Xi on education; Escalating crisis at Sabina Shoal; FOCAC week; Toyota opposes more chip controls; A Gao Brother detained

Summary of today’s Essential Eight:

1. Xi on education and Socialist successors - The lead essay in the latest issue of Qiushi is an excerpt from Xi's speech at the 2018 National Education Conference "Cultivating Socialist Builders and Successors with Comprehensive Development in Morality, Intelligence, Physical Fitness, Aesthetics, and Labor". The publication was nicely timed for the start of the 2024-25 school year, and comes just a week after the issuance of a set of guidelines to “cultivate high-quality teachers”. In his 2018 speech Xi says “Our education must never cultivate destroyers and gravediggers of socialism. We must never cultivate people who 'have Chinese faces, but not Chinese hearts, lack Chinese sentiment, and are devoid of Chinese flavor'!…various hostile forces have never stopped implementing strategies of Westernization and division against our country, never stopped subverting and sabotaging the leadership of the Communist Party of China and the socialist system of our country, and have always attempted to plan "color revolutions" in our country. One of their main efforts is to compete for our youth. Comrade Mao Zedong once said, "Imperialists say that there is no hope for our first and second generations, but what about the third and fourth generations? There is hope. Is what the imperialists say true? I hope it is not, but it might be." Now, it seems that college students are roughly within the scope of the third and fourth generations, and there will be fifth, sixth, and even dozens of generations in the future. The struggle for the youth is long-term and severe, and we cannot afford to lose. We must be vigilant!”.

2. Philippine ship rammed at Sabina (Escoda) Shoal/Xianbin Jiao - On August 31st a China Coast Guard vessel repeatedly rammed the BRP Teresa Magbanua at Sabina (Escoda) Shoal/Xianbin Jiao. The PRC side says its vessel was the victim of ramming by the Philippines ship, but even the video released by the PRC makes it obvious the PRC boat was the aggressor. According to PRC media “US Navy P-8A maritime patrol aircraft was spotted on-site disrupting the CCG’s law enforcement operations”, so the US was watching in real time. The crisis at this shoal has intensified, with the PRC making it explicitly clear that they will not allow the Philippines establish a permanent presence there as they did with the Sierra Madre at Second Thomas Shoal, even though this shoal is also well within the Philippines EEZ. There seems little possibility of a credible, enduring deal in which both sides withdraw from the shoal, both because the Philippines and the US were burned in 2012 over a deal for both sides to withdraw from Scarborough Shoal as well as because both sides have made this into a much more public struggle over sovereignty. It will be very hard for the Philippines to hold out with just one ship, so I think the US will have to get more directly involved, beyond just statements of support and reaffirmations of Article IV of the 1951 United States-Philippines Mutual DefenseTreaty, or the Philippines will have to withdraw.

3. FOCAC week in Beijing - The 9th Forum on China-Africa Cooperation (FOCAC) starts Wednesday in Beijing. At least 50 African heads of state/government will attend.

4. July economic data - The latest economic data are mixed but generally negative. the official manufacturing PMI is in contraction territory, the private Caixin manufacturing PMI indicates slight expansion, and real estate data show no signs of a bottom. Predictably there are more calls (begging?) for stimulus, but I doubt the data are either surprising to the top leadership or weak enough for them to change the current approach beyond some tweaks.

5. Toyota pushing Japan government to resist more US controls on chip exports to PRC - Bloomberg got the story that Toyota is one of the main reasons that Japan will not get on board with tighter US chip controls on China. As I wrote on August 23 "Toyota is worried about more controls so the Japanese are not on board, even as Huawei keeps building out is fab network". The Japanese will not move without the US invoking the foreign direct product rule (FDPR), and I have heard that there has been talk of passing a law banning their companies from complying if the US takes that step. I would be surprised if the Biden Administration invokes the FDPR with an ally like Japan.

6. Ministry of Foreign Affairs on Jake Sullivan’s visit - MoFa issued a briefing of the visit after Sullivan had left, by Director General Yang Tao of the Department of North American and Oceanian Affairs. The briefing makes it sound like the PRC side thinks the visit was constructive, though the US still has many mistaken policies toward and perception of the PRC. Yang said that “Taiwan, democracy and human rights, path and system, and right to development are the four red lines China has drawn in China-U.S. relations”. But the actions at Sabina Shoal just two days after Sullivan left do not reflect well on the visit.

7. Pacific Islands Forum caves on Taiwan - The original public communique from last week’s Pacific Islands Forum (PIF) including language from prior communiques that “Leaders reaffirmed the 1992 Leaders decision on relations with Taiwan/Republic of China”, but after complaints by Qian Bo, the PRC special envoy for the Pacific, the communique disappeared from the website, only to reappear later with the language removed, though the PIF will still be taking money from Taiwan.

8. Artist detained for insulting heroes and martyrs - Gao Zhen, one of the two members of the “Brothers Gao” artist team, went back to the PRC from the US for a visit in August, and was detained under suspicion of slandering China’s heroes and martyrs. The Gao Brothers have long made art critical of Mao and the Cultural Revolution, and have had run-ins with censors over the years, but this arrest is a surprise, and perhaps an escalation of the struggle against historical nihilism.