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		<title>Euro-Obama in China</title>
		<link>http://chinayouren-free.com/2009/11/16/2498</link>
		<comments>http://chinayouren-free.com/2009/11/16/2498#comments</comments>
		<pubDate>Mon, 16 Nov 2009 11:19:50 +0000</pubDate>
		<dc:creator>Julen Madariaga</dc:creator>
				<category><![CDATA[Politics and Change]]></category>
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		<guid isPermaLink="false">http://chinayouren-free.com/2009/11/16/2498</guid>
		<description><![CDATA[So Obama is in China, and even if he is not my president he is still my favourite president. Here is my first-hand analysis of the visit. The most important news, surprisingly gone unnoticed by all observers, is that Obama wants to become Euro-bama in Chinese. That is how I read the new spelling of [...]]]></description>
			<content:encoded><![CDATA[<p><a href="http://chinayouren-free.com/wp-content/uploads/2009/11/barack-obama-the-french-sun-king.jpg"><img style="border: 0pt none; margin: 8px 15px 10px 0px; display: inline;" title="barack_obama_the_french_sun_king" src="http://chinayouren-free.com/wp-content/uploads/2009/11/barack-obama-the-french-sun-king-thumb.jpg" border="0" alt="barack_obama_the_french_sun_king" width="146" height="195" align="left" /></a> So Obama is in China, and even if he is not my president he is still my favourite president. Here is my first-hand analysis of the visit.</p>
<p>The most important news, surprisingly gone unnoticed by all observers, is that Obama wants to become Euro-bama in Chinese. That is how I read the new spelling of his name in characters, as proposed by the website of the <a href="http://www.whitehouse.gov/blog/2009/11/15/shanghai-town-hall">white house</a> :</p>
<p>欧巴马 (oubama) will replace 奥巴马, where 欧 is the Chinese character for Europe, making the name sound in Chinese like Euro-Bama.</p>
<p>Some might say that the new spelling is chosen for greater phonetic similarity, or because it is standard in Taiwan, but when have politicians listened to the linguists? There is a clear political motivation in the naming of Euro-Obama, and I see a bright future in the project.</p>
<p>I think I speak for a large number of Europeans when I say we are very happy to see this plan finally in execution. Mr. Obama, please sweep away all our bunch of incompetent presidents and prime ministers, and become King of the European Union. Then, perhaps, in the next meeting with China you can represent our united interests, instead of having each European tribe sending its little pathetic chief for the CCP to cleverly divide and manipulate <em>a la</em> <a href="http://www.whitehouse.gov/blog/2009/11/15/shanghai-town-hall">Sun Tzu</a>.</p>
<p>One of the things I like of being European is that you can be thoroughly unpatriotic against the UE, and nobody cares. Dear commentators of the <a href="http://www.washingtonpost.com/wp-dyn/content/article/2009/11/09/AR2009110902793.html">Washington Post</a>, please do not worry anymore. America is not in decline yet, and it will not be for a long time. Among other reasons because it is needed by European countries that are too incompetent to unite in international politics. And indeed, when the Chinese people see Obama, they see a leader of the West as much as they see a leader of America. Because seen from here, the concepts of West, Europe, America, or Euramerica (欧美）have never been all that distinct.</p>
<p>After this important geostrategic consideration, you can continue to read what else is to read about the visit. Essentially nothing, because no real news have emerged yet, and most journalists and bloggers alike do their best to fill in their columns with China generalities. Apart from the links above, interesting questions are:</p>
<ul>
<li>Will Obama comment on the <a href="http://blog4china.org/2009/11/15/alleyway-in-hell-a-report-on-chinas-black-jails/" class="broken_link" rel="nofollow">Human Rights Watch</a> report about black jails and other human rights issues? Of course this will not happen, no more than Hu will elaborate on the new <a href="http://granitestudio.org/2009/11/12/bad-history-qin-gang-joins-the-tea-party-movement/">theories</a> of the Liberation of Tibet. But it is interesting for the sake of debating.</li>
</ul>
<ul>
<li>Perhaps more likely is that he mentions the environment, as this blog <a href="http://jamesfallows.theatlantic.com/archives/2009/11/heres_why_the_china_trip_matte.php">suggests</a>. I am pretty sure the two leaders will mention it, actually, a different thing is how much of a commitment will come from the meeting. From the voiceless rest of the World we will be watching to see if the 2 giants finally decide to make a move and quit sending their fumes to our back yard.</li>
</ul>
<ul>
<li>Finally, a lot of articles out there speak of Obama-mania and make a big deal of the <a href="http://chinayouren.com/es/wp-content/uploads/2008/11/obamao1.jpg">Obamao</a> icon, which has been circulating in China since before the <a href="http://chinayouren.com/esp/2008/11/06/obama-y-china/">election</a>. My view is that young modern Chinese tend to like Obama, and he is marginally more popular than Bush was. But there is no such thing as the Obamania we saw in Europe, and most people here adopt a cold stance of “wait and see”. The minute 欧 mentions some delicate issue or  meets some old lama, it will take no more than a minute of well phrased CCTV news to wipe the Obamania into thin air.</li>
</ul>
<p>So already, quit the Obamaos and give me some Eurobamas, we are growing tired of politics over at the other side of this continent.</p>



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		<title>Crisis seen from the Sinosphere (II)</title>
		<link>http://chinayouren-free.com/2009/05/13/1952</link>
		<comments>http://chinayouren-free.com/2009/05/13/1952#comments</comments>
		<pubDate>Tue, 12 May 2009 18:11:42 +0000</pubDate>
		<dc:creator>Julen Madariaga</dc:creator>
				<category><![CDATA[Economy and Business]]></category>
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		<guid isPermaLink="false">http://chinayouren-free.com/?p=1952</guid>
		<description><![CDATA[From the post left unfinished last week. Some of the main arguments read (or heard) in China Crisis discussions: The Time Economies don&#8217;t grow indefinitely.  Low cycles follow high cycles and after 30 years it is about time. China cannot break the laws of economics, so the recession must necessarily come in the next X [...]]]></description>
			<content:encoded><![CDATA[<p>From the post left unfinished <a href="http://chinayouren-free.com/2009/05/the-crisis-seen-from-the-sinosphere/" target="_blank">last week</a>. Some of the main arguments read (or heard) in China Crisis discussions:</p>
