The Dalai Lama, Taiwan and China

By S.P.SETH

The Dalai Lama’s recent Taiwan visit was comforting for its typhoon ravaged people. But it infuriated China. An official spokesman commented that, “Under the pretext of religion, he has all along been engaged in separatist activities.”

Elaborating, he said, “Obviously, this is not for the sake of disaster relief. It’s an attempt to sabotage the hard-earned good situation in cross-strait relations.”

Considering that President Ma Ying–jeou has been bending over backward to please China, he obviously made some hard political calculations when allowing the Dalai Lama’s visit.

He was losing political ground to the opposition Democratic Progressive Party from the torrent of criticism in the country over his administration’s slow and tardy response to the devastating tragedy of Typhoon Morakot.

And knowing how close the Ma administration is to China, they must have explained to Beijing their need to contain political damage that might worsen if the Dalai Lama was refused to visit Taiwan in his role of imparting spiritual solace.

Beijing might not have found it satisfactory but the thought of another possible DPP comeback at some point must be sobering.

The Typhoon Morakot has killed up to 800 people, destroyed property and dislocated communities.

In the midst of all this destruction, the government seemed still unsure how best to respond as if the gravity of the situation had not sunk in.

On such occasions when Nature’s wrath strikes, and the government is woefully incompetent and inadequate, people’s minds turn to spiritual nourishment.

The local leaders (mayors and local government chiefs) were more responsive to their people’s need for some sort of spiritual comfort at a time of tremendous grief.

Which led them to invite the Dalai Lama to serve that need.

Whether or not they were politically motivated is not the issue here. The issue is that they spotted the dire need for spiritual solace and decided that the Dalai Lama was the one to fit that role.

And he played that role with great aplomb and sincerity, judging from the people’s enthusiasm at his meetings.

Indeed China too, in its present state of obsessive greed and consequent moral/spiritual void, can use the Dalai Lama for the good of its people to perform such a role.

China’s ruling oligarchy has so demonized him that they refuse to see any role for him. For them he is a separatist, a political monk and a traitor, at worst.

And what has he done to deserve these epithets? Simply because he seeks autonomy for Tibet as part of China.

Which translates into an autonomous Tibet being able to deal with its regional affairs, while the central government in Beijing controls its defense, foreign dealings and currency.

With such sovereign control over Tibet, is it possible to imagine that it would pose a threat to China’s territorial integrity?

In a country of 1.3 billion people, an autonomous Tibet’s population of about 6 million will be a tiny minority.

And if Beijing can be paranoid on this score, then there is something seriously wrong about the polity and psychology of such a state.

Indeed, judging by the Dalai Lama’s public pronouncements he comes out as a very pragmatic and practical man. For instance, he is always hosing down the hotheads in the Tibetan Youth Congress who advocate independence for Tibet.

The Dalai Lama has reportedly said, “But I always ask them: How are you going to attain independence? Where are you going to get the weapons? How are you going to pay for them? How are you going to send them into Tibet? They have no answer.”

This is certainly not a guy who has some delusion of grandeur about Tibet’s capacity to become independent through an armed struggle with the hugely powerful China.

He acknowledges China’s great power role. They already have the “manpower, military power [and] monetary power.” But, he says, “Moral power, moral authority is lacking.”

In other words, China would need some moral and spiritual foundation to underpin its heedless and relentless pursuit of greed.

Because, in its absence, it will lose its social and cultural cohesion and bring on itself the social chaos that its leadership professes to fear so much.

And for this, China can certainly use the Dalai’s Lama’s moral authority.

According to Pico Iyer, who has studied the Dalai Lama over the decades, “…the Dalai Lama has always been adept at pointing out, logically, how Tibet’s interests and China’s converge—bringing geopolitics and Buddhist principles together…”

China, therefore, should tap his spiritual and moral authority and make him a partner in its moral regeneration.

Which would require them to stop demonizing him as some sort of an evil phenomena.

An autonomous Tibet might give some substance to China’s otherwise phony claim of ethnic and cultural diversity.

They should stop waiting for the Dalai Lama to die and replace him with their own compliant nominee.

