China

[ccp]

good news
though waiting the military put down.

hopefully not bloody

[G M]

https://www.americanthinker.com/blog/2019/12/chicom_nightmare_hong_kong_protests_spread_to_gigantic_guangdong.html?fbclid=IwAR2BwkHWpvTOsmIwEuN9kVQxZxTQdkvez4Etz_Y8MsA3T-mIx8h6r2PK34o

My core pessimist nature says this will be crushed, but I figured that Hong Kong would have been crushed by now. If this spark spreads and and the PRC ends as a result, this will be the greatest win for freedom in human history.

[Crafty_Dog]

https://www.nytimes.com/2019/12/07/world/asia/hong-kong-protests-us-chamber-commerce.html?action=click&module=Top+Stories&pgtype=Homepage&fbclid=IwAR2MC1nSONHxsXWNUe-Zm1htri6Sx-vQ2_5Su2XCpd8wo9qmIXZyxwEqqog

[Crafty_Dog]

https://www.theepochtimes.com/the-chinese-communist-regime-is-on-the-brink-of-disintegration-says-leading-china-expert_3167543.html?fbclid=IwAR2QTNLcwZF-DZzu2_MNPukxqVelTiUFBnz87CKmkHuMRMhoBWdcBUWj22U

[DougMacG]

https://www.theepochtimes.com/the-chinese-communist-regime-is-on-the-brink-of-disintegration-says-leading-china-expert_3167543.html?fbclid=IwAR2QTNLcwZF-DZzu2_MNPukxqVelTiUFBnz87CKmkHuMRMhoBWdcBUWj22U

Yes, when do massive mainland protests begin?  Before it's too late?

China launches mandatory face scans for mobile users
https://qz.com/1759108/china-launches-mandatory-face-scans-for-mobile-users/


Today at SCMP:
Hong Kong police should stop using tear gas on protesters – it’s both harmful and ineffective
https://www.scmp.com/comment/letters/article/3041570/hong-kong-police-should-stop-using-tear-gas-protesters-its-both

[Crafty_Dog]

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The Coronavirus Spreads Fears of a Shutdown in China's Tech Sector
Matthew Bey
Matthew Bey
Senior Global Analyst, Stratfor
9 MINS READ
Feb 7, 2020 | 10:00 GMT
An employee sits in the showroom of an Apple store in Beijing after it closed for the day on Feb. 1, 2020.
An employee sits in the showroom of an Apple store in Beijing after it closed for the day on Feb. 1. So far, China's technology industry has been spared the worst of the new coronavirus outbreak, but that could quickly change.

(KEVIN FRAYER/Getty Images)
HIGHLIGHTS
Because Wuhan is a relatively minor player in China's technology industry, the sector has been spared the worst of the new coronavirus. That could change if the outbreak spreads to the country's R&D heartland right next door....

Without question, the new coronavirus has taken a toll on China and many other places in the world, infecting at least 30,600 people and killing 633 as of Feb. 7. But only now, as the Lunar New Year holiday draws to a close, is Beijing preparing to assess just how much economic damage the coronavirus outbreak has wrought, especially as China is central to the global electronics and information technology sector.

The Big Picture
China is an indispensable part of the global tech sector, and the new coronavirus has the potential to drastically affect its supply chains and operations. But the virus' epicenter, Wuhan, is not as crucial as other areas, meaning authorities could minimize the impact of the virus to a few specific product types in the industry if it manages to contain the geographic scope and scale of the outbreak. If the virus does lose its intensity, for instance, the vast majority of the tech sector's operations, especially in cities in Jiangsu province and Shanghai, might suffer only limited impacts.

See The Geopolitics of Disease
Ultimately, the breadth of the impact depends on how far the virus spreads beyond its current location. Hubei province and its capital, Wuhan, are not critical nodes for the vast majority of China's electronics sector. But neighboring provinces, including Shaanxi, Henan and Jiangxi, are all home to cities that are prominent in the global technology sector, while the provinces with the second and third most confirmed cases so far, Zhejiang and Guangdong, are arguably China's two most critical areas for tech. For the moment, the risk of the new coronavirus to such provinces is somewhat limited — but all that depends on the success of China's containment strategy in Hubei: For if the outbreak continues, it would have a monumental impact on China's tech sector, resulting in significant shortages.

A Limited Effect on Tech — For Now
If the worst of the virus remains centered on Hubei, then the impact on supply chains for the Chinese — and, thus, the global — tech sector is likely to remain relatively limited. In 2017, Hubei produced less than 1 percent of China's overall integrated circuit production and just 1 percent of the country's overall television output. The following year, the province accounted for only 2.4 percent of the country's mobile phone output and 3.6 percent of its microcomputer equipment — two goods for which China's share of global production isn't high. Undoubtedly, there will be individual supply chains that will lack components as a result of the quarantine in Hubei, but large producers of goods like circuits, TVs, mobile phones and microcomputer equipment would be able to find suppliers outside the province over time if necessary.

Four maps showing industrial output by Chinese province for selected sectors.
But while Wuhan sits on the margins of China's semiconductor industry and broader tech sector, a prolonged industrial shutdown would have three important implications. First, China has penciled in Wuhan as a key location for domestic semiconductor manufacturing. There are two primary companies currently operating in Wuhan, primarily in the Donghu New Technology Development Zone. The more established company, Wuhan Xinxin Semiconductor Manufacturing Corp. (XMC), operates a small, 300 mm fabrication plant and functions as a contract pure-play foundry for the semiconductor industry. The other major semiconductor firm is Yangtze Memory Technologies Co. (YMTC), which was founded by China's Tsinghua Unigroup and is now owned by several other public investment funds, including the National Integrated Circuit Industry Investment Fund, colloquially known as China's "Big Fund." YMTC acquired a 100 percent stake in XMC in 2016.