<p><strong>The Time</strong></p>
<p>Economies don&#8217;t grow indefinitely.  Low cycles follow high cycles and after 30 years it is about time. China cannot break the laws of economics, so the recession must necessarily come in the next X years. The country hasn&#8217;t prepared itself politically and psicologically to face this period. In the end, we are sure to have trouble.</p>
<p>Of course, this argument is of little value without the X, and many proponents of a time limit have failed in the past. This is the field of technical analysts and other mystical thinkers. Mythology also plays a role:  In Chinese history, cataclysms mark the end of a cycle. An earthquake preceded this crisis, and a solar eclipse is coming in July, the dynasty has lost its virtue. These arguments tend to work better with a bit of hindsight.</p>
<p><strong>The Markets</strong></p>
<p>The World&#8217;s economies are interdependent today. China&#8217;s economy is largely dependent on exports and FDI. The weight of these external factors in China&#8217;s growth has been much discussed, but regardless of the exact numbers, few doubt that it is a significant motor of the economy. External motors failing, China turns to internal ones: investment and consumption. Today, strong public investment, mostly in infrastructure and energy, is making up for the loss. <span id="more-1952"></span></p>
<p>But infrastructure on its own does not move an economy, an empty highway is dead weight. Its value lies in the economic activities that are created or improved by using it, and those activities need markets to get them going in the long term. Optimists have pointed out that the crisis might turn developed economies to cheaper products, but international markets are saturated with cheap Chinese wares, and the latest news are <a href="http://www.chinaeconomicreview.com/dailybriefing/2009_05_12/Exports_decline_226_in_April.html" target="_blank" class="broken_link" rel="nofollow">discouraging</a>. This leaves the Chinese consumer.</p>
<p><strong>The People</strong></p>
<p>Since the urban consumer was already developing at full speed, it is to the masses of Chinese peasants that all the eyes turned when a new market was needed to replace the failing exports. The peasants had been left out of the economic miracle, and measures were announced to get them back in.  But few of those social measures have materialized in any significant way, and the government seems to realize that this is a long term effort, not to be mistaken with an emergency financial package.</p>
<p> Chinese peasants don&#8217;t like to spend money. They like to save it.  Some argue this is an immutable principle of a post-confucian society, others attribute it to the lack of &#8220;safety nets&#8221;, such as  health care plans, and the fact that poverty is still seen as a very real option.  Perhaps Chinese have too much common sense, and in the face of all evidence, they continue to act as if working hard and being thrifty will make you richer.</p>
<p>Meanwhile, the optimists of internal consumption see <a href="http://www.ft.com/cms/s/0/429c3242-3db7-11de-a85e-00144feabdc0,dwp_uuid=9c33700c-4c86-11da-89df-0000779e2340.html?ftcamp=rss&amp;nclick_check=1" target="_blank">hope</a> in the low-tier cities, the segments of the population that have already abandoned the peasant lifestyle, but still have a long way to reach East Coast level. </p>
<p><strong>The Government</strong></p>
<p>China&#8217;s authoritarian system has some advantages over Western systems. The executive can take strong, quick measures unhindered by parliament debate and popularity surveys. A good example is the stimulus package. China was the first major country to announce it, and it is has been the biggest  relative to the size of the economy. Government technocrats tend to know more of economics than voters.</p>
<p>But some see in the system the seeds of disaster. The Son of Heaven is human, and bound to the wheel of favours, factions, patrons and clients. The lack of checks and balances makes it easy  for personal interests to take precedence over the common good. Some have a stake in the stock market, others in real estate, there are ways to pump up these markets with the connivance of Beijing. One day they might all decide it is time to cash in, and the rest of the population will be caught by surprise, watcing the CCTV report with the 8% growth spreadsheet. Lack of transparency usually works well to bubble up crises. </p>
<p><strong>The Package</strong></p>
<p>China has a good package, timely and sizable. Few doubt now that it has delivered the desired stimuli. The thrust in infrastructure and energy investment is spilling its effects over the rest of the economy, and the feared legions of the unemployed are still nowhere to be seen today. </p>
<p>But the package can only be a temporary patch, as we have seen above, and its function is just to cover the gap until the economy gets back to normal. In the meantime, the investments should be preparing the path for the return of sustainable growth.</p>
<p>Optimists point at the positive parts of the package, such as social measures, education, or development of new sectors of the economy in biotech or renewable energies. Pessimists note that the bulk of the package is actually flowing into very few sectors related to heavy construction, and this will cause unbalances and excess capacities the minute the financial tap is turned off.  In their view, the package is just postponing/aggravating the consequences. Some mention the devastating and unpredictable specter of deflation.</p>
<p><strong>The Chest</strong></p>
<p><strong><span style="font-weight: normal; ">China has also a nice chest. It is a war chest, and it is full of foreign-exchange reserves denominated in dollars. Optimists and lovers of logic alike see salvation in these reserves. They like to point out that China has room to go on with its package for a long time, thanks to all the years that the country has spent saving saving money and acting as &#8220;Americas banker&#8221;.</span></strong></p>
<p>From a plain logical point of view, this makes sense, but unfortunately financial logic is anything but plain. The specialists in the area are quick to remind us that these reserves are not unencumbered wealth, and not free for the government to use. The central and provincial governments finances are already under stress, and the banking system is channeling all financial resources to the package SOEs, with the consequence of drying up available finance for other sectors of the economy.</p>
<p><strong>The Riots</strong></p>
