Tag: Politics

Safety First: A New Mantra for America

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I don’t ever watch the news on TV.  Maybe once a month, generally while sitting in a waiting room of some sort where you can’t help but listen to the TV blaring away in the corner.

A few months ago I was in that situation, and listened to Mayor Bloomberg utter the now all too common refrain that “safety of residents was his top priority.”  I don’t want to focus in on the specific situation he was referring to or anything along those lines, I just want to comment briefly on a once-bedrock notion that seems to have been lost permanently from the American Psyche: safety or security is not an ideal in and of itself.

Let me explain.

If you hang around geeks long enough, you’ll hear them discuss the security and safety of their computers.  There’s lot of things to secure (and thus talk about) too: their code, their servers, even security of non-computery things and other physical devices.  At some point, you’ll hear a version of this statement: “The only secure computer is one that’s turned off, unconnected to anything, encased in a block of concrete, sitting in the bottom of the ocean…and even that’s not going to be completely secure!”

What’s really being said here is that security is not a binary function of yes/no but a continuum between two mutually exclusive goals: utility and security.  In other words, security is a process during which intelligent and thoughtful trade-offs have to be made just to get stuff done.  This is why you will find nerds, geeks, and other computer professionals disproportionately critical of many modern security measures, processes, and other “security theater” institutions like the TSA.  Computer people already have a wealth of experience trading perfect security for reasonable security in order to achieve things, and we’ve done so without coercion or legislation or massive cost to the user.  The technology security analyst’s job is literally right on the pain point between these two opposing priorities and it’s often not pleasant, but that’s their job.

Back to America and our newfound obsession with safety and security.  Ben Franklin has an iconic quote (often paraphrased) which we seem to have lost sight of:

“Those Who Sacrifice Liberty For Security Deserve Neither.”  

It’s as clear a signal from the framers of the United States as to what kind of country we were to be.   There’s an even more powerful quote which I’ll discuss in just a moment.

I’m not a George W. Bush fan, but I eagerly bought his book “Decision Points” when it came out and very much enjoyed reading it.  It clearly wasn’t ghost written, which was refreshing.  He plays fast and loose with the facts in a few places, and revises history in others, but the first chapter is genuinely inspiring as he documents his battle with alcoholism.

I found myself respecting him more after reading the book and I also gained a lot of insight into his thought processes.  Over and over again he justifies his, uhh, decision points by claiming that his primary duty was to keep Americans safe.  If you listen to talk radio even just a little this is a refrain you’ll hear over and over again.  We have to keep Americans and America safe.  We have to keep our allies safe.  It’s mentioned by commentators, newscasters, senators, congressmen, presidents, and people. Safe. Safe. Safe.

Except Bush, talk radio personalities, and anyone else who believes that safety is our ultimate priority are all wrong.  The founding fathers knew what they were doing when they designed the oath of the office of the President of the United States:

I, , do solemnly swear (or affirm) that I will faithfully execute the Office of President of the United States, and will to the best of my ability, preserve, protect and defend the Constitution of the United States.

Presidents and Congress are to protect our Constitution, not Americans, and in doing so they protect America.  Pure safety is unatainable, and to get as close as we can to pure security means totalitarianism, and no happiness, life or liberty.  Just like with the almost-safe computer sitting in the bottom of the ocean, a purely safe life means being locked in a room in the bottom of the ocean where nobody can harm you.

We need to stop pursuing this idea that the end goal of America and Americans is safety.  I don’t want to live a safe life.  I want to live a fulfilling life, one that’s full of adventure and creation and freedom.  

We need do a better job at educating ourselves about the true risks in life.  The reality is that it’s much more dangerous to drive and pickup a pizza than to fly.  I’m more likely to get hit by lightning than be a victim of terrorism.  

There are dozens and dozens of examples that document how we’re living in an age of extreme safety and relative security, and none of this is due to security checks or military spending or increased wiretapping.  I’d encourage you to do the research and see if you come to the same conclusion.  

Back to the American oath of office.  Think of how natural it would have been to make the chief goal of our President be the security of his people.  Swearing an oath to the constitution was no accident.  Think of how easy it is to make bad decisions if all you care about is safety.

We have a higher calling in life than to be safe.  Most of history’s meaningful changes have been very unsafe affairs.  We should expect our leaders to understand this and we shouldn’t accept safety as our prime directive or even as a goal in and of itself.