Indeed, in his death, he might become a more potent symbol of retrieving Tibet’s identity, with not inconsiderable public support internationally.

At 73, the Dalai Lama is still going strong, and is likely to be around for many years.

If Beijing can get over its pathological hatred of him, he might be able to play a useful role in broadening and humanizing China’s image.

And with his considerable spiritual following in Taiwan, he might even be able to play a useful bridging role with the mainland.

The point is that China’s paranoid leadership needs to relax and let Taiwan breathe freely.

Even with a broadly shared culture, people can still decide to live as separate nations. Take the case of Australia and New Zealand. They have the best of relations as separate countries with a shared cultural heritage.

Why can’t China feel more confident with an independent Taiwan, with both countries deepening their shared cultural, trade and other activities?

Granting autonomy to Tibet might be the first step to make China feel more at ease.

Troubled China-India relations

By S.P.SETH

Recent press reports suggest that tensions between China and India are once again on the rise on their disputed border. China claims a vast swathe of India’s northeastern state of Arunchal Pradesh as its territory.

The ongoing border talks between the two countries haven’t done much to resolve the dispute. They simply froze the border dispute to unfreeze other aspects of the relationship.

But it does crop up now and then with renewed tensions to remind the world that all is not quiet on India-China border.

Apparently, things have heated up to a point where Professor Brahma Chellaney, of the Centre for Policy Research in Delhi, has said, “Things are getting really intense and from the Indian perspective outrageous.”

The border issue is part of a much more complex relationship.

Beijing has never taken kindly to the presence of the Dalai Lama and his entourage in India, even though New Delhi regards Tibet as part of China.

At the same time, it infuriates Beijing when India is paraded so often in international talkfest as its Asian rival.

They tend to be dismissive of these claims, considering that China is stronger than its presumed Asian rival.

But Beijing can’t stop the world from projecting India as a competing Asian power.

This has been China’s problem ever since its “liberation” in 1949. India keeps popping up in some way or the other.

New Delhi’s initial role (in the early fifties) to sponsor communist China into international community was grudgingly accepted, but its credentials doubted.

Its role in facilitating autonomy for Tibet in the fifties was regarded as doing the US bidding. And India increasingly came to be seen as an American proxy.

China is unforgiving that India somehow continues to exist as a single national entity. And by virtue of its size and potential is regarded as China’s Asian rival.

Indeed, the successful creation of Bangladesh in early seventies with Indian help, sent Beijing into a rage; with Premier Zhou Enlai questioning (in an interview with a British journalist) the very basis of India’s nationhood, calling it a British creation.

New China News Agency (NCNA) then warned India on December 17, 1971, that others might do to India what it had done to Pakistan.

In other words, India too could be dismembered, apparently with Chinese help.

It was, therefore, not entirely surprising when it was reported recently that a think tank linked to the Chinese military called for India to be split into 30 independent states.

It further said that if China “takes a little action, the so-called great Indian federation can be broken up.”

This (the breaking up of India), in its view, would be in China’s interest, and foster regional prosperity.

And it could be accomplished though the agency of China-friendly countries like Pakistan, Bangladesh, and Nepal helping “different nationalities” (in India) establishing their own independent states.

Beijing is obviously rattled by India’s move to strengthen its military presence along their joint border after reports of Chinese military intrusions, describing it as “unwise military moves.”

New Delhi, on the other hand, has reiterated their joint commitment (with China) to “resolve outstanding issues, including the boundary question, through peaceful dialogue and consultations, and with mutual sensitivity to each other’s concerns.”

How serious is the border situation?

It is serious enough and one cannot rule out border incidents involving some military clashes. China periodically tests Indian resolve and defenses, with increased military activity.

New Delhi is equally determined to hold on to its border posts and territory to deny China any territorial advantage.

These border military clashes, if they were to occur, might develop their own momentum to create a bigger crisis.

But, by and large, it is likely to be a controlled affair.

However, as pointed out earlier, the border dispute is part of a larger problem for China. Which is that India, with its size and potential, denies China the right to become the acknowledged Asian supremo.

Japan is easily dismissed these days because of its chronic economic and political malaise.

