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Kim Jong-il receives personal letter from Bush – What happened to all that optimism from the Bush Administration a week ago? Update

Large Sino-French deals – It seems France wanting to end the arms embargo against China is part of larger economic trade negotiations to the tune of $17.4 billion.

Uganda: President Museveni Meets Rice in Ethiopia – Leaders of Africa’s Great Lakes Region speak with Sec. Rice about greater security, especially in regard to rebel groups and terrorists.

The Manchurian Incident, the League of Nations and the Origins of the Pacific War. What the Geneva archives reveal – An interesting re-reading of history concerning the “Manchurian Incident”.


This is supposed to be for “rogue” nations like North Korea, which shot a missle over Japan in 1998, scarying the s–t out of most of the Japanese I know.  However, there are over 50K U.S. troops based in Japan and the CCP has always looked at Japan as a potential threat, directly or launch pad for a U.S. attack.  I’m guessing the CCP is concerned that if they have to go to war over Taiwan their missiles will not be a deterrent to U.S. interference, due to the Missile Defense Shield.   This is the “elephant in the room”, that no one wants to talk about publically.  As the article stated, there will be no strong reprecusion from this other than Beijing building a larger quanity of sophisticated missles.  😦


Japan bolsters missile shield around Tokyo

The Associated Press
Tuesday, December 4, 2007
TOKYO: Japan has deployed two missile defense detachments and plans major drills around Tokyo and its first sea-based interceptor test off Hawaii this month, underscoring its missile race with neighboring North Korea and China.

The moves cap a decade-long effort by Tokyo, with the strong backing of Washington, to create the region’s most advanced ballistic missile defenses.

Defense Ministry officials said Japan was installing its second PAC-3 Patriot missile defense system at an air base just east of Tokyo. The first was set up west of Tokyo in March, and nine more will come online around the country by March 2011.

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This is not shocking to me at all. I know a lot of Japanese people who are “annoyed” with America’s politics, this might change after Bush is gone though.

Record 20% of Japanese say U.S.-Japan relations not good


THE ASAHI SHIMBUNA record one in five Japanese says relations between Japan and the United States are not what they should be, according to a survey released Saturday by the Cabinet Office.

However, more Japanese feel that relations with South Korea and China are improving, compared to last year’s poll.

The percentage of Japanese who feel the country’s relations with the United States are still good decreased to 76 percent from 83 percent in October 2006. Those who said Japan-U.S. relations are not good increased to 20 percent from 12 percent.

Those who said Japan-South Korea relations are not good dropped to 45 percent from last year’s record-high 57 percent. Those who said the relations are good rose to 50 percent from 34 percent.

The poll also said 26 percent of Japanese regard Japan-China relations as good, up 4 percentage points from last year.

The poll on Japan’s foreign relations was conducted in October, covering 3,000 people aged 20 or older nationwide. A total of 1,757 people, or 59 percent, gave valid responses.(IHT/Asahi: December 3,2007)

Le Roi Soleil as a Responsible Regional Player: L’Affaire Kitty Hawk Michael Turton has an interesting take on the Hong Kong/U.S. Navy Incident.

Michael is unabashedly pro-Taiwan and pro-DPP, and although I feel indirectly calling Chinese leaders “children” is over the top, he generally has an excellent global take on most topics in this area, even if I disagree with his analysis of the facts.

He did mention something that I have not read about before, the U.S. Congressional reaction. Apparently, Republicans in the House Armed Services Committee are calling for a re-assessment of America’s relationship with China. Even in the current Sino-phobic environment on Capital Hill, I do not think much will come of this, as too much money is flowing between countries and Neocon Hawks no longer control Congress.

I reject the idea that China is acting as if it is still the Middle Kingdom and sending orders down to barbarians as if Hu were on the Dragon Thrown of old. All of that is hyperbole. I think, Michael, in this Pro-Taiwan Ecstasy, fails to see the power relationship between America and China is not one of equals, not economically; politically; or militarily; and this, as well as vast cultural differences, should be factored into any signaling from China. That being said, China has a right to display displeasure with the United States over issues they find contrary to their national interest. America would not tolerate China flying spy planes 2 miles off our border, bombing our embassies, funding armed groups in Hawaii we see as rebels, awarding medals to those we consider separatists, etc. Unlike China, we can do more than “deny entry to a port” and likely would. So China’s response is rather tame.