 

Goodbye Current Events

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I’m trying something out and it only tangentially happens to correspond with the New Year.  It looks like a resolution, but it’s not.  Essentially, I’m going to unplug from most current events when at all possible.

This flies in the face of my normal desire to read and know about current events obsessively.  I may not be a full fledged news junkie, but I definitely used to read two newspapers pretty extensively, and generally spend large chunks of time reading about current events.  I even used to take daily notes of important events with the goal of being able to identify trends and analyze coverage, particularly longer running items like the 2008 Financial Meltdown or the Arab Spring.  Ultimately, I came to the conclusion that I was better off reading well researched books that came out a few months or years later.  I enjoyed the treatment of the events better, they were more informative, and the coverage more balanced, and the whole experience was of course seasoned with hindsight.

This flies in the face of conventional wisdom, but should yield the following benefits.

More Time

The idea had already been percolating a bit but was reinforced during the last few months of an international move where I literally didn’t have time to follow current events.  The end result was I didn’t care that much.  And I had a lot more time to devote to moving.  Now I’ll have more time to devote to other things.

More Accuracy

There’s a name for a phenomenon (that I don’t have time to research) where you read media coverage of an event or detailed subject which you know a lot about and realize that the article is inaccurate, missing important details, or misses crucial nuance.  You smirk as you realize the reported missed the point or didn’t do the subject justice, then move on to the next article and trust they’re getting it right on all those other subjects on which you’re not an expert.  I’d rather research things in a more classical manner and read books by experts, and challenge their ideas with research.  None of this requires a newspaper subscription or online RSS reader.

A More Informed Citizen

The upcoming presidential election in the United States will probably be one of the biggest wastes of time and money since the last one.  Here’s a great article that surfaced recently which sums up my opinions pretty well: the US political process is dominated by money (94% of the time the candidate with the most money wins) and both political parties are essentially the same.  I’ve seen one blogger call them the Coke and Pepsi parties and I’m convinced it’s true.  Both spend a lot of time telling you they’re different, but at the end of the day, most people wouldn’t be able to objectively tell.  Certainly both parties are hellbent on remaining in power and enriching themselves.  Both are consistently advancing positions that I greatly disagree with and won’t be able to affect by voting for one candidate over another.  For damn sure I could never tell you (and I’d challenge you to honestly reflect for yourself) how one party affected my life compared to another to any measurable degree.

During the previous mid-term elections, I received a polling call that went through every single office and their attendant candidates that was up for election in South Florida, and asked if my choice as a voter would be affected by learning the following information.  All of them had been convicted for some form of fraud, bribery, election campaign funds misappropriation, and more.  The third party candidate calling me made a really good point: everyone in both parties is a criminal!

Ultimately, for the last two elections I’ve ended up spending an hour or so on Politifact for all non-national races, read the presidential candidate’s books, and talked to a few people I trust and made my decision.  I’ve found that the above process educated me significantly more than the breathless campaign coverage I was reading every day.

A More Interesting Person

I’m not going to ignore current events – if people are talking about things that are happening, I’ll tell them I haven’t heard of the event, and they can explain it to me.  It’s better than talking about the weather, it avoids me monologuing on my own opinions which can be a drag to others, and it’ll ultimately make things more interesting for both of us.

A Few Exceptions

I will still maintain a daily reading of technical, work related, and hobby related blogs.  These are intensely interesting and enjoyable, and aren’t really focused around current events most of the time.  I will also maintain a daily eye on the weather and train schedules because this is how I get to work.  I will monitor financial and investment information, but will limit most decisions to being made in a minimum 3-5 year time horizon (which is what I do anyway) and not worry about current doom and gloom.  Any substantive investment strategy should always assume gloom and doom by default and prepare for it, not react to the horrors of the day.

This is Not a New Idea

This is not a new or even novel idea.  I’ve seen this discussed in the book “I Was Blind but Now I See” by James Altucher, I believe it’s referenced in “The Art of Nonconformity” by Chris Guillebeau, and when I really think about it, it’s how I lived the first 15 years of my life without internet access in Asia.  I’m not really worried.

Updated 8 Jan 2011:

Updated thanks to a comment that just came in through email.  The phenomenon I mentioned above was coined by Michael Chrichton and is the Gell-Mann Amnesia Effect.  He also mentioned this in an essay title “Why Speculate?” Thanks “jcs”!

Does China’s Autocratic Government Provide an Economic Advantage?