<p>One of the main subjects in the Crisis discussions has been the possibility of large scale riots caused by unemployment. These riots could have the effect of destabilizing the system, with consequences in politics as well as in the economy. Perhaps because of the political derivations, unemployment has attracted a lot of attention from Western observers. Around the turn of the year, when the Western Christmas season was over and many semi-seasonal workshops were closing, the discussion reached the peak of popularity.</p>
<p>But the package has kicked in, and for the moment unemployment doesn&#8217;t show signs of getting out of control. The riots have increased in number, but they remain essentially local in nature, directed to claim arrears from a particular company, or against local authorities. There is a climate of relative optimism among the Chinese, and it looks like the the propaganda package that came with the financial one is having the desired soothing effects.</p>
<p><strong>Inflation/Deflation</strong></p>
<p>Predictably, another high point will come when the investment package is left behind, or when the financial situation makes it unsustainable to continue pushing it. At this point, we might see more passionating discussions, with the added appeal of possible deflation risks. </p>
<p>Inflation has historically been a major cause of riots and wars, so a logical mind would assume that its opposite -deflation- has opposite effects, forcing everyone to stay in at home reading self-improvement books and drinking green tea. I doubt very much the economists will let us get away with this theory. In the meantime, I will stay tuned to the blogosphere for any interesting development to add to this list.</p>



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		<title>Blog credibility thread: Chinablogs</title>
		<link>http://chinayouren-free.com/2009/03/05/1631</link>
		<comments>http://chinayouren-free.com/2009/03/05/1631#comments</comments>
		<pubDate>Wed, 04 Mar 2009 18:54:34 +0000</pubDate>
		<dc:creator>Julen Madariaga</dc:creator>
				<category><![CDATA[My Front Garden]]></category>
		<category><![CDATA[America]]></category>
		<category><![CDATA[bloggers]]></category>
		<category><![CDATA[CCTV]]></category>
		<category><![CDATA[crisis]]></category>
		<category><![CDATA[economy]]></category>
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		<category><![CDATA[internet]]></category>
		<category><![CDATA[law]]></category>
		<category><![CDATA[media]]></category>
		<category><![CDATA[politics]]></category>
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		<guid isPermaLink="false">http://chinayouren-free.com/?p=1631</guid>
		<description><![CDATA[Ever since I opened this blog the problem of credibility has been in the back of my mind. These days, the comments of a tenacious part-time troll, as well as some recent events that shook the Chinosphere have brought back the subject to the top of my agenda. It is well known that Chinablogs* (defined [...]]]></description>
			<content:encoded><![CDATA[<p>Ever since I opened this blog the problem of credibility has been in the back of my mind. These days, the <a href="http://chinayouren-free.com/2009/03/capitalism-with-chinese-characteristics/#comments" target="_blank">comments</a> of a tenacious part-time troll, as well as some recent <a href="http://www.chinalawblog.com/2009/02/breaking_news_did_pure_fabrica.html" target="_blank">events</a> that shook the Chinosphere have brought back the subject to the top of my agenda.</p>
<p>It is well known that Chinablogs* (defined as <em>blogs about China in English</em>) are only a tiny part of the Chinese internet, and their readership is insignificant compared to their Chinese counterparts. But it would be a mistake to dismiss them as irrelevant. For some time already, especially after last year&#8217;s  events &#8211; Tibet revolts and the Olympic torch saga were a <a href="http://www.anti-cnn.com/" target="_blank">turning</a> <a href="http://www.anti-cctv.net/" target="_blank">point</a> -  readers from all sides have questioned the media&#8217;s impartiality regarding Chinese politics. Just or not, the fact is that these accusations have cast a doubt, and many have turned to blogs to try to find an independent point of view.</p>
<p>Some things make me suspect that the influence of Chinablogs in shaping the World opinion about China is more significant than their size might suggest. The famous <a href="http://www.chinalawblog.com/2009/02/breaking_news_did_pure_fabrica.html">#cde</a> affair, where a well known entrepreneur and blogger in China caused the RMB/dollar exchange to move after a post on his blog, forcing the Chinese government to issue an official notice, confirmed this idea. Also, the world media are sending some of their best writers to China, not to become correspondents as used to be the case, but to open a blog and speak about what they  see outside their <a href="http://www.newyorker.com/online/blogs/evanosnos/2009/02/on-the-river.html" target="_blank">window</a> &#8211; among other things.  Blog sceptics might want to look at this Boston <a href="http://www.boston.com/bostonglobe/ideas/articles/2008/12/07/so_you_want_to_save_the_economy/" target="_blank">Globe</a> article to see just how influential blogs can become.</p>
<p>And here is where my question comes in: what legitimates  Chinabloggers to give opinions about this country, its politics, economy and other fields that affect the well being of billions of people?  Where does our credibility lie? Are we misrepresenting ourselves as experts in China without any serious basis?<span id="more-1631"></span></p>
<p><strong>My take: Intelligent bloggers or intelligent readers?</strong></p>
<p>Although there are exceptions, the majority of blogs commenting on Chinese economy and politics are not written by specialists with credentials in the field. In the same way as the majority of newspaper articles commenting on a wide array of subjects are written by journalists, not by experts.</p>
<p>It is precisely one of the missions of a journalist &#8211; and, I suppose, of a blogger too- to collect complex information, digest it and come up with a product that the general public cares to read and understand. Most of the news worth commenting cover many different fields of knowledge so, even if they wanted to,  specialists in one single field would be ill-prepared to write a good opinion article on current affairs.</p>
<p>There is a difference, however, between newspaper editorials and blog posts. The former are supported by an author and a company&#8217;s reputation, built over many years, and they have to follow certain rules of the trade. Bloggers are not subject to these restrictions, and, understandably, some readers are expressing doubts about their credibility.</p>