Besides, whenever it tries to raise its head, China whacks it down with the stick of its historical guilt. Which Japan has a knack of re-visiting on itself through its insensitivity and incompetence.

On the other hand, despite all its problems, India tends to loom large. Which is terribly annoying for China.

And as long as this is the case, China finds it difficult to fit India into its scheme of things.

The only way out of this predicament is to somehow slice it into different national entities. They will be more manageable like Pakistan, Bangladesh and other smaller neighbors of India.

The problem, though, is that it is easier said than done.

True, India is plagued with some insurgent and rebel movements in its far-flung regions, including Maoist rebels (of Indian variety). But they have been around, in some form or the other, for a long time.

But it does stretch the Indian state and constitutes a serious problem. However, India has managed it so far.

Its democratic political system gives it the necessary flexibility and responsiveness to try autonomy deals of varying success, unlike China dealing with Tibet, and Xinjiang.

But If China could accentuate these contradictions in India, it would pin down New Delhi in its neighborhood and within the country.

China, for instance, could funnel economic and military aid to these rebel movements through countries like Pakistan, Bangladesh and any other country inclined to play China’s game.

China has done this in the past.

But the Maoist policy of creating ‘revolutionary’ disorder was discontinued under Deng Xiaoping to concentrate on China’s modernization.

Therefore, any reversal of this policy to put India in place will require serious deliberations at the highest level.

Because, such adventures can create all kinds of unpredictable complications at a time when China is still in the process of consolidating and expanding its power.

Besides, looking at Pakistan’s parlous state, it doesn’t seem like an effective Chinese proxy against India.

Bangladesh too has its own problems.

At the same time, India might not be an easy pushover.

Which brings us to the threat of creating 30 independent states out of India.

Obviously, it is a warning of sorts to India that China can create serious trouble if New Delhi sought to be ‘unreasonable’.

In the immediate period, this clash might lead to some local clashes.

In the long term, China might continue to question India’s nationhood, and hope for its fragmentation into multiple nation states.

In other words, there is no hopeful scenario for stable China-India relations.

China’s Overkill

By S.P.SETH

Isn’t it ironic that more China becomes a major global player; the more it shows signs of insecurity? One encounters this all the time whether its communist leadership is dealing with dissidents, the Dalai Lama and, more recently, Rebiya Kadeer, leader of the World Uighur Congress.

Rebiya Kadeer (62), who lives in exile in the United States and is the mother of 11 children, is accused of igniting the recent riots in Xinjiang, triggered by the killing of some Uighur workers at a factory in Guangdong.

How she did all this from thousands of miles away in the United States is hard to comprehend! But Beijing is adamant, calling her a criminal, and a terrorist.

Earlier, she spent five years in a Chinese jail even though, at one time, she was said to be China’s richest businesswoman.

The point, though, is that when the Chinese leadership decides to go after some person(s) or group, they don’t worry about the plausibility of their accusation.

Indeed, the ferocity with which they pursue their victim (in this case, Rebiya Kadeer) is breathtaking.

Sample this interview with one Pan Zhiping, a researcher at Xinjiang Academy of Social Science. Talking about Rebiya with the Weekend Australian, she described her as “rotten meat, the kind that only attracts flies… The human rights she advocates are evil rights, murderers’ rights.”

Whatever might be the academic credentials of Pan Zhiping, she certainly is an apt pupil of China’s political establishment.

While an ordinary Chinese academic might verbalize the establishment’s anger, the government always has a ready- made case to condemn their victim.

They have already procured and flashed letters on TV from her two children and other relatives (including some of her grandchildren) to testify that Rebiya started the riots in Urumqi, the capital of Xinjiang.

Does Beijing really think that the world is so gullible as to believe this stratagem of pitting children against their parents?

But Chinese leaders have a history of believing their own propaganda by equating coercive confession as willing admission.

Rebiya’s children are the convenient pawn in this political chess game, and the regime has no moral qualm in these matters.

She said, while visiting Australia, that, “It is shameful that the Chinese Government has tried to turn the children of a mother against her.”

And added, “… It is immoral violence. It is a forgery, transparent propaganda.”

Incidentally, five of her 11 children are living in China. Two of her sons are in Chinese prisons.