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It’s a question you often see timidly asked, in an almost guilty fashion.  Don’t you think, just maybe, setting aside all of its problems and just focusing on the economic question, that China’s government gives it an advantage over our messy democratic republic? Liberals in the United States are often criticized for their breathless infatuation with technology, intelligence, education, and a belief that top-down government inspired projects and policies are the main way to affect lasting and dramatic changes within society.  They point to examples including the Transcontinental Railroad, New Deal’s Tennessee Valley Authority, the Apollo Project,  and the impact that DARPA and other government funding had on the internet.

No one today cheerleads the economic advantages of China’s autocratic government more than Thomas Freidman, author of The World is Flat, and Hot, Flat and Crowded. Reading these books is to experience a breathless optimism that surrounds India, China, and other developing countries as he examines their education systems, massive economic investments in infrastructure, and the desire of their citizens to compete in a global economy.  No country receives quite as much praise as China, however, and the message both implicit and explicit throughout his columns and books is that this is all a product of a single-minded focus from a strong central government that’s dedicated to improving the lives of its citizens.

Are We Losing Our Edge to China?

China watchers (both admiring and fearing) can usually list off the following in quick abandon: China has the world’s second largest and second busiest airport, the fastest train, the fastest computer, the largest dam, and is using most of the world’s concrete (PDF).  There are other impressive economic stats as China is now the world’s largest exporter, makes the most cars, and has the world’s second largest economy.  The Chinese people and Chinese government relish statistics, particularly those that point out how they’re the best, and they have a flair for announcing large projects like the construction and logistical integration of several cities into the world’s largest mega-city that leave foreign observers stunned at the sheer scope of such projects.  If you read the previously linked Telegraph article, you can clearly see in your mind’s eye a vision of editors going back to each number and checking that they have the right number of zeros, all while softly cursing to themselves at the absurd size and scale involved.

Lets Look at Real Statistics

But for all of the admiration, large projects, and grandiose announcements, Friedman and others tend to forget a simple fact: China and India are still by any standard exceedingly poor.  Equating scale of projects without taking into account relative size is just, well, stupid.  Of course China and India should have the largest of everything – they have the largest populations.  The public works that everyone salivates over are all driven by the monumental sized populations that each country is responsible for.  People forget that China is still the 95th poorest country in the world when ranking by per-capita GDP.  Lest we become guilty of not adjusting for relative purchasing power (in other words, everything’s cheaper in China so you can earn less but still feel richer), when we look at their per capita GDP adjusted by Purchasing Power Parity, China climbs two spots to number 93.  These are imperfect estimates, but are directionally correct, and are prepared every year by the International Monetary Fund.  The United States, by contrast, is in the top ten for both measurements, with none of the countries besting the United States having a population of over fifteen million.

Can We Really Know the Effects of Communism on China?

Note that these bad (both absolutely and relatively speaking) individual economic indicators are despite nearly thirty years of constant economic growth, many of these years being close to ten percent or greater.  Not exactly the picture that tends to be painted, is it?  The point is this – there are two words that accurately describe China’s current economic progress: catch up. Decades of autocratic rule, political unrest, warfare (China was continuously at war from 1927 through 1950) have actually intensely harmed the country and its economic prospects.  In fact, these are often pointed to by outsiders (and even some Chinese) as reasons to why China is currently lou hou or backward.  

However, there is a decent control scenario that we can use to contrast with the current Chinese economy: Taiwan.  Both countries were founded the same year, 1949.  Both had participated in the ravages of civil war.  It can be argued that Taiwan may have left the mainland with some economic advantages: the best and the brightest, and possibly more administrative experience, but that case seems hard to make due to how poorly they had previously run the mainland.  They also left with China’s gold reserves, but the mainland received economic aid from the Soviet Union the first decade of its existence, and if the economic development stats were at all close it might be relevant.  In any event, Taiwan, having always pursued a free market with limited government interventions is today is one of the world’s strongest economies and near the top of the lists we just ran for the United States and China.  In other words, historically, China’s autocratic government has been nothing but a hindrance.

Today we are told, that all has changed.  China’s embrace of new economic policies (and priorities) is the new paradigm: that of the state guiding the economy along long term goals, inspiring its citizens with great public works while simultaneously providing a stimulus to the economy as a kind of dual pronged weapon of economic good.  This is contrasted against the herky-jerky, short sighted, messy and error prone proclivities of democratically elected governments that are so obviously wrong. However, when you really stop to consider this, it’s extremely puzzling.  We’re essentially saying that the element that prevented China’s economic growth for thirty years (a planned economy) is now it’s key advantage when competing globally.  