Both XMC and YMTC are presently building two new, large facilities that will boost Hubei's overall production capacity by a factor of nearly 15. That, ultimately, will make Wuhan one of the pillars of China's long-term push to achieve greater self-reliance and global prominence in the semiconductor sector — especially in the memory segment of the industry — and a key city in the country's Made in China 2025 initiative. Before the outbreak, XMC and YMTC had ramped up construction on the facilities, but the companies could now slow down the building process or delay it by several months — if not a year. But once fully operational, YMTC's Wuhan plant will be China's largest memory semiconductor chip plant, with a planned capacity of 300,000 wafers per month. And with their Wuhan investments, both XMC and YMTC are focusing heavily on 3D NAND memory chips, which are central to China's push for self-reliance in chip production as they are an integral component of smartphones and other mobile devices. There are only a few companies that specialize in 3D NAND memory chips, such as South Korea's Samsung and SK Hynix, Japan's Toshiba and the United States' Intel and Micron — the latter of which Tsinghua Unigroup tried to buy in 2015 before running into opposition from the Obama administration. Thwarted, Tsinghua Unigroup formed YMTC instead.

A map showing the location of integrated circuit production and semiconductor plants in China.
The second key implication will be the more acute impact on China and Wuhan's optical fiber industry, which accounts for roughly 20 percent of China's overall output in the sector and, according to officials in the city, boasts a global market share of 25 percent. As a focal point for China's fiber optics industry, the Donghu New Technology Development Zone has referred to itself as "China Optics Valley" thanks to major firms like Wuhan Yangtze Optical Technology Co. (YOTC) — the world's largest supplier of optical fiber preform, optical fiber and optical cables — Fiberhome Technologies and Accelink Technologies. While there may be some global inventories that can withstand a limited, weekslong outage in the Wuhan fiber-optic sector's production capacity, a shutdown that lasts more than a few weeks could substantially hurt supply chains in the industry.

Finally, Wuhan is a leading center for research and development in China's technology sector. At the university level, Wuhan is home to Wuhan University, which is consistently ranked among China's top five universities, as well as the Huazhong University of Science and Technology, which is invariably among China's top 10 research universities and the operator of the Wuhan National Laboratory for Optoelectronics. Wuhan is also the site of research and development centers for Hon Hai Precision manufacturing (also known as Foxconn), United Imaging, Tencent, Huawei and Xiaomi (which opened its second headquarters in the city in December 2019), but the outbreak will halt new R&D endeavors, potentially setting China back in terms of novel advancements — especially if Wuhan suffers a long-term decline in overseas visitors because of its damaged reputation even after the outbreak subsides.

A graphic showing the breakdown of Hubei province's total manufacturing output.
The Consequences of Contagion Beyond Hubei
Unsurprisingly, if the provinces beyond Hubei continue to suspend their industrial activities, the ramifications would be much more severe for China. Many of Hubei's neighbors are crucial tech hubs, and the three provinces that have witnessed the next most cases, Zhejiang, Guangdong and Henan, are particularly big players in the sector. Already, a number of these areas have delayed the resumption of operations after the end of the Lunar New Year as a precaution, pushing back the start date from Jan. 29 to Feb. 9. Apple, for instance, has noted that orders for 45 million AirPods are at risk because of the measures necessary to contain the virus.

Hangzhou, the capital of Zhejiang, is the headquarters of Alibaba and one of the key hubs for China's overall tech sector. In terms of manufacturing, the province is not as critical as some neighbors, like Shanghai and Jiangsu, but it is crucial to the technological development of China's internet services sector and — together with Beijing — a leader in the country's artificial intelligence development. But in response to the new coronavirus, Hangzhou officials have reduced and restricted travel in several districts, including the area where Alibaba's center is located, in hopes of limiting the expansion of the virus. (The technology departments of China's services sector can at least mitigate the impact of the coronavirus by asking their employees to work remotely.) But if Hangzhou were to suffer a similar outbreak to Hubei, it would likely portend other major outbreaks in places like Shanghai and Jiangsu, as it would indicate the failure of efforts to halt the spread of the virus.

The most important Chinese province for tech, however, is Guangdong, an area that is home to more than 113 million people and major cities like Guangzhou, Shenzhen and Zhongshan. If the virus spreads to such a degree that officials must take extreme measures, it would paralyze the innovation, production and export of tech components in Guangdong. After all, the province manufactures 50 percent of China's TVs, produces 45 percent of its mobile phones and makes more than 15 percent of its semiconductor and microcomputer equipment.

A graphic showing the spread of the new coronavirus beyond China.
Henan province, which had registered 851 cases as of Feb. 6, directly borders Hubei to the north. Its capital, Zhengzhou, is particularly important for the manufacture of smartphones and iPhones — in fact, the presence of Foxconn's largest iPhone assembly line has led some to dub the metropolis "iPhone City." While its share of domestic smartphones is somewhat smaller, Zhengzhou and Henan province shipped a quarter of China's total smartphone exports last year, more than half of which were directly from Foxconn's operations. On Feb. 5, Foxconn issued new targets for 2020 sales, increasing the rate from just 1 to 3 percent this year. That's down from goals of 3 to 5 percent issued just two weeks earlier on Jan. 22. And in a further measure to check the virus' spread, Foxconn has vowed to subject any employee who returns from the Lunar New Year holiday from anywhere outside Henan province — not just from Hubei — to 14 days of quarantine.

More likely than not, the impact on tech supply chains beyond Hubei will be limited so long as the number of new coronavirus cases does not reach crisis-level proportions. At present, it appears that the virus will lay low some operations outside Hubei for upward of 10 days, given that many factories are planning to resume operations by Feb. 9. In the coming days, it will become clearer whether further contagion beyond Hubei's border will occur and, if so, how much it will impact operations outside Wuhan. If the virus does spread more significantly than most suspect, then almost all of China's tech sector along the Yangtze River Basin will be at risk of more acute disruptions — either from the direct impact of shutdowns or the secondary impact from closures among suppliers. In such a case, factories in China's technological heartland might remain shuttered long after Feb. 9.

[G M]

It's hitting every sector of the Chinese economy. Not long until it's hitting the world's economy as well.

Stratfor Worldview
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SITUATION REPORTS
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ASSESSMENTS
The Coronavirus Spreads Fears of a Shutdown in China's Tech Sector
Matthew Bey
Matthew Bey
Senior Global Analyst, Stratfor
9 MINS READ
Feb 7, 2020 | 10:00 GMT
An employee sits in the showroom of an Apple store in Beijing after it closed for the day on Feb. 1, 2020.
An employee sits in the showroom of an Apple store in Beijing after it closed for the day on Feb. 1. So far, China's technology industry has been spared the worst of the new coronavirus outbreak, but that could quickly change.

