The Chinese Communist Party is becoming Africa’s new colonial master

Robert Rotberg has a slew of foundation titles, but it is his piece in Canada’s National Post that gets my attention today. It is an excellent analysis of the situation in Africa, where despots across the continent have sold their people down the river for favors and funds from the CCP:

African autocrats absolutely adore China’s President Xi Jinping. At a meeting last month with 13 prominent African leaders in Durban, South Africa, Equatorial Guinea’s hard-fisted President Teodoro Obiang Nguema Mbasogo led the others in lavishing praise on China. The front page of the weekend China Daily for March 29 trumpeted their obsequieousness and China-Africa friendship.

None of Africa’s despots dare bite the hand that has fed so well, and so consistently. While Chinese support keeps rolling in, these leaders enrich themselves and their inner circles while their people go without.

China directly supports the leaders and enables their continued internal tyrannies by refusing to “interfere” in local politics, by willfully ignoring well-documented trails of human rights violations, by turning a blind eye to egregious corrupt practices, and by protecting presidents such as Zimbabwae’s Robert Mugabe and Sudan’s Omar al-Bashir…

That’s just the first few paragraphs. The whole piece goes into exquisite detail as to how the CCP enables Africa’s dictators to run roughshod over their own people – and, in Zimbabwe’s case, make an end-run around the power-sharing deal with the opposition:

In impoverished Angola, one of Africa’s largest producers of petroleum, President José Eduardo dos Santos and the men around him have pocketed $3- or $4-billion a year. One of the three big diamond mining enterprises in Zimbabwe is Chinese, in partnership with the heads of the country’s security apparatus. It, and the other Mugabe-related, firms illicitly transfer diamonds to Dubai and Hong Kong in defiance of officials in the Zimbabwean Treasury (which has been run by a Mugabe rival).

In fact, the only thing missing from Rotberg’s column is the word that best describes the relationship the CCP is having with so many African regimes: colonizer. True, as Rotberg notes, the CCP…

neither desires land (aside from leasing agricultural properties on which to grow food crops for export back to China) nor seeks, as Europeans did, to “civilize” Africans. But it does want access to African oil, African copper, African ferrochrome, African iron ore, and many more minerals. For that overriding mercantile reason, China is prepared to go to extraordinary lengths to befriend even the most outrageous African despots, and to help to support them in the manner to which they have become accustomed.

In effect, the tyrants have become CCP viceroys – enriching themselves on their support for their Zhongnanhai benefactors while their people starve and their lands are depleted of natural resources.

Is the relationship as dependent as the Korean colony (a.k.a. “North Korea”)? Perhaps not, but there is no way these regimes can even claim to be truly sovereign, let alone independent-minded and dedicated to the people they tyrannize.

Sadly, Rotberg doesn’t seem to realize that the corruption, decadence, and depravity that comes with the CCP are features, rather than bugs. Still, while he may have the cause wrong, he nails the symptoms.

Cross-posted to the right-wing liberal

Will the CCP try to annex North Korea at long last?

As the Stalinist regime of northern Korea continues its hair-raising rhetoric, its colonial masters have also been busy beefing up their military presence (IBT):

Chinese armed forces have been placed on high alert over the escalating tensions in the Korean Peninsula, US officials say.

Reports suggest that the People’s Liberation Army (PLA) troops have been mobilised over fears of war breaking out in the region.

According to US officials quoted in the reports, the Chinese military has beefed up its presence especially in the border region with North Korea since mid-March, soon after Pyongyang stepped up its threats against South Korea and the US.

The Chinese navy has also conducted a live-firing naval drill in the Yellow Sea in close proximity to the Korean Peninsula.

Chinese forces in Jilin Province bordering North Korea have been mobilised and kept on “Level One” alert. Large groups of troops, along with tanks and armoured personnel carriers, have also been detected in the region near the Yalu River which divides China and North Korea.

Hardly anyone on this side of the Pacific has noticed this, but I think it could be a part of the Chinese Communist Party’s endgame.

