Tag: China

Cargill v. Syngenta: Biotechnology and Trade

On September 12, Cargill, a major commodity trading and processing firm, filed a lawsuit in a Louisiana state court against Syngenta Seeds for selling genetically engineered MIR 162 (also known as “Agrisure Viptera®”) seed corn to farmers. China has not yet approved importation of corn containing MIR 162, so U.S. exports to that country of corn and corn products have come to a halt. Demand for U.S. corn has fallen. Cargill believes its losses exceed $90 million. 

Syngenta’s view?  “Syngenta believes that the lawsuit is without merit and strongly upholds the right of growers to have access to approved new technologies …”. The company’s position is that it has been legally selling seeds containing MIR 162, a trait that provides useful insect resistance, to U.S. farmers since 2010.  Other major corn importers – including Japan, South Korea, Mexico, Colombia and the European Union – have approved importation of corn with the MIR 162 trait. Syngenta has been seeking approval in China since March 2010. MIR 162 has not raised any health or environmental safety issues. 

Cargill’s view is that Syngenta has rendered U.S. corn supplies ineligible for export to China. Corn containing MIR 162 has spread throughout the U.S. marketing system to the extent that it would be expected to be present in any ocean vessel loaded for export:

China Celebrates an Anniversary of Its Dictatorship

Today the People’s Republic of China is celebrating the 65th anniversary of its founding on October 1, 1949, which is likely to produce even bigger crowds of protesters in Hong Kong demanding democracy. China’s opposition to democracy in Hong Kong and in China itself is not just the recalcitrance of cranky old men. It’s part of the Chinese Communist state’s founding mission. 

Take the speech of Mao Zedong on July 1, 1949, as his Communist armies neared victory. The speech was titled, “On the People’s Democratic Dictatorship.” Instead of life, liberty, and the pursuit of happiness, it spoke of “the extinction of classes, state power and parties,” of “a socialist and communist society,” of the nationalization of private enterprise and the socialization of agriculture, of a “great and splendid socialist state” in Russia, and especially of “a powerful state apparatus” in the hands of a “people’s democratic dictatorship.”

Tragically, unbelievably, this vision appealed not only to many Chinese but even to Americans and Europeans, some of them prominent. But from the beginning it went terribly wrong, as really should have been predicted. Communism created desperate poverty in China. The “Great Leap Forward” led to mass starvation. The Cultural Revolution unleashed “an extended paroxysm of revolutionary madness”  in which “tens of millions of innocent victims were persecuted, professionally ruined, mentally deranged, physically maimed and even killed.” Estimates of the number of unnatural deaths during Mao’s tenure range from 15 million to 80 million. This is so monstrous that we can’t really comprehend it. What inspired many American and European leftists was that Mao really seemed to believe in the communist vision. And the attempt to actually implement communism leads to disaster and death.

Use Education to Transform China From Within

BEIJING—China’s university system is growing.  However, the People’s Republic of China still lags behind the U.S. and other Western nations.  Chinese students increasingly are heading to America for higher education. 

While recently playing tourist in Beijing I spoke to a number of young Chinese.  They were bright and inquisitive, ambitious and nationalistic.  They worried about finding good jobs and were irritated by government restrictions on their freedom. 

Beijing’s global influence depends upon domestic economic growth and political stability.  And that ultimately depends upon China’s young. 

The PRC’s university students today are most likely to become the country’s leaders tomorrow.  The number of college graduates has increased to seven million, a four-fold jump over the last decade. 

While the number of universities in China is growing, few have national, let alone international, reputations.  Undoubtedly that will change over time.  Today, however, competition for the few available spots at top schools is extraordinary. 

For instance, Peking and Tsinghua Universities are the only Chinese universities among the world’s top 100.  They have space only for 6000 new students a year. 

Obviously, far more Chinese students could succeed, indeed thrive, at fine universities.  So more than 400,000 young Chinese are heading abroad every year. 

Military Cooperation with China: RIMPAC as a Model for the Future

The Rim of the Pacific Exercise recently concluded in waters near Hawaii.  For the first time China joined the drills.  It was a small but positive step for integrating Beijing into more international institutions.

RIMPAC started in 1971.  This year there are 23 participants, including the People’s Republic of China, which explained that the maneuvers are “an important mission of military diplomacy” and a means to strengthen “friendly relations with countries of the South Pacific through public diplomacy.”

Beijing’s participation comes at a time of significant regional tension.  The PRC’s more aggressive stance in asserting its territorial claims in the South China Sea and Sea of Japan have led to dangerous maritime confrontations. 

RIMPAC offers an opportunity to create some countervailing pressure in favor of a less threatening regional naval environment.  At the political level inviting Beijing to participate demonstrates respect for China’s increased military power and international role.   Doing so also counters the charge that Washington is seeking to isolate and contain the PRC.

Moreover, inclusion hints at the benefits for Beijing of a civil if not necessarily friendly relationship with its neighbors as well as America.  No doubt, the direct pay-off for China from RIMPAC is small. 

But to be treated as an equal and regular participant in international affairs is advantageous.  Although any great power must be prepared to accept unpopularity when necessary, in general a friendly environment is more conducive to ensuring both peace and prosperity. 

Deterring China Isn’t Hard

My op-ed today in China US Focus gives five reasons why the United States and its Asian allies will deter Chinese military aggression for the foreseeable future. The argument responds to commentators who worry that U.S. military spending cuts or passivity elsewhere have damaged our credibility to defend Asian allies and thus encouraged China to use its growing military for conquest.