Rebiya Kadeer’s Australia trip has infuriated Chinese authorities for allowing a “criminal” and a “terrorist” into Australia in disregard of Chinese representations.

She has been in Australia to attend the premier of a film based on her life (The 10 Conditions of Love) at the Melbourne International Film Festival.

The Chinese diplomatic mission in Australia tried unsuccessfully to stop this documentary being screened in Melbourne.

As a retaliatory measure, Chinese films, that were part of the Melbourne Festival, were withdrawn.

The Australian ambassador in Beijing was summoned to explain, and Melbourne’s Lord Mayor was threatened that his city’s sister-city relationship with Tianjin might be ended.

But the Australian authorities stood their ground both on the screening of the film and the grant of visa to Rebiya Kadeer.

But she hasn’t been granted audience with any of the officials and ministers here.

Rebiya Kadeer has almost overnight become the Dalai Lama of the Uighur people.

Like the Tibetan people, the Uighurs fear ethnic cleansing and cultural decimation.

One must say it defies common sense why China, a strong country of 1.3 billion people, cannot devise a workable policy of accommodating its ethnic minorities like the Tibetans and the Uighurs?

But then the Communist Party of China has always sought to deal with its presumed enemies by demonizing them.

Which brings us to the insecurity inherent in a system where the ruling party has monopoly power.

The CPC’s insecurity borders on paranoia. It believes that it alone can ensure social stability and consequent economic growth in the country.

Hence, any challenge to its power is a challenge to the nation, because both the party and the nation are indivisible.

And Beijing demands utmost loyalty not only from Chinese citizens but also from citizens of other countries with Chinese descent.

The party is, therefore, seeking to rally overseas Chinese as well around the flag. Which is a dangerous exercise, as it tends to elevate national chauvinism to a transcendental level.

At a recent congress of the overseas Chinese, Wang Zhaoguo, a Politiburo member, reportedly called on the delegates to use “blood lineage” of their common Chinese descent “to achieve outstanding results in uniting the broad masses of overseas Chinese.”

And to emphasize the indivisibility of national and party interests, he told the delegates to “do a better job of uniting the force of the circle of overseas Chinese around the party and the government.”

This is quite a dangerous exercise that Beijing is embarking on quite openly.

The Chinese diplomatic missions are already quite active in organizing and mobilizing overseas Chinese in their respective countries. This happened during the anti-Tibetan rallies and about the time of the Beijing Olympics.

But Wang’s brazenly open call on the Chinese citizens of other countries to rally around the flag, the party and the government is a sinister development.

Has Beijing realized that this could create a backlash against Chinese living in other countries by raising concerns about their loyalty?

And if Beijing persists with such politics, it won’t be long before some of them start being seen as a potential fifth column.

China might feel emboldened that with its new reach and power, the benefits of rallying millions of overseas Chinese around the flag far outweigh any potential danger from hostile reaction in other countries.

It probably thinks that no Asian country (where most of the overseas Chinese live) will dare create trouble for its “blood lineage” for fear of crossing China.

If this is the line of thinking dictating China’s policy, it is not a good omen for the region and the world.

Such overkill is the mark of a blustering but essentially paranoid country.

Sino-Australian Relationship in Crisis Mode

By Sushil Seth

Who would have thought that Australia’s relations with China would nose-dive under its Mandarin-speaking Prime Minister, Kevin Rudd? The question therefore is: what happened for things to reach a crisis point?

Before we analyze the state of Sino-Australian relations in some detail, one point needs to be emphasized. Which is that, after Kevin Rudd became Prime Minister, expectations were high on both sides.

Rudd believed that as China’s friend, and one who saw himself well versed in Chinese culture, he had some latitude when speaking to Beijing frankly even about issues (like Tibet) that will annoy them.

Beijing too seemed well inclined toward Rudd, being the only leader of a Western country with fluency in Mandarin and proud of it.

And they naturally thought that he would be sympathetic to China’s interests.

But things started to go wrong not long after Rudd became Prime Minister.

Even though he chose China among the first countries (and the first in Asia) that he visited, thus rattling Japan particularly; Beijing was not amused when Rudd publicly told them, during a Beijing University address, that frankly “there are significant human rights problems” in Tibet. And advised them to recognize this fact and deal with it.