One thing I do know. In this world people (and nations) will not respect you unless you make them. Power respects power.

PS: As far as the Vietnam angle, who cares? Vietnam has been sending officials to kowtow to China since the early 1990’s. They are not about to make serious waves with China at this point. For more on that see Kenny (2002).

That’s right. It was not an bureaucratic accident, China has been denying American Navy access to Hong Kong harbor as punishment for U.S. for arms sales to Taiwan at such a sensitive time in Taiwanese-Mainland relations and Bush awarding medals to the Dalia Lama for political reasons. As the article mentions China has not sent this strong a message of displeasure since we (mistakenly) bombed the Chinese embassy in former-Yugoslavia in 1999. I remember that clearly, as I lived in Shanghai at the time and was warned to stay in my room that day due to threat of violence. Luckily for me, most people assumed only white people were American (including the German and French students at my school) and I was from Africa. No one bothered me, well they just stared as they normally did.

There was also the time were American the American spy plane crashed off the coast of China, in international waters, which came to be known as the “Hainan Incident”, where China held America survivors for a few days, insisting that America apologize (shuo keqi).

It is obviously the CCP is more concerned about the Taiwanese issue then they are letting on in the media. I’m sure Taipei is watching this closely. Since the 17th Party Congress, Beijing has taken a conciliatory tone toward Taiwan, but I am wondering how long that is going to land, as the Taiwanese seem to have rejected the overtures.


November 30, 2007

China Explains Decision to Block U.S. Ships

BEIJING, Nov. 29 — China denied permission for a United States aircraft carrier battle group and other American warships to visit Hong Kong last week because of the Bush administration’s proposal to sell upgrades to Patriot antimissile batteries to Taiwan, Chinese state media said today.

Beijing also said today that Foreign Minister Yang Jiechi had not told President Bush in a meeting Wednesday that the decisions to deny the ship visits were a “misunderstanding,” as the White House had reported after the talks.

“Reports that Foreign Minister Yang said in the United States that it was a misunderstanding do not accord with the facts,” a Foreign Ministry spokesman, Liu Jianchao, said in Beijing today, adding that China had “grave concern” over United States weapons sales to Taiwan.
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Japan Times has an interesting editorial on Japan-Taiwan relations, specifically in regard to Japan’s duty to support its democratic neighbors. For those familiar with Japan and Taiwan’s relationship, there is nothing new there.

To be honest, although I morally side with Taiwan, my pragmatism tells me they are fighting a hopeless battle. It would be more practical for Taiwan to negotiate with China now, while China is still relatively weak, then to wait 15-20 years, when China is strong and even more nationalistic than now. At the same time, as time passes, Taiwanese feel even less fraternity with the Mainland, due to generational drift. Taiwan might get a better deal than Hong Kong…a type of federation type structure. The longer this drags on and the stronger China gets the less likely they will feel so “giving” and the greater chance for conflict.

Taiwan has 23 million people; it is an economic powerhouse, but almost completely isolated diplomatically as most nations recognize it as a part of China; 110 miles (180km) off the coast of China; and heavily integrated into Mainland China economically.

China has 1.3 billion people; the manufacturing hub of the world; nuclear capable; a very large army that is growing in its ability to project force; with an economy that will soon be the 3rd largest in the world and it has not come close to peaking; with a populous that is highly nationalistic and believes Taiwan to be an inseparable part of their nation; and with a government that can not afford to “lose face” over the issue again.

You can do the math from there. I believe that economics drives politics most of the time, and too much money is changing hands with China to go to war with it over Taiwan. Democracy in a small nation like Taiwan is secondary to the national economic interests of most of the major players in this issue (Japan and the U.S. or the EU for that matter).