<p>Especially in China, where there&#8217;s a permanent imbalance in the market of experts &#8211; demand  growing faster than supply- and  it is enough to be a vocal writer to grab a slice of the cake and position oneself as a pontifying guru. Perhaps the best example is this recent fashion of predicting where and when the crisis is going, and how it will affect the Chinese political system. Forgetting to specify that it is just a guess or, in the best of cases, an educated &#8220;feeling&#8221;.</p>
<p>So it makes sense for an outside observer to maintain some healthy skepticism when looking into the multiple English-speaking sources coming out of China, and to avoid taking credentials at face value in a field where they are all too easily earned.  And it makes sense to keep an eye on the ongoing discussion on the internet, where nothing is taken for granted and every idea has to hold its own.</p>
<p>I am convinced that a reader with common sense can get a more accurate picture of the current events in China reading blogs than by any other means. Here is why:</p>
<ul>
<li>Precisely because there are no other credentials, a blog post has to stand on its own. It has to offer solid arguments and links to support itself.</li>
</ul>
<ul>
<li>Links can be immediately checked; arguments immediately overturned.  A post is subject to the scrutiny of thousands of readers who have a special interest in the field. Errors rarely go unnoticed.</li>
</ul>
<ul>
<li>China is too big a country to include in one discipline, and there is no such a thing as &#8220;China studies&#8221; that can cover the full range of  cultural, political, historical, and other intelligence necessary to understand the country. Only the discussion among diverse sources with experience in the country cancome close to reflecting the real situation.</li>
</ul>
<ul>
<li>Chinablogs are the only place where people  with diverse professional backgrounds, with different experiences on the ground and sometimes with radically opposed political views discuss China affairs openly and (most of the times) peacefully.</li>
</ul>
<ul>
<li>The blog has freed us of the tyranny of lifelong experts. No diplomas, contacts or years of experience can help you if you publish nonsense. On the internet, nobody knows you are a dog, but you are quick to become one if you write like one.</li>
</ul>
<ul>
<li>A reader of blogs typically switches among more different sources and is able to compare far more <a href="http://blog.foolsmountain.com/" target="_blank">different</a> <a href="http://www.mutantpalm.org/">points</a> of <a href="http://www.insideoutchina.com/" target="_blank">view</a> more than a reader of any other medium.</li>
</ul>
<p>That&#8217;s all for the moment, sorry for the longish post. Feel free to discuss here -and not in other posts- all aspects regarding credibility. Trolls are welcome as long as they stay on topic. The objective is to speak in general of Chinablogs, not necessarily about ULN (but feel free as well if you wish to discuss this passionating subject)</p>
<p><em><strong>UPDATE</strong>: *Re &#8220;Chinablog&#8221;.  A commentator pointed out- rightly- that the definition of this term is ambiguous. I am afraid it cannot be otherwise, the term &#8220;blog&#8221; itself not having a clearly defined meaning. I want to clarify that, for the purpose of this post, I am counting as &#8220;Chinablogs&#8221; all the websites that participate in the online discussion about China using blogging methods (pingbacks, comments, links) to interact with each other. Some are based in China and some are not, see my blogroll for examples. Note that not all of them would necessarily agree to call themselves &#8220;blogs&#8221;.</em></p>
<p>And if you are still not tired of reading, some boring info after the <a href="http://chinayouren-free.com/xfiles/" target="_blank">fold</a>.</p>



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		<title>Capitalism with Chinese Characteristics</title>
		<link>http://chinayouren-free.com/2009/03/02/1602</link>
		<comments>http://chinayouren-free.com/2009/03/02/1602#comments</comments>
		<pubDate>Sun, 01 Mar 2009 16:29:33 +0000</pubDate>
		<dc:creator>Julen Madariaga</dc:creator>
				<category><![CDATA[Economy and Business]]></category>
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		<description><![CDATA[Today I am starting my review section with one of the books on Chinese economy that has impressed me most in the last year, &#8220;Capitalism with Chinese characteristics&#8221;, by MIT professor Huang Yasheng. It is a book that clearly stands out from the recent China books, and it might be destined to become one of [...]]]></description>
			<content:encoded><![CDATA[<p><a href="http://www.amazon.com/dp/0521898102/?tag=chinayouren-20"><img class="alignleft size-medium wp-image-1605" style="margin: 10px;" title="cp7zmp6g" src="http://chinayouren-free.com/wp-content/uploads/2009/03/cp7zmp6g-324x490.jpg" alt="cp7zmp6g" width="189" height="283" /></a></p>
<p>Today I am starting my review section with one of the books on Chinese economy that has impressed me most in the last year, &#8220;Capitalism with Chinese characteristics&#8221;, by MIT professor Huang Yasheng. It is a book that clearly stands out from the recent China books, and it might be destined to become one of the big references in the field.</p>
<p>There is no shortage of good China books in the last years. Many are written from a business perspective, by people with first hand experience who will tell you exactly how things are done here. Others look at the available economic data and build interesting theories to explain them. Few go deeper than this, to look into the heart of the matter: the politics behind the Chinese economy.</p>
<p>The problem is:  it is so difficult to obtain reliable information on Chinese policy that most efforts in this field turn into circular arguments over the same limited data. Professor Huang breaks the circle by going back to the sources and questioning directly all the mainstream assumptions, leaving many of them upside down. The situation in China requires this approach, as he says in the preface:</p>
<blockquote><p>In studies of American economy, scholars may debate about the effects of, say, &#8220;Reagan tax cuts&#8221;. In studies of the Chinese economy, the more relevant question would be, &#8220;Did the government cut taxes in the first place?</p></blockquote>
<p>By going back to the archives of what, in his own words is &#8220;some of the world&#8217;s most medieval record keeping&#8221;, Huang Yasheng is able to come up with a whole new picture of Chinese economic policy in the last three decades. This book is the result of painstaking archival research into rarely examined files, such as a &#8220;22 volumes compilation of internal bank documents&#8221; or the archives of the Ministry of Agriculture.</p>
<p>A qualitative leap from the classic tea leave reading, and one that deserves some careful consideration, even if the conclusions drawn will not be to the taste of every reader.<span id="more-1602"></span></p>
<p><strong>The book</strong></p>
<p>&#8220;Capitalism&#8221; is the work of an academic, it is published by the Cambridge University Press and it comes with all the scholarly bells and whistles. But the occasional reader should not let this scare him off it. It is a readable piece, with chapters drafted following the tested formula: attractive anecdote &#8211; presentation of the argument &#8211; easily skipped statistics &#8211; groundbreaking conclusion. Add to this some juicy celebrity bashing (including Nobel J. Stiglitz) for just the right spot of gore, and you get a read that you can thoroughly enjoy. Selling for a surprising  23$ (cheap for a Cambridge Uni hardcover) this is clearly a book designed to be read.</p>
<p>I will not do a detailed summary here, you can find some more in this excellent <a href="http://thechinabeat.blogspot.com/2009/01/in-case-you-missed-it-capitalism-with.html" target="_blank">review</a><strong> </strong>posted last month on China Beat. Instead, what I will do is highlight some of the points that Huang makes that I find most relevant. These they are, as I understood them:</p>
<ul>
<li>China is much less capitalistic today than most observers assume it to be. The real miracle of private entrepreneurship happened in the 80s, but has since been deliberately suppressed, largely through financial repression.</li>
</ul>
<ul>
<li>The 90s and 00s policies favour FDIs and large SOEs against privately owned Chinese companies on one hand, and the cities against rural areas on the other, with very negative effects on some aspects of the economy. These aspects, which are not represented in the sexy GDP figures, are essential to ensure the sustainability of China&#8217;s growth. They include: education, productivity, creativity, entrepreneurial spirit.</li>
</ul>
<ul>
<li>The large developed cities, and Shanghai in particular, are <a href="http://en.wikipedia.org/wiki/Potemkin_village" target="_blank">Potemkin</a> metropolis. The sparkling new infrastructure of Shanghai and Beijing, from the Maglev to the recently burnt CCTV tower, are for a good part &#8220;white elephants&#8221;. While these investments -mostly executed by SOEs-  have helped boost the economy in the 90s, they have questionable returns in the long term, and their opportunity cost will have to be paid dearly.</li>
</ul>
<ul>
<li>China is failing to develop the necessary &#8220;soft infrastructure&#8221; to ensure a sustainable economy. Worse still, it has actually regressed in this field during the last decade. This spells trouble for the future. The &#8220;soft infrastructure&#8221; &#8211; a term used in many China books and which I suspect originates from previous Huang Yasheng works &#8211; refers to those immaterial conditions such as the rule of law, open financial institutions, a civil society and entrepreneurial spirit that many consider essential for the long term development of an economy.</li>
</ul>
<p><strong>Wrong Shanghai: Observations on the Ground</strong></p>
<p>The book opens with a statement that is sure to catch the eye of many living in China: there is something wrong with Shanghai.</p>
<p>Yes, no less than Shanghai, the city that has been fooling us for years with its aura of dynamism and openness. Huang Yasheng arguments, with precise data in hand, that entrepreneurship has long been eliminated from the city.  Shanghai&#8217;s wealth is made of SOEs, FDIs and transfer of resources from other parts of China. It is in fact an economy of CPC members and risk averse &#8220;iron bowls&#8221;.</p>
<p>From my viewpoint of an observer on the ground, it is this statement that I found most exciting. I went straight to chapter 4 and then I went straight to ask all my Shanghainese friends what they though of it. The response I got almost unanimously: &#8220;No kidding, do you need to read a 300 pages book to see this?&#8221;</p>
<p>Which led me once again to this reflection:  We continue to pay too much attention to foreign experts, and not enough to the Chinese themselves. In spite of the growing efforts of bridge <a href="http://www.zonaeuropa.com/weblog.htm" target="_blank">bloggers</a> and media, there is still a massive divide between the two worlds. The successful China books are mostly written by foreigners who don&#8217;t read and write Chinese. It is still too easy for an old China hand to position himself as an expert in everything China. And the circle feeds itself.</p>
<p><strong>And the sheer dismalness of it all</strong></p>
<p>It is always amusing to read these scholarly works in social sciences, where findings are measured against some -ism pattern, and where partisans tear each other apart mercilessly.</p>
<p>Reading this book one cannot help feeling that there is an underlying model in all of its arguments. A conviction -some might call it an ideology- that free markets, a small state and liberalism are the fundamental bases upon which a healthy economy is built, and that there can be no long-term &#8220;China miracle&#8221; based on exclusive &#8220;Chinese characteristics&#8221; if it doesn&#8217;t follow this model. A line of thinking that is understandably very critical of the Chinese policies in the 90s and early 00s.</p>
<p>On the other hand, while this partisanship may lend the book a more unscientific feel than one might like -and what is so scientific about economy anyway- , it also makes for a more compelling reading, not unlike watching a football match where the author scores a spectacular hat-trick. Should anyone be ruffled by the treatment of authors like J. Stiglitz, I would suggest a read of his own popular book &#8220;Globalisation&#8221; to get a taste of what it means to tear apart your opponent.</p>
<p>Of course, the problem with all this is that it makes all works very vulnerable to world fashions. &#8220;Capitalism&#8221; was written before the financial crisis developed, and unfortunately for Huang Yasheng, the winds of economics are since blowing in the opposite direction. The moment marked last year by the fall of Lehman Brothers  and the crowning of some other <a href="http://krugman.blogs.nytimes.com/2008/10/13/an-interesting-morning/" target="_blank">partisans</a> have tipped the scale to the Big  State ideas. More importantly, China&#8217;s economy is still holding strong compared to the West, and this is feeding the side of those who feel that China&#8217;s miracles can save the World from the greedy free-market ideas of the Washington consensus.</p>
<p>While I am of the opinion that China has still a lot to offer to the World, and I certainly see some sense in the famous <a href="http://www.cui-zy.cn/recommended/BeijingConsensus_EN.pdf" target="_blank" class="broken_link" rel="nofollow">Beijing</a><strong> </strong>consensus in the field of international politics, when it comes to economic policy I tend to agree with Huang Yasheng&#8217;s point of view. Being based here and working daily with Chinese companies, it is just too difficult to believe in the soundness and &#8220;entrepreneurialness&#8221; of China&#8217;s economy.</p>
<p>In any case, and whatever the opinion of the reader, Huang Yasheng drives his points home with argumentative skill, and making good use of an admirable research work to shed light on some of the least understood aspects of China&#8217;s economic development. Moreover, it is to his credit that, based on the new data, Huang goes against his own previously held ideas -namely, that the 90s reforms were more far reaching than the 80s. It is always comforting for this humble, unenlightened engineer to see that, in social science too, empirical data can change a theory rather than the opposite.</p>
<p>Who knows, it is very possible that the economy&#8217;s Wheel of Fortune will turn again sooner than we expect. Then China&#8217;s  economic system might suddenly show all its contradictions, and people will need to turn to books like &#8220;Capitalism&#8221; to try to understand what has been going on all this time.</p>



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		<title>Chinese FDI in Barcelona. This is the end.</title>
		<link>http://chinayouren-free.com/2009/02/14/1559</link>
		<comments>http://chinayouren-free.com/2009/02/14/1559#comments</comments>
		<pubDate>Fri, 13 Feb 2009 17:24:43 +0000</pubDate>
		<dc:creator>Julen Madariaga</dc:creator>
				<category><![CDATA[My Front Garden]]></category>
		<category><![CDATA[bridge blogger]]></category>
		<category><![CDATA[Business]]></category>
		<category><![CDATA[CCTV]]></category>
		<category><![CDATA[charts]]></category>
		<category><![CDATA[crisis]]></category>
		<category><![CDATA[FDI]]></category>
		<category><![CDATA[media]]></category>
		<category><![CDATA[police]]></category>
		<category><![CDATA[real estate]]></category>
		<category><![CDATA[Shanghai]]></category>
		<category><![CDATA[Spain]]></category>
		<category><![CDATA[TV]]></category>
		<category><![CDATA[unemployment]]></category>

		<guid isPermaLink="false">http://chinayouren-free.com/?p=1559</guid>
		<description><![CDATA[I have a bunch of friends back in Spain who are always quick to send me the juiciest China news coming up over there, and to supervise that I&#8217;m fulfilling my duties as a bridge blogger. This time I have received a couple of links from Spanish newspapers El Pais and El Mundo where there [...]]]></description>
			<content:encoded><![CDATA[<p>I have a bunch of friends back in Spain who are always quick to send me the juiciest China news coming up over there, and to supervise that I&#8217;m fulfilling my duties as a bridge blogger.</p>
<p>This time I have received a couple of links from Spanish newspapers El Pais and El Mundo where there is evidence of at least two different Chinese industries that continue their cheerful expansion to the West in spite of the World Crisis: These are the industries of Shady Barber Shops and Mahjong Gambling Dens. Fourteen of them have been closed down in a recent police raid in Barcelona.</p>
<p>These are the <a href="http://www.elmundo.es/elmundo/2009/02/12/barcelona/1234449869.html" target="_blank">two</a> <a href="http://www.elpais.com/articulo/espana/Desmantelado/casino/ilegal/ubicado/altillo/peluqueria/Barcelona/elpepuesp/20080325elpepunac_17/Tes" target="_blank">articles</a>, one very recent, one from last year:</p>
<blockquote><p>In recent months local residents of the districts of Eixample, Sants-Montjuïc, Gràcia, Horta-Guinardó and Sant Martí, had brought to the police their suspicions that many hairdressers opened recently by Chinese citizens were something more than to cut and dye hair.</p></blockquote>
<p>Yes, how perspicacious. I never knew of these things  during the three years I lived in Barcelona. For linguistic reasons I had quite a few friends in the Chinese migrant community over there and I frequented the Chinese areas of the city. As far as I know these FDIs must be very recent.</p>
<p>Anyway, so much for the Chinese hairdressers&#8217; expansion. Although gambling and prostitution are not among the Rights that this blogs stands for,  I can&#8217;t help feeling a bit sorry for those Chinese that see their  business seized by the police. Something must have gone wrong with their otherwise perfectly profitable business model. Perhaps they didn&#8217;t remember to &#8220;glocalize instead of globalize&#8221;. Perhaps the local police superintendent is not keen on Asian chicks, or maybe they chose the wrong hand to oil. Who knows.</p>
<p><strong>The New Iceland?</strong></p>
<p>Since we are at it, and on a completely different subject, check out below this scary chart of Spanish unemployment that newspaper <a href="http://www.elcorreodigital.com/vizcaya/20090210/economia/zapatero-habla-congreso-sobre-200902100012.html" target="_blank">El Correo</a> published this week. Two little thoughts:</p>
<p>First, I am seriously afraid that Spain is going to turn into the next Iceland. The growth of these last years was so based on the real estate bubble that troubles could be smelled all the way from China. Am I going to turn into a poor immigrant in Shanghai working my ass off to send money back to homecountry? It would be an interesting role reversal, after all the Chinese I met doing exactly that in Barcelona. Oh well, it was  inevitable at some point, I guess, I just never imagined it could come so soon.</p>
<p>Second, as an engineer I note again how numbers and charts are powerful tools of manipulation. The chart below  goes so high on the Y axis that it almost needs logarithmic scales to fit in the paper. A mere problem of the units chosen, of course&#8230; or of the number of copies the newspaper wishes to sell.</p>
<p>Inversely, it would be very easy to make this graph look flatter with a more harmonious  objective in mind&#8230; CCTV, take note, you might consider hiring a specialist like me to re-engineer your charts and numbers for harmonious results. But then, what do they care, they simply would not publish the negative charts.</p>
<p>(yes, it is CCTVbashing week this <a href="http://chinadigitaltimes.net/2009/02/han-han-%E9%9F%A9%E5%AF%92-bash-cctv-when-its-on-fire/" target="_blank">week</a>)</p>
<p><img class="aligncenter size-full wp-image-1561" title="paro11" src="http://chinayouren-free.com/wp-content/uploads/2009/02/paro11.gif" alt="paro11" width="440" height="600" /></p>



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		<title>Chаrter 08: Why it should be called Wang</title>
		<link>http://chinayouren-free.com/2009/01/11/1101</link>
		<comments>http://chinayouren-free.com/2009/01/11/1101#comments</comments>
		<pubDate>Sun, 11 Jan 2009 00:58:56 +0000</pubDate>
		<dc:creator>Julen Madariaga</dc:creator>
				<category><![CDATA[Politics and Change]]></category>
		<category><![CDATA[America]]></category>
		<category><![CDATA[CCTV]]></category>
		<category><![CDATA[censorship]]></category>
		<category><![CDATA[Charter 08]]></category>
		<category><![CDATA[Google]]></category>
		<category><![CDATA[Great Wall]]></category>
		<category><![CDATA[Human Rights]]></category>
		<category><![CDATA[internet]]></category>
		<category><![CDATA[language]]></category>
		<category><![CDATA[law]]></category>
		<category><![CDATA[leadership]]></category>
		<category><![CDATA[media]]></category>
		<category><![CDATA[politics]]></category>
		<category><![CDATA[speech]]></category>
		<category><![CDATA[TV]]></category>
		<category><![CDATA[university]]></category>

		<guid isPermaLink="false">http://chinayouren-free.com/?p=1101</guid>
		<description><![CDATA[When I started my article about the Chrter 08 last month I couldn&#8217;t help wondering if it was well worth the effort. Most of the English speaking blogs and media had been very quiet about this issue, and in China nobody seemed to know anything about it.  Two weeks after the Charter&#8217;s publication, I thought [...]]]></description>
			<content:encoded><![CDATA[<p>When I started my article about the <a href="http://chinayouren-free.com/2008/12/charter-08-and-political-change-in-china/" target="_blank">Chrter 08</a> last month I couldn&#8217;t help wondering if it was well worth the effort. Most of the English speaking blogs and media had been very quiet about this issue, and in China nobody seemed to know anything about it.  Two weeks after the Charter&#8217;s publication, I thought perhaps that was all we were going to hear of it.</p>
<p>I am pleased to see after all that the Chrter 08, in spite of the <a href="http://chinayouren-free.com/2008/12/charter-08-and-political-change-in-china/" target="_blank">weaknesses</a> I noted, is indeed slowly &#8220;flying into 2009&#8243;. From the English language blogs, it has since got more attention, with featured posts by <a href="http://www.insideoutchina.com/2009/01/china-revolution-or-reform-summary-of.html" target="_blank">Xujun Eberlein</a>, <a href="http://www.pekingduck.org/2009/01/muted-reaction-to-charter-08-explained/" target="_blank">Peking Duck</a>, <a href="http://blog.foolsmountain.com/2008/12/31/%E5%8A%89%E6%9B%89%E6%B3%A2%E8%88%87%E7%BE%8E%E5%9C%8B%E6%B0%91%E4%B8%BB%E5%9F%BA%E9%87%91%E6%9C%83-liu-xioabo-and-the-ned/" target="_blank">FM</a>, and now also <a href="http://www.zonaeuropa.com/20090111_1.htm" target="_blank">ESWN</a>. Most importantly, in the Chinese speaking circles it is slowly gaining momentum, as is proven by the fact that the government is getting nervous and has closed down the whole site <a href="http://chinayouren-free.com/2009/01/never-laugh-faster-than-china-laughs/" target="_blank">bullog</a>.</p>
<p>ESWN and the <a href="http://www.csmonitor.com/2009/0107/p06s01-woap.html" target="_blank">CSM</a> have written about this rather optimistically in my opinion. CSM quotes :</p>
<blockquote><p>Zhang says more than 300,000    websites now link to the charter, and it&#8217;s being discussed on blogs, QQ groups, and other chat    rooms. &#8220;It&#8217;s impossible to block information in society now,&#8221; he says.</p></blockquote>
<p>I am afraid this statement has yet to be proved. Like ESWN&#8217;s Roland Soong notes, this number 300,000 is taken from the number of Google.com results. It is a relatively large number and it indicates that the subject has become popular in the Chinese internet forums.  But little more than that. Of these results, only 1/3 come from mainland China, and 100,000 is attained easily by many of the hot topics coming up regularly on Chinese BBS (see <a href="http://www.chinasmack.com/secrets/chinese-people-secrets-part-11/" target="_blank">ChinaSMACK</a>).</p>
<p>The fact is that Chrter 08 is still an unknown movement in mainland China. Out of 5 local friends I asked, all with university degrees and fluent English, even today only one of them had heard the term (but knew no details). As for the majority of Chinese who live out of the cities and don&#8217;t use the internet, there is no way they can have heard about it. I don&#8217;t know who is the &#8220;peasant&#8221; that CSM mentions as a signer, but until I get  some tangible evidence otherwise, I maintain that <span style="text-decoration: underline;">China doesn&#8217;t know about the Charter</span>.</p>
<p>This is a very important point because, of the difficult path that Chrter 08 will need to run to achieve its goals, the first unavoidable condition is to become known to the public by beating the censors at their own game. As I said in my previous posts, the government has done an impressive job of silencing Chrter 08, but it is a sign of hope to see it little by little creeping back into the mainstream.</p>
<p>As I see it, the 3 phases and 3 main difficulties that the Charter will have to face to grow into a real mass movement are, in this order:</p>
<p>1-To be <strong>Known</strong> vs.  internet censorship and lack of freedom of speech</p>
<p>2-To be <strong>Trusted</strong> vs. <a href="http://chinayouren-free.com/2008/12/charter-08-and-political-change-in-china/" target="_blank">weaknesses</a> that make it easy to manipulate against</p>
<p>3-To be <strong>Loved</strong> vs.   lack of a spark, a leader, a name: the material of which Change is made</p>
<p><span style="color: #ffffff;">.</span></p>
<p><strong>Charter Step 1 and the Internet Underworld</strong></p>
<p>We will leave point 3 for a post in the future, supposing we ever get there. For the moment we are still stuck in phase 1, and it is far from clear that the Charter will make it past this point. We know  that the Chinese government  has developed a very sophisticated system to control information on the internet. But how does it work? What are its strengths and weaknesses to oppose the Charter? Following ESWN, I have conducted some research on Google and found the curious results below.</p>
<p>First, as Roland points out, if you search for Chrter 08 in Chinese, Google.cn is sending back this message:</p>