Even as he claimed to be China’s friend he, nevertheless, continued to emphasize the primacy of Australia’s strategic alliance with the United States.

Beijing, of course, wasn’t expecting any sudden change in Australia’s primary political and security relationship with the United States.

But, it did expect that, under Kevin Rudd, Canberra wouldn’t stand in the way of Chinese investments in the crucial resources sector, particularly iron ore.

China is now Australia’s top trading partner, ahead of Japan. It is devouring Australia’s commodity exports, particularly iron ore.

According to one estimate, iron ore comprised 18 billion dollars (Australian) of Australia’s 32.5 billion exports to China last year.

With the global economy spiraling (until recently), and the demand for commodity prices high, China’s insatiable demand for iron ore hiked up its price several times, with huge profits reaped by Australian companies like Rio Tinto.

China was not happy. It wanted to control both the supplies and pricing of iron ore; with Australia as a major global supplier along with Brazil.

To this end, Beijing sought to double its stocks (share holding) in Rio Tinto, taking advantage of its debt problems. But, Rio Tinto backed out of the deal at the last moment, having made up with BHP, another Australian mining giant that, only a short while ago, wanted to gobble up Rio Tinto.

China was thus left high and dry, and fuming, it would appear.

Beijing feels that the Australian Government played a role in scuttling China’s investment by delaying its approval. Which, it regards as discriminatory against China.

Whether or not the Australian Government twisted Rio Tinto’s hands is not the question here. Because, most countries (China, even much more) wouldn’t like another country’s instrumentality having a controlling share in its strategic resource sector.

However, China cries foul and is not happy with Australia. Indeed, they seem angry and vengeful at the way, in their view; Australia has sought to fiddle with China.

Even as things were getting tangled with Rio Tinto, the global economic crisis lifted the pressure on commodity prices. China wanted Rio Tinto to reduce its iron ore prices by over 40 per cent, refusing to accept a 33 per cent reduction as agreed with Japan and South Korea.

With the wrangling over the price of iron ore still continuing, Chinese authorities arrested Stern Hu (a Rio Tinto executive in China, carrying an Australian passport) and three other Rio Tinto employees who are Chinese citizens.

They are accused of bribing executives of Chinese steel mills and stealing state secrets to damage China’s economic security.

It is now become a state security matter, and not simply an ongoing negotiating process about the price of iron ore.

However, the arrested Rio Tinto employees have not been formally charged, as we report.

And Australia is being largely ignored, with its approaches in the matter being regarded as interference in China’s “judicial sovereignty”.

To cap it all, the matter has become highly politically charged in Australia’s domestic politics, with the opposition taunting Kevin Rudd to pick up the phone and talk directly with the top man in China, obviously referring to President Hu Jintao or Prime Minister Wen Jiabao.

The implication here being that Kevin Rudd made much politically of his magic touch with China, and now is the time to deliver.

But China has told Australia publicly to butt out and let its judicial process take its own course.

Beijing is virtually telling Canberra that they should forget about Stern Hu and his colleagues, whom they have already pronounced guilty of bribery and stealing secrets.

They are already being branded as traitors by Chinese bloggers.

There are two schools of thoughts in Australia on the question of dealing with China. First, and the one sympathetic to China, would like Australia to cave in, not only because China is a regional giant but also because commodity exports to China are increasingly the bread and butter of Australia’s economic lifeline.

This school includes a good number of Australian Sinologists, as well as some strategic analysts.

The second school, reflected in the government policy so far, acknowledges the growing importance of China’s economic connection but argues (as did Prime Minister Kevin Rudd in a recent statement) that the importance of Sino-Australian economic relationship cuts both ways, since China needs what Australia has to offer.

Besides, if Canberra were to make a humiliating back down on the iron ore issue (ignoring the arrest of Stern Hu and his Chinese colleagues as well), it would mean that in future its economic policy (where it concerns China) will increasingly be dictated by Beijing.

In a larger sense, Australia will become part of China’s regional sphere of influence thus undercutting its US alliance and much more.