Keep in mind that when people decry the fact that the free market hasn’t arrived with something, they’re generally pushing an agenda that is economically incompatible with reality.  Friedman and friends are pushing carbon reduction due to a belief in global warming.  Others push social agendas for things like public housing.  Still more push redistribution of wealth for the betterment of the working and lower classes.  While we can debate the merits of these agendas, the reality is that if they were economically viable, someone would have found a way to monetize them. Here’s the general conclusion (to be followed I’m sure by a few more posts on this topic): it’s easy to make double digit gains when you’re in last place.   It’s also easy to cherry pick smart development deals when your whole country is undeveloped or underdeveloped.  In a hyper complex, massive economy like the United States that also happens to be very diverse, this type of top-down management is practically impossible.  China makes their share of stupid investments too, we just tend to not hear about them.

Did China Steal America’s Stealth Technology?

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A brief interlude here as I’d like to comment on a great blog post by the folks over at Wired writing for their excellent blog Danger Room.  They have an entry up asking if the recently revealed J-20 stealth fighter incorporates stolen American stealth technology.

The post takes us back 1999 when the Yugoslavian defense forces managed to shoot down a F-117 Stealth fighter, an incredibly lucky event.  According to Wired, there were reports of Chinese agents immediately scouring the country for pieces of the plane, buying them up from farmers who had recovered them.  Several pieces ended up in a Belgrade museum whose curators insist hasn’t seen suspicious activity or visits.  Wired discusses how the technology was already fairly mature, how the F-117 was eventually retired in short order, and how the J-20 doesn’t look very much like the F-117.

Probably not much copying going on here they tell us.

I tend to agree, but for different reasons.  The fighter was shot down at the end of March (the 27th) and a month later, on May 7, the United States accidentally bombed the Chinese embassy in Belgrade.  Most Americans wouldn’t even remember this but almost all Chinese remember and as an expat living in the country at the time, it is impossible to forget.

The Chinese went crazy.

Immediately, demonstrations erupted across the country, but particularly in Beijing, Chengdu, and Guanzhou whose cities had consulates or embassies.  American personnel, including ambassador James Sasser, were trapped inside the Beijing embassy.  Rioters attempted to burn down both the Chengdu and Guanzhou consulates.  The United States and NATO immediately released an apology and circulated the fact that they were attempting to hit a Yugoslavian warehouse nearby that looked similar, but bizarrely, these apologies were not allowed to be immediately rebroadcast in China.

This was China.  You don’t get to demonstrate or riot without the government allowing it to happen.  There were reports of students being bussed in by the government to the US embassy to let loose their anger.  It was declared to be unsafe for Americans to be out in public, the first time this had ever happened nationwide for US Nationals since China reopened in 1980.  International schools and companies closed.  We were told to stay inside and not go out for any reason.

For Americans living in China, it was an incredibly surprising incident, and I managed to get involved in one of the scariest situations I’ve experienced overseas by ignoring the warning and venturing out to see what was going on.  While most of the world is annoyed by America today, in the late nineties, particularly in Asia, Americans were extremely popular.  Everyone in China loved Clinton, his policies, our economy, everything.  It was almost inconceivable that Americans could be bothered out in the streets of China.

Some pundits explained the riots by saying the Chinese government was concerned that repressing the students would cause them to get out of control, but this doesn’t jive with how China normally views demonstrations. The crux of the issue was that China was ultimately convinced that the bombing was not intentional.  But why would the US bomb an embassy?  What could we hope to gain?

In the aftermath, strange facts emerged.  George Tenet testified that the Belgrade strike was the only one of that war directed by the CIA.  I heard from two different American personnel involved in the military that it wasn’t an accident, and these rumors are still prevalent today.  Another source testified that CIA maps correctly identified the Chinese embassy, which seemed to debunk the flawed cartography defense that was the official US explanation of the incident.  An in-depth investigation conduced by Danish Newspaper Politiken and the UK Observer turned up even more inconsistencies.  And there was still China jumping up and down that it wasn’t an accident for no apparent reason.

Eventually, the link seemed to become clear: China had been gathering stealth fighter pieces, boxing them up, and were preparing to send them back for analysis.  The United States’ message to China was clear: welcome to the NFL, and don’t mess with our technology in our warzone. As I said earlier, I agree with Wired that China never got those stealth parts, just for different reasons.