(KEVIN FRAYER/Getty Images)
HIGHLIGHTS
Because Wuhan is a relatively minor player in China's technology industry, the sector has been spared the worst of the new coronavirus. That could change if the outbreak spreads to the country's R&D heartland right next door....

Without question, the new coronavirus has taken a toll on China and many other places in the world, infecting at least 30,600 people and killing 633 as of Feb. 7. But only now, as the Lunar New Year holiday draws to a close, is Beijing preparing to assess just how much economic damage the coronavirus outbreak has wrought, especially as China is central to the global electronics and information technology sector.

The Big Picture
China is an indispensable part of the global tech sector, and the new coronavirus has the potential to drastically affect its supply chains and operations. But the virus' epicenter, Wuhan, is not as crucial as other areas, meaning authorities could minimize the impact of the virus to a few specific product types in the industry if it manages to contain the geographic scope and scale of the outbreak. If the virus does lose its intensity, for instance, the vast majority of the tech sector's operations, especially in cities in Jiangsu province and Shanghai, might suffer only limited impacts.

See The Geopolitics of Disease
Ultimately, the breadth of the impact depends on how far the virus spreads beyond its current location. Hubei province and its capital, Wuhan, are not critical nodes for the vast majority of China's electronics sector. But neighboring provinces, including Shaanxi, Henan and Jiangxi, are all home to cities that are prominent in the global technology sector, while the provinces with the second and third most confirmed cases so far, Zhejiang and Guangdong, are arguably China's two most critical areas for tech. For the moment, the risk of the new coronavirus to such provinces is somewhat limited — but all that depends on the success of China's containment strategy in Hubei: For if the outbreak continues, it would have a monumental impact on China's tech sector, resulting in significant shortages.

A Limited Effect on Tech — For Now
If the worst of the virus remains centered on Hubei, then the impact on supply chains for the Chinese — and, thus, the global — tech sector is likely to remain relatively limited. In 2017, Hubei produced less than 1 percent of China's overall integrated circuit production and just 1 percent of the country's overall television output. The following year, the province accounted for only 2.4 percent of the country's mobile phone output and 3.6 percent of its microcomputer equipment — two goods for which China's share of global production isn't high. Undoubtedly, there will be individual supply chains that will lack components as a result of the quarantine in Hubei, but large producers of goods like circuits, TVs, mobile phones and microcomputer equipment would be able to find suppliers outside the province over time if necessary.

Four maps showing industrial output by Chinese province for selected sectors.
But while Wuhan sits on the margins of China's semiconductor industry and broader tech sector, a prolonged industrial shutdown would have three important implications. First, China has penciled in Wuhan as a key location for domestic semiconductor manufacturing. There are two primary companies currently operating in Wuhan, primarily in the Donghu New Technology Development Zone. The more established company, Wuhan Xinxin Semiconductor Manufacturing Corp. (XMC), operates a small, 300 mm fabrication plant and functions as a contract pure-play foundry for the semiconductor industry. The other major semiconductor firm is Yangtze Memory Technologies Co. (YMTC), which was founded by China's Tsinghua Unigroup and is now owned by several other public investment funds, including the National Integrated Circuit Industry Investment Fund, colloquially known as China's "Big Fund." YMTC acquired a 100 percent stake in XMC in 2016.

Both XMC and YMTC are presently building two new, large facilities that will boost Hubei's overall production capacity by a factor of nearly 15. That, ultimately, will make Wuhan one of the pillars of China's long-term push to achieve greater self-reliance and global prominence in the semiconductor sector — especially in the memory segment of the industry — and a key city in the country's Made in China 2025 initiative. Before the outbreak, XMC and YMTC had ramped up construction on the facilities, but the companies could now slow down the building process or delay it by several months — if not a year. But once fully operational, YMTC's Wuhan plant will be China's largest memory semiconductor chip plant, with a planned capacity of 300,000 wafers per month. And with their Wuhan investments, both XMC and YMTC are focusing heavily on 3D NAND memory chips, which are central to China's push for self-reliance in chip production as they are an integral component of smartphones and other mobile devices. There are only a few companies that specialize in 3D NAND memory chips, such as South Korea's Samsung and SK Hynix, Japan's Toshiba and the United States' Intel and Micron — the latter of which Tsinghua Unigroup tried to buy in 2015 before running into opposition from the Obama administration. Thwarted, Tsinghua Unigroup formed YMTC instead.

A map showing the location of integrated circuit production and semiconductor plants in China.
The second key implication will be the more acute impact on China and Wuhan's optical fiber industry, which accounts for roughly 20 percent of China's overall output in the sector and, according to officials in the city, boasts a global market share of 25 percent. As a focal point for China's fiber optics industry, the Donghu New Technology Development Zone has referred to itself as "China Optics Valley" thanks to major firms like Wuhan Yangtze Optical Technology Co. (YOTC) — the world's largest supplier of optical fiber preform, optical fiber and optical cables — Fiberhome Technologies and Accelink Technologies. While there may be some global inventories that can withstand a limited, weekslong outage in the Wuhan fiber-optic sector's production capacity, a shutdown that lasts more than a few weeks could substantially hurt supply chains in the industry.

Finally, Wuhan is a leading center for research and development in China's technology sector. At the university level, Wuhan is home to Wuhan University, which is consistently ranked among China's top five universities, as well as the Huazhong University of Science and Technology, which is invariably among China's top 10 research universities and the operator of the Wuhan National Laboratory for Optoelectronics. Wuhan is also the site of research and development centers for Hon Hai Precision manufacturing (also known as Foxconn), United Imaging, Tencent, Huawei and Xiaomi (which opened its second headquarters in the city in December 2019), but the outbreak will halt new R&D endeavors, potentially setting China back in terms of novel advancements — especially if Wuhan suffers a long-term decline in overseas visitors because of its damaged reputation even after the outbreak subsides.