As one prominent Australian columnist has written, “Australia’s greatest strategic challenge: how to manage a successful relationship with China as a repressive state that rejects our values, legal system, governance and US alliance.”

Sino-Australian relationship has been brought to a crisis point with the arrest in Shanghai of four Rio Tinto employees, one of them an Australian citizen.

China is using this to intimidate Australia into submission.

It has been unhappy with Rudd’s Australia for a variety of reasons, including its softness for the Dalai Lama.

This annoyance must have turned into anger after the recent unofficial visit of a bipartisan parliamentary delegation to visit Dalai Lama in his Dharamsala headquarters in India.

To compound it further, the Melbourne International Film Festival is screening a documentary about Rebiya Kadeer, the Uighur leader in exile in the United States.

Beijing calls her a terrorist and holds her responsible for the recent violent unrest in Xinjiang.

A Chinese consular official reportedly rang the director of the Film Festival, demanding that the documentary be dropped.

This is not all. Rubiya is coming to Australia for the premier of her documentary and has plans to canvass her people’s cause with the government here.

China has, however, withdrawn some films due to screen in the Festival. And Chinese hackers have been at work to damage the web site of the Melbourne Festival.

At a strategic level, the new Australian defense white paper has apparently angered China even more by suggesting that a rising China could threaten Australia’s security as it overtakes the United States as the world’s largest economy around 2020.

Which means, “by 2030, any changes in economic power will affect the distribution of strategic power.”

Coming back to the Rio Tinto issue, Australia has sought to internationalize it by pointing out to Beijing that it could affect its commercial interests worldwide with the brazen arrest of the employees of an international corporation.

The United States has already raised the issue with Premier Wen Jiabao during the recent China visit of its Commerce Secretary, Gary Lock.

It would seem that Sino-Australian relationship is in for a rough ride for quite some time to come. How it will be resolved is anybody’s guess.

China’s “Harmonious Society” ?

By Sushil Seth

Interestingly, President Hu Jintao’s “harmonious society” is not featuring as prominently in the official Chinese propaganda as it did a while ago. It is not surprising, though, considering that China is experiencing considerable social unrest in different parts of the country.

And it is not just due to the current economic downturn, which certainly is making things worse. The economic slowdown, for instance, has worsened the employment situation, sending millions of rural migrants back to the countryside where things are even worse.

The diversion of resources from the rural hinterland to develop an industrial economy had already created a wide gap between the countryside and the urban areas.

Apart from arbitrary local taxes and entrenched corruption among party hacks, people in rural areas had their land taken away (with little or no compensation) to make it available for the needs of the industrial economy.

The diversion of water for urban use and/or its pollution from industrial chemical wastes further damaged rural economy and living.

It was such pillaging of rural assets to subsidize urban economy, which forced millions of rural migrant workers to flock to the urban industrial centers in search of jobs.

And since these workers were not entitled to social and legal benefits of urban residency, they were easy prey for employers and virtually anyone else powerful enough to screw them.

They were paid abysmal wages (and that too held in arrears in so many cases), with little or no recourse to any legal process.

That they still came in millions to work in urban ghettoes is a sad commentary on the state of the rural economy.

This is how China’s economy became internationally competitive, making it the factory of the world.

Commenting on the axis between the Party elites and developers, Zhao Ziyang (who was deposed as Party general secretary for opposing the 1989 Tiananmen massacre and then spent rest of his life under house arrest until his death) reportedly said (Zhao Ziyang: Captive Conversations by Zong Fengming]:

“The government seizes land from the people, pushing the price down to a minimum, then hands it over to developers to sell it at a huge mark-up…”

The result is: “…we now have a tripartite group in which the political elite, the economic elite, and the intellectual elite are fused.”

And it is, “This power elite [which] blocks China’s further reform and steers the nation’s policies toward service of itself.”

But popular resistance has been building up for a number of years now. In December 2005, for instance, a riot in the southern town of Dongzhou against plans to build a power plant on land taken without compensation, resulted in the killing of 20 people fired on by the security forces.

Lately, there have been instances of protests organized across some provinces, as in the case of taxi drivers’ strike against the high cost of renting their cabs. And many more which go unreported.