China vs. the United States: What about all this debt?

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It’s almost impossible to mention China in a conversation now without hearing about them owning a large portion of our debt.  Based on my own unscientific and anecdotal perception (I asked a bunch of people), most would answer that China owns “most” or “close to half” of our debt, and I’m commonly asked “when I think that Mao Zedong will be on the hundred dollar bill.”Before we begin, I’d like to make clear that I am a fiscal conservative.  I believe the US should not routinely run a deficit, particularly a large one.  I live in a state (Florida) with a balanced budget provision in our constitution and even though it’s ignored from time to time, I think it would be a good thing to have nationally, and I believe it to be extremely unwise to routinely run deficit spending.

One of the best resources for understanding the national debt is, unsurprisingly, the US Treasury.  You can read up to date reports on outstanding debt and its holders here.  Wikipedia has a slightly outdated but directionally graphical correct representation of this data here.  From this, we can see that somewhere around 30% of all US Treasuries are held by foreign and international interests.  The rest are held by insurance companies, other investors, pension funds, mutual funds, and the government itself (mostly the Social Security trust fund).Already, this is probably not the picture you expected.  Less than a third of all US debt held by foreigners.  The treasury helpfully breaks this down further here, listing each country by holdings and the dates of the holdings.  Of that debt, China is indeed the leading holder at roughly 20.8% (as of July 2010), but Japan is right behind at 20.2%, then the United Kingdom at 9.2%, then oil exporters (5.5%), Brazil (4.0%), Hong Kong (3.3%), Russia (3.2%), and Republic of China or Taiwan at 3.2%.

After just a few minutes of basic research, we’ve learned that China has roughly 6% of our national debt under its ownership, and of the rest of the countries on that list, Japan, the UK, Taiwan, and Brazil would be counted in the friendly-to-America column, or at least in the “choose America over China” column.  It can be argued that Hong Kong is essentially China, but it still doesn’t change the general picture at all.China, along with other countries, just doesn’t own that much of America’s national debt.  In fact, I’d say in light of all the political rhetoric, 6% is a shockingly small amount.

Still, lets say that the nightmare scenario happens, things went sour with China, and they wanted to begin flexing their muscle, using our debt against us as a weapon.  What would their options be?

  • They could sell their holdings.  This would immediately depress the value of treasuries and probably cause some amount of alarm.  However, were China to begin selling their nearly 800 billion in treasury bills, the market for these bills would rapidly cause their existing holdings to plunge in value.  In other words, by selling, they’d screw themselves fairly quickly, and they’d be forced to take that money and place it somewhere else.  Where?  The EU has proven recently to be a less than stellar investment.  Their own domestic market wouldn’t be able to absorb a nearly trillion dollar capital injection without being inflationary.  Not to mention that the Fed could simply step in like they did with TARP and buy up the 800 billion dollars that China would sell, at rock bottom prices.  Our allies could also mobilize considerable buying pressure so that their own holdings wouldn’t devalue.  At the end of it all, China would probably lose the most from this maneuver.
  • They could unpeg their currency to the US Dollar. China today artificially keeps their currency pegged at an unfavorable exchange rate (to them) in order for their products to remain cheaper for Americans.  Unbelievably, most of the current US diplomatic effort on economic issues is centered around trying to get China to remove this peg, thus making things more expensive for Americans.  Derogatory terms like “dumping” are used to describe China’s gift of subsidized products to millions of Americans.  By demanding that China unpeg its currency, we’re basically saying “remove your artificial subsidy on goods that middle and lower class Americans predominantly buy, and that will help us.”  Smarter people than I have written on this elsewhere numerous times.
  • Are there other options here? I’m trying to think of them, but the reality is this – Chinese businesses are flush with dollars.  There’s a reason almost all of the countries that are major holders of US debt are manufacturing or commodities export driven (China, Taiwan, Brazil, Oil Nations, and Japan).  They receive dollars for their products, and need to buy materials to make their products.  These materials can and do often come from other economies, so it’s advantageous to use the world’s reserve currency to procure these materials.  Notice how India is absent from the list – they’re a knowledge exporter (mostly services and knowledge work like software), and therefore most of their income is paid in wages to individuals who then spend the cash within their own economy, not paid to other economies to procure raw materials.

