The FT's Philip Stephens, in an essay published yesterday, claim that Xi & Putin are "contesting the established world order. " This is an increasingly common take on Russia and China's aggressive approach to their respective border disputes (Crimea, the South China Sea, Senkaku/Diaoyutai, etc.). But I think it's folly and the height of arrogance to portray the US's disagrements with Russia and China as one of a disagreement about the basic rules of the international system. The first point is to note that Russia and China are acting in highly assertive ways and using coercion to press pursue their... Continue reading

After several years of planning, Indiana University's China office opened its doors on Friday, May 23rd. Although the cover photo for the office's website may exaggerate how clean Beijing's air is, the facility really is state of the art, and will be a very comfortable home for IU faculty, students, and alumni who need to do research and hold meetings in China. For more info on using the facility, visit IU's China Office website. The opening is officially described in a press release issued by IU, so no need for me to go into much more detail here. But you... Continue reading

China's Global Times ran a story on Sunday calling the knife attack that left at least 29 dead in the Kunming railway station, "China's 9-11." The story went on: Any explanation for the attack, like those in previous cases elsewhere in China, would be feeble at the bloody scene, where mothers, sons and daughters were slaughtered by strangers. Nothing justifies such a carnage against innocent civilians. This was a random attack, with the sole purpose of causing the greatest casualties and impact within the shortest period of time. It seems that the terrorists have had their way. Their killing spree... Continue reading

I'm a professional China specialist, but I'm a lifelong Redskins fan. My two identities have always remained separate. When I'm in the US, Sunday afternoons are for watching NFL football. When I'm in China I can't even see the games. And explaining American football to my Chinese friends -- from the uniforms to the thousands of rules -- shows how utterly strange the sport is to outsiders. But there's now a way for my two lives to intersect. The NFL regular season ended yesterday, and my Redskins finished with 8 consecutive losses, to wind up with a 3-13 record, their... Continue reading

Arthur Levitt, a former SEC Chairman, had a nice, consolling gift for American banks operating in China in the form of a Wall Street Journal op-ed on Christmas day. He catigated the current SEC leadership and other American regulators for going after JPMorganChase and other banks who hire the princelings of Chinese leaders in order to promote their businesses. He justifies the practice in three ways. First, he says it is so commonplace in the US that it would be hypocritical to outlaw it in China. He writes: The accusation is scurrilous and hypocritical. If you walk the halls of... Continue reading

Today in Beijing Vice President Biden issued a strong and candid defense of a free press. In his speech to US business executives he said, "innovation will thrive where people breathe freely, speak freely, are able to challenge orthodoxy, where newspapers can report the truth without fear of consequences." He went on, saying that "We have many disagreements, some profound disagreements on some of those issues right now - the treatment of U.S. journalists." Of course, he is referring to the difficulty of reporters from the New York Times and Bloomberg getting accredited, as well as the daily hassles foreign... Continue reading

Vice President Biden is completing his visit to China as part of his broader trip through the region. Although China's announcement of a new Air Defense Identification Zone (ADIZ) has dominated the headlines and been a central part of the discussions everywhere he goes, he has addressed a great many issues during the past several days. I'm particularly struck, though, by the sweet and sour mix of his meetings with Xi Jinping. They in a nutshell embody what may be enduring elements of the broader US-China official relationship. On the sweet, positive side, there was genuine, sustained personal engagement and... Continue reading

Given Japan's treatment of China in the first half of the 20th century it's no surprise that many Chinese hold very negative feelings about the land of the rising sun. At the same time, Beijing does go over the top, using educational texts, movies, and other means to highlight this past. The goal is to essentialize this earlier behavior as eternal Japanese character traits that disqualify Japan from the right to have a military, to be a leader in Asia, and have a permanent seat on the UN Security Council. With Japan sidelined and the view of many in China... Continue reading

Since Party plenums are closed-door events with nothing emerging except what the leadership wants us... Continue reading

The New York Times is running a story about the rise of China's global arms sales. They were prompted by China's large deal with Turkey, a NATO member. Yes, Chinese sales are up, to around $2.2B per year, and they're gradually moving up the value-added chain to sell more sophisticated stuff. It's a story that sounds similar to the civilian sector, where extensive state support puts China in a position to undercut the US and other advanced economies. And given that the most recent sales are to a NATO member, this could force a wedge into the alliance. Yes, all... Continue reading

China's corporate landscape is continuing to evolve in ways unexpected and expected. I recently came... Continue reading

China's Internet has never been an easy place to drive. Although theoretically a super-highway paved with thousands of kilometers of fiber optic lanes, the Internet is more like a highway with a toll booth at every mile. Data is scanned repeatedly and often. In techno-speak, the speed is high, but there is also high latency. That's why even when some enterprising souls turn on their VPN's as a way to get around the Great Fire Wall, their performance goes up -- the broadband speed declines but most of that latency (sitting around at toll booths) disappears. Things have gotten even... Continue reading

How can government-business relations be structured to most likely generate good economic policies? A huge question with perhaps no good answer. In the late fall I gave an interview to a reporter from the China Enterprise News (CEN) on this question. My answer, published a couple days ago, borrowed from Peter Evans' 1995 book, Embedded Autonomy. In a nutshell, businesses need to have access to government to collect information and provide ideas, but at the same time not be too closely enmeshed with their regulators and politicians. CEN was kind of enough to publish an extensive transcript of the interview... Continue reading

Today's unveiling of the new Chinese leadership reveals a system that generates balances, however, fragile, involving factions, policies, and process. Continue reading

Trying to determine the trajectory of economic policy in China is never easy, but last week we got some important insights into the financial bureaucracy's views when PBOC deputy governor and SAFE administrator Yi Gang spoke on April 18th at Indiana University's Indianapolis campus. Yi, a former economics professor at the awkwardly named Indiana University Purdue University Indianapolis, or IUPUI, was in town to receive an honorary doctorate of letters for his academic research and application of this knowledge through his contributions to Chinese economic policy during the past 15 years. Yi joined the PBOC in 1997, and has steadily... Continue reading

For most observers it has become conventional wisdom that protest in China have been on the rise as a result of a growing gap between rich and poor, generated by corruption and the special privileges of China's elites. "Seething discontent," which occasionally boils over into huge protests involving thoustands, would be the picture many would draw. Scholars point to the growing assertiveness of China's labor movement as the latest sign that society is fighting back against oppression. This view is particularly visible is portraits of the Chinese countryside. Pulitzer prize-winning author Ian Johnson's book, Wild Grass, details the rising assertiveness... Continue reading