The Sinocism China Newsletter For 05.26.13

In observance of the US Memorial Day holiday there will be no Sinocism Monday.

I am considering drafting a blog memo (a blemo?) to President Obama suggesting what he should put on the agenda for his Sunnylands summit with President Xi Jinping. What do Sinocism readers think should make the list of priorities for that meeting? If there is enough feedback I will write up the suggestions.

Some weekend reading:

THE ESSENTIAL EIGHT

China Top Planner Dismisses Reuters Report of Urbanization Plan Refusal -Caijing rear end covering or reporting problems?// It is completely rootless, said Li Tie, director at the City and Town Development Center of NDRC, who explained that the urbanization draft is still under discussion and there’s no clear timetable for implementation. “How could the draft be turned down if it hasn’t been finished yet?”  said Ba Shusong, a renowned economist with the State Council’s finance research center.

China Plans to Reduce the State’s Role in the Economy – NYTimes.com On Friday, the Chinese government issued a set of policy proposals that seemed to show that Mr. Li and other leaders were serious about reducing government intervention in the marketplace and giving competition among private businesses a bigger role in investment decisions and setting prices. Whether Beijing can restructure an economy that is thoroughly addicted to state credit and government directives is unclear. But analysts see such announcements as the strongest signs yet that top policy makers are serious about revamping the nation’s growth model.

China gets into the business of making friends-Garnaut–CAIFC [China Association for International Friendly Contacts 中国国际友好联络会] has also been increasing its work rate with the American business elite. A month before Owens’ visit, before the Chinese system shut down for the 18th party congress, CAIFC helped arrange visits for an American business delegation headed by John Mack, the chief executive of investment bank Morgan Stanley in the Hall of Purple Light, in Zhongnanhai. Mack promised to ”educate American politicians” when he returned home, while noting with dismay that Charles Schumer, a reputedly ”China-bashing” senator, had been to China only once. Over the following three days CAIFC hosted John Howard, Tony Blair, and Bill Gates at one of its new platforms, the First China Philanthropy Forum.

Related: Chinese military woos big business-Sydney Morning Herald-Garnaut Some of Australia’s most high flying business leaders were feted in China by an ”influence” platform of the People’s Liberation Army, a Fairfax investigation has revealed…It is understood that none of the Australian business leaders was aware that the ”social organisation” facilitating their access, The China Association for International Friendly Contacts (CAIFC), was a platform for ”influence operations” by the Liaison Department of the General Political Department of the People’s Liberation Army.

Xi warns officials they’ll be held responsible for pollution ‘for life’ | South China Morning Post An environmentalist said it was the toughest warning yet linking officials’ political future to their stewardship of the environment. In a Politburo study session on environmental issues, Xi said pollution had become a major concern of the people and China could no longer develop its economy by sacrificing the environment. “The government must create a system of accountability,” he said.

Related: President Xi vows strict observation of ecological “red line” – Xinhua | English.news.cn Chinese President Xi Jinping on Friday vowed to set and strictly observe an ecological “red line” amid the country’s rapid urbanization in order to protect the environment.China should accelerate the implementation of a functional zoning strategy, said Xi, at a study session with members of the Political Bureau of the Communist Party of China (CPC) Central Committee. The government should set and strictly observe an ecological “red line” which requires all regions to optimize, prioritize, restrict or prohibit their industrial development according to their defined nature, he said.

A tussle in China over the Communist Party bowing to the Constitution – CSMonitor.com “Things seem to have quite dramatically changed,” since that meeting, says Zhang Qianfan, a constitutional law expert at Peking University and one of the leaders of the constitutionalist movement here. “They have decided to turn against constitutionalism, and that signifies the premature end to political reform” under the new administration, he adds gloomily. Other observers, however, are less certain that the battle is over.

Related: Chinese scholar challenges Party in constitutional debate | South China Morning Post A recent Communist Party circular, warning officials of “dangerous western values,” appears to have been challenged from inside the ranks of the party leadership in Beijing. Those who have written the circular “consider the people’s legitimate calls for reform as activities by hostile forces and ‘dissidents’ and thus wrongly estimating and analysing the situation,” Yang Tianshi, a senior scholar and adviser, wrote in an essay shared online.

Related:  百年宪政”的认识误区–炎黄春秋杂志 lead essay in the latest issue of Yanhuang Chunqiu about the 100 years of historical ideas and debate about “Constitutional Government”, by Professor Guo Shiyou 郭世佑 // 如果说清朝最后12年乃中国历史上最为复杂的时段之一,那么,1905年就是其中最为重要的年份之一。就在这一年,日俄战争宣告结束,君主立宪的日本打败君主专制的俄国,矢志推翻清朝的中国同盟会却在东京宣告成立,曾经亲手镇压戊戌变法的慈禧太后授意光绪帝,一边宣布废除延续中国1300年的科举制,一边破天荒地派遣载泽等5名大臣,远航东、西两洋,专程考察外邦宪政,并于次年宣布“预备仿行宪政”,于1908年8月承诺以9年为限,推行君主立宪,举世瞩目的《钦定宪法大纲》也随即出台。再过3年,武昌起义的枪声催发辛亥革命的高潮,清朝“万世一系”的君宪计划成为泡影。及至民国奠基,易主频仍,宪法文本不断翻新,宪政之果却一再难产,至今未曾到位,知识精英的宪政呼声时隐时现,不绝于途。自晚清宪政考察团出访至今,100多年过去了,江山不可复识,宪政之梦却萦绕神州,无时或释。回首近代先贤筚路蓝缕浴血奋战的身影,难免令人感慨万千。近年来,从媒体到学界,“百年宪政”的话题经久不衰,歧义纷呈,见仁见智在所难免。

China Tells North Korea to Return to Nuclear Talks – NYTimes.com In an earlier encounter Friday with the vice marshal, a senior Chinese military commander delivered a similar message to Mr. Xi, and suggested that North Korea’s nuclear program was responsible for the rising tensions on the Korean Peninsula. By the standards of China’s carefully worded statements, the remarks by Gen. Fan Changlong, a vice chairman of the powerful Central Military Commission, were unusually strong. They were devoid of any ritualistic references to the friendship between the allies

U.S., China Set Pact On Auditor Access – WSJ.com The agreement doesn’t address or resolve a similar but separate dispute in which the Securities and Exchange Commission is demanding access to documents from Chinese audit firms, as it, too, probes possible fraud. Nor does the agreement allow the PCAOB into China for inspections of Chinese firms that audit U.S.-traded companies, which the U.S. regulator has pushed for. Still, Mr. Doty said the agreement is a first step toward resolving those issues. It demonstrates that the Chinese are modifying their position on cooperating with U.S. regulators, he said, and “one could only regard it as encouraging.”

Related: PCAOB deal announced | China Accounting Blog | Paul Gillis  Gillis seems to think the US caved. I tend to agree. Access to the us capital markets is a privilege not a right, and either foreign companies and accounting firms play by the rules, regardless of their home government policies or they go somewhere else // While I expect negotiations will continue for inspection access, I do not expect there will be any further progress. The real leverage the U.S. had over China was access to its capital markets. With the shutdown of the IPO markets in both the U.S. and China, private enterprise in China is being starved of capital, and that threatens indigenous innovation and the future competitiveness of China. If a deal with the PCAOB and the SEC removes that threat and reopens the IPO markets, I think it is unlikely that China goes any further. That does not bode well for investors.

China Has Drones. Now What? | Foreign Affairs The time to fret about when China will acquire drones is over: it has them. The question now is when and how it will use them. But as with its other, less exotic military capabilities, Beijing has cleared only a technological hurdle — and its behavior will continue to be constrained by politics.–Andrew Erickson and Austin Strange

 

BUSINESS AND ECONOMY

Securities brokerages at centre of China regulator’s crackdown – FT.com One possibility is that international companies, unscathed by the crackdown, may benefit from the reputational damage to their Chinese rivals. However, the executive in the Sino-foreign brokerage joint venture is not optimistic. “We want there to be systematic changes in China rather than campaigns,” he says. “I don’t believe that underwriters were created bad or evil. The market mechanism is sick, and it is the regulator that creates this market.”

北京楼市调控加码:万科保利等40项目预售证遭扣押_中国经济网??国家经济门户 one way to keep Beijing housing prices down is to not grant permits for sales of new constructions…some crazy stuff going on in Beijing right now over real estate policy // 自北京传出预售证需要分管副市长签字方能生效的消息后,近日又爆出因项目定价过高,北京市住建委目前已押了近40个项目的预售证,而目前,北京市住建委正就如何调整项目价格与开发商进行协调。

Xinjiang Smelter Tour | Black China Blog Similar to other capital cities in China, Wulumuqi looks good and you can see that the local economy is burgeoning. The State government is busy pursuing investment to improve GDP growth by offering cheaper energy or other forms of preferential policy, but VAT refund is excluded. The 4 smelters we visited were located in an Industrial Park, and are all giants in the industry with a typical design capacity of 1.6 million tpy and one with 2.4 million tpy. Captured power plants, anode plants and downstream processing mills are included in each project to take advantage of the cheaper coal, natural gas and benefit of circular economy. All of them entirely or partly adopt advanced Chinese technology, such as 500KA potlines designed by SAMI. Wind turbines are pervasive there, replacing water cooling towers to deal with the lack of water. So far all of them are operating smoothly and also busy working on sequential construction of their Phase II, III. Everybody is seeing an apparent aluminium boom in Xinjiang, but who is thinking about the underlying issues there?

 

POLITICS AND LAW

Low-key approach to anniversary of death of Xi’s father | South China Morning Post Many news portals ran an article on their home pages featuring a quote in the headline saying Xi Zhongxun had “never made the mistake of being a leftist in his entire life”. The article first appeared in China Newsweek for the 10th anniversary of his death.

Has Hu Jintao’s son been appointed deputy party secretary of Jiaxing? | South China Morning Post Jiaxing Daily, the local government’s mouthpiece, reported on Friday that the city’s deputy party secretary, a man named Hu Haifeng had, among a few other officials, accompanied Zhejiang’s deputy governor Wang Huizhong to visit industrial parks and factories on Thursday. News footage aired on the same day by Zhejiang Satellite TV showed the man, who bore a strong resemblance to the former head of state’s son, sitting in on a meeting with fellow officials.

Chen Guangcheng talks to The Economist: A lot of nice-sounding words | The Economist CHEN GUANGCHENG is a blind Chinese activist who left his country a year ago, soon after taking refuge in the American embassy in Beijing. Mr Chen was in London recently to receive an award for his work defending the rights of rural Chinese women. The Economist’s China Editor, Rob Gifford, caught up with him at the Houses of Parliament

Mao Yushi warns of a revival by leftists | South China Morning Post Indeed, the campaign against Mao Yushi is part of broad effort by leftists to revive Maoism, a movement which has fallen out of favour over three decades of economic reform by the Communist Party. The campaign has gained momentum as the new leadership seeks to tighten ideological control and crack down on dissent.

Promotion of former anti-graft chief Wu Guanzheng’s book prompts questions | South China Morning Post Although Wu is not the only retired member of the Politburo Standing Committee to pen a book in an attempt to cement his political legacy, a publicity push such as the one for his book has been seen rarely since former party chief Jiang Zemin brought out a book. Beijing-based political affairs analyst Zhang Lifan said Wu’s book was no coincidence. “From the central government’s perspective, Wu could be a role model for other officials across the country, telling the general public that there is such a clean and honest official in the party, at the very least,” Zhang said.

Chinese premier faces clash with local crime gangs–Garnaut-Fairfax ‘In each of the other five provinces we studied, we found crime syndicates and underworld networks acting in a sort of symbiosis with local states,” the researchers say in their paper, Reassessing Collective Petitioning in Rural China, which will be published in Comparative Politics. ”Village cadres channelled development contracts, money or other resources to organised crime networks in return for a pledge to keep residents too intimidated to seek redress of grievances related to such issues as land requisition, fiscal extraction, and enforcement of the birth control policy,” it says.

红顶油商陈九霖变身励志哥 称狱中像狗一样活着    the re-emergence of Chen Jiulin//  他曾带领中国航油在海外商战中纵横捭阖,业绩显著,但却在最高点时跌落,锒铛入狱。在1035天的监狱生活中,他曾“孤独得想一头撞死”,“像狗一样地活着”;遭遇同胞踩压,让他想到鲁迅笔下的“人血馒头”

河南56岁教师被指性侵多名幼女 家属称系诬陷_网易新闻中心 56 year old teacher in henan accused of molesting many of of 1st-2nd grade students// 新京报讯 昨日,多家河南媒体报道,河南省南阳市桐柏县一小学教师涉嫌性侵多名小学女生。当地村民介绍,9名小学生中有幼女处女膜破裂。 河南日报报业集团主办的大河网还发消息称,桐柏县公安局宣传科马科长证实性侵幼女的教师杨某已被刑拘。

Elite academy discovers illicit election canvassing – Xinhua | English.news.cn The Chinese Academy of Engineering (CAE), one of the country’s top think tanks, said illicit canvassing took place during its biennial election of academics. In a letter to its candidates, the CAE said it discovered clues pointing to illicit canvassing conducted by some candidates and their employers, reminding candidates to adhere to the organization’s rules.

A Hole in China’s Skyline – Caixin Labor law violations on construction sites can range from the unsafe to hazardous. But on April 11, four migrant workers held signs protesting their lack of a union outside the Beijing Municipal Federation of Trade Unions (BMFTU) in downtown Beijing. This is their fourth visit to the BMFTU since March.

Sidney Rittenberg on China – James Fallows – The Atlantic A video of the discussion has gone online from TVW at the University of Washington. (C-SPAN also filmed the event.) I thought it was truly interesting. For an example of what’s unique in Sidney Rittenberg’s perspective: starting at around time 15:10, he talks about his close friendship not with the new president of China, Xi Jinping, but with Xi’s father. “A fine man..”