Lest we forget, the CCP is in an unusual – and perhaps for them unexpected – bind. The American president – the fellow who is rapidly downshifting American power everywhere else in the world – has been upshifting it in eastern Asia. Meanwhile, electorates in Japan and South Korea went for the relatively more anti-Communist candidates in the past year.

Perhaps Zhongnanhai was hopeful that some saber-rattling by their colonists would move President Obama to go soft. Suffice to say, that hasn’t happened (BBC).

However, I have always felt the CCP had a double-game going. In effect, when the Korean tyranny stopped being useful, invade and annex it.

Lest that sound strange, keep in mind that the regime has already made a “historical” claim on northern Korea – exactly the kind of things used as an excuse to occupy Tibet and East Turkestan back in the day.

Of course, the rest of world might get rather upset at such irridentism – unless they were convinced the occupiers were replacing something much worse.

Hence, the CCP continues to let Pyongyang bluster…

…and they will continue to do so unless it becomes clear that the democratic world won’t be offering concessions to them. In which case, you might want to look for the military action to come from above Korea.

He’s Back

This is my house again, son!

Ten years ago, Jiang Zemin – the neo-corporatist cadre who came to personally symbolize the corruption and thievery of the Chinese Communist Party – stood down as party leader (but not military chief) in favor of Hu Jintao, who promised a cleaner (but arguably presided over a meaner) regime.

This week, Jiang’s revenge was complete. Not only is the new Politburo Standing Committee largely filled with “his” people (CNN) – including the big fish, Xi Jinping – but he even saw Hu Jintao step down as Chairman of the Central Military Commission in Xi’s favor (National Post, BBC).

Willy Lam – who was a CNN reporter the last time Jiang was this powerful, and is now a professor at the Chinese University of Hong Kong – called it a “a conservative team.” Given that Lam is one of the few analysts smart enough to know that “conservative” means leftist/anti-democratic in the CCP, his words carry weight. As he put it, “We can expect no substantial or meaningful movement toward political reform” (CNN).

Truth be told, I was never really optimistic that Hu Jintao was serious about political reform either. All his talk of “intra-party democracy” made me cold (choosing corrupt cadre A over corrupt cadre B is not my definition of democracy). Moreover, Hu’s behavior during the Hanyuan County Massacre made it clear that even if Hu managed to clean up his party’s image, it would still be the bloodthirsty regime we’ve all come to know and loathe.

That Hu decided (or was convinced) to leave the CMC Chair only adds to the complete rout. Jiang was at least able to hang on to the real post of power in Communist China for two years after handing over the Party leadership post to Hu. Nearly everyone, myself included, thought Hu would do the same thing. That he couldn’t speaks volumes of his weakness within the regime.

It also says something about the Chinese Communist Party. Hu’s atttempt to reshape the organization as more Maoist, populist, and clean has failed utterly. Clearly the economic downturn hit his faction hard. Now that Jiang’s people are ascendant once again, look for more “development” and less concern about corruption.

Oh, and if the Epoch Times folks are right about the factions’ positions on Falun Gong…well, that spiritual movement is in for an even rougher ride.

As for the free world, it’s tough to see any change. Most, if not all, of the CCP’s links with anti-American terrorists (states or groups) came during Jiang’s tenure at the CMC Chair. Hu did little stop those; and one could argue he was even more aggressive geopolitically than Jiang, but that was likely due as much to increased opportunity as a difference in viewpoint. In other words, steady as she crashes.

False transition, false prosperity, false calm…just another day in Communist-controlled China

Conventional wisdom will tell you that the Chinese Communist Party conference (which kicked off last night) is yet another milestone in China’s rise as a global leader, an orderly transition for an economic powerhouse…

…and it’s all wrong.

We’ll start with the economic problems – yes, that’s right, Communist China has economic problems. One of its biggest ailments is…debt. This may surprise the casual observer who hears “China” and “debt” in the same sentence and assumes the subject is the gigantic pile of U.S. T-bills in Zhongnanhai. Yet as Clarissa Tan of the Spectator notes, “the Middle Kingdom isn’t doing too shabbily at clocking up credit of is own.”