There was another interesting article concerning Japan, Taiwan, and South Korea that stood out. It it quite obvious that the Taiwanese and South Korean elites do not want American forces out of Asia in 2007 either.

The documents, found at the U.S. National Archives by Yasuko Kono, a professor of Japanese political and diplomatic history at Hosei University in Tokyo, show that some of the well-known U.S. reluctance in those days to return Okinawa without keeping its forces there nuclear-capable was in part due to demands from Seoul and Taipei, which at the time faced threats from the Soviet Union, China and North Korea.

Despite the South Korean and Taiwanese objections and the U.S. reluctance, Okinawa was returned to Japan in 1972 after Prime Minister Eisaku Sato and U.S. President Richard Nixon agreed on Nov. 21, 1969, on its return with the U.S. giving up the right to use military bases in the prefecture as it saw fit, including maintaining atomic arsenals, as was the case during the occupation period.

Hat tip to Michael Turton.

Government seeks WTO pledge – Taiwan wants China to be fair in trade negotiations.

Police crush largest ethnic Indian protest in Malaysia for years – This is very interesting. I do not know much about Malaysia outside of its relationship with Singapore over the last 40 years. It is interesting to see that Indians are having such problems, whereas in Singapore it is the Malay who are on the “demographic bottom”. Unlike the Chinese, from what I know, overseas Indian populations have very mixed results in their aggregate standard of living. Overseas Chinese are generally at the top of the demographic statistics in every nation they live in outside of China.

Senior political advisor expects closer China-ROK trade ties – I wonder how this increasing integration will effect the current trade problems ROK is experiencing.

Graduates can only dream of being boss – New grads in China dream of being their own boss. I do not find that shocking as China has a very long history of entrepreneurship. Most of the Chinese I know (born outside the U.S.) do not want to work for other people longer than it takes to learn the business, so they can go into business for themselves. I’m glad to see 50 years of communism has not killed that attitude on the Mainland. I am also glad that China realizes there are significant barriers to entry, and I have long argued that the state can do more to ease these issues by streamlining government red-tape and improving the efficiency of capital allocation, especially between provinces.

Greenback decline has ripple effects – China worries that the USD decline could cause inflation and speculative investment in their market. China has already raised their interest rate 5 times this year in an attempt to cool their economy.

Judicial reforms ‘yield good results’ – Its a start, but they have a long way to go. I’m glad they are doing this slowly so that it becomes cultural overtime. Russia did their reforms fast and look at how their court system is. CORRUPT. Changing laws and fronting a democratic system does not automatically change the foundation, building up real institutions takes time.

Putin reacts to NATO ‘muscle-flexing’ – Put appears to be talking tough. There are multiple messages aimed at different audiences, a domestic audience, to rally nationalism; a show solidarity with China (through the Shanghai Cooperation Organization); and a message to the newer Eastern European NATO members, as well as the U.S., that Russia is not a “push over”.

Ian Smith, white supremacist in Rhodesia, dies at 88 – Not much to say about this other than his hell will be to spend eternity with Mugabe. Hopefully he is not far behind old Ian. Good luck with that $*#*@

Stocks tumble as oil hits record high – The downward spiral continues from yesterday.

HIV case double in Beijing – This is still quite small by American standards. If you want to see Southern African style HIV infection rates come to Washington D.C.   I’m sure the CCP does not want things to get out of hand though.  I’m not sure how things have progressed on this front in China, being I have not been there since 2002, and was not dating at that time. When I lived there in 1999, there were not that many people using condoms, and I remember STDs were increasing in Shanghai at that time due to increasing prostitution.  The article cited that the majority of new cases were “migrants” and I’m guessing they are mostly male and frequent prostitutes when they have the money.  There is also IV drug use going on, which the CCP, claims is responsible for most of the HIV cases in Yunnan, not sure about the rest of China though.

The U.S. and the EU can keep crying. As the article states, and as I know, China will not be easily budged on this issue as their primary concern is Chinese uplift. Their immediate concern is the societal stability and international clout that continued economic development can bring.