The cumulative economic and social pressures over the years, and the desperate need for some political outlet to air their grievances, is starting to even fray the tripartite bond between the “political elite, the economic elite, and the intellectual elite” of Zhao Ziyang’s description.

The most telling example was the signing of the Charter 08 last December by several thousand Chinese intellectuals and others seeking the end of one-party rule and its replacement by real democracy based on freedom, respect for human rights, equality and rule of law.

As usual, the Chinese government tends to further tighten the system to suppress dissent, while obfuscating the issue of political freedom with platitudes.

Its recent example is the so-called 2-year human rights action plan (National Human Rights Action Plan of China, 2009-2010) to make government more responsive to popular concerns about governance.

But the document is silent on the question of freedom, an independent judiciary and political plurality by way of competing political parties to challenge the monopoly of the ruling communist party.

The document focuses instead on improving the situation within the existing system of one-party rule.

The point, though, is that in theory the Chinese constitution already incorporates democratic provisions. But, in practice, it doesn’t work like this because the party interprets it to suit its own power imperatives.

The question then is: why would anyone believe that the new action plan (notwithstanding its specified 2-year duration) would work any better than the much comprehensive constitution of the country?

As an example, all the provisions of the constitution are easily nullified through the system of administrative detention without trial, imposing sentences like “re-education through labor”.

The arbitrariness of the system under one party-rule, where everything goes if the party or its minions so decree, has slowly built up resistance within the populace to corruption and capriciousness of the powers that be.

Li Datong, a Chinese political analyst, recently told a visiting scholar in Beijing, “The government has been skilful in convincing the middle class it’s futile to protest… but you only need one spark for that to change.”

Whether the present economic crisis would provide that spark is difficult to say. What one can say is that it certainly is another building block, and a significant one at that, in the growing social unrest in the country.

Because the political system is so top-heavy and unresponsive, there are no built-in safety valves to let off steam through mass protests. And there is very little transparency and accountability.

In a recent investigative reporting of China’s mining disasters with workers killed all too often, the New York Times quoted Hu Xingdou, an economics professor at the Beijing Institute of Techonolgy:

“We don’t have the grass-roots democracy; we don’t have independent labor unions; we don’t have checks and balances, we don’t have any system of official accountability.”

Hu’s observation sums up what is wrong with China in essence.

Which means that unless the political system develops grass-roots democracy, it will remain prone to periodic sudden shocks.

And in the absence of institutional democratic shock absorbers like popularly elected assemblies, a free media, independent judiciary and rule of law, China will remain a punters’ game.

Will China Revive Global Economy?

By Sushil Seth

As the global economic meltdown continues to defy any rational solution apart from what, sometimes looks like throwing good money after bad, there is some naïve belief that China might become the ultimate savior with its economic stimulation program.

Lately, the estimates of China’s economic growth vary anywhere between 6 to 9 per cent; not bad considering that much of the world is in a recessionary mode.

If true, it might not be long before China again is able to reach the double-digit growth that has characterized it in the last few years.

As with everything Chinese these days, there is a tendency to look at the rosy side of things.

And with the world in economic doldrums, the tendency is even greater to look for a glimmer of hope somewhere. China appears to hold that promise.

But to extrapolate China’s growth as a vehicle for global recovery is like believing in the tooth fairy.

Leave aside the world; even for China its present economic strategy is a bit dubious. The entire growth strategy of state directed largesse into infrastructure projects and the likes is a stopgap arrangement.

It is based on the hope that, as in the past global recessions, the world economy will soon recover to create demand for China’s falling export sector.

Until then, the generous state spending on infrastructure and other state directed projects would hold the fort, hopefully staving off growing social instability.

But there are problems with this line of thinking. Japan’s experience during its decade or more of infrastructure spending is instructive in this respect.

Japan tried infrastructure spending (some good but much of it dubious) to lift its economy during its long period of economic slowdown/stagnation, but with unflattering results. In the end, Japan was helped by its robust export sector.

In other words, because the global economy was healthy and growing, Japan could plug its export sector into it to keep ticking.

Besides, Japan’s domestic spending (even though sluggish) constituted a large proportion of its GDP.