The bulk of the article concerns the particulars of U.S. military superiority in Asia, and why recent Pentagon cuts don’t much lessen it. One conclusion is that deterring war is easier than you generally hear.

Washington’s foreign policy elites have a narcissistic take on deterrence; they see it teetering with every foreign policy decision that troubles them. But East Asia’s stability remains robust—insensitive to the annual fights in Congress—because war remains a losing prospect for all major powers.

This is a good place to put that conclusion in historical context. Technology and economics have shifted the cost-benefit calculus of conquest, making it generally counterproductive. That is an explanation for the steep decline in interstate warfare. Cold War nuclear history, as I discussed in a recent co-authored report, supports that point. The balance of terror—mutual deterrence—between the United States and the Soviet Union was not delicate. Arms control agreements and shifting nuclear weapons plans barely affected stability. As John Mueller argues, conventional deterrence, reinforced by the memory of the world wars, was instrumental in keeping the peace. Nuclear weapons were largely overkill.

So the pundits now bellowing about the credibility lost because of crossed red lines or Crimea are using a theory of deterrence that lacks historical basis. Deterrence is especially robust in Asia, where water or mountains separate most major rivals, aiding defense of the status quo. Even a total withdrawal of U.S. forces and defense commitments from East Asia wouldn’t create a dangerous imbalance of power there.

Sadly, withdrawal faces high political hurtles today. For now, probably the best we can hope for is that all the beltway consternation about eroding credibility will accidently reduce free-riding. As I put it in the op-ed:

If allies take U.S. commentary about insufficient pivots and failed red lines too seriously, they may worry enough to pay more for their own defense and give U.S. taxpayers a break. Letting them sweat a bit is in the U.S. interest.

For more on these themes, come see Barry Posen discuss his book on U.S. military strategy next week at Cato.

Cyber-Espionage (Not Necessarily Implicating U.S. Agencies) Returns to the Headlines

The Washington Post reported this morning that the U.S. government is “charging members of the Chinese military with conducting economic cyber-espionage against American companies.”  According to the story, Attorney General Eric Holder will “announce a criminal indictment in a national security case,” naming members of the People’s Liberation Army.

If you will recall, cyber-security, cyber-espionage, and cyber-theft of trade secrets and other intellectual property belonging to American businesses started becoming prominent sources of friction in the U.S.-China relationship about 18 months ago before suddenly dropping off the front pages 11 months ago to make way for revelations of domestic spying by the U.S. National Security Agency.  Somehow, the notion that Chinese government-sponsored cyber-theft broached a red line lost some of its luster after Americans learned what Edward Snowden had to share about their own government.

But today the issue of Chinese cyber-transgression is back on the front pages.  Never before – according to the Washington Post – has the U.S. government leveled such criminal charges against a foreign government.  The U.S. rhetoric has been heated and, just this afternoon, the Chinese government responded by characterizing the claims as “ungrounded,” “absurd,”  “a pure fabrication,” and “hypocritical.”

While the U.S. allegations may be true, given well-publicized U.S. cyber-intrusions, it isn’t too difficult to agree with the “hypocritical” characterization either.  Perhaps that’s why the U.S. government is attempting to distinguish between cyber-espionage, which is conducted by states to discern the intentions of other governments – and is, from the U.S. perspective, fair play – from “economic” cyber-espionage, which is perpetrated by states or other actors against private businesses and is, from the U.S. perspective, completely unacceptable.  It’s not too difficult to understand why the United States has adopted that bifurcated position. The Washington Post quotes a U.S. government estimate of annual losses due to economic cyber espionage at $24-$120 billion.

Taiwan Is the Success Story, not China

Which nation is richer, Belarus or Luxembourg?

If you look at total economic output, you might be tempted to say Belarus. The GDP of Belarus, after all, is almost $72 billion while Luxembourg’s GDP is less than $60 billion.

But that would be a preposterous answer since there are about 9.5 million people in Belarus compared to only about 540,000 folks in Luxembourg.

It should be obvious that what matters is per-capita GDP, and the residents of Luxembourg unambiguously enjoy far higher living standards than their cousins in Belarus.

This seems like an elementary point, but it has to be made because there have been a bunch of misleading stories about China “overtaking” the United States in economic output. Look, for instance, at these excerpts from a Bloomberg report.

China is poised to overtake the U.S. as the world’s biggest economy earlier than expected, possibly as soon as this year… The latest tally adds to the debate on how the world’s top two economic powers are progressing. Projecting growth rates from 2011 onwards suggests China’s size when measured in PPP may surpass the U.S. in 2014.

There are methodological issues with PPP data, some of which are acknowledged in the story, and there’s also the challenge of whether Chinese numbers can be trusted.

But let’s assume these are the right numbers. My response is “so what?”

I’ve previously written that the Chinese tiger is more akin to a paper tiger. But Mark Perry of the American Enterprise Institute put together a chart that is far more compelling than what I wrote. He looks at the per-capita numbers and shows that China is still way behind the United States.

To be blunt, Americans shouldn’t worry about the myth of Chinese economic supremacy.

But that’s not the main point of today’s column.

Instead, I want to call attention to Taiwan. That jurisdiction doesn’t get as much attention as Hong Kong and Singapore, but it’s one of the world’s success stories.

And if you compare Taiwan to China, as I’ve done in this chart, there’s no question which jurisdiction deserves praise.

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