If you were to obtain a large sum of money (in the billions or trillions of dollars), you’re going to need to make decisions regarding the investment of that money using long term, macro-level criterion.  Government stability comes into play, geopolitics becomes important, and all of a sudden in addition to a rate of return, you’re faced with the difficult decision of who do you trust with your money – but on a national scale.  If you’re China and you’re looking around the world to invest your US dollars, you can choose Europe, a handful of economies in SouthEast Asia that are just as invested in the US as you and are competitors to yourself, Africa, or South America.  The world just got a whole lot smaller.  In that context, the US is by far the most stable recipient for your investment, and its markets are also the driver for your current economic success.Deng Xiaoping, the former leader of China and the architect of China’s reforms that shifted the country to free-market capitalism, is famous for his quote that China should stick to its economic policies for one hundred years.  China is thirty years in and has already taken enormously expensive steps (subsidizing exports by pegging to the US dollars for example) to ensure stability and continued growth.  Reasons for this are also steeped in history, as we’ll in see future posts.

Sure, China is investing more in Europe, as the recent debt offerings from Spain and Portugal illustrate, but the broader context here is that a global economic downturn hurts China just as much or more than any other economy.  Their domestic markets aren’t big enough or sophisticated enough to sop up the spare manufacturing capacity that would be created by a global downturn.  China’s economic interests are driven by political and historical goals that go unseen by Western economic analysts.

The analogy to this situation is simple:  as a construction company, you build a house, then rent it to a tenant who can also beat you up.  You sell furnishings to him too.  You’ve invested a lot in the home that you build, and all of a sudden, your tenant starts having trouble paying you back.  Unfortunately, the house is so big and lavish that there’s nobody else who can afford it, or if they were to buy it, you’d have to sell at a steep or near-total loss.  What do you do?  You follow the wisdom that banks who own their own mortgages follow: you do what you can to work out a payment plan and look to keep the tenant in the house, while not humiliating him in the process.  This way, both of you make it through hard times, and you can sell him a nicer house when he’s back on his feet in a few years and is looking to upgrade.

China is not about to jeopardize its future by focusing on short term issues and America needs to stop wringing its hands over non-issues.  The problem isn’t China’s holdings (or any other foreign entity’s holdings) of our national debt, the problem is the national debt: it’s us.  It feels a lot better to fear monger, but at the end of the day, we’re the problem.

China vs. the United States

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Yesterday I was at the dentist, getting my teeth cleaned, and watching CNN for roughly an hour.  They spent almost the entire time (they did interrupt to let us know that Regis was retiring, sigh) discussing Hu Jintao’s visit to the US, how the Chinese economy is the second largest, and what the goals of the visit would be for both parties.  It was painful, and not because my teeth were getting poked.  The media, most members of the US Congress, and I’d say most of these groups in addition to normal Americans spend significant time talking about China in very abstract, basic, and historically ignorant terms.Here are some statements that are a commonly made with regards to China that I believe most China observers would take issue with, but are accepted as fact by most Americans:

  • China owns most of our debt, and therefore owns America, and therefore will begin to (if not already) influence the United States in ways we aren’t comfortable with, and in ways which would be imposible if they didn’t own so much of America’s debt.
  • China’s military power is a deep concern for both the United States and the West at large, and certainly a threat to East and Southeast Asia.
  • China’s autocratic government coupled with their capitalist economy affords them tremendous advantages to exert political and economic will towards being “the best” in ways the US and the West can’t muster.
  • China must demonstrate that it’s willing to behave responsibly towards the rest of the world and engage at the level of statesmanship that the West has long demonstrated.
  • China’s economic growth will continue unabated for the foreseeable future, and there is essentially almost no risk of a derailment.

There are a few more but these seem to be the ones that most people focus on, and simply put, the feeling is that maybe not now, but in the next twenty to thirty years, the following scenario could play out: China is big, they own our country, they could wreck our economy (either by wielding our debt against us or demolishing our superiority in competition), then kick our butts in a war.I’ve tried not to make these straw men arguments, and over the next few days/weeks I’ll deal with each and provide some counterpoint to each.

Christmas – a Time of Giving

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Normally around Christmas people are focused on giving.  Giving to family, friends, maybe even coworkers.  Some give time to charities, some make donations to others.  One of my annual traditions for Christmas is giving to the Electronic Frontier Foundation (EFF), a digital liberties organization that fights for freedom of speech online, privacy, and other causes that are generally too technical to garner attention from other organizations.

This year I’m adding a very similar organization to my annual Christmas list, Software Freedom Law Center (Hi Aaron!),  which similarly advocates for issues that increasingly plague and impact our lives, whether we understand them or not.With all the buzz going on right now about Wikileaks maybe you’ve thought about these issues a little more than normal.