But, in the case of China, the picture is quite different.

First, the current global recession is unlike the ones before it. The previous recessions were short-lived and the economies rebounded with greater vigor.

Therefore, China was able to expand its export sector, with only a short diversion at times into large scale infrastructure spending.

The current global recession, though, is systemic steeped in a mountain of private and public debt. It is, therefore, not going to be short-lived phenomena.

And if and when it recovers, it is going be slow and painful.

Which means that the world, particularly the United States with its seemingly insatiable demand for Chinese goods, is unlikely to pick up the tab on Chinese exports with the same alacrity.

And if China’s is looking for economic nirvana through a revived export sector after a relatively short global recession, it is likely to be disappointed.

At the same time, its state directed investments in infrastructure and bank lending are not a real solution. It is basically filler until normalcy returns, which is more like wishful thinking—at least in its old form-- than a hardheaded policy.

What it means is that instead of being a vehicle of global economic revival, China has to think more in terms of reviving its own economy in a more meaningful way.

The present infrastructure spending, as part of nearly $600 billion stimulus package, will help but it is not going to fix up China’s problems. Therefore, it needs to stimulate its domestic consumer spending.

It has successfully managed to depress or contain economic demand at home to produce exportable goods at cheaper prices with a skewed exchange rate. That option is now constrained because of the deep global debt crisis.

Therefore, it has to stimulate its domestic consumer economy. But there are two problems here.

First, China, both at the government and private level, puts great store by a high rate of saving of about 30 per cent.

From the government’s viewpoint, a high rate of saving with low interest rates for its savers, contributes to China’s low cost economy.

And with high private savings as a cushion against adversity, China has been able to manage with the minimum spending on social services and health of its people.

This must change. China needs to modernize its social spending to take greater care of its people’s education, health, old age and related services. This is long overdue.

The expansion of the social services sector will create domestic demand for a whole range of jobs and goods with a multiplier effect on the economy.

More than anything else, China badly needs to revive and upgrade its rural sector. It can no longer afford to use its depressed rural economy to subside urban industrial sector.

If it wants to create a broad based and sustained domestic economy, it needs to put more resources into rural economy.

This is necessary not only to bridge the urban-rural gap, but also to expand domestic economy through increased consumer demand beyond the urban middle class of about 300 million people.

It is important to note that nearly 800 million or more of China’s rural folks have been largely left out of China’s industrial economy.

An expanded domestic economy will also create demand for foreign goods, once China undertakes to revalue its currency to better reflect the international exchange mechanism.

There is need for China to shed its hoarding mentality of building up currency reserves, and large domestic savings for some sort of a rainy day. It is no longer vulnerable to foreign manipulation and occupation of the 19^th century.

A reinvigorated Chinese economy with a strong domestic base can play a useful role internationally.

But with its historical baggage of a “century of humiliation” and a Leninist political system, it might not be able to deliver.

COMMENT: CHINA THROWS ITS WEIGHT

Who thought that China and Australia would get involved in a diplomatic spat under Australia’s Mandarin-speaking Prime Minister, Kevin Rudd? He was supposed to be the good guy to put relationship between China and Australia on a special footing. What went wrong, then?

The immediate context is the arrest in Shanghai of four Rio Tinto employees, one of them an Australian passport holder. China has accused them of stealing state secrets to damage Chinese interests.

For China, Rio Tinto is becoming the symbol of Australia’s ugly side by not letting Beijing play a determining role in the pricing and supply of its much-needed (by China) raw materials, like iron ore.

China felt spurned when its bid to increase its stake in Rio Tinto was thwarted. It is chagrined further that Australia is not agreeable to about 40 per cent reduction in the price of iron ore as demanded by China.

China expected a lot from Kevin Rudd. But, instead, after coming to power, he politely told China during his Beijing visit to explore a dialogue with the Dalai Lama, compounding China’s fury in the wake of Tibetan unrest last year during 50^th anniversary of its occupation by China.

And China is not amused that Australia’s defense white paper seems to suggest that China’s rise and the consequent US decline could become unsettling for the region, particularly necessitating “fundamental reassessment” Australia’s strategic assumptions.