How bad are things in the People’s Middle Republic? Well, private household debt is fairly low, but “Before the New Year arrives, China’s public debt will stand at 58 per cent, consumer debt at 19 per cent and corporate debt at 128 percent.”

For the uninitiated, low consumer debt was supposed to protect Japan from its heavy corporate borrowing in the early 1990s…just before their economy entered their “lost decade.” Moreover, most of the “corporate” sector in Communist China is a slew of State Owned Enterprises. Assuming at least half of the corporate debt is SOEs (a fairly safe bet), then real government debt is likely over 120% of GDP – higher than the American government by comparison.

You read that right: the Chinese Communist Party is more deeply overleveraged than Washington.

Meanwhile, “outgoing” leader Hu Jintao (more on his real status later) has no intention of slowing down the growing state sector of the Chinese economy. Ambrose Evans-Pritchard (Telegraph) has the details:

President Hu Jintao opened the 10-year power handover with a clear warning to modernizers that Beijing will not give up control over the commanding heights of industry and commerce.

In a valedictory state of the nation address after a decade in power – called “Firmly march on the path of Socialism” and delivered beneath a huge hammer and sickle – he insisted that “public ownership is the mainstay of the economic system” and warned that the party must “resolutely not follow Western political systems”.

So much for economic or political reform, despite how badly it’s needed (Pritchard again):

His comments are sharply at odds with a report earlier this year by the World Bank and China’s Development Research Council (DRC) that has become the Bible for reformers.

It warned that China has exhausted the growth model of the last thirty years and risks stagnating in the “middle income trap” unless it breaks the suffocating control of the state.

“The forces supporting China’s continued rapid progress are gradually fading. The government’s dominance in key sectors, while earlier an advantage, is in the future likely to act as a constraint on creativity,” it said.

So much for the economic powerhouse.

Now, some may note that Hu is on his way out as CCP General Secretary in favor of Xi Jinping, and thus his commentary is no longer as important…except that the most powerful position in Communist China is the Chair of the Central Military Commission, and as Frank Fang of the Epoch Times notes, “Many sources say that Hu Jintao is very likely to serve two more years as chairman of the central military commission, after he steps down as general secretary of the Party at the congress.” In other words, Hu isn’t handing over real power any time soon.

So, we’re not seeing an actual transition, and the economic prowess of the regime is illusory, but things are still orderly, yes? Well, not according to Pritchard:

Mr Hu’s speech reflects a complex power-struggle behind the scenes as hardliners – some linked to former leader Jiang Zemin – reassert control, forcing the outgoing leader to change his message.

Pritchard’s account is confirmed by the AP’s Charles Hutzler:

On stage with Hu appeared one of his nemeses, his predecessor Jiang Zemin, who has supported Xi and is angling to fill many of the seats in the leadership with his allies.

Jiang himself let Hu take the General Secretary job in 2002, but hung on to the CMC Chair until 2004, after which it was presumed his faction and political power entered a steep decline. If he’s pushing Xi forward, the factional battles not only never really ended, but could be flaring up anew.

There goes “orderly.”

So, to sum up, the Chinese Communist regime is dealing with a debt-laden, government-burdened economy with the “outgoing” leader clinging to power in the midst of a factional battle royale. In other words, everything you’ve heard about Communist-controlled China recently is probably wrong.

Well, at least the American people rejected the presidential candidate who pledged to take on the CCP’s intellectual property theft, in favor of the incumbent who…was the first president in American history to publicly challenge the regime’s claim to the South China Sea.

So much for that silver lining.

Cross-posted to Bearing Drift

The New Communist Chinese word for “crisis”: the present

One of the more amusing elitist games in the United States is deciphering the Mandarin language word for “crisis.” The late president Richard Nixon declared it was a combination of danger and opportunity. A Hollywood scriptwriter – via actor Peter Weller – opined that crisis and opportunity were in fact the same word in the language of most of mainland China. However, these days, one can’t help wondering if Zhongnanhai would translate “crisis” and “present” into the same word.