The Weekend Interview with Yang Jisheng: Reading Hayek in Beijing – WSJ.com Mr. Yang went on to make his career, first as a journalist and senior editor with the Xinhua News Agency, then as a historian whose unflinching scholarship has brought him into increasing conflict with the Communist Party—of which he nonetheless remains a member. Now 72 and a resident of Beijing, he’s in New York this month to receive the Manhattan Institute’s Hayek Prize for “Tombstone,” his painstakingly researched, definitive history of the famine. On a visit to the Journal’s headquarters, his affinity for the prize’s namesake becomes clear.

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FOREIGN AND DEFENSE AFFAIRS

Preventing a U.S.-China Cyberwar – NYTimes.com Editorial When President Obama and President Xi Jinping of China have their first meeting next month in California, addressing the issue of China’s cyberattacks on American institutions will be an important priority. Both nations need to take steps to avoid drifting into an all-out cyberwar.

C.I.A. to Focus More on Spying, a Difficult Shift – NYTimes.com As Mr. Lowenthal, the former top C.I.A. official put it, “China isn’t going to allow us to fly drones over their country.”

BBC News – China seals first free-trade deal with Switzerland China has signed the framework of a free-trade agreement with Switzerland, which could become Beijing’s first such deal with a major Western economy.

News Analysis: China-Switzerland FTA to benefit both sides – Xinhua | English.news.cn A memorandum of understanding was signed during a meeting between visiting Premier Li Keqiang and Swiss President Ueli Maurer. The two sides also announced the establishment of a financial dialogue mechanism. However, they did not reveal when the FTA will be finally signed and put into place.

Outrage after People’s Daily’s ‘Dishonest Americans’ column goes viral | South China Morning Post The People’s Daily, the mouthpiece of China’s Communist Party, has baffled and shocked people in China by launching a  “Dishonest Americans” Series, aiming  to “provide a more objective picture of what the US and Americans are really like.”

 

TECH AND MEDIA

Yahoo’s Big Mistake – Bloomberg In 2002, Yahoo could have bought Google for $5 billion. A decade later, it has sold off most of its shares in Alibaba. Ten years from now, both decisions may look equally bad.

 

SOCIETY, ART, SPORTS, CULTURE AND HISTORY

媒体称社会底层上升通道或受阻:一代穷世代穷|底层|弃考|贫富差距_新浪新闻 People’s Daily on education inequities, in advance of this year’s Gaokao. Nearly impossibile now for kids from poor/rural areas to get into top universities, upward social mobility very difficult in China, getting harder // 高考临近,堂兄家的女儿突然决定放弃高考,这让堂兄急得坐卧不安,一天几个电话找人劝侄女。侄女的反应倒很平静:“上四年大学,一年得花两万多,到头来工作还是不好找,不如现在出去打工。”侄女说,在她就读的乡镇高中,升学率低,上好大学难,弃考的同学屡见不鲜,“除非你考上一线名校,否则念书的路也不平坦。”

China Rising – Special series – Al Jazeera English A four-part series that gives a rare insight into the country on the move, with history in tow.

Ai Vey – By Jon Campbell | Foreign Policy ouch. where is John Campbell based? // Those two items are the kind of moments that Ai the dissident celebrates and encourages: the brief and often clever battles that Chinese netizenry wage, and that embody Ai’s mission of standing up for free expression and the victims of the Chinese system. But an artist of Ai’s caliber should be able to find new ways to engage. “Dumbass” has the feel of on-the-outs culture figure making a last-gasp attempt at relevance.

Things Done Well: Sinica Podcast – Lost Laowai From Manchus to Mo Yan, week after week Kaiser Kuo and Jeremy Goldkorn gather together some of the most well-informed journalists, writers and academics to talk about everything ‘China’. To kick off our new section highlighting Things Done Well, Lost Laowai talks to the hosts of our favourite China podcast, Sinica.

 

ENERGY, ENVIRONMENT AND HEALTH

China plans tougher quality standards for coal to tackle pollution | Reuters NEA could not be immediately reached for comment. It was not immediately clear when a final decision on implementing the standards will be taken. But if adopted, the proposals will hit the world’s top thermal coal supplier Indonesia, from where exports of coal with low heating value to China have swelled since late last year. It could also affect sellers of U.S. steam coal with high sulfur content, a major cause of air pollution.

Kunming mayor reassures over PX plant health, safety concerns – CHINA – Globaltimes.cn Mayor Li Wenrong on Tuesday answered concerns about the project’s pollution in the second meeting of the kind with 23 resident representatives and environment authorities. Local residents have fiercely objected to the project, initiated by the State-owned China National Petroleum Corporation and set to be located in the nearby city of Anning. Li said the company would be under strict supervision in terms of pollution discharge even it is State-owned, adding that the government will hold a science exhibition to educate residents with more knowledge on the project, getting rid of their anxieties brought by information asymmetry.

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