<p style="text-align: center;"><a href="http://chinayouren-free.com/wp-content/uploads/2009/01/ioioioi.png"><img class="aligncenter size-medium wp-image-1107" title="ioioioi" src="http://chinayouren-free.com/wp-content/uploads/2009/01/ioioioi-489x142.png" alt="" width="489" height="142" /></a><span style="font-size: x-small; font-family: Verdana;">&#8220;Some results are not displayed according to  local laws, regulations and policies.&#8221;</span></p>
<p>This has made me think that indeed, when it comes to fighting censorship, the Charter has an insurmountable flaw: it is a document. Therefore, its title and content are fixed and it is extremely easy to locate by a bot. Worse even, in this era of internet search engines, nobody has still given the  Charter a better nickname than that easily searchable title 08宪章. Any internet conversation where the Charter comes up, even if the contents are not copied, is sure to attract the Censor&#8217;s eye.</p>
<p>It might sound ridiculous at this point, but I&#8217;m serious: The Chrter 08 should be named Wang.  Or Zhang or Liu, any other term that is not exclusively related to it and therefore cannot be banned. Two centuries ago, the first Spanish constitution of 1812 was nicknamed by the people &#8220;La Pepa&#8221;, a popular name for a girl that many intellectuals scorned at the time. Two years later, during the reign of autocrat Fernando VII, this name became extremely useful to dissidents to acclaim the Constitution without risk to their lifes, with the famous slogan &#8220;Viva la Pepa!!&#8221;</p>
<p>Do you still think this is not relevant? Well, follow me with the next google experiment. If you are in China, try to search Google.cn for sensitive political terms like: Falungong, Tiananmen 89 massacre, Liu Xiaobo, you name it. You might be surprised to find not the message above, but rather a reset connection, which only affects viewers from mainland China and which is easily bypassable with a proxy or VPN.  It looks like this:</p>
<p><a href="http://chinayouren-free.com/wp-content/uploads/2009/01/interrupta9kaqvd.png"><img class="aligncenter size-medium wp-image-1104" title="interrupta9kaqvd" src="http://chinayouren-free.com/wp-content/uploads/2009/01/interrupta9kaqvd-490x189.png" alt="" width="490" height="189" /></a></p>
<p>So what is that first message that Roland Soong and myself have been obtaining? It is not the political censorship message, but another one with which many Chinese men are acquainted. It is the notice you get when you look for some well defined  terms, like those found in pornography. As an example, I suggest you try a search for the word  &#8220;口交&#8221;. I will not translate it directly here, but let&#8217;s just say it is not a <em>blog job</em>. Run the search, surprised? Try any other &#8220;vulgar&#8221; word and you will end up with Google&#8217;s  Chrter 08 message. This is the first and most basic level of defense in the Great Wall, the porn block !</p>
<p>Pretty annoying for the drafters, I guess. But above all, it is very negative for the transmission of Chrter 08, because by calling it this name, the supporters are giving themselves away directly to the  Censors. And this is before phase  2- direct manipulation- has even kicked in.</p>
<p>So we are back to the basics. Like I already said, this Charter is lacking the <strong>popular element</strong>, the leadership that succesful movements have had in the past, the brand and name and life that would make a whole people roar &#8220;Viva la Pepa!&#8221;, or the one that years ago inspired a man to dance with the tanks on Changan Avenue. As it stands, it is the cold work of the intellectuals, and nobody has felt the urge to call it Wang.</p>
<p><span style="color: #ffffff;">.</span></p>
<p><strong>Note on Censorship</strong></p>
<p>Finally, one more thing I cannot leave unmentioned. It is not news for anyone that Google have a deal with the Chinese government to collaborate in the repression of the internet. What is news to me is that Google is so openly censoring the principles by which all decent democratic countries abide, including the most basic of Human Rights. Google should be careful, they are entering a dangerous area, one which can backfire in a not very far future.</p>
<p>One more final test for the shame of the censors: when you run the Charter o8 search on Google.cn and you get the message screen, go to the number 4 item on the list of results. I just did that tonight and I believe I found out the essence of Google&#8217;s repression algorithm: <span style="text-decoration: underline;">&#8220;Ban all except the People&#8217;s Daily&#8221;</span>. Indeed, this is the only way I can imagine that a People&#8217;s Daily article comes up as the single result for the search 零八宪章. It is a random PD <a href="http://live.people.com.cn/note.php?id=488070820122610_ctdzb_028" target="_blank" class="broken_link" rel="nofollow">article</a> that coincidentially contains separate instances of 宪章 and 零八.</p>
<p><a href="http://chinayouren-free.com/wp-content/uploads/2009/01/kjh.png"><img class="aligncenter size-medium wp-image-1105" title="kjh" src="http://chinayouren-free.com/wp-content/uploads/2009/01/kjh-490x176.png" alt="" width="490" height="176" /></a></p>
<p>What a shame, Google, what a shame. Watch your steps today, lest you might find tomorrow that the people does not forget.</p>
<p><span style="color: #ffffff;">.</span></p>
<p><strong>UPDATE:</strong> The results on Google change with time, and this last People&#8217;s daily result is not on page 4 anymore. In any case, the search for 零八宪章 on Google.cn gives results that have always one thing in common: they are all from websites controlled by the government, like china.com, cctv, etc.  No results from the thousands of forums and blogs that discussed the issue.</p>
<p><strong>UPDATE2:</strong> See this <a href="http://chinayouren-free.com/2009/01/chinese-internet-censorship-explained/" target="_blank">post</a> for a more clear explanation of how the internet censorship works in China and <a href="http://chinayouren-free.com/2010/01/22/2869">this one</a> for the ways in which Google -and many other search engines- collaborate with the Chinese government. I have learned a lot in the year since I wrote this article, and I know now some of the info contained is not technically correct. I am not updating the text above anymore, so if you are interested in the technical part you should absolutely visit these <a href="../2009/01/chinese-internet-censorship-explained/" target="_blank">two</a> <a href="../2010/01/22/2869" class="broken_link" rel="nofollow">posts.<br />
</a></p>



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