Their primary trading partners in the region also do not want China to reevaluate as they have become more integrated economically with China, a reevaluation of the Yuan (Renminbi) would cause inflation. China is currently the largest (or close to) import trading partner of Japan, S.Korea, and Singapore. On the other hand, China does not import nearly as much stuff from these countries as they export, often because these countries finish goods in China and then import to their home market. I do wonder about the countries in ASEAN that direct compete with China though, there opinion might be different.

For China, floating the Yuan or manually increasing the value (monetary policy) will only serve as a catalyst already rising inflation . China has also been trying to generate demand in their home market, by expanding economic opportunity to the inland regions. Since China has 1.3 billion people, unlike smaller nations in the region (i.e. Singapore) or in Europe and much like the United States they have enough potential people to generate a massive economic growth on their own without the intense reliance on exporting. High inflation is an anathema to that goal.

America will also experience some inflation behind this, being that 16% of our imports now come from China (second only to Canada). How much, I’m not certain. This is all political, the American economy is on the verge of stalling and politicians want to point a “nationalist finger”. Reality is, as long as Americans consume above and beyond their means, often from foreign sources, and the U.S. dollar is used as a foreign reserve around the world we will have a trade deficit, especially with China.

As long as it is politically un-sexy to speak in nuance about our trade and monetary policies as compared to our overall foreign policy in the Pacific Rim and how one of those goals is a stable China, America will always be chasing its tail, just as we did with the Japanese in the1980’s. I often wonder how much of this “outrage” over China would not exist if China was in Western Europe. Shinaro Ishihara asked that question about Japan’s trade problems with the West 15 years ago.



Realigning the yuan: Resistance from G-20

Friday, November 16, 2007


FRANKFURT: At a Group of 7 meeting this autumn in Washington, the United States persuaded Europe to join its strategy of leaning on China to revalue the yuan upward, a step that would help ease the pressure on the beleaguered dollar.

But on the eve of a similar meeting of officials from a much bigger group of countries, that achievement may be a tough feat to repeat.

Instead, turbulent currency markets are likely to dominate the meeting of the Group of 20, which comprises central bankers and finance ministers, this weekend near Cape Town.

The forum was created in 1999 to coordinate policy between the major developed economies and the major developing ones.

Heading into the meeting, the United States and top European countries are walking in greater lockstep than ever before, having agreed that the heart of their common problem is China. Beijing suppresses the value of its currency, keeping its exports cheap.
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A few weeks ago I blogged on Taiwan’s quest for UN membership and some interesting protests in regard to China’s opposition. Although the Bush administration is firmly against Taiwan’s entry as a “state” would violate the One-China Policy, resulting in a major East Asian security upset. It seems Taiwan has found new support in the U.S. Congress. I do not believe this resolution will pass, as China has firm bipartisan support, despite the grandstanding over “poison toys”. Too much money is changing hands across the Pacific to allow a little thing like a democratic nation of 23 million people get in the way. Nobody is going to be allowed to rock that boat.


Published on Taipei Times

US Congress proposes UN bid support

BACKING THE BID: The representatives co-sponsoring the resolution include some of Taiwan’s biggest supporters such as Scott Garrett, Tom Tancredo and Steve Chabot
By Charles Snyder
Sunday, Nov 11, 2007, Page 1 Complaining that the human rights of the people of Taiwan have been “severely abridged” by the exclusion of the nation from the UN, a group of 19 US representatives introduced legislation to support Taiwan’s membership in the global body.

It is the sense of Congress that “Taiwan and its 23 million people deserve membership in the United Nations,” the measure declared.

“The United States should fulfill the commitment it made in the 1994 Taiwan Policy Review to more actively support Taiwan’s membership in appropriate international organizations,” the resolution said, adding that the UN should be included among those organizations.

“Taiwan has dramatically improved its record on human rights and routinely holds fair and free elections in a multiparty system, as evidenced by Taiwan’s second [sic] democratic presidential election in 2000 and 2004, in which Mr Chen Shui-bian [陳水扁] was elected as President,” the resolution said.

“The 23 million people in Taiwan are not represented in the United Nations and their human rights as citizens of the world are therefore severely abridged,” it said.

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