As the Chinese Communist Party prepares for its quinquennial Party Congress, the fellow slated to become the new face of the regime – Xin Jinping – has disappeared. No one has seen him for weeks, and the cadres are completely uninterested in telling anyone else where he is (National Post, Cdn,). Meanwhile, the Bo Xilai scandal (which includes the murder of a foreign investor from Great Britain) continues to dominate the news (CNN).

Even the latest attempt to distract the public – allowing a slew of protests over the Senkaku islands dispute with Japan – went sideways when a Communist-approved mob (for the uninitiated: when any protests reach the streets without the police swooping down on them, it’s Communist-approved) apparently confused American Ambassador Gary Locke with a Japanese official and attacked his car (CNN, although the conclusion is mine). The regime took pains to apologize to the United States, while refusing to condemn far worse violence on Japanese holdings on the mainland (Japan Daily Press). The North Korean colony has gotten in on the act, too, having come to the decision that feeding its own people is less important that producing a music video antagonizing the odds-on favorite to be elected president of South Korea in December (BBC).

In order to understand just how revealing of the CCP’s weakness this fiasco is, we need to remember just what is supposed to happen next month. Contrary to popular belief, the fellow running the regime when the Congress is over will likely be the same fellow running it now: Hu Jintao. No Communist regime is a carbon copy of the others, and the fall of the Soviet model had every one else scramble to avoid its fate. The CCP came upon two distinguishing characteristics. The first (by design) was to fuse Marxist-Leninist economic theory with corporatist practice to transform the state from factory manager to the equivalent of an American 19th Century trust. The second (by improvisation in reaction to the Tiananmen Spring) was a shift in ultimate power from the General Secretary of the Politburo to the Chairman of the Party’s Central Military Commission. While the rest of the world introduced itself to Hu Jintao when he took the General Secretary job in 2002, Jiang Zemin still ran the place as CMC Chair until 2004. Xi is (or was) to enter the same role as the face, but not the head, of the regime.

So, in truth, Xi’s illness/problem/crime/insert-other-reason-for-disappearance-here means nothing. However, the CCP has so much invested in the lie that Xi really was about to become the new leader that its silence on the matter has become unnerving to just about everyone – to the point of undermining the twin pillars of the regime’s legitimacy: it’s capacity for global leadership (NP), and even worse, it’s supposed economic prowess (Anne Applebaum, NP).

Meanwhile, the rest of the world brings little solace to the regime. Despite its desperate economic straits, the European Union refuses to lift its arms embargo for the CCP. Japan and South Korea appear ready to elect anti-Communists to their top political positions. Finally, in America, the most anti-CCP president since LBJ is in the fight of its political life with a challenger who is even more anti-Communist. All of this is occurring as the Chinese people continue to age far faster than is sustainable and grow more restive.

However the cadres may translate “crisis,” it’s all but certain they’re in the middle of one.

Meanwhile, in Communist China, fraud sinks state banks

During the go-go-aughts, the Chinese Communist Party presented itself to the world as the great statist alternative to the United States. The merger of Communism and corporatism then spread its wings in 2008 and protected the world from the financial crisis that Wall Street spawned – at least that’s the story in Beijing. The reality was very, very different.

Recently, even the cadres in Zhongnanhai (Beijing’s version of the Kremlin) have come to terms with the fact that their breakneck growth of the last decade was a massive bubble fueled by state-owned enterprises borrowing heavily from state-owned banks on overvalued property seized by the state from peasants and workers. There were, however, some loans that were based on genuine collateral – i.e., actual assets. Even if the stuff was also overvalued, it was at least stuff.

Or not (Reuters via Zero Hedge):

Chinese banks and companies looking to seize steel pledged as collateral by firms that have defaulted on loans are making an uncomfortable discovery: the metal was never in the warehouses in the first place.