A graphic showing the breakdown of Hubei province's total manufacturing output.
The Consequences of Contagion Beyond Hubei
Unsurprisingly, if the provinces beyond Hubei continue to suspend their industrial activities, the ramifications would be much more severe for China. Many of Hubei's neighbors are crucial tech hubs, and the three provinces that have witnessed the next most cases, Zhejiang, Guangdong and Henan, are particularly big players in the sector. Already, a number of these areas have delayed the resumption of operations after the end of the Lunar New Year as a precaution, pushing back the start date from Jan. 29 to Feb. 9. Apple, for instance, has noted that orders for 45 million AirPods are at risk because of the measures necessary to contain the virus.

Hangzhou, the capital of Zhejiang, is the headquarters of Alibaba and one of the key hubs for China's overall tech sector. In terms of manufacturing, the province is not as critical as some neighbors, like Shanghai and Jiangsu, but it is crucial to the technological development of China's internet services sector and — together with Beijing — a leader in the country's artificial intelligence development. But in response to the new coronavirus, Hangzhou officials have reduced and restricted travel in several districts, including the area where Alibaba's center is located, in hopes of limiting the expansion of the virus. (The technology departments of China's services sector can at least mitigate the impact of the coronavirus by asking their employees to work remotely.) But if Hangzhou were to suffer a similar outbreak to Hubei, it would likely portend other major outbreaks in places like Shanghai and Jiangsu, as it would indicate the failure of efforts to halt the spread of the virus.

The most important Chinese province for tech, however, is Guangdong, an area that is home to more than 113 million people and major cities like Guangzhou, Shenzhen and Zhongshan. If the virus spreads to such a degree that officials must take extreme measures, it would paralyze the innovation, production and export of tech components in Guangdong. After all, the province manufactures 50 percent of China's TVs, produces 45 percent of its mobile phones and makes more than 15 percent of its semiconductor and microcomputer equipment.

A graphic showing the spread of the new coronavirus beyond China.
Henan province, which had registered 851 cases as of Feb. 6, directly borders Hubei to the north. Its capital, Zhengzhou, is particularly important for the manufacture of smartphones and iPhones — in fact, the presence of Foxconn's largest iPhone assembly line has led some to dub the metropolis "iPhone City." While its share of domestic smartphones is somewhat smaller, Zhengzhou and Henan province shipped a quarter of China's total smartphone exports last year, more than half of which were directly from Foxconn's operations. On Feb. 5, Foxconn issued new targets for 2020 sales, increasing the rate from just 1 to 3 percent this year. That's down from goals of 3 to 5 percent issued just two weeks earlier on Jan. 22. And in a further measure to check the virus' spread, Foxconn has vowed to subject any employee who returns from the Lunar New Year holiday from anywhere outside Henan province — not just from Hubei — to 14 days of quarantine.

More likely than not, the impact on tech supply chains beyond Hubei will be limited so long as the number of new coronavirus cases does not reach crisis-level proportions. At present, it appears that the virus will lay low some operations outside Hubei for upward of 10 days, given that many factories are planning to resume operations by Feb. 9. In the coming days, it will become clearer whether further contagion beyond Hubei's border will occur and, if so, how much it will impact operations outside Wuhan. If the virus does spread more significantly than most suspect, then almost all of China's tech sector along the Yangtze River Basin will be at risk of more acute disruptions — either from the direct impact of shutdowns or the secondary impact from closures among suppliers. In such a case, factories in China's technological heartland might remain shuttered long after Feb. 9.

[G M]

https://nationalpost.com/news/world/with-the-coronavirus-crisis-xi-jinping-faces-chinas-chernobyl-moment

I am going with yes.

[Crafty_Dog]

http://www.chinafile.com/reporting-opinion/viewpoint/viral-alarm-when-fury-overcomes-fear

[Crafty_Dog]

https://www.youtube.com/watch?v=Ot1ejwUeFpI&feature=youtu.be

[Crafty_Dog]

https://www.jordanharbinger.com/michael-yon-chinas-big-trouble-in-little-hong-kong/

[G M]

https://www.jordanharbinger.com/michael-yon-chinas-big-trouble-in-little-hong-kong/

A lot of very good information packed into that interview. Worth the time.

[Crafty_Dog]

https://www.nationalreview.com/2020/02/china-history-key-to-understanding-chinese-government-actions-today/?utm_source=Sailthru&utm_medium=email&utm_campaign=NR%20Daily%20Monday%20through%20Friday%202020-02-24&utm_term=NRDaily-Smart

[Crafty_Dog]

https://www.forbes.com/sites/kenrapoza/2020/03/01/coronavirus-could-be-the-end-of-china-as-global-manufacturing-hub/?utm_campaign=forbes&utm_source=facebook&utm_medium=social&utm_term=Valerie%2F#2fc431dc5298

[DougMacG]

https://www.forbes.com/sites/kenrapoza/2020/03/01/coronavirus-could-be-the-end-of-china-as-global-manufacturing-hub/?utm_campaign=forbes&utm_source=facebook&utm_medium=social&utm_term=Valerie%2F#2fc431dc5298

Yes.  The decoupling began when China chose to fight back in the tariff war.  They had a good thing going and blew it when they should have locked it in.  Now US and global companies (like Apple) HAVE to source elsewhere.

[ccp]

I just read
maybe on drudge that about 80% of generics are manufactured in Red Communist China

I was shocked
prescribing these all day long
and never knew this 

[G M]

https://charleshughsmith.blogspot.com/2020/03/could-chinas-overlapping-crises-spiral.html?m=1

[Crafty_Dog]

March 13, 2020   View On Website
Open as PDF



    The Next Phase of China’s Fight with the Coronavirus
By: Phillip Orchard

The Communist Party of China would like you to know it’s winning the war against the coronavirus, and that we all have Xi Jinping to thank. That’s been the core message from Chinese state media over the past few weeks, which marked a major turning point in the crisis. Internally, China’s massive mobilization against the virus appears to have stemmed the tide, with new infections slowing to single digits and Chinese industry gingerly getting back to work. And as the outbreak became a pandemic, Western governments’ spotty responses have put both Beijing’s early missteps and its later successes in a more favorable light.