Depending on your understanding of the issue or political orientation, it might be hard to believe, but freedom of speech online is a relatively fragile thing.  Maybe it’s because technology appears to be finite and controllable, maybe it’s because online speech travels much faster and is easier to consume, but it seems that governments and governing bodies tend to naturally flock towards the idea of speech regulation of technical mediums.Groups like the Software Freedom Law Center and the Electronic Frontier Foundation work to preserve freedoms on our behalf.

When I say “freedom of speech online” or “freedom online”, we’re also talking about fighting against overly broad software patents, violators of the GPL, warrantless wiretapping of online communications, and a whole bunch of other issues that may seem only tangentially related to speech, but do impact your voice online.In addition to the work they do, I’ve had the privilege of interacting with and knowing a few individuals from both organizations, and they’re great people as well!  So Merry Christmas, and if you’re looking for a great gift idea or a cause to support, check out both groups.

The North Korean State of Mind

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The Wife and I watched a 2004 documentary over the weekend titled “A State of Mind” that was incredibly enthralling.  I’ve never been to North Korea, but I’ve known many South Koreans, and I’ve seen a few collections of photographs from various travelers that have managed to make it to the country over the last ten years, and I’m always interested in any kind of media that manages to claw it’s way out of that country.One reason for my intrigue is that the pictures I’ve seen are the closest to my memories of what it looked like when I arrived in China in 1984.  China was just a few years into it’s experiment of opening to the West, and it’s very difficult to describe what it was like to see a thoroughly communist country wading tepidly into the waters of capitalism.”A State of Mind” follows two young North Korean gymnasts through their training regimen to participate in the “Mass Games” which are held more or less every year to demonstrate the power of the North Korean state, the singular mind of its people, and the Communist ideal of the group overpowering the individual.  These games are elaborate gymnastic, visual, and auditory productions designed to shock and awe the North Korean population to even higher levels of devotion to “The General”, Kim Il-Sung.I previously mentioned how the wholesale lifting of hundreds of millions of Chinese out of poverty has to be one of the greatest miracles in history, and nowhere is this point driven home more than the contrast between China and the North Korea of today.  North Korea has barely progressed since 1950, while China is challenging for world economic supremacy.  South Korea, likewise is a beacon of economic progress, and it’s all eerily driven home by the gymnasts and their families who confess to the camera that performing for the Great Leader is and will always be the highlight of their life.  Electricity blackouts, food shortages, and the lack of any progress over the last fifty years are all the fault of the Imperialist Americans.  North Korea has truly succeeded in a total religious education of its population on the virtues of communism, and it’s almost like you’re watching a farcical episode of Monty Python mocking the heady days of communism in the 50s and 60s when you see otherwise intelligent, driven people in total worship of their deranged leader.The ultimate shame is that the North Korean people, like the Chinese, Burmese, Vietnamese, a host of nations in Africa, South America, and Central Asia, are completely stifled.  But nowhere is it as bad as North Korea, and as someone who remembers the flood of refugees flooding North China during the late nineties as millions starved, I was left with a genuine feeling of total frustration.  This film is important to remind people that it’s all been tried and failed before, right down to the 1984-esque state radio in every North Korean kitchen that broadcasts propaganda and cannot be turned off.  While it’s easy to criticize the evils of capitalism, and decry abuses of greed, it’s hard to see a corollary anywhere in world history where capitalism has produced a wasteland of human potential.Communism works, and it works well.  It is the greatest engine of equality the world has ever seen as it swiftly ensures that everyone is equally poor.  Watch this film for the cautionary tale that it is, and watch it to be amazed at the talent and devotion of the North Korean people.