Thus do the demands of accountability in a 21st Century economy meet the corruption that is a staple of a decaying, 20th Century dictatorship.

This is yet another example of the rot that infests the CCP. The Bo Xilai example may be the most dramatic, but it was not atypical. For nearly every cadre, the Chinese Communist Party membership card is a license to steal: land from peasant, wages owed to workers, budget appropriations from state agencies, and especially loan money from state-owned banks. When it comes to bank loans, the cadres follow the Henry Hill school of economics: “No one’s gonna pay for it anyway.”

Except that there will be people who pay for it: foreign investors who lose their shirts and their intellectual property; cadres in the wrong faction who find themselves in prison (while the ones in the right faction take the stuff for themselves); and as always, the Chinese people, more of whom will be forced out of their homes, paid less (if at all), and see prices go through the roof they don’t have. At some point, they will decide enough is enough and take their country back.

Cross-posted to Bearing Drift and the right-wing liberal

Now, Communist China is following us on “green energy” . . . over the cliff

Remember when the president, Tom Friedman, and all their buddies insisted that the Chinese Communist Party was leading the way on “green energy,” to justify companies like Solyndra getting billions in taxpayer dollars?

Yeah, about that . . .

Li Fei, the owner of Chengxing Solar Company in Jinhua, Zhejiang Province, committed suicide by jumping off a building, alarming the debt-ridden photovoltaic industry, reported First Financial Daily in Shanghai.
Li ended his life after Chengxing was unable to repay a 20 million yuan (US$3.15 million) loan taken by another photovoltaic company called Zhongxi, for which Chengxing was the guarantor.
The incident was a sign of the imminent collapse facing the Chinese photovoltaic industry, because of its lack of liquidity and mounting debts, noted First Financial Daily.
. . .
The newspaper quoted US investment bank Maxim Group as warning that China’s top ten photovoltaic companies had accumulated a combined debt of US$17.5 billion and the entire industry was teetering on the brink of collapse.

Source: Want China Times
H/t: Andrew Bolt

It looks like America led the way on this file after all, and Communist China is following us right over the cliff.

Perhaps “green” corporatism – in either tyranny or democracy – is not such a good idea after all.

Cross-posted to the right-wing liberal and Virginia Virtucon

MSM notices the CCP’s hideous “one child policy”

Truth be told, the USA Today piece is a very good sketch on the forced abortion scheme – and the web of corruption that preserves it and profits from it.

The hideous chemical burning of Pan Chunyan’s child (“because the whole body was black and the skin on the face had peeled”) would be enough for outrage, but this little gem of info should not go unnoticed:

Another reason why the policy will probably remain is the army of family planner bureaucrats nationwide who depend on its collateral benefit: It boosts their salaries. Authorities across China collect more than $3 billion a year from “out-of-policy” pregnancies, according to China Economic Weekly magazine. Many Chinese say that money winds up in the pockets of corrupt bureaucrats.

Wu Liangjie raised the $8,640 fee before his wife’s forced abortion, but his payment was not distributed in time to the several government agencies expecting a cut, he says. Since the child was never born, Wu is eligible for a refund, but only if he is sterilized.

This blood-money scheme was what Joe Biden claimed he “fully understood.”

Thankfully, there is a presidential candidate who truly understands this dangerous tyranny.

Cross-posted to the right-wing liberal and Bearing Drift

The real reason the CCP owning so much US debt is a bad thing

I really think Irwin Stelzer should know better. The Weekly Standard economics writer usually leans toward the “engagement” crowd when it comes to the Chinese Communist Party, but he always managed to steer clear of the Kool-Aid.

This time, though, he falls for a different myth, the debt myth.

China can easily turn that feeble recovery into a downturn by cutting back on purchases of U.S. treasury IOUs, driving interest rates up.

Leaving aside the fact that the Fed has told anyone who will listen that they will vacuum up as many T-bills as is required to keep interest rates near zero, Stelzer should know – as Gordon Chang does – that paper power is really a paper tiger.