It’s been a boon to Beijing’s propagandists, who can now call attention to China’s triumphs and the world’s woes. Their messaging has also made it clear that Xi and his inner circle will emerge from the public health crisis intact – and perhaps even stronger. Xi has commanded the decisive battles in the “People’s War” against an invisible enemy, at least according to state media hell-bent on elevating the president to almost Mao-like status.

But if Xi is safe on his throne, his realm is not. The Chinese economy is, to put it plainly, in really bad shape. Nearly every problem Beijing couldn’t figure out how to fix has been made an order of magnitude worse by the coronavirus crisis. And while the virus going global may be a shot in the arm for China’s hype machine, its spread may very well shut down the country’s most promising roads to a rapid recovery.

Xi’s Glorious Battle

A month ago, the CPC was reeling. The epidemic had become nearly uncontainable, and Xi’s tightly centralized decision-making structure and a culture of censorship were at least partially to blame. This created pressure both at home and abroad, forcing Beijing to implement a twist on Mao’s Hundred Flowers Campaign and relax the restrictions on independent reporting and to censor social media with a lighter touch. The outrage that followed, particularly after the death of whistleblowing doctor Li Wenliang, scared Beijing, forcing it into a series of clumsy moves to squelch dissent. Beijing was also forced to postpone its annual National People’s Congress, which the CPC relies on to align the machinery of the state with its agenda. For much of this time, Xi himself was conspicuously absent from the spotlight. When the central government finally launched a campaign to demonstrate its command of the crisis response, it was led not by Xi but by Premier Li Keqiang, the closest thing Xi has to a rival in the Politburo Standing Committee. But as soon as the outbreak looked like it would soon crest in early February, Xi was firmly back out in front.

The pillars of power in China are often described as “the three Ps”: the People's Liberation Army, personnel and propaganda. And by becoming the public face of the government’s response, Xi has demonstrated his control over each of them. In early February, he deployed the PLA, which answers directly to him as chairman of the Central Military Commission and had been noticeably absent from the response in January, to build hospitals, transport supplies, ensure public order and dispatch medics to the front lines in Wuhan. If Xi were losing control over key personnel appointments, he wouldn’t have been able to replace the party leadership in Hubei province with a pair of loyalists. Finally, the propaganda machine has gone into overdrive in lionizing the president. State media has begun referring to the president as “the People’s Leader” and, particularly during Xi’s long-awaited visit Wuhan this week, equating his leadership in the fight against coronavirus to Mao’s command of the Communist Party’s civil war victory in 1949. This matters more than mere symbolism. By effectively elevating Xi to Mao-like status, the Communist Party is wrapping its own legitimacy in Xi’s cult of personality even more tightly, making it near-impossible for rivals to dislodge him.

Still, there are at least two other “Ps” that also matter. The first is the public, which for now appears to broadly support the CPC. To be sure, there are glimpses of discontent over Beijing’s mismanagement – and not just in social media circles where outfoxing censors has become something of an art form. Doctors in Wuhan haven’t stopped speaking out about the government’s suppression of information about the virus. An exceedingly tone-deaf speech given by Wuhan’s party chief calling for a “gratitude education campaign” for the city’s residents ahead of Xi’s inspection tour had to be buried by censors after earning so much backlash. And leaked videos showed Chinese Vice Premier Sun Chunlan getting showered with insults from quarantined citizens during her own visit to Wuhan. But this has yet to translate into any sort of mass movement on the streets.

This is, in part, because the country has been effectively in lockdown. (Indeed, the digital systems put in place to combat the spread of the virus will be useful in combating attempts to mobilize against the government going forward.) It’s also because there’s no prominent opposition figure or party to rally around. (This is why any signs of a major split in the PLA or Politburo would be so important). But the power of the state’s messaging machine shouldn’t be dismissed. Propaganda is more effective when it contains nuggets of truth. Beijing can reasonably point to the lockdowns in Italy and elsewhere to make the case that its own response was within bounds, and it can point to the severe shortage of medical masks, testing kits, hospital beds and so forth in places like the U.S. to make the case that, whatever its flaws, the CPC’s model of governance is superior to Western democracies in a crisis.

The War Isn’t Over

The other “P” is prosperity. Breakneck growth was already becoming impossible to sustain. In February, the economy effectively ground to a halt. As many as a third of Chinese businesses remain shut down, with many more operating at only partial capacity. As was made clear by anemic credit growth figures released this week, Beijing's chronic struggles with getting liquidity to small and medium-sized businesses – which account for as much as 80 percent of employment in China, and more than half of which say they can’t last two months on their savings – persist. Even “shadow banking" hit a three-year low in February. This is good news for Beijing’s long-term battle against reckless lending, but it’s bad news in the current environment.

We’ve noted that China would be reasonably well-positioned for a “V-shaped” recovery once it could contain the virus enough to restart its manufacturing engine – that is, so long as it could keep systemic risks in, say, the financial or property sectors from rupturing. That’s basically what happened following the SARS epidemic in 2003. Once people can actually get back to work en masse, it won’t be hard to rev up Chinese factories and services sectors.

The pace of the recovery will therefore depend primarily on demand. Massive stimulus spending and the state sector will help here. But with the mass, short-term loss of wages likely to drag down domestic consumption for at least a month or two more, external consumption will once again be the key.

This is why the global spread of the crisis is such a problem for China – especially since it's happening at a pace that’s likely to last months and may surge again in the fall. Prolonged disruptions to trade would be bad enough for Chinese exports, which dropped more than 17 percent in January and February alone. The more European and the U.S. economies slow down, the more Western demand for Chinese goods will dry up. In this light, “doomsday scenarios” like the one put out by the United Nations predicting a $2 trillion hit to global gross domestic product somehow seem optimistic.
 
(click to enlarge)

Meanwhile, stress on financial markets in the West – combined with the likely boost to anti-globalization political forces and the broad awareness among multinational corporations that supply chains have become overly dependent on China – will blunt investment and capital flows into China. Despite China’s impressive capacity to screen just about everyone for the virus at just about every factory door or airport gate, it’s not impossible for the virus to come back. Additional mass quarantines, of course, could be incalculably disruptive. (One silver lining of the global slowdown for Beijing: The collapse of oil prices will have mixed effects on the Chinese economy, but on the whole it will do more good than harm.)