Book Review: When China Rules the World

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Reading is one of my favorite things to do, and it’s become harder and harder to make time for books over the last few years.  However, over Christmas I was given Martin Jacques’ book  “When China Rules the World” and I read most of it on the six flights we took over the holidays.This is an extremely important book, in that I feel Martin accurately distills and describes a few integral pieces of China and the Chinese mindset that are almost universally missed by Western commentators.  These pieces, when placed in the proper context can often combine to explain the more (to Western eyes) puzzling questions about China, events that happen within China, and China’s reactions to external pressures.One of the reasons why I enjoyed this book is that the author is a master at providing historical context and to illustrate and reinforce his ideas.  With a history as long as China’s this isn’t a small task, but he accurately makes the point that few nations are as cognizant of their history and traditions as China.  Ignoring thousands of years of constant cultural development leads to gross misunderstanding, and is something that is all too easy to do from a Western perspective that’s driven by the acceptance of a Western order that is really only three centuries old.Jacques begins his book with the relevant facts of how China will most likely overtake the US as the largest economy in the world by 2027, and focuses on the central question of the book: What will a modern world dominated by China look like?  The prevailing thought of most attention paid to China is that capitalism, free markets, and Western style economies inevitably echo Western values of freedom, human rights, democracy, and culture.  In other words, free trade begets free societies.  Not necessarily so in China.This misguided belief that a swing towards Western style freedom and government is inevitable is a key miscalculation that negatively affects US foreign policy and undermines true understanding of China and the rest of East Asia.Reasons for China not following the Western model of modernism coalesce around different set of values.  In China, unity and stability is a key value that is reinforced by the strong, hierarchical family unit, the universal acceptance of Confucian thought, and the reality that China is a civilization-state, not a nation state.  The Chinese desire of unity explains the tolerance of the “one state, two systems” approach to Hong Kong, Macau, and Taiwan, and even within the numerous special economic zones found within the country.  This type of duality is almost inconceivable to the West.  Stability is valued highly due to China’s  experiences with turmoil during its history (estimations of 25 million dead during Manchu invasion, 50 million dead during Taiping rebellion, and as many as another 50 million dead during World War II and the ensuing Great Leap Forward and Cultural Revolution), and it’s long experience with a strong central government and its emphasis on a Confucian trained and tested government bureaucracy.  Stability, therefore, is enough of a priority that the Chinese are content with a system that values the group over the individual.History teaches us that the Chinese civilization has never wavered in it’s attitude of superiority towards outsiders.  Indeed, even when conquered by external invaders, which happened often throughout history, the invading groups (Mongols, Manchus) forsook their own identities and adopted Chinese customs, dress, and language while moving their capitals and governments to China.  Today there is an overwhelming sense among the Chinese that China is finally regaining it’s rightful place in the world as the Middle Kingdom.  Most forget that in the 1800s, the Chinese standard of living was slightly higher per capita than that of Europe.  England had a strong navy and easy access to coal close to its urban centers, China did not.  A crippled and weak end of the Qing dynasty, the Japanese invasion, World War II and the disastrous effects of Communism contributed to a net decrease in China’s GDP between 1820 and 1950.The idea that modernism must revolve around the Western model is rejected by the examination of how little modernity has affected Chinese politics.  China has always had a strong central government that was paternalistic in nature and was bound to the collective well being of society.  This is unlike Western governments, which have evolved to the point where they exist as a utilitarian entity in exchange for popular support.Jacques also spends significant time exploring the reasons behind the current Chinese policies towards trade, it’s own citizen’s freedom, and it’s long term goals.  In the light of the many historical and political contributing factors, it’s much easier to understand China’s currency peg (which hurts China more than it hurts the US), it’s continuing support for US debt, and it’s aggressive stance towards opening its own markets.  According to Deng Xiaoping, two things must remain for China to lift its population from poverty: domestic stability and international peace.  Seventy-five percent of China’s economy is accounted for by international trade of some sort, and while this may decrease as China continues to diversify, this is an unprecedented level for a country that is so large.  This precarious balance between its economy and the implicit social bargain (like all Confucian states have) to its citizenry for future standard of living improvement are the key drivers to China’s behavior.This book isn’t without its faults.  Jacques, like the good Marxist he is, glosses over the disastrous effects of Communism for China’s people and its economy.  Like many intelligentsia (Thomas Friedman and almost any other environmentalist) , he finds himself almost in awe of the incredible power that the Chinese Communist Party has to command policies that he wishes or wants to see implemented.  His exploration of China’s tributary system and it’s possible resurgence in the future is incomplete as it doesn’t resonate well with the Western reader.  Some of the book’s information is outdated or at least could have been updated, and some of the statistics feel as though they’ve been cherry picked.  There also doesn’t seem to be enough credit given to the remarkable lever of capitalism: lifting hundreds of millions of people out of poverty in just thirty years is nothing short of a miracle.While the overall message of the book is that China will not become the US or a prototypical Western nation-state, this doesn’t mean that the China of today will exactly mirror the China of tomorrow.  It does mean that we shouldn’t prescribe the Western template to China, and should remain mindful of the powerful historical currents that remain in full force for China.