No, the real problem with the CCP buying so much of our debt is that they can’t stop, meaning the traditional incentives to get serious about deficit reduction (the fear creditors will stop lending) doesn’t apply. Instead of firm warnings from Wall Street or the City (London), we have a regime desperate to keep lending us money in order to maintain their cheap currency and export sectors.

Thus, our day if reckoning will be delayed, but hurt that much harder when it finally comes.

Cross-posted to Virginia Virtucon and the right-wing liberal

Mitt Romney, seizing the anti-Communist mantle

Thanks to the president’s ”hot mic” incident in Russia, more Americans are paying attention to foreign policy – reviewing not just the president’s record, but the views of his would-be Republican opponents. Mitt Romney has come under particular scrutiny, which led yours truly to notice a Wall Street Journal piece he wrote on the Chinese Communist Party last month. My shame at missing this for six weeks aside, Romney’s op-ed makes it abundantly clear: if nominated, he would be the most anti-Communist major party nominee for president in over 20 years.

Romney’s column is an anti-CCP tour de force (to the extent that a pile of words can ever be). Unlike most presidential challengers, Romney does not just simply complain about the Communists’ deliberate cheapening of their currency for export. In fact, the currency devaluation isn’t even his first indictment of the regime. Instead, Romney perfectly distils the situation we face in the second paragraph (emphasis added):

One much bruited these days is that of a Chinese century. With China’s billion-plus population, its 10% annual average growth rates, and its burgeoning military power, a China that comes to dominate Asia and much of the globe is increasingly becoming thinkable. The character of the Chinese government—one that marries aspects of the free market with suppression of political and personal freedom—would become a widespread and disquieting norm.

The verbiage is critical here, in particular, “aspects of the free market.” Far too often, lazy pundits and politicians have assumed China already has a free market. Romney, whose business experience has given him a far better idea of what a free market is – and isn’t – is more circumspect than nearly all of Washington on this score. More to the point, he also sees the regime as the anti-American threat it really is.

As one would expect, Romney is critical of the president. Readers would note that while I have issues with Barack Obama, his East Asia policy has had its high points. Much to my surprise, Romney actually noticed, too, albeit dismissively: “Now, three years into his term, the president has belatedly responded with a much-ballyhooed ‘pivot’ to Asia . . . “

More importantly, Romney also noted where the president has contradicted himself:

The pivot is also vastly under-resourced. Despite his big talk about bolstering our military position in Asia, President Obama’s actions will inevitably weaken it. He plans to cut back on naval shipbuilding, shrink our Air Force, and slash our ground forces. Because of his policies and failed leadership, our military is facing nearly $1 trillion in cuts over the next decade.

Simply put, this is head and shoulders over everyone else running and nearly everyone else who even thought of running for president. Romney’s understanding of the connections between military strength and geopolitics is disappointingly rare among politicians today, but that makes his willingness to connect the dots all the more valuable.

Even in the matter of bilateral trade, Romney is about more than just the depreciated currency. He has been the only candidate for president (for two cycles now) to talk about intellectual property theft, and he mentions it again in this column. No one else has even bothered with this issue.

Romney concludes with the fundamental point about the CCP that I’ve been making for a dozen years now:

We have much to gain from close relations with a China that is prosperous and free. But we should not fail to recognize that a China that is a prosperous tyranny will increasingly pose problems for us, for its neighbors, and for the entire world.

That such a statement would come from a leading candidate for President of the United States was a laughable dream just a few years ago. Now, a president who could argue to having the most anti-Communist East Asia policy since the Tiananmen massacre will (if trends continue) go up against a Republican who has presented the most detailed, nuanced, and intelligent anti-Communist policy for any candidate (current incumbent included) since that same dark day in June.

In short, Mitt Romney, should he be nominated as is increasingly expected, will become thecandidate for anti-Communists in 2012. That is a dramatic and exhilirating departure from just about every other presidential cycle from 1992 onward.

Cross-posted to the right-wing liberal and Bearing Drift