For almost a decade now, we’ve been waiting for the next big shock that would test the resilience of the CPC-led system. The assumption has been that the most likely shock would come from external forces. Turns out, the shock came from within, spread to the rest of the world and now looks likely to boomerang back. There’s nothing China’s propagandists can do about it.   

[DougMacG]

https://www.realclearpolitics.com/articles/2020/03/18/beijing_fears_covid-19_is_turning_point_for_china_globalization__142686.html

"Instead of acting with necessary speed and transparency, the party-state looked to its own reputation and legitimacy. It threatened whistleblowers like the late Dr. Li Wenliang, and clamped down on social media to prevent both information about the virus and criticism of the Communist Party and government from spreading."
----------------------------
Never again to be trusted.

[G M]

Pariah State. Hard decoupling needs to be the policy.

https://www.realclearpolitics.com/articles/2020/03/18/beijing_fears_covid-19_is_turning_point_for_china_globalization__142686.html

"Instead of acting with necessary speed and transparency, the party-state looked to its own reputation and legitimacy. It threatened whistleblowers like the late Dr. Li Wenliang, and clamped down on social media to prevent both information about the virus and criticism of the Communist Party and government from spreading."
----------------------------
Never again to be trusted.

[Crafty_Dog]

China's Economy Braces for a COVID-19 Double Hit
7 MINS READ
Mar 24, 2020 | 14:59 GMT
Workers operate a production line of a new material company in Lianyungang, China, on March 23, 2020.
Workers operate a production line of a new material company in Lianyungang, China, on March 23, 2020.

(Costfoto/Barcroft Media via Getty Images)
HIGHLIGHTS
China's economy will sustain a double hit in 2020 due to COVID-19 given both the direct domestic impact of the virus control measures and the looming hit to global demand.
The government will need to tread carefully in stimulus spending given the risk of increasing economic instability by fueling unsustainable debt.
However, if the global outbreak worsens, the risk to economic growth and employment may compel Beijing to engage in large-scale spending in order to ensure political stability in the long term.
In China, the economic fallout of the COVID-19 outbreak will drag on 2020 GDP growth as the country endures the twin hits of both the early-year domestic slowdown and the as-yet-unknown drop in overseas demand in key markets. But the country’s high debt levels — partly fueled by its massive stimulus during the 2008 financial crisis, in addition to the structural slowdown already underway before the outbreak — means Beijing will hesitate to mirror the large-scale spending being implemented in other virus-ravaged economies, such as the United States, Japan and South Korea. China will now have to choose whether to help buoy its employment and annual growth targets through spending that could jeopardize long-term economic stability.

The Big Picture
China's COVID-19 economic damage and recovery path will be a key bellwether for the rest of the world as more countries weather the spread of the virus. However, government efforts to ensure a smooth rebound will be challenged by the legacy of the country's 2008 stimulus spending and ongoing structural slowdown.

See COVID-19
The Virus Fallout
The COVID-19 outbreak originating in China saw the country’s economy locked down for the better part of two months — a massive blow to export-oriented industries, as well as consumer and travel spending during a key annual holiday period. China’s combined January-February economic data released in mid-March showed a worse than expected hit to the economy due to the virus, with value-added industrial production down 13.5 percent, fixed asset investment down 24.5 percent and retail sales down 20.5 percent. Those months also saw at least 5 million workers lose their jobs, bringing the official unemployment rate to 6.2 percent — the highest on record and not even counting the massive pool of migrant workers inside the country that were idle during the same period but not counted in official unemployment numbers.

Even before COVID-19’s unexpected emergence, China had been in the throes of a structural slowdown in its economic growth. Over the past decade, China’s GDP growth, according to government figures, has gradually moderated from above 10 percent in 2010, to below 8 percent in 2015 before hitting 6.6 percent in 2018 and softening further to 6.1 percent in 2019 — the slowest in three decades. There is a broad consensus that the first quarter of the year will bring a contraction in GDP with COVID-19 factored in. And for the full year of 2020, economists across the board have revised their growth projections downward. Goldman Sachs dropped their initial 5.5 percent forecast to 3 percent, S&P lowered it from 4.8 percent to 2.9 percent and Nomura from 4.8 percent to 1.3 percent. High-level Chinese government leaks suggest that even the official projections may be revised downward from the current 6 percent for 2020 to 5 percent.


China’s growth figures will also depend on the scope and trajectory of the COIVID-19 outbreaks now burning through Europe, the United States and elsewhere. These outbreaks will dampen global consumer demand, posing a secondary hit to China’s economy even as the domestic sector tries to effect a recovery. 20 percent of China’s exports go to the United States; 9.2 percent to Germany, France, Italy and Spain; with 10.6 percent to South Korea and Japan.

What China Can Do
The spike in unemployment and drop in growth rates presents something of a political crisis for the Communist Party of China, which has based its legitimacy on the ability to deliver consistently rising prosperity and economic stability to the population. The 2020 party-mandated goal of doubling China’s 2010 GDP in order to achieve a “moderately prosperous society” is likely now out of reach. News of authorities’ early mishandling of the virus only deepens this risk — and spurs the party not only to focus on maintaining growth but also on ensuring blame for the pandemic rests at the local level and does not rise to the central government and President Xi Jinping.

So far, the government has emphasized an expectation that the second quarter will bring a recovery and return to normal. In mid-March, the government announced that, outside of the Hubei province epicenter, 90 percent of state-owned enterprises have resumed operations after virus-related shutdowns as have 60 percent of small- to medium-sized enterprises. Given the strong incentive to signal a robust rebound, there is reason to doubt this optimism and the true numbers are likely lower. An Economist Intelligence Unit survey of 200 large, foreign-backed firms found only half had resumed operations. Many provinces appear to have officially branded all businesses operating at one-third of normal capacity as having resumed their operations. Around 32 percent of Chinese manufacturers in the southern industrial core are reportedly facing shortages in supplies needed for production with a further 15 percent out of key stocks due to lingering supply chain disruptions related to COVID-19, according to an American Chamber of Commerce survey.

Given the uncertain next steps for the Chinese economy, the government is weighing its options to intervene. With governments worldwide moving quickly to stimulate their economies through monetary and fiscal policy, China’s central government has so far proceeded cautiously. Large-scale stimulus spending would exacerbate China’s already massive debts, which currently stand at three hundred percent of GDP. It also needs to be careful of measures that could fuel a bubble in the already potentially volatile property market. The central government is particularly watching local governments very carefully to prevent them from borrowing off balance sheets and increasing the risk of default. But without resorting to debt, local governments will face major limitations in their spending given that their budgets have already been squeezed by 2019 nationwide tax cuts that had been meant to offset the impacts of the U.S.-China trade war. Central-local tensions are already playing out, with local government plans for consumer handouts sparking a central government warning that they exercise caution and not overspend.

The direct domestic impact of lockdown measures to contain the virus, combined with the looming hit to global demand, will stymie China's economic growth in 2020.

To date, China’s central government has largely focused on tax relief and increased liquidity to try to offset the effects of the virus. It has not engaged in steep interest rate cuts (only 10 basis points) and shied away from massive stimulus spending on par with the $570 billion it spent during the global financial crisis. Instead, the People’s Bank of China has cut the reserve ratio requirement by 0.5 to 1 percent, freeing up $78.8 billion for lending by banks nationwide with instructions that this lending be targeted to smaller businesses most hit by the COVID-19 disruptions. China's Financial Stability and Development Committee has opened more offices across the country to oversee this process. China has more room to cut the reserve requirement ratio, which is currently around 10 percent (down from 20 percent in 2011) and a cut to zero could open up 20 trillion yuan in lending.

But the global spread of COVID-19 is rapidly unfolding a demand-side crisis for China as key markets experience economic damage. Given the drawbacks of aggressive government spending, China may wait until the second quarter when the other shoe drops in the form of demand-side hits to Chinese growth. More decisions could come ahead of the previously delayed sessions of both China's legislature, the National People’s Congress, and the government advisory body, the Chinese People’s Political Consultative Conference, which are now likely to be held in late April or early May. Leaks suggest Beijing is considering a massive stimulus that would see the 2020 government budget deficit rise to 3.5 percent, breaking the informal 3 percent cap of recent years. This spending could include $394 billion in special local government bonds, funds for infrastructure spending related to public health, emergency materials, 5G and data centers.

But such stimulus layout comes with downsides in the form of increased borrowing and threats to economic stability at a time when China is not only weathering a structural slowdown but still saddled with the debts accrued during the 2008 global financial crisis. However, China may calculate that these measures — and the attendant risks — are worth hazarding given the risks to the economy and political stability.

[G M]

https://www.japantimes.co.jp/news/2020/03/24/asia-pacific/politics-diplomacy-asia-pacific/wuhan-coronavirus-patient-numbers-manipulated-china-xi-jinping/

Trust global health and the global economy to their very trustworthy leadership!

[DougMacG]

troubling disappearance of some 21 million cell telephone accounts in China about the previous three months – an unprecedented decrease that hints at much more fatalities than disclosed by the government.
https://www.theepochtimes.com/the-closing-of-21-million-cell-phone-accounts-in-china-may-suggest-a-high-ccp-virus-death-toll_3281291.html
https://abc14news.com/2020/03/24/21-million-chinese-cellphone-users-disappear-in-three-months/

[Crafty_Dog]

My son's theory is that they are taking away the phones of those that have made or received international calls.
===========

https://www.theepochtimes.com/where-ties-with-communist-china-are-close-the-coronavirus-follows_3268389.html?utm_source=Epoch+Times+Newsletters&utm_campaign=b751c4c659-EMAIL_CAMPAIGN_2020_03_24_11_05&utm_medium=email&utm_term=0_4fba358ecf-b751c4c659-239065853

[DougMacG]

My son's theory is that they are taking away the phones of those that have made or received international calls.
===========

https://www.theepochtimes.com/where-ties-with-communist-china-are-close-the-coronavirus-follows_3268389.html?utm_source=Epoch+Times+Newsletters&utm_campaign=b751c4c659-EMAIL_CAMPAIGN_2020_03_24_11_05&utm_medium=email&utm_term=0_4fba358ecf-b751c4c659-239065853

That explanation makes sense - with a duplicitous, totalitarian, oppressive, repressive regime.  They can take their phones or just disconnect their service. 

I wonder if it is still considered free and universal health care if you can't have a phone to call a doctor?
https://en.wikipedia.org/wiki/List_of_countries_with_universal_health_care

[G M]

troubling disappearance of some 21 million cell telephone accounts in China about the previous three months – an unprecedented decrease that hints at much more fatalities than disclosed by the government.
https://www.theepochtimes.com/the-closing-of-21-million-cell-phone-accounts-in-china-may-suggest-a-high-ccp-virus-death-toll_3281291.html
https://abc14news.com/2020/03/24/21-million-chinese-cellphone-users-disappear-in-three-months/

Probably not, given that my wife and her family in the US routinely talks to friends and family in China on a constant basis, uninterrupted since the Kung Flu started.

[Crafty_Dog]

Presumably the Commies are listening in and take the phones of those of disloyal to the Party , , ,

[G M]

Presumably the Commies are listening in and take the phones of those of disloyal to the Party , , ,

At the minimum. The social credit system wasn't created for giggles. The Chicoms have never hesitated to disappear dissenters.

[Crafty_Dog]

https://www.youtube.com/watch?v=jFvCwdfoiH8&feature=youtu.be

[Crafty_Dog]

https://www.youtube.com/watch?v=MQyxG4vTyZ8&feature=share

[Crafty_Dog]

https://www.theepochtimes.com/food-supplies-in-china-under-scrutiny-as-panic-buying-abrupts-across-country_3295736.html?utm_source=Epoch+Times+Newsletters&utm_campaign=0bbea86e14-EMAIL_CAMPAIGN_2020_04_02_06_31&utm_medium=email&utm_term=0_4fba358ecf-0bbea86e14-239065853

[Crafty_Dog]

http://cachlamdephieuqua.info/home/live-donkey-fed-to-tigers-at-chinese-zoo-420.html

[G M]

http://cachlamdephieuqua.info/home/live-donkey-fed-to-tigers-at-chinese-zoo-420.html

Yeah, Tigers only eat organic tofu in the wild.

I guess there is nothing else to worry about in China.

[ya]

In these times of stress..

[Crafty_Dog]

https://www.dailymail.co.uk/news/article-8233203/Chinas-disappeared-happened-dared-speak-coronavirus.html?

[Crafty_Dog]

https://www.youtube.com/watch?v=f4hUZwdZKqg&feature=share

[DougMacG]

[Which thread do you want to be the 'China Lies' thread?  There is a lot of material.]

Following is a 17 year old Mark Steyn column with the word sars replaced with COVID-19:

The appearance of the virus itself was a surprise but everything since has been, to some extent, predictable. Because totalitarian regimes lie, China denied there was any problem for three months, and thereafter downplayed the extent of it. Because UN agencies are unduly deferential to dictatorships, the World Health Organization accepted Beijing's lies. This enabled SARS COVID-19 to wiggle free of China's borders before anyone knew about it. I mentioned all this three weeks ago, but only in the last couple of days has the People's Republic decided to come clean -- or, at any rate, marginally less unclean -- about what's going on.
http://www.jewishworldreview.com/0420/steyn042020.php3

Steyn continued, April 20, 2020:
"It is profoundly depressing - on CNN, the BBC, CBC, etc - to hear the credibility their reporters still give to ChiCom/WHO propaganda.

Fool me once, shame on you. Fool me twice, shame on me.

Fool me thrice? Death on me."

[Crafty_Dog]

https://www.breitbart.com/national-security/2020/04/20/report-china-traps-human-rights-activists-religious-believers-mental-hospitals/

[DougMacG]

https://strategypage.com/on_point/20200331224243.aspx#foo
Huawei: 5G Viral Spies
by Austin Bay
March 31, 2020
February was a cruel month for the Chinese corporate giant Huawei Technologies, and rightly so. The "high-risk" telecommunications company with deep ties to Beijing's communist dictatorship deserves an even crueler April and a disastrous 2020 marked by criminal investigation, criminal indictment and billion-dollar lawsuits.

For several years Huawei has pursued a strategy to position itself as the world's biggest supplier of telecommunications equipment, with the goal of dominating global and regional communications infrastructure as well as crucial international digital systems.

Its most worrisome operation gambit involves the 5G "next generation" wireless communication systems that have the ability to connect cellphones, the internet, the internet of things -- well, virtually all things digital. Huawei intends to provide hardware and corporate technical support.

Here's the high-risk rub: Does anyone not on the payroll of the Chinese Communist Party trust Beijing's dictatorship with the power to pervasively monitor communications (spy locally as well as globally), interrupt, deny or corrupt digital services, and possibly take surreptitious control of digital devices, say, the air traffic control computers at Los Angeles International Airport?

Outrageous scenario? No, given Huawei's baggage is a legitimate worry exacerbated by the regime's criminal dishonesty (e.g., lying about COVID-19/Wuhan virus). For all practical purposes, Huawei is a Chinese Communist Party tool. In spy lingo, a cutout company can hide an espionage operation. Abundant evidence suggests Huawei serves as a cutout.

Which is why February's tough responses to Beijing's gambit were so encouraging.

On Feb. 10, U.S. Attorney General William Barr did more than make the case that Huawei poses a security risk to the entire free world. He also suggested several actions the U.S. and its allies could undertake to confront China and mitigate Huawei's threat. He suggested the U.S. form a consortium with private U.S. and allied companies to manufacture 5G equipment. He specifically mentioned Nokia and Ericsson. Nokia, Ericsson and Samsung are Nos. 1, 2 and 3 globally in holding standard and essential telecommunications patents. By this measure, three democracies, Finland (Nokia), Sweden (Ericsson) and South Korea (Samsung), have superior tech.

Huawei is sixth, according to one analysis. Huawei, however, has assets its intellectual superiors lack: Beijing's money and political muscle, and the covert support of the authoritarian state's intelligence services. Some sources estimate Huawei has received $75 to $80 billion from Beijing and used the money to increase sales by guaranteeing financing.

On Feb. 13, Barr's Department of Justice and the FBI detailed Huawei's national and international security risk. The DOJ's 56-page indictment hit the company with 16 charges involving "racketeering conspiracy and conspiracy to steal trade secrets."

Huawei faces numerous counts of intellectual property theft. The indictment has some interesting tidbits that stink of government espionage. Federal investigators found a "top-secret" Huawei manual that ordered "certain individuals" to conceal the fact that they worked for the company when meeting "foreign law enforcement officials."

Numerous analysts believe Huawei has aided Chinese espionage efforts. Huawei personnel have admitted that the company has the ability to intercept communications using its hardware, both in mainland China and in foreign nations.

The company databases contain information on foreign personnel, phone records and property that have nothing to do with telecommunications.

Moreover, it is a fact the Chinese dictatorship requires Chinese companies to give Beijing access to all data they hold. But Huawei is not a private corporation. It is owned by a holding company that is owned by a trade union investment committee that is essentially an arm of the All-China Federation of Trade Unions, which is a public entity.

Then there's l'affair Meng Wanzhou. Ms. Meng is chief financial officer of Huawei and daughter of its founder. According to the DOJ, she was directly involved in stealing American-developed source code. She tried to steal memory hardware and antenna technology. She also violated U.S. sanctions on Iran. The U.S. is trying to extradite her from Canada.

[DougMacG]

US Sen Tom Cotton today in the WSJ, link below.
From the article:
...
Beijing has claimed that the virus originated in a Wuhan “wet market,” where wild animals were sold. But evidence to counter this theory emerged in January. Chinese researchers reported in the Lancet Jan. 24 that the first known cases had no contact with the market, and Chinese state media acknowledged the finding. There’s no evidence the market sold bats or pangolins, the animals from which the virus is thought to have jumped to humans. And the bat species that carries it isn’t found within 100 miles of Wuhan.

Wuhan has two labs where we know bats and humans interacted. One is the Institute of Virology, eight miles from the wet market; the other is the Wuhan Center for Disease Control and Prevention, barely 300 yards from the market.

Both labs collect live animals to study viruses. Their researchers travel to caves across China to capture bats for this purpose. Chinese state media released a minidocumentary in mid-December following a team of Wuhan CDC researchers collecