Earth, blogs, military journals and, perhaps most startlingly, a fictionalized TV docudrama about Chinese artillery soldiers — the rough equivalent of watching Fox’s TV show “24” for insights into U.S. counterterrorism efforts.

But the strongest condemnation has come from nonproliferation experts who worry that the study could fuel arguments for maintaining nuclear weapons in an era when efforts are being made to reduce the world’s post-Cold War stockpiles.

Beyond its impact in the policy world, the project has made a profound mark on the students — including some who have since graduated and taken research jobs with the Defense Department and Congress.

“I don’t even want to know how many hours I spent on it,” said Nick Yarosh, 22, an international politics senior at Georgetown. “But you ask people what they did in college, most just say I took this class, I was in this club. I can say I spent it reading Chinese nuclear strategy and Second Artillery manuals. For a nerd like me, that really means something.”

For students, an obsession

The students’ professor, Phillip A. Karber, 65, had spent the Cold War as a top strategist reporting directly to the secretary of defense and the chairman of the Joint Chiefs of Staff. But it was his early work in defense that cemented his reputation, when he led an elite research team created by Henry Kissinger, who was then the national security adviser, to probe the weaknesses of Soviet forces.
 
Another sort of Cyberwar:

http://www.technologyreview.com/blog/arxiv/27357/?nlid=nldly&nld=2011-11-23

Undercover Researchers Expose Chinese Internet Water Army

An undercover team of computer scientists reveals the practices of people who are paid to post on websites.

In China, paid posters are known as the Internet Water Army because they are ready and willing to 'flood' the internet for whoever is willing to pay. The flood can consist of comments, gossip and information (or disinformation) and there seems to be plenty of demand for this army's services.

This is an insidious tide. Positive recommendations can make a huge difference to a product's sales but can equally drive a competitor out of the market. When companies spend millions launching new goods and services, it's easy to understand why they might want to use every tool at their disposal to achieve success.

The loser in all this is the consumer who is conned into making a purchase decision based on false premises. And for the moment, consumers have little legal redress or even ways to spot the practice.

Today, Cheng Chen at the University of Victoria in Canada and a few pals describe how Cheng worked undercover as a paid poster on Chinese websites to understand how the Internet Water Army works. He and his friends then used what he learnt to create software that can spot paid posters automatically.

Paid posting is a well-managed activity involving thousands of individuals and tens of thousands of different online IDs. The posters are usually given a task to register on a website and then to start generating content in the form of posts, articles, links to websites and videos, even carrying out Q&A sessions.

Often, this content is pre-prepared or the posters receive detailed instructions on the type of things they can say. And there is even a quality control team who check that the posts meet a certain 'quality' threshold. A post would not be validated if it is deleted by the host or was composed of garbled words, for example.

Having worked undercover to find out how the system worked, Cheng and co then studied the pattern of posts that appeared on a couple of big Chinese websites: Sina.com and Sohu.com. In particular, they studied the comments on several news stories about two companies that they suspected of paying posters and who were involved in a public spat over each other's services.

The Sina dataset consisted of over 500 users making more than 20,000 comments; the Sohu dataset involved over 200 users and more than 1000 comments.

Cheng and co went through all the posts manually identifying those they believed were from paid posters and then set about looking for patterns in their behaviour that can differentiate them from legitimate users. (Just how accurate were there initial impressions is a potential problem, they admit, but the same one that spam filters also have to deal with.)

They discovered that paid posters tend to post more new comments than replies to other comments. They also post more often with 50 per cent of them posting every 2.5 minutes on average. They also move on from a discussion more quickly than legitimate users, discarding their IDs and never using them again.

What's more, the content they post is measurably different. These workers are paid by the volume and so often take shortcuts, cutting and pasting the same content many times. This would normally invalidate their posts but only if it is spotted by the quality control team.

So Cheng and co built some software to look for repetitions and similarities in messages as well as the other behaviours they'd identified. They then tested it on the dataset they'd downloaded from Sina and Sohu and found it to be remarkably good, with an accuracy of 88 per cent in spotting paid posters. "Our test results with real-world datasets show a very
promising performance," they say.

That's an impressive piece of work and a good first step towards combating this problem, although they'll need to test it on a much wider range of datasets. Nevertheless, these guys have the basis of a software package that will weed out a significant fraction of paid posters, provided these people conform to the stereotype that Cheng and co have measured.

And therein lies the rub. As soon as the first version of the software hits the market, paid posters will learn to modify their behaviour in a way that games the system. What Cheng and co have started is a cat and mouse game just like those that plague the antivirus and spam filtering industries.

And that means, the battle ahead with the Internet Water Army will be long and hard.

Ref: arxiv.org/abs/1111.4297: Battling the Internet Water Army: Detection of Hidden Paid Posters
 
An interesting bit of informed speculation in this article which is reproduced under the Fair Dealing provisions of the Copyright Act from the Globe and Mail:

http://www.theglobeandmail.com/news/politics/john-ibbitson/are-chinese-golf-plans-in-iceland-a-water-hazard-for-canada/article2259653/
Are Chinese golf plans in Iceland a water hazard for Canada?

JOHN IBBITSON

From Monday's Globe and Mail
Published Sunday, Dec. 04, 2011

Over at National Defence Headquarters, there’s considerable interest in some real estate that a Chinese tycoon tried to buy in Iceland. Senior figures in Canada’s military believe this is why Canada needs more ice breakers, ships and submarines.

Huang Nubo is a billionaire property developer who recently offered to purchase a vast tract of land in northeastern Iceland equal to 0.3 per cent of that country’s land mass.

Mr. Huang said he wanted to build a hotel and golf course. The Icelandic government turned down his offer last week, saying its laws don’t permit foreigners to own that much land. Some officials in Reykjavik also suspect Mr. Huang wanted the land for more than a golf course. Canadian military planners agree.

While most of us wonder whether the Arctic ice will melt sufficiently to make the Northwest Passage commercially navigable, one senior military official, who was not authorized to speak publicly on this matter, dismissed the passage as “a twisty, rural backwoods road” compared to the real northern passage that a warming planet will eventually open up: over the Pole.

And some people believe that China thinks the same thing. That country is ravenous for oil and gas, and the Far North has plenty. Its economy depends on importing natural resources and exporting finished goods. Navigable Arctic sea lanes would make both much cheaper.

The country is investing heavily in a polar research institute. It has one icebreaker and is building another. It maintains a permanent Arctic research station. China has asked for (but not been granted) observer status on the Arctic Council. And it proclaims that the Arctic, its oil and gas resources and any future navigable sea lanes, should be considered a “shared heritage of humankind.” (Which is not quite how it views the South China Sea.)

Acquiring Icelandic real estate, military officials suspect, is part of a Chinese plan to position strategic assets that could be converted to ports and staging facilities in pursuit of oil and gas exploration, and to ease the passage of vessels through a future trans-polar shipping route.

This analysis, not coincidentally, comes as DND struggles to find ways to meet the budget cuts that the Conservative government is demanding of every department. Prime Minister Stephen Harper has been asking sharp questions about whether the problem-plagued Victoria-class submarines purchased from Britain more than a decade ago will ever put to sea.

The Navy promises that HMCS Victoria will be fully operational and patrolling off the West Coast by this time next year, and the Windsor will be doing the same in the Atlantic.

In this new Great Game that is emerging in the Arctic, the military insists Canada must be able to assert sovereignty in the air, on land, on the sea and beneath the sea.

Rob Huebert agrees. Prof. Huebert is a political scientist at the University of Calgary who specializes in Arctic geopolitics. “Any time you reorient your trade [as Canada is doing toward Asia] you inevitably become a player in the geopolitics of that region,” he said in an interview. When conflicts emerge, as they inevitably will, “you’re going to get drawn in one way or another,” which means “you need to have forces to defend your interests.”

But in a time of slow economic growth, high unemployment and worrying deficits, how much can the Canadian government afford to spend defending those interests?

While we debate that question, a disappointed Mr. Huang says he is looking at other Nordic sites for his golf course.


Just for interest, here are the "available" sea routes through the Arctic:

arctic_sea_routes_northern_sea_route_and_northwest_passage_003.png
 
The bubble is finally deflating in China as well:

http://www.telegraph.co.uk/finance/china-business/8957289/Chinas-epic-hangover-begins.html

China's epic hangover begins

China's credit bubble has finally popped. The property market is swinging wildly from boom to bust, the cautionary exhibit of a BRIC's dream that is at last coming down to earth with a thud.

Chinese stocks are flashing warning signs. The Shanghai index has fallen 30pc since May. It is off 60pc from its peak in 2008, as much in real terms as Wall Street from 1929 to 1933.

By Ambrose Evans-Pritchard, International business editor

10:20PM GMT 14 Dec 2011

Comments317 Comments

It is hard to obtain good data in China, but something is wrong when the country's Homelink property website can report that new home prices in Beijing fell 35pc in November from the month before. If this is remotely true, the calibrated soft-landing intended by Chinese authorities has gone badly wrong and risks spinning out of control.

The growth of the M2 money supply slumped to 12.7pc in November, the lowest in 10 years. New lending fell 5pc on a month-to-month basis. The central bank has begun to reverse its tightening policy as inflation subsides, cutting the reserve requirement for lenders for the first time since 2008 to ease liquidity strains.

The question is whether the People's Bank can do any better than the US Federal Reserve or Bank of Japan at deflating a credit bubble.

Chinese stocks are flashing warning signs. The Shanghai index has fallen 30pc since May. It is off 60pc from its peak in 2008, almost as much in real terms as Wall Street from 1929 to 1933.

"Investors are massively underestimating the risk of a hard-landing in China, and indeed other BRICS (Brazil, Russia, India, China)... a 'Bloody Ridiculous Investment Concept' in my view," said Albert Edwards at Societe Generale.
 
"The BRICs are falling like bricks and the crises are home-blown, caused by their own boom-bust credit cycles. Industrial production is already falling in India, and Brazil will soon follow."

"There is so much spare capacity that they will start dumping goods, risking a deflation shock for the rest of the world. It no surpise that China has just imposed tariffs on imports of GM cars. I think it is highly likely that China will devalue the yuan next year, risking a trade war," he said.

China's $3.2 trillion foreign reserves have been falling for three months despite the trade surplus. Hot money is flowing out of the country. "One-way capital inflow or one-way bets on a yuan rise have become history. Our foreign reserves are basically falling every day," said Li Yang, a former central bank rate-setter.

The reserve loss acts as a form of monetary tightening, exactly the opposite of the effect during the boom. The reserves cannot be tapped to prop up China's internal banking system. To do so would mean repatriating the money – now in US Treasuries and European bonds – pushing up the yuan at the worst moment.

The economy is badly out of kilter. Consumption has fallen from 48pc to 36pc of GDP since the late 1990s. Investment has risen to 50pc of GDP. This is off the charts, even by the standards of Japan, Korea or Tawian during their catch-up spurts. Nothing like it has been seen before in modern times.

Fitch Ratings said China is hooked on credit, but deriving ever less punch from each dose. An extra dollar in loans increased GDP by $0.77 in 2007. It is $0.44 in 2011. "The reality is that China's economy today requires significantly more financing to achieve the same level of growth as in the past," said China analyst Charlene Chu.

Ms Chu warned that there had been a "massive build-up in leverage" and fears a "fundamental, structural erosion" in the banking system that differs from past downturns. "For the first time, a large number of Chinese banks are beginning to face cash pressures. The forthcoming wave of asset quality issues has the potential to become uglier than in previous episodes".

Investors had thought China was immune to a property crash because mortgage finance is just 19pc of GDP. Wealthy Chinese often buy two, three or more flats with cash to park money because they cannot invest overseas and bank deposit rates have been minus 3pc in real terms this year.

But with price to income levels reaching nosebleed levels of 18 in East coast cities, it is clear that appartments – often left empty – have themselves become a momentum trade.

Professor Patrick Chovanec from Beijing's Tsinghua School of Economics said China's property downturn began in earnest in August when construction firms reported that unsold inventories had reached $50bn. It has now turned into "a spiral of downward expectations".

A fire-sale is under way in coastal cities, with Shanghai developers slashing prices 25pc in November – much to the fury of earlier buyers, who expect refunds. This is spreading. Property sales have fallen 70pc in the inland city of Changsa. Prices have reportedly dropped 70pc in the "ghost city" of Ordos in Inner Mongolia. China Real Estate Index reports that prices dropped by just 0.3pc in the top 100 cities last month, but this looks like a lagging indicator. Meanwhile, the slowdown is creeping into core industries. Steel output has buckled.

Beijing was able to counter the global crunch in 2008-2009 by unleashing credit, acting as a shock absorber for the whole world. It is doubtful that Beijing can pull off this trick a second time.

"If investors go for growth at all costs again they are likely to find that it works even less than before and inflation returns quickly with a vengeance," said Diana Choyleva from Lombard Streeet Research.

The International Monetary Fund's Zhu Min says loans have doubled to almost 200pc of GDP over the last five years, including off-books lending.

This is roughly twice the intensity of credit growth in the five years preceeding Japan's Nikkei bubble in the late 1980s or the US housing bubble from 2002 to 2007. Each of these booms saw loan growth of near 50 percentage points of GDP. (interpolation: F.A. Hayek will not be denied)

The IMF said in November that lenders face a "steady build-up of financial sector vulnerabilities", warning if hit with multiple shocks, "the banking system could be severely impacted".

Mark Williams from Capital Economics said the great hope was that China would use is credit spree after 2008 to buy time, switching from chronic over-investment to consumer-led growth. "It hasn't work out as planned. The next few weeks are likely to reveal how little progress has been made. China may ride out the storm over the next few months, but the dangers of over-capacity and bad debt will only intensify".

In truth, China faces an epic deleveraging hangover, like the rest of us.

And more on ghost cities:

http://pjmedia.com/eddriscoll/2011/12/14/china%E2%80%99s-deserted-fake-disneyland/

China’s Deserted Fake Disneyland
December 14, 2011 - 4:32 pm - by Ed Driscoll

Ah, the joys of central planning. Back in 2009, we linked to this item on China’s ghost city. As John Derbyshire wrote at the time, “If You Build It, They May Not Come:”

    You want reckless property speculation? China’s got it. And they don’t just throw up the occasional condo on spec: They build entire cities.

    It’s a five-minute video but well worth watching. Note especially that masses of those empty apartments in this empty city have been bought “as investments” by Chinese speculators. Lots of luck there, guys.

This Australian clip from 2011 notes that New Ordos isn’t China’s only ghost city:

And even if you build amusement parks, they may not come, as Reuters notes this week:

    Along the road to one of China’s most famous tourist landmarks – the Great Wall of China – sits what could potentially have been another such tourist destination, but now stands as an example of modern-day China and the problems facing it.Situated on an area of around 100 acres, and 45 minutes drive from the center of Beijing, are the ruins of ‘Wonderland’. Construction stopped more than a decade ago, with developers promoting it as ‘the largest amusement park in Asia’. Funds were withdrawn due to disagreements over property prices with the local government and farmers. So what is left are the skeletal remains of a palace, a castle, and the steel beams of what could have been an indoor playground in the middle of a corn field.

Click over for the photos.

I’m sure building these ghost cities gooses China’s economic stats, gives its workers something to do (see also: FDR and the WPA), and as the Australian item hints, allows the Chi-Coms to generate plenty of PR to entice useful idiots such as Thomas Friedman. But how many of these ghost cities does China have?
 
There are more than a few "ghost" projects in China but they fall int two broad categories:

1. Those that fell apart (like the Disneyesque theme park) because of bad financing; and

2. Those which are awaiting completion.

The latter are especially common - as of 10 months ago, anyway - in the central provinces. There appear to be new super-highways to nowhere, there are new, seriously underutilized, airports and excellent farmland near smallish cities has been expropriated and lies (officially) fallow - but famers are still working it, illegally. What's happened? They're waiting for one or two things - a new power station, perhaps, or a new water pipeline. Then, IF the Chinese plan works, relatively low tech and "dirty" production will move from the crowded, high wage East coast to the low wage interior (rather than to Indonesia or Philippines). That's the "plan," anyway - it has been working in some areas. In one town, in Hunan province, I was told, about five years ago, that the big industrial park was all ready, including highways, but needed more water. It took three years more to get the water supply connected but now, according to sources I think are reliable, the small city is booming - thousands of new jobs and people have moved back from the East coast.
 
More on the "String of Pearls" idea.

http://blogs.the-american-interest.com/wrm/2011/12/14/great-game-smart-india/

Strangled by a String Of Pearls?

“There’s nothing wrong with China setting up a base in the Seychelles”. This is apparently what the Indian defense minister had to say when asked if China’s plans to build a naval port on the Indian ocean island chain was of concern to India. The Hindustan Times puts it this way:
The Defence [sic] Ministry on Tuesday said it did not see anything “wrong” in China setting up a military base in Seychelles since this appeared to be part of Beijing’s efforts to combat piracy in the Indian ocean region. “The world has mutual concerns about piracy going on in that region. They are also trying to play a major role in that. I think they are augmenting their anti-piracy efforts. I don’t see anything wrong in this,” minister of state for defence MM Pallam Raju said.

Others weren’t quite so sanguine. One analyst said, “This is a serious development…China seems to have got a toehold in the country, despite the presence there of both the US and India. The question now is, will the toehold turn into a foothold?”

Probably not right away; the news that a US drone fell from the sky near the Seychelles airport is a reminder that Beijing will not have the islands to itself. The low key Indian reaction also reflects the multinational nature of the anti piracy effort.  The growing scourge of piracy in the waters off East Africa is a threat to Indian as well as to other interests; ships from many countries are patrolling these waters in the attempt to protect commerce, and the invitation to China makes some sense.

Though not an overtly antagonistic military maneuver, China’s move to the Seychelles is indeed a quiet step forward in the competition with India. Indians have viewed Chinese arrangements with countries like Sri Lanka and Pakistan as part of an effort to put together a “string of pearls” — Chinese bases in countries surrounding India.  Previously, India thought of the Seychelles as part of its own network of regional allies; now that status seems a little less secure, and some of India’s defense bureaucrats will likely be putting in some unusually long hours as they figure out how to respond.

Posted in Asia, China, India, Quick Take
 
E.R. Campbell said:
There are more than a few "ghost" projects in China but they fall int two broad categories:

1. Those that fell apart (like the Disneyesque theme park) because of bad financing; and

2. Those which are awaiting completion.

The latter are especially common - as of 10 months ago, anyway - in the central provinces. There appear to be new super-highways to nowhere, there are new, seriously underutilized, airports and excellent farmland near smallish cities has been expropriated and lies (officially) fallow - but famers are still working it, illegally. What's happened? They're waiting for one or two things - a new power station, perhaps, or a new water pipeline. Then, IF the Chinese plan works, relatively low tech and "dirty" production will move from the crowded, high wage East coast to the low wage interior (rather than to Indonesia or Philippines). That's the "plan," anyway - it has been working in some areas. In one town, in Hunan province, I was told, about five years ago, that the big industrial park was all ready, including highways, but needed more water. It took three years more to get the water supply connected but now, according to sources I think are reliable, the small city is booming - thousands of new jobs and people have moved back from the East coast.

While you certainly have far more first hand knowledge on the subject, I havn't found any other suggestions these cities are "just awaiting completion", or even that they are soon to be manufacturing hubs in Western China. Are there some other sources that you can point to?
 
I think you will find examples in Robyn Meredith"s The Elephant And The Dragon (Norton, 2008). In Chapter 3 Meredith outlines this process as it was working in 2006/07, about the time I saw it in Yiyang, a relatively small (only 4 million people), second tier city in Hunan province. See also: http://www.chinatoday.com.cn/English/e20035/p70.htm (but China Today is a government agency so take what it says with that in mind.)
 
A couple of interesting tidbits leaked out of the PRC this week. The second sea trials of their refurbished carrier and an uprising at a coastal town against local party officials.

VaryagAircraft.jpg


http://www.contracostatimes.com/news/ci_19550533

BEIJING -- A long-running dispute between farmers and local officials in southern China exploded into open rebellion this week after villagers chased away government leaders, set up roadblocks and began arming themselves with homemade weapons, residents said.

The conflict in Wukan, a coastal settlement near the country's booming industrial heartland in Guangdong province, escalated Monday after residents learned that one of the representatives they had selected to negotiate with the local Communist Party had died in police custody. The authorities say a heart attack killed the 42-year-old man, but relatives say his body bore signs of torture.

Spasms of social unrest in China have become increasingly common, a reflection of the widening income gap and deepening unhappiness with official corruption and an unresponsive justice system.

But the clashes in Wukan, which first erupted in September, appear to be unusual for their longevity -- and for the brazenness of the participants.

Reached by phone Wednesday, residents said throngs of people were staging noisy rallies by day outside Wukan's village hall, while young men with walkie-talkies employed tree limbs to obstruct roads leading to the town. Not far away, heavily armed riot police were maintaining their own roadblocks. The siege has prevented deliveries from reaching the town of 20,000, but residents said they had no problem receiving food from adjoining villages.

Communist Party officials in Shanwei, the jurisdiction that includes Wukan, declined to comment Wednesday evening saying they would hold a news conference Thursday.


The unrest began in September, when thousands of people took to the streets to protest the seizure of agricultural land they said was illegally taken by government officials. The land was sold to developers, they said, but the farmers ended up with little or no compensation. After two days of protests, during which police vehicles were destroyed and government buildings ransacked, riot police moved in with what residents described as excessive brutality.

With order restored, local officials vowed to investigate the villager's land-grab claims. Two village party officials were fired and the authorities made an offer that is rare in China's top-down political system: County party officials would negotiate with a group of village representatives chosen by popular consensus.

A butcher named Xue Jinbo was among the 13 people chosen.

It is unclear what happened next, but villagers say the goodwill evaporated earlier this month after a Lufeng County government spokesman condemned the earlier protests as illegal and accused Wukan's ad hoc leaders of abetting "overseas forces that want to sow divisions between the government and villagers." A few days later, residents took to the streets again and staged a sit-in. Last Friday, the authorities responded by sending in a group of plainclothes policemen who grabbed five of the representatives, including Xue.

Two days later, he was dead.

According to a 24-year-old villager who described himself as Xue's son-in-law, his knees were bruised, his nostrils were caked with blood and his thumbs appeared to be broken. The man, who spoke by phone and gave his surname as Gao, declined to fully identify himself.

"We've been to the funeral home a couple of times but the police won't release his body," he said.

Although government censors blocked news of the latest unrest, the state-run Xinhua News Agency weighed in on the "rumors" about Xue's death, saying he had died of cardiac arrest a day after confessing to his role in the riots of in September.

The account, published Tuesday, cited public security officials who said Xue had a history of asthma and heart disease, and it referred to a report by forensic investigators who found no evidence of abuse.

"We assume the handcuffs left the marks on his wrists, and his knees were bruised slightly when he knelt," Luo Bin, deputy chief of the Zhongshan University forensics medical center told Xinhua.

The top party official in Shanwei, Zheng Yanxiong, said Xue's death would nonetheless be investigated, but he warned residents against using their suspicions to fuel unrest.

"The government will strive to settle all related problems and hopes the village will not be instigated into staging further riots," Zheng said.
 
More on the riots:

http://www.guardian.co.uk/commentisfree/2011/dec/16/china-land-grab-undermining-democracy/print

China's land grab is undermining grassroots democracy

The standoff in Wukan exemplifies the growing tensions between state and society in a rapidly urbanising country

        Tao Ran
        guardian.co.uk, Friday 16 December 2011 14.30 GMT
     

After continuous confrontation between villagers and local officials for almost four months, the land grab in the fishing village of Wukan, in Guandong province, China, has now led to the death of one of the elected village leaders in police custody, and further escalated into a violent "mass incident" with tens of thousands of farmers protesting against local officials.

The Wukan case is just one of many mass incidents China has experienced in recent years. In fact, the number keeps rising every year; journalists often cite a figure of 87,000 for 2005, estimates by the China Academy of Social Sciences give a figure of "over 90,000" mass incidents in 2006, and further unspecified increases in 2007 and 2008.

In China, a mass incident is defined as "any kind of planned or impromptu gathering that forms because of internal contradictions", including mass public speeches, physical conflicts, airing of grievances, or other forms of group behaviour that may disrupt social stability. Among China's mass incidents, more than 60% have been related to land disputes when local governments in China worked closely with manufacturers and real-estate developers to grab land from farmers at low prices.

In a drive to industrialise and urbanise, thousands of industrial parks and many thousands of real estate development projects have been, or are being, built at the costs of dispossessed farmers. The land requisition system deprives three to four million farmers of their land every year, and around 40-50 million are now dispossessed.

The Wukan case says a lot about the serious tension between state and society in the fast urbanising China. It is difficult to play the land requisition game fairly under the current system, since farmers are neither allowed to negotiate directly on the compensation package, nor are they allowed to develop their own land for non-agricultural purposes. They have to sell their land to local government first, which defines the price then leases the land to industrial and commercial/residential users for a profit. As land prices keep rising in China, it is not surprising that farmers with rising expectations are becoming increasingly unhappy. As a result, mass incidents, sometimes as violent as in Wukan, are inevitable.

Local authorities in China, in their pursuit of revenue via aggressive urbanisation and industrialisation, are also undermining the country's grassroots democracy. It was usually local officials who would carry out difficult negotiations with village collectives, or who were in charge of coercing defiant farmers to accept government terms. Having village cadres who shared their interests would not only lower the selling price but also determine whether or not the transaction could take place at all. Therefore, township and county officials in localities that experienced greater land requisition had a stronger incentive to manipulate village democracies to make sure that more co-operative cadres were elected.

One township party secretary I interviewed in Fujian province said: "If election rules are followed strictly, [we] will lose control of the rural society. Village cadres will be afraid of villagers, not the township government. They can put off assignments from the township government and compromise the tasks during implementation. Therefore … local officials are willing to introduce rules that subvert the true meaning of village democracy. This is also the case in Wukan in which farmers are protesting not only against local governments, but also against villager cadres who worked with the authorities in abusive land requisition.

As China is urbanising fast, land requisition takes place in more Chinese villages, in particular those closest to the cities. Farmers with rising expectations on the one hand, and local officials with financial stakes in keeping the compensation low on the other, are bound to lead to increasingly violent mass incidents. Local governments in China needs to spend more not only on compensating farmers, but also on maintaining social stability. Wukan should be a signal for China to reform its land requisition system in order to keep local governments away from the financial gains of abusive land taking.

    © 2011 Guardian News and Media Limited or its affiliated companies. All rights reserved.
 
It is interesting: the figures of 90,000 mass incidents is well below what I was told by a mid to high ranked official who suggested that there were at least 1,000 incidents (demonstrations, protests, etc) every single day in China.

Most are, he told me, relatively, peaceful and, as far as I know, all are aimed at local officials - but they are not all in remote regions. One, of which I can speak from personal knowledge, took place in Beijing a few years ago and it involved thousands of pensioners who protested a change in public park access fees - they got their way: public park fees remained high (by our standards) for everyone under 55 (or whatever age) and those over 70 (I think that's the magic number) get a free pass.

When you don't have some form of participatory democracy protests, large and small, peaceful and violent, are the only way the vox populi can be heard. This is one of the reasons the Chinese Communist Party is experimenting with local, direct elections in a few villages and small towns.
 
More on the economic bubble.

http://blogs.the-american-interest.com/wrm/2011/12/19/bad-news-gets-worse-for-china-2/

Bad News Gets Worse For China

Europe and China have this much in common: the bad economic news just keeps getting worse.  The latest headaches for Beijing: Growing numbers of analysts fear that a combination of slumping exports and overexposed loans could spell real trouble for the increasingly vulnerable Chinese economy.
First, the export problem. As Reuters reports:

The first quarter [of 2012] is shaping up to be especially tough because of slow European and U.S. demand, coupled with the normal spike in imports that comes with the celebration of Chinese New Year, which this year starts in late January.

Zhiwei Zhang, a Nomura economist based in Hong Kong, expects China to import $28.8 billion more than it exports during the first three months of 2012, dwarfing the $1 billion deficit posted over the same period this year. That quarterly deficit was the first since 2004, and China has not recorded a full-year shortfall in two decades.

Chinese Commerce Ministry officials have been warning for weeks that the trade outlook is “very severe.”
Perhaps even more troubling than falling exports are the conclusions drawn from this Bloomberg investigation into China’s real versus publicly acknowledged borrowing levels:

Bloomberg News tallied the debt disclosed by all 231 local government financing companies that sold bonds, notes or commercial paper through Dec. 10 this year. The total amounted to 3.96 trillion yuan ($622 billion), mostly in bank loans, more than the current size of the European bailout fund.
There are 6,576 of such entities across China, according to a June count by the National Audit Office, which put their total debt at 4.97 trillion yuan. That means the 231 borrowers studied by Bloomberg have alone amassed more than three-quarters of the overall debt…

The findings suggest China is failing to curb borrowing that one central bank official has said will slow growth in the world’s second-largest economy if not controlled. With prices dropping in China’s real estate market, economists warn that local authorities won’t be able to repay their debt because of poor cash flow and falling revenue from land sales they rely on for much of their income.

It is unlikely that anybody in China has any idea just how much of a mess they have on their hands.  Local governments have every incentive to hide the full scope of their borrowing from central authorities — and local banks and businesses often have excellent reasons for helping the local authorities to hide their tracks and borrow and spend still more.

Every growing economy must pass through the fire of a major financial crisis and economic crash — usually more than once.  China’s new economy has not been tested by a truly wrenching crisis and downturn yet, but especially if the euro implodes, that could change.  With the political system already under stress, an economic meltdown would lead to, um, interesting times.

I hasten to add that China’s financial authorities are both talented and hardworking, but that is not the point.  Nobody dodges all the bullets, and sooner or later it will be China’s turn to take a big hit.
 
Without comment (part 1):

http://www.weeklystandard.com/print/articles/xinjiang-procedure_610145.html

The Xinjiang Procedure
Beijing’s ‘New Frontier’ is ground zero for the organ harvesting of political prisoners.
Ethan Gutmann
December 5, 2011, Vol. 17, No. 12

To figure out what is taking place today in a closed society such as northwest China, sometimes you have to go back a decade, sometimes more.

One clue might be found on a hilltop near southern Guangzhou, on a partly cloudy autumn day in 1991. A small medical team and a young doctor starting a practice in internal medicine had driven up from Sun Yat-sen Medical University in a van modified for surgery. Pulling in on bulldozed earth, they found a small fleet of similar vehicles—clean, white, with smoked glass windows and prominent red crosses on the side. The police had ordered the medical team to stay inside for their safety. Indeed, the view from the side window of lines of ditches—some filled in, others freshly dug—suggested that the hilltop had served as a killing ground for years.

Thirty-six scheduled executions would translate into 72 kidneys and corneas divided among the regional hospitals. Every van contained surgeons who could work fast: 15-30 minutes to extract. Drive back to the hospital. Transplant within six hours. Nothing fancy or experimental; execution would probably ruin the heart.

With the acceleration of Chinese medical expertise over the last decade, organs once considered scraps no longer went to waste. It wasn’t public knowledge exactly, but Chinese medical schools taught that many otherwise wicked criminals volunteered their organs as a final penance.

Right after the first shots the van door was thrust open and two men with white surgical coats thrown over their uniforms carried a body in, the head and feet still twitching slightly. The young doctor noted that the wound was on the right side of the chest as he had expected. When body #3 was laid down, he went to work.

Male, 40-ish, Han Chinese. While the other retail organs in the van were slated for the profitable foreigner market, the doctor had seen the paperwork indicating this kidney was tissue-matched for transplant into a 50-year-old Chinese man. Without the transplant, that man would die. With it, the same man would rise miraculously from his hospital bed and go on to have a normal life for 25 years or so. By 2016, given all the anti-tissue-rejection drug advances in China, they could theoretically replace the liver, lungs, or heart—maybe buy that man another 10 to 15 years.

Body #3 had no special characteristics save an angry purple line on the neck. The doctor recognized the forensics. Sometimes the police would twist a wire around a prisoner’s throat to prevent him from speaking up in court. The doctor thought it through methodically. Maybe the police didn’t want this prisoner to talk because he had been a deranged killer, a thug, or mentally unstable. After all, the Chinese penal system was a daily sausage grinder, executing hardcore criminals on a massive scale. Yes, the young doctor knew the harvesting was wrong. Whatever crime had been committed, it would be nice if the prisoner’s body were allowed to rest forever. Yet was his surgical task that different from an obstetrician’s? Harvesting was rebirth, harvesting was life, as revolutionary an advance as antibiotics or steroids. Or maybe, he thought, they didn’t want this man to talk because he was a political prisoner.

Nineteen years later, in a secure European location, the doctor laid out the puzzle. He asked that I keep his identity a secret. Chinese medical authorities admit that the lion’s share of transplant organs originate with executions, but no mainland Chinese doctors, even in exile, will normally speak of performing such surgery. To do so would remind international medical authorities of an issue they would rather avoid—not China’s soaring execution rate or the exploitation of criminal organs, but rather the systematic elimination of China’s religious and political prisoners. Yet even if this doctor feared consequences to his family and his career, he did not fear embarrassing China, for he was born into an indigenous minority group, the Uighurs.

Every Uighur witness I approached over the course of two years—police, medical, and security personnel scattered across two continents—related compartmentalized fragments of information to me, often through halting translation. They acknowledged the risk to their careers, their families, and, in several cases, their lives. Their testimony reveals not just a procedure evolving to meet the lucrative medical demand for living organs, but the genesis of a wider atrocity.

Behind closed doors, the Uighurs call their vast region in China’s northwest corner (bordering on India, Pakistan, Afghanistan, Tajikistan, Kyrgyzstan, Kazakhstan, and Mongolia) East Turkestan. The Uighurs are ethnically Turkic, not East Asian. They are Muslims with a smattering of Christians, and their language is more readily understood in Tashkent than in Beijing. By contrast, Beijing’s name for the so-called Autonomous Region, Xinjiang, literally translates as “new frontier.” When Mao invaded in 1949, Han Chinese constituted only 7 percent of the regional population. Following the flood of Communist party administrators, soldiers, shopkeepers, and construction corps, Han Chinese now constitute the majority. The party calculates that Xinjiang will be its top oil and natural gas production center by the end of this century.

To protect this investment, Beijing traditionally depicted all Uighur nationalists—violent rebels and non-violent activists alike—as CIA proxies. Shortly after 9/11, that conspiracy theory was tossed down the memory hole. Suddenly China was, and always has been, at war with al Qaeda-led Uighur terrorists. No matter how transparently opportunistic the switch, the American intelligence community saw an opening for Chinese cooperation in the war on terror, and signaled their acquiescence by allowing Chinese state security personnel into Guantánamo to interrogate Uighur detainees.

While it is difficult to know the strength of the claims of the detainees’ actual connections to al Qaeda, the basic facts are these: During the 1990s, when the Chinese drove the Uighur rebel training camps from neighboring countries such as Kazakhstan and Pakistan, some Uighurs fled to Afghanistan where a portion became Taliban soldiers. And yet, if the Chinese government claims that the Uighurs constitute their own Islamic fundamentalist problem, the fact is that I’ve never met a Uighur woman who won’t shake hands or a man who won’t have a drink with me. Nor does my Jewish-sounding name appear to make anyone flinch. In one of those vino veritas sessions, I asked a local Uighur leader if he was able to get any sort of assistance from groups such as the Islamic Human Rights Commission (where, as I found during a brief visit to their London offices, veiled women flinch from an extended male hand, drinks are forbidden, and my Jewish surname is a very big deal indeed). “Useless!” he snorted, returning to the vodka bottle.

So if Washington’s goal is to promote a reformed China, then taking Beijing’s word for who is a terrorist is to play into the party’s hands.

Xinjiang has long served as the party’s illicit laboratory: from the atmospheric nuclear testing in Lop Nur in the mid-sixties (resulting in a significant rise in cancers in Urumqi, Xinjiang’s capital) to the more recent creation in the Tarim Desert of what could well be the world’s largest labor camp, estimated to hold 50,000 Uighurs, hardcore criminals, and practitioners of Falun Gong. And when it comes to the first organ harvesting of political prisoners, Xinjiang was ground zero.

In 1989, not long after Nijat Abdureyimu turned 20, he graduated from Xinjiang Police School and was assigned to a special police force, Regiment No. 1 of the Urumqi Public Security Bureau. As one of the first Uighurs in a Chinese unit that specialized in “social security”—essentially squelching threats to the party—Nijat was employed as the good cop in Uighur interrogations, particularly the high-profile cases. I first met Nijat—thin, depressed, and watchful—in a crowded refugee camp on the outskirts of Rome.

Nijat explained to me that he was well aware that his Chinese colleagues kept him under constant surveillance. But Nijat presented the image they liked: the little brother with the guileless smile. By 1994 he had penetrated all of the government’s secret bastions: the detention center, its interrogation rooms, and the killing grounds. Along the way, he had witnessed his fair share of torture, executions, even a rape. So his curiosity was in the nature of professional interest when he questioned one of the Chinese cops who came back from an execution shaking his head. According to his colleague, it had been a normal procedure—the unwanted bodies kicked into a trench, the useful corpses hoisted into the harvesting vans, but then he heard something coming from a van, like a man screaming. 

“Like someone was still alive?” Nijat remembers asking. “What kind of screams?”

“Like from hell.”

Nijat shrugged. The regiment had more than enough sloppiness to go around.

A few months later, three death row prisoners were being transported from detention to execution. Nijat had become friendly with one in particular, a very young man. As Nijat walked alongside, the young man turned to Nijat with eyes like saucers: “Why did you inject me?”

Nijat hadn’t injected him; the medical director had. But the director and some legal officials were watching the exchange, so Nijat lied smoothly: “It’s so you won’t feel much pain when they shoot you.”

The young man smiled faintly, and Nijat, sensing that he would never quite forget that look, waited until the execution was over to ask the medical director: “Why did you inject him?”

“Nijat, if you can transfer to some other section, then go as soon as possible.”

“What do you mean? Doctor, exactly what kind of medicine did you inject him with?”

“Nijat, do you have any beliefs?”

“Yes. Do you?”

“It was an anticoagulant, Nijat. And maybe we are all going to hell.”

I first met Enver Tohti—a soft-spoken, husky, Buddha of a man—through the informal Uighur network of London. I confess that my first impression was that he was just another emigré living in public housing. But Enver had a secret.

His story began on a Tuesday in June 1995, when he was a general surgeon in an Urumqi hospital. Enver recalled an unusual conversation with his immediate superior, the chief surgeon: “Enver, we are going to do something exciting. Have you ever done an operation in the field?”

“Not really. What do you want me to do?”

“Get a mobile team together and request an ambulance. Have everyone out front at nine tomorrow.”

On a cloudless Wednesday morning, Enver led two assistants and an anaesthesiologist into an ambulance and followed the chief surgeon’s car out of Urumqi going west. The ambulance had a picnic atmosphere until they realized they were entering the Western Mountain police district, which specialized in executing political dissidents. On a dirt road by a steep hill the chief surgeon pulled off, and came back to talk to Enver: “When you hear a gunshot, drive around the hill.”

“Can you tell us why we are here?”

“Enver, if you don’t want to know, don’t ask.”

“I want to know.”

“No. You don’t want to know.”

The chief surgeon gave him a quick, hard look as he returned to the car. Enver saw that beyond the hill there appeared to be some sort of armed police facility. People were milling about—civilians. Enver half-satirically suggested to the team that perhaps they were family members waiting to collect the body and pay for the bullet, and the team responded with increasingly sick jokes to break the tension. Then they heard a gunshot, possibly a volley, and drove around to the execution field.

Focusing on not making any sudden moves as he followed the chief surgeon’s car, Enver never really did get a good look. He briefly registered that there were 10, maybe 20 bodies lying at the base of the hill, but the armed police saw the ambulance and waved him over.

“This one. It’s this one.”

Sprawled on the blood-soaked ground was a man, around 30, dressed in navy blue overalls. All convicts were shaved, but this one had long hair.

“That’s him. We’ll operate on him.”

“Why are we operating?” Enver protested, feeling for the artery in the man’s neck. “Come on. This man is dead.”

Enver stiffened and corrected himself. “No. He’s not dead.”

“Operate then. Remove the liver and the kidneys. Now! Quick! Be quick!”

Following the chief surgeon’s directive, the team loaded the body into the ambulance. Enver felt himself going numb: Just cut the clothes off. Just strap the limbs to the table. Just open the body. He kept making attempts to follow normal procedure—sterilize, minimal exposure, sketch the cut. Enver glanced questioningly at the chief surgeon. “No anaesthesia,” said the chief surgeon. “No life support.”

The anaesthesiologist just stood there, arms folded—like some sort of ignorant peasant, Enver thought. Enver barked at him. “Why don’t you do something?”

“What exactly should I do, Enver? He’s already unconscious. If you cut, he’s not going to respond.”

But there was a response. As Enver’s scalpel went in, the man’s chest heaved spasmodically and then curled back again. Enver, a little frantic now, turned to the chief surgeon. “How far in should I cut?”

“You cut as wide and deep as possible. We are working against time.”

Enver worked fast, not bothering with clamps, cutting with his right hand, moving muscle and soft tissue aside with his left, slowing down only to make sure he excised the kidneys and liver cleanly. Even as Enver stitched the man back up—not internally, there was no point to that anymore, just so the body might look presentable—he sensed the man was still alive. I am a killer, Enver screamed inwardly. He did not dare to look at the face again, just as he imagined a killer would avoid looking at his victim.

The team drove back to Urumqi in silence.

On Thursday, the chief surgeon confronted Enver: “So. Yesterday. Did anything happen? Yesterday was a usual, normal day. Yes?”

Enver said yes, and it took years for him to understand that live organs had lower rejection rates in the new host, or that the bullet to the chest had—other than that first sickening lurch—acted like some sort of magical anaesthesia. He had done what he could; he had stitched the body back neatly for the family. And 15 years would elapse before Enver revealed what had happened that Wednesday.

As for Nijat, it wasn’t until 1996 that he put it together.

It happened just about midnight, well after the cell block lights were turned off. Nijat found himself hanging out in the detention compound’s administrative office with the medical director. Following a pause in the conversation, the director, in an odd voice, asked Nijat if he thought the place was haunted.

“Maybe it feels a little weird at night,” Nijat answered. “Why do you think that?”

“Because too many people have been killed here. And for all the wrong reasons.”

Nijat finally understood. The anticoagulant. The expensive “execution meals” for the regiment following a trip to the killing ground. The plainclothes agents in the cells who persuaded the prisoners to sign statements donating their organs to the state. And now the medical director was confirming it all: Those statements were real. They just didn’t take account of the fact that the prisoners would still be alive when they were cut up.

“Nijat, we really are going to hell.”

Nijat nodded, pulled on his beer, and didn’t bother to smile.
 
Part 2:

http://www.weeklystandard.com/print/articles/xinjiang-procedure_610145.html

On February 2, 1997, Bahtiyar Shemshidin began wondering whether he was a policeman in name only. Two years before, the Chinese Public Security Bureau of the Western city of Ghulja recruited Bahtiyar for the drug enforcement division. It was a natural fit because Bahtiyar was tall, good-looking, and exuded effortless Uighur authority. Bahtiyar would ultimately make his way to Canada and freedom, but he had no trouble recalling his initial idealism; back then, Bahtiyar did not see himself as a Chinese collaborator but as an emergency responder.

For several years, heroin addiction had been creeping through the neighborhoods of Ghulja, striking down young Uighurs like a medieval plague. Yet inside the force, Bahtiyar quickly grasped that the Chinese heroin cartel was quietly protected, if not encouraged, by the authorities. Even his recruitment was a bait-and-switch. Instead of sending him after drug dealers, his Chinese superiors ordered him to investigate the Meshrep—a traditional Muslim get-together promoting clean living, sports, and Uighur music and dance. If the Meshrep had flowered like a traditional herbal remedy against the opiate invader, the Chinese authorities read it as a disguised attack on the Chinese state.

In early January 1997, on the eve of Ramadan, the entire Ghulja police force—Uighurs and Chinese alike—were suddenly ordered to surrender their guns “for inspection.” Now, almost a month later, the weapons were being released. But Bahtiyar’s gun was held back. Bahtiyar went to the Chinese bureaucrat who controlled supplies and asked after it. “Your gun has a problem,” Bahtiyar was told.

“When will you fix the problem?”

The bureaucrat shrugged, glanced at his list, and looked up at Bahtiyar with an unblinking stare that said: It is time for you to go. By the end of the day, Bahtiyar got it: Every Chinese officer had a gun. Every Uighur officer’s gun had a problem.

Three days later, Bahtiyar understood why. On February 5, approximately 1,000 Uighurs gathered in the center of Ghulja. The day before, the Chinese authorities arrested (and, it was claimed, severely abused) six women, all Muslim teachers, all participants in the Meshrep. The young men came without their winter coats to show they were unarmed, but, planned or unplanned, the Chinese police fired on the demonstrators.

Casualty counts of what is known as the Ghulja incident remain shaky. Bahtiyar recalls internal police estimates of 400 dead, but he didn’t see it; all Uighur policemen had been sent to the local jail “to interrogate prisoners” and were locked in the compound throughout the crisis. However, Bahtiyar did see Uighurs herded into the compound and thrown naked onto the snow—some bleeding, others with internal injuries. Ghulja’s main Uighur clinic was effectively shut down when a squad of Chinese special police arrested 10 of the doctors and destroyed the clinic’s ambulance. As the arrests mounted by late April, the jail became hopelessly overcrowded, and Uighur political prisoners were selected for daily executions. On April 24, Bahtiyar’s colleagues witnessed the killing of eight political prisoners; what struck them was the presence of doctors in “special vans for harvesting organs.”

In Europe I spoke with a nurse who worked in a major Ghulja hospital following the incident. Nervously requesting that I provide no personal details, she told me that the hospitals were forbidden to treat Uighur protesters. A doctor who bandaged an arm received a 15-year sentence, while another got 20 years, and hospital staff were told, “If you treat someone, you will get the same result.” The separation between the Uighur and Chinese medical personnel deepened: Chinese doctors would stockpile prescriptions rather than allow Uighur medical staff a key to the pharmacy, while Uighur patients were receiving 50 percent of their usual doses. If a Uighur couple had a second child, even if the birth was legally sanctioned, Chinese maternity doctors, she observed, administered an injection (described as an antibiotic) to the infant. The nurse could not recall a single instance of the same injection given to a Chinese baby. Within three days the infant would turn blue and die. Chinese staffers offered a rote explanation to Uighur mothers: Your baby was too weak, your baby could not handle the drug.

Shortly after the Ghulja incident, a young Uighur protester’s body returned home from a military hospital. Perhaps the fact that the abdomen was stitched up was just evidence of an autopsy, but it sparked another round of riots. After that, the corpses were wrapped, buried at gunpoint, and Chinese soldiers patrolled the cemeteries (one is not far from the current Urumqi airport). By June, the nurse was pulled into a new case: A young Uighur protester had been arrested and beaten severely. His family paid for his release, only to discover that their son had kidney damage. The family was told to visit a Chinese military hospital in Urumqi where the hospital staff laid it out: One kidney, 30,000 RMB (roughly $4,700). The kidney will be healthy, they were assured, because the transplant was to come from a 21-year-old Uighur male—the same profile as their son. The nurse learned that the “donor” was, in fact, a protester.

In the early autumn of 1997, fresh out of a blood-work tour in rural Xinjiang, a young Uighur doctor—let’s call him Murat—was pursuing a promising medical career in a large Urumqi hospital. Two years later he was planning his escape to Europe, where I met him some years after.

One day Murat’s instructor quietly informed him that five Chinese government officials—big guys, party members—had checked into the hospital with organ problems. Now he had a job for Murat: “Go to the Urumqi prison. The political wing, not the criminal side. Take blood samples. Small ones. Just to map out the different blood types. That’s all you have to do.” 

“What about tissue matching?”

“Don’t worry about any of that, Murat. We’ll handle that later. Just map out the blood types.”

Clutching the authorization, and accompanied by an assistant from the hospital, Murat, slight and bookish, found himself facing approximately 15 prisoners, mostly tough-guy Uighurs in their late twenties. As the first prisoner sat down and saw the needle, the pleading began.

“You are a Uighur like me. Why are you going to hurt me?”

“I’m not going to hurt you. I’m just taking blood.”

At the word “blood,” everything collapsed. The men howled and stampeded, the guards screaming and shoving them back into line. The prisoner shrieked that he was innocent. The Chinese guards grabbed his neck and squeezed it hard.

“It’s just for your health,” Murat said evenly, suddenly aware the hospital functionary was probably watching to make sure that Murat wasn’t too sympathetic. “It’s just for your health,” Murat said again and again as he drew blood.

When Murat returned to the hospital, he asked the instructor, “Were all those prisoners sentenced to death?”

“That’s right, Murat, that’s right. Yes. Just don’t ask any more questions. They are bad people—enemies of the country.”

But Murat kept asking questions, and over time, he learned the drill. Once they found a matching blood type, they would move to tissue matching. Then the political prisoner would get a bullet to the right side of the chest. Murat’s instructor would visit the execution site to match up blood samples. The officials would get their organs, rise from their beds, and check out.

Six months later, around the first anniversary of Ghulja, five new officials checked in. The instructor told Murat to go back to the political wing for fresh blood. This time, Murat was told that harvesting political prisoners was normal. A growing export. High volume. The military hospitals are leading the way.

By early 1999, Murat stopped hearing about harvesting political prisoners. Perhaps it was over, he thought.

Yet the Xinjiang procedure spread. By the end of 1999, the Uighur crackdown would be eclipsed by Chinese security’s largest-scale action since Mao: the elimination of Falun Gong. By my estimate up to three million Falun Gong practitioners would pass through the Chinese corrections system. Approximately 65,000 would be harvested, hearts still beating, before the 2008 Olympics. An unspecified, significantly smaller, number of House Christians and Tibetans likely met the same fate.

By Holocaust standards these are piddling numbers, so let’s be clear: China is not the land of the final solution. But it is the land of the expedient solution. Some will point to recent statements from the Chinese medical establishment admitting the obvious—China’s medical environment is not fully ethical—and see progress. Foreign investors suspect that eventually the Chinese might someday—or perhaps have already—abandon organ harvesting in favor of the much more lucrative pharmaceutical and clinical testing industries. The problem with these soothing narratives is that reports, some as recent as one year ago, suggest that the Chinese have not abandoned the Xinjiang procedure.

In July 2009, Urumqi exploded in bloody street riots between Uighurs and Han Chinese. The authorities massed troops in the regional capital, kicked out the Western journalists, shut down the Internet, and, over the next six months, quietly, mostly at night, rounded up Uighur males by the thousands. According to information leaked by Uighurs held in captivity, some prisoners were given physical examinations aimed solely at assessing the health of their retail organs. The signals may be faint, but they are consistent, and the conclusion is inescapable: China, a state rapidly approaching superpower status, has not just committed human rights abuses—that’s old news—but has, for over a decade, perverted the most trusted area of human expertise into performing what is, in the legal parlance of human rights, targeted elimination of a specific group.

Yet Nijat sits in refugee limbo in Neuchâtel, Switzerland, waiting for a country to offer him asylum. He confessed to me. He confessed to others. But in a world eager not to offend China, no state wants his confession. Enver made his way to an obscure seminar hosted by the House of Commons on Chinese human rights. When the MPs opened the floor to questions, Enver found himself standing up and speaking, for the first time, of killing a man. I took notes, but no British MP or their staffers could be bothered to take Enver’s number.

The implications are clear enough. Nothing but self-determination for the Uighurs can suffice. The Uighurs, numbering 13 million, are few, but they are also desperate. They may fight. War may come. On that day, as diplomats across the globe call for dialogue with Beijing, may every nation look to its origins and its conscience. For my part, if my Jewish-sounding name tells me anything, it is this: The dead may never be fully avenged, but no people can accept being fatally exploited forever.

Ethan Gutmann, an adjunct fellow at the Foundation for Defense of Democracies, wishes to thank Jaya Gibson for research assistance and the Peder Wallenberg family for research support.
 
Rail woes:

http://blogs.the-american-interest.com/wrm/2011/12/26/china-rail-fail-42-spending-cut-in-bullet-train-meltdown/

China Rail Fail: 42% Spending Cut in Bullet Train Meltdown

The Panda Lobby, the pundits and policy wonks who want the US to imitate China’s state capitalism, has long celebrated what it claims to be China’s far sighted and effective approach to industrial policy.  China, the Panda pundits tell us, will own the future because of its courageous subsidies to green technology and high speed rail.  The meltdown of the Chinese solar industry has been widely reported; now comes word that the rail program is also in trouble.

From the Wall Street Journal:

    The railway ministry had a rough 2011: Top ministry officials were ousted on corruption charges; technical snafus marred the opening of its signature Beijing-Shangai bullet line; and July’s grisly train collision crushed government confidence its technology was the new global standard.

Spending on rail will fall 42 percent from projected levels, and the priority looks to shift from gee-whiz high speed bullet trains to the expansion of China’s overstretched freight network.

Those of us who remember the short lived but intense Sushi Lobby, the Americans who thought the US needed to imitate the brilliant success of Japanese state capitalism back in those halcyon days of the 1980s when the grounds of the Imperial Palace in Tokyo were estimated to cost more than the entire state of California, will be waiting to hear how the Panda pundits explain the high speed rail meltdown.

A stern and dignified silence, followed by a swift change of subject, is what the secret pundit manual recommends for situations like this one.  We shall see.

And ever increasing indebtedness:

http://www.zerohedge.com/news/china-insolvency-wave-begins-nations-biggest-provincal-borrowers-defer-loan-payments

China Insolvency Wave Begins As Nation's Biggest Provincial Borrowers "Defer" Loan Payments

Submitted by Tyler Durden on 12/26/2011 00:07 -0500

Remember, back in the day, when a bankruptcy was simply called a bankruptcy? Naturally, this was well before ISDA came on the scene and footnoted the living feces out of everything by claiming that a bankruptcy is never a bankruptcy, as long as the creditors agree to 99.999% losses at gunpoint, with electrodes strapped to their testicles, submerged in a tank full of rabid piranhas, it they just sign a piece of paper (preferably in their own blood) saying the vaseline-free gang abuse was consensual. Well, now we learn that as the global insolvency wave finally moves to China, a bankruptcy is now called something even less scary: "deferred loan payments" (and also explains why suddenly Japan is going to have to bail China out and buy its bonds, because somehow when China fails, it is the turn of the country that started the whole deflationary collapse to step to the plate). After all, who in their right mind would want to scare the public that the entire world is now broke. Certainly not SWIFT. And certainly not that paragon of 8%+ annual growth, where no matter how many layers of lipstick are applied, the piggyness of it all is shining through ever more acutely. Because here are the facts, from China Daily, and they speaks for themselves: "China's biggest provincial borrowers are deferring payment on their loans just two months after the country's regulator said some local government companies would be allowed to do so....Hunan Provincial Expressway Construction Group is delaying payment on 3.11 billion yuan in interest, documents governing the securities show this month. Guangdong Provincial Communications Group Co, the second-largest debtor, is following suit. So are two others among the biggest 11 debtors, for a total of 30.16 billion yuan, according to bond prospectuses from 55 local authorities that have raised money in capital markets since the beginning of November." So not even two months in and companies are already becoming serial defaulters, pardon, "loan payment deferrers?" And China is supposed to bail out the world? Ironically, in a world in which can kicking is now an art form, China will show everyone just how it is done, by effectively upturning the capital structure and saying that paying interest is, well, optional. In the immortal words of the comrade from Georgia, "no coupon, no problem."

Our advice: go long Teva, which recently acquired Cephalon, and its wonderful drug Provigil, which is basically legalized cocaine, speed, meth and heroin all in one perfectly legal pill, as the newsflow, up until now only picking up with the idiot headlines out of Europe at 3 am Eastern is about to become one constant 24/7 flashing red rumor/disinformation mill. Also, next time someone wants to make THE drug cocktail of choice for the headline reacting speed trading junkie, please name it appropriately. Jeffrey will suffice.

More on China's piglipsticking:

    As local governments delay payments for projects commissioned as part of the stimulus to ward off recession in 2009, less money is available for bank lending even as China is taking steps to inject more into the economy. The central bank has held interest rates at 6.56 percent since July to boost the economy, while the US Federal Reserve and the Bank of Japan have kept benchmark rates near zero since 2008.
   
    "When companies start to roll over debt they're not retiring debt, and banks aren't retrieving their capital, so you're crowding out new lending," Patrick Chovanec, a professor at Tsinghua University in Beijing, said in a Dec 13 interview. "This is a problem that's going to start to bite next year."
 
    Local governments had 10.7 trillion yuan in debt at the end of last year, 79 percent due to banks, according to the country's first audit released in June. So-called local financing vehicles that meet collateral requirements can have a one-time extension on their loans, Zhou Mubing, vice-chairman of the China Banking Regulatory Commission, said at a conference on Oct 24 organized by the Internet portal Sina.com.cn, according to a transcript of his comments on the website.
   
    Guangdong Provincial Communications Group, Hunan Provincial Expressway Construction Group, Gansu Provincial Highway Aviation Tourism Investment Group Co and Sichuan Railway Investment Group Co owe more than 200 billion yuan to banks, the data show. They plan to defer 34.4 billion yuan in interest payments, according to their bond prospectuses.

Yes, that's a lot, and it's going to get much worse. But not if you listen to Beijing Bob: yes, even communist countries have a department of propaganda:

    Lei Wanming, Gansu Highway's deputy Communist Party secretary, said the company's interest payment deferrals do not raise any concerns. "Our company can pay our interest and our principal payments with no problem," he said in a Dec 5 interview. "You can't just consider this issue by looking at a bond prospectus."

Said otherwise, all is good, and China's 'relatively fast' growth is still on the agenda:

    National leaders set a goal of "relatively fast" economic growth for 2012 at a major conference in Beijing that ended on Dec 14, according to the Xinhua News Agency. The global outlook "remains very grim", Xinhua cited the leaders as saying.

What is most ironic is that Meredith Whitney will be right... just wrong about the country.

    The extra yield required to hold Hunan Provincial Expressway's 900 million yuan in 2012 bonds has increased to 308 basis points from 151 basis points on June 21, when they were issued. That compares with a current spread of 11 basis points on Shenzhen's five-year direct municipal bonds.

    Yields on local government financing company bonds will remain high next year as selling debt becomes a main channel for raising funds, China International Capital Corp analysts led by the fixed-income analyst Xu Xiaoqing wrote in a Dec 16 research note. Most of the bonds are sold at yields of 8 percent, or 144 basis points more than the benchmark bank lending rate, according to the report. Five-year top-rated corporate bonds yield 4.98 percent, according to Chinabond, the nation's bond clearing house.
 
    "Although the China Banking Regulatory Commission has recently eased loan restrictions to help liquidity, recent supply has been increasing, causing the secondary market to pay attention to systemic risks," they wrote. "The credit quality of recent financing vehicle bonds continues to get weaker."

For those who refuse to swallow China's lies, there is one way around it:

    Five-year credit-default swaps insuring against default on China's sovereign debt rose 3.2 basis points recently to 149.66 basis points, according to data provider CMA...

As more and more scratch their heads, the math is clearly not your friend:

    Even after the reduction in interest payments, Gansu Provincial Highway said that interest and principal payments in 2011 will amount to 3.33 billion yuan, more than its 2010 cash flow of 3.04 billion yuan, according to bond-marketing materials.
 
    "This prospectus is telling us that banks can expect to only receive roughly half of what would have been expected in interest payments," Charlene Chu, a Beijing-based banking analyst with Fitch Ratings, said of the Gansu disclosure.

And as for what happens when an entire continent is stuck fighting simple math and failing, we refer you all to the case study that is Europe.


 
A little too much preening in this article, but yes, we should put the PLAN's aircraft carrier into perspective:

http://www.wired.com/dangerroom/2011/06/relax-chinas-first-aircraft-carrier-is-a-piece-of-junk/all/1

Relax: China’s First Aircraft Carrier is a Piece of Junk

    By David Axe
 
    June 1, 2011 |
    11:14 am |
   
Her new guns are installed. Her light-gray paint job has dried. Her airplanes are flying and her engines are turning. Thirteen years after she was purchased from Ukraine half-complete and lacking engines, the Chinese navy’s very first aircraft carrier is ready to set sail from Dalian shipyard in northeast China. The former Soviet carrier Varyag, renamed Shi Lang in Chinese service, could begin sea trials this summer.

Just how worried should the world be?

The answer depends on who you ask. To China’s closest neighbors, the prospect of a carrier speeding heavily-armed Chinese jet fighters across the world’s oceans is an alarming one. But the U.S. Navy, the world’s leading carrier power and arguably the Chinese navy’s biggest rival, seems oddly unaffected.

There are good reasons for the Pentagon’s calm. For starters, Shi Lang, pictured above, could be strictly a training carrier, meant to pave the way for bigger, more capable carriers years or decades in the future.

But even if she is meant for combat, there’s probably little reason to fear Shi Lang. A close study of the 990-foot-long vessel — plus the warships and airplanes she’ll sail with — reveals a modestly-sized carrier lacking many of the elements that make U.S. flattops so powerful.

When Shi Lang finally gets underway in coming months, she will boost the ability of the People’s Liberation Army Navy (PLAN) to patrol airspace over contested sea zones, provided they’re not too far from the Chinese mainland. And more to the point, she’ll look good doing it. “I think the change in perception by the region will be significant,” Adm. Robert Willard, commander of U.S. Pacific forces, told the Senate in April.

Willard said he is “not concerned” about the ship’s military impact.

Carrier Census

Shi Lang will sail into a Pacific Ocean teeming with carriers. First, there are the American carriers: five nuclear-powered supercarriers home-ported in California, Washington and Japan, plus six assault ships in California and Japan. Between them, the American carriers displace no less than 700,000 tons and can carry 600 aircraft. “Our Navy can carry twice as many aircraft at sea as all the rest of the world combined,” outgoing U.S. Secretary of Defense Robert Gates pointed out last year.

(In comparison, the Chinese flattop displaces just 60,000 tons and carries no more than 40 planes and choppers.)

Japan’s got two 18,000-ton assault ships, plus another on the way. Today they carry just a few helicopters, but it’s possible the ships will eventually embark vertical-landing F-35B stealth fighters. The same applies to South Korea’s four planned 14,000-ton carriers and the two 30,000-ton Australian flattops still under construction.

Thailand’s 12,000-ton Chari Naruebet is an outlier: too small for more than a handful of aircraft, but nevertheless capable of carrying the country’s ancient, vertical-landing Harrier jets.

India and Russia both operate full-fledged carriers with jet fighters aboard. Russia’s Admiral Kuznetsov is actually Shi Lang‘s older sister. Her dozen Su-33 fighters are just rustier versions of the Chinese J-15. Lately, Kuznetsov has spent most of her time in the Mediterranean. India’s 30,000-ton Viraat and her 30 Harriers and choppers tend to stick to the Indian Ocean.

Of the 22 flattops already plying the Pacific or coming soon, none belongs to a country that China can consider a close ally. Today it’s not uncommon to see American carriers sailing in mixed formations with carriers from Japan, South Korea, Thailand and India. Beijing can only dream of assembling that kind of international sea power, with or without Shi Lang.

Empty Nest

A carrier is only as potent as her air wing, a fact the Pentagon appreciates. That’s why the U.S. Navy spends an average of $15 billion a year on new airplanes — about the same as the Air Force. Today, a Navy supercarrier sails with a 70-strong air wing. F/A-18 fighters, EA-6B or EA-18G radar-jamming planes, E-2 radar planes, C-2 cargo-haulers and H-60 helicopters are all part of the mix. The aircraft work as a team, patrolling, tracking and attacking targets below, on and above the surface and moving people and supplies to and from the carrier.

Shi Lang will not possess anything close to that mix of aircraft and capabilities. China’s J-15 naval fighter, pictured above, is a rough analogue of the F-18, but with a shorter range, less sophisticated sensors and fewer weapons options. The Ka-28 helicopter hunts submarines like the H-60 does.

But that’s it. The PLAN doesn’t have radar-jamming jets, carrier-based airlifters or fixed-wing radar planes. Rumors of a Chinese copy of the E-2 seem unfounded, for an E-2 would require a steam-powered catapult to boost it into the air, and Shi Lang lacks even that basic equipment. To fill that huge gap in Shi Lang‘s air wing, China is testing a Z-8 helicopter fitted with a radar. But such a set-up offers only a fraction of the E-2′s range and endurance.

The disparity will only increase in the next decade, as the U.S. Navy finally deploys jet-powered killer drones, early versions of which are already undergoing testing in the California desert.

Defenseless

The same limitations apply to Shi Lang‘s escorts.

To protect its $10 billion carriers and their air wings from aerial attack, the U.S. Navy assigns several of its 83 destroyers and cruisers to sail alongside each flattop. The escorting warships boast super-sophisticated Aegis radars and carry 100 or more Surface-to-Air Missiles per ship. An American carrier battle group possesses more high-powered radars and at-sea missiles than most other countries’ entire naval fleets.

The Chinese navy has just two destroyers that come close to matching America’s Aegis warships, although more are under construction. The Type 052C destroyer, pictured above, carries half as many missiles as a U.S. destroyer, and its radar is unlikely to match the Aegis’ ability to closely track scores of targets simultaneously. On the surface, Shi Lang will be all but defenseless, by U.S. standards.

Underwater, the situation is even worse. American carriers travel with an unseen companion: at least one nuclear-powered attack submarine. The sub’s job is to patrol ahead of the carrier, screening for hostile warships — especially other submarines. After all, submarines are the world’s most lethal ship-killers.

The PLAN has two Type 093 submarines capable of long-range patrols. Again, that’s too few for carrier-escort duty in addition to the other missions likely assigned to the Chinese attack-submarine force. But the bigger problem is communications. To coordinate surface ships and submarines, the Americans and other advanced navies rely on a mix of Very Low Frequency radios installed aboard special aircraft, plus higher-frequency radios for talking from ship to sub.

China hasn’t perfected that system. “Due to the limitations of submarine communications technology, the PLAN currently can only exercise relatively limited tactical control over its submarines,” Garth Heckler, Ed Francis and James Mulvenon wrote in the 2007 book China’s Future Nuclear Submarine Force.

For that reason, Shi Lang probably cannot rely on Chinese submarines for protection from other submarines. That realization evoked a rather pointed comment from National War College professor Bernard Cole. “As a former Navy man, I’d love to see them [the Chinese] build a fleet of aircraft carriers which, increasingly, are just good sub targets,” Cole said.

Potemkin Carrier

Leaving aside her modest size compared to American carriers, her incomplete air wing and escort force and the fact that she’ll sail without the company of allied flattops, Shi Lang could be even less of a threat than her striking appearance implies. Shi Lang‘s greatest potential weakness could be under her skin, in her Ukrainian-supplied engines.

Powerplants — that is, jet engines for airplanes, turbines for ships — are some of the most complex, expensive and potentially troublesome components of any weapon system. Just ask the designers of the Pentagon’s F-35 stealth fighter and the U.S. Navy’s San Antonio-class amphibious ships. Both have been nearly sidelined by engine woes.

China has struggled for years to design and build adequate powerplants for its ships and aircraft. Although Chinese aerospace firms are increasingly adept at manufacturing airframes, they still have not mastered motors. That’s why the new WZ-10 attack helicopter was delayed nearly a decade, and why there appear to be two different prototypes for the J-20 stealth fighter. One flies with reliable Russian-made AL-31F engines; the other apparently uses a less trustworthy Chinese design, the WS-10A.

For Shi Lang, China reportedly purchased turbines from Ukraine. Though surely superior to any ship engines China could have produced on its own, the Ukrainian models might still be unreliable by Western standards. Russia’s Kuznetsov, also fitted with Ukrainian turbines, has long suffered propulsion problems that have forced her to spend most of her 30-year career tied to a pier for maintenance. When she does sail, a large tugboat usually tags along, just in case the carrier breaks down.

If Shi Lang is anything like her sister, she could turn out to be a naval version of the mythical “Potemkin village” — an impressive facade over a rickety interior.

“As China’s interests expand globally, the Chinese navy needs to go further outbound, and an aircraft carrier is needed,” said Arthur Ding, from National Chengchi University in Taiwan. If so, China might have to wait for the carrier after the potentially hollow Shi Lang.
 
I'd love to hear from the more experienced China hands on this interpretation of events/trade issues:
.... All you need to know about Ottawa’s disgracefully servile relations with the degenerate police state in Beijing is that along with all the computers, toys, games, television sets and plastics that have caused our trade deficit with China to balloon to more than $30 billion in recent years, we can now add cement. You’ll want to think about that for a moment.

Cement, the heaviest thing you’re likely to encounter during a walk around any Canadian city, is not what would be going into the holds of ships to be shunted all the way across the Pacific Ocean if capitalism’s genius efficiency in allocating scarce resources had anything to do with it. But that’s not what our coziness with Beijing, our new best friend and trading partner, is about.

It’s a rigged game. Canada is an open society, with an open economy. China is neither.

In the case of cement, British Columbian cement producers are obliged to pay a stiff carbon tax. Chinese cement comes into Canada tax-free, produced by workers who are forbidden to form their own unions, and heaven help them if they get cranky about working 12-hour shifts seven days a week. But cement is just where it starts.

Ten years after Beijing insinuated itself into the World Trade Organization, Chinese corporate monopolies and crony-capitalist empires still enjoy protectionist tariffs and anti-competition laws that have rendered the whole idea of liberalized global trade a sick joke. The racket has engorged Chinese industrial barons with the booty of a six-fold increase in Chinese exports that have cost millions of North American workers their jobs and transformed what was an already fraudulent “socialism with Chinese characteristics” into an increasingly vile regime.

Fully half of China’s billion citizens subsist on sub-Saharan incomes of less than $2 a day, and they’re growing increasingly impatient with the corruption, oppression and persecution that has accompanied the stuffing of Beijing’s foreign-reserves treasury.

But the dozens of unelected billionaires who now dominate the People’s Congress that pretends to be a parliament have decided they will not put up with backchat from Chinese patriots and essayists or with “mass incidents” of the kind that broke out in Wukan and Haimen. Over the past five years, Congress deputies have doubled military spending, adding to a vast and growing security, surveillance and prison-complex apparatus with an annual budget that now hovers in the neighbourhood of $200 billion ....
Terry Glavin column, Ottawa Citizen, 29 Dec 11
 
There's nothing incorrect with what Terry Glavin says, but neither does it present an accurate picture, in my opinion.

There were, most people seem to agree over 200,000 "mass incidents" in 2011 in China - that's 6,000 riots, demonstrations, strikes or whatevers (things requiring police intervention). Now China's population is 40 times as big as ours - do we have 150 such incidents a day in Canada?

China is in the throes of a massive change - begun by Deng Xiaoping and ongoing today - that is transforming the lives of 1.3 Billion people. Much as been accomplished - mostly on the Eastern seaboard; much, much more needs to be done and many, hundreds of millons of Chinese are growing impatient because they can see what's happening on the East Coast and they can see what is not happening to them in the Central and Western provinces.

We need to be careful with comparisons. Yes, many Chinese live on $2.00 per day - but I spent some time, early last year in a large village (or very small town) in rural Anhui province and $2.00 (more like $5.00 or $10.00) pr day goes a long way in the countryside. China is not Africa or even Indonesia or Philippines.

I don't know how China will turn out, I don't know how long this new "dynasty" can last - but the interregnum between the fall of the Qing (1911) and the rise of this one (the Red dynasty?) in 1991 was long enough. China needs some peace and stability, what Hu Jintao refers to as the "harmonious society" to gather and spread the rewards of the past 20 years. What I do know is that China's problems and possible futures cannot be summarized in 500 words ... or 500,000.
 
The US has more worries about China's military "threat," according to this report which is reproduced under the Fair Dealing provisions of the Copyright Act from the Globe and Mail:

http://www.theglobeandmail.com/news/world/pentagons-new-defence-strategy-eyes-china/article2292485/
Pentagon’s new defence strategy eyes China

AFFAN CHOWDHRY

Globe and Mail Update
Published Thursday, Jan. 05, 2012

The Pentagon’s strategic review of the U.S. military comes in the age of austerity.

Defence budget cuts are on the way, the only question is: how deep will they be? Estimates range from at least $450-billion to $1-trillion over the next decade.

But one of the key aspects of President Barack Obama’s comments this morning at the Pentagon is the shift in strategy to bolster the air force and navy, and to build the U.S. military’s capacity in the Pacific region to counter China’s growing military presence.

“We’ll be strengthening our presence in the Asia Pacific, and budget reductions will not come at the expense of this critical region,” Mr. Obama said in the Pentagon’s briefing room on Thursday.

This isn’t the first time the U.S. has addressed military spending in the Asia-Pacific region. The Pentagon has been warning about China’s military spending for years.

Last August, it warned in a report that China’s military was on course to build a modern military by 2020, and in a year when the Chinese military tested a stealth aircraft and conducted trials of a new aircraft carrier, the Pentagon's concern was unmistakable.

China’s defence spending and military growth “are potentially destabilizing to regional military balances, increase the risk of misunderstanding and miscalculation and may contribute to regional tensions and anxieties,” Deputy Assistant Secretary of Defence for East Asia Michael Schiffer said in August of last year around the release of the report on China’s military.

China’s sea disputes with neighbours such as the Philippines and Vietnam over competing claims of sovereignty on islands is nothing new. And Chinese President Hu Jintao’s recent message to its navy – ”make extended preparations for warfare” – will no doubt make U.S. allies nervous.

But how fast is the Chinese military growing? And is there any expectation that defence spending will one day surpass the U.S. military?

Reality check: the size of the U.S. military and the scale of U.S. defence spending will continue to dwarf China’s military growth for years to come. Mr. Obama will be careful to point out in an election year that, whatever reductions in defence, the U.S. defence spending will continue to grow but just not at the pace it has in the past.

But there will come a point when, theoretically, China can surpass the Unites States on defence spending.

This bubble graph by the Stockholm International Peace Research Institute, an independent international institute dedicated to research into conflict, armaments, arms control and disarmament, illustrates the story of defence spending from 2001 to 2010: the United States is spending more than any other country, with China a distant second.

image

Source: Stockholm International Peace Research Institute


A trend line graph by the same institute compares military spending regionally. North American spending (dominated obviously by the United States) rose dramatically from 2001 to 2010 compared to total military spending in the Asia and Oceania region (dominated obviously by China).

image_preview

Source: Stockholm International Peace Research Institute

So when will China overtake the United States in defence spending?

China has witnessed incredible economic growth, and it has invested its wealth with consecutive double-digit increases in military spending. In March of 2011, it announced that it will increase its military spending in 2011 by 12.7 per cent.

But how long can China sustain such phenomenal economic growth? Military spending will depend on that growth.

This handy interactive graph by The Economist magazine allows readers to adjust GDP growth rates, inflation and Yuan appreciation to arrive at their own date for when China will surpass the United States in real GDP growth.

The Economist assumes a GDP growth rate over the next decade of 7.75 per cent in China and 2.5 per cent in the U.S., compared to the GDP growth rate over the last decade of 10.5 per cent a year in China and 1.6 per cent in the U.S.

And following on from the growth figures, the magazine concludes that China will surpass U.S. defence spending in 2025.

There is no telling what the Chinese military would look like after all that spending.

Its navy is small compared to the United States, and there are all kinds of factors worth considering: what if Chinese economic growth slows dramatically? And even though China is closing the technological gap with the United States, a recent report by the International Institute for Strategic Studies concluded that factories involved in arms manufacturing “often possess outdated manufacturing and research attributes.”


Without wishing to make the Chinese appear too smart, this may be just what they want. A strong US presence in the region serves to "keep the peace," which is in China's best interests and relieves China of that responsibility. But the US will have to cut somewhere and that may leave China with openings to advance its own interests elsewhere.
 
Just out ....

"China's evolving nuclear posture: Part 1-Background and benchmark"
This paper is the first part of a larger study the goal of which is to determine the trajectory of China’s nuclear weapons policy, strategy, capability and doctrine. It discusses the origins, scope and methodology of the proposed study, and provides an overview of the evolution of US nuclear strategy in order to establish a baseline for discussing why, and to what extent, China’s nuclear evolution has differed from US nuclear thinking. In doing so it sets the stage for further papers examining the evolution of China’s nuclear strategy; the status of its strategic nuclear forces; and the drivers of China’s declaratory policy, nuclear strategy, and nuclear doctrine. The study will terminate with a comprehensive report discussing the apparent trajectory of Chinese nuclear strategy and capability and the implications thereof for Canada and its allies, and will suggest directions for future research.

"China's evolving nuclear posture: Part II- The evolution of China's Nuclear Strategy"
This paper is the second part of a larger study the principal purpose of which is to determine the trajectory of China’s nuclear weapons policy, strategy, capability and doctrine. Building on the first paper, which provided a benchmark for comparative analysis in the form of an overview of the evolution of US nuclear strategy since the end of the Second World War, this paper discusses the origins of China’s nuclear strategy; its view of deterrence; what certain elements of its declaratory policy reveal about Beijing’s nuclear strategy; and where that strategy appears to stand at present. The paper concludes that while the evolution of China’s nuclear strategy bear some resemblance to Western patterns of nuclear evolution, the process has been largely unique; and that although Beijing will probably maintain an official commitment to minimal deterrence, China’s nuclear strategy has progressed well beyond its declaratory policy, and is continuing to change rapidly. Further papers in this study will examine China’s strategic nuclear forces, and investigate the principal drivers of China’s declaratory policy, nuclear strategy, and nuclear doctrine. The study will conclude with a comprehensive report discussing the apparent trajectory of China’s nuclear posture and the implications thereof for Canada and its allies, and suggesting directions for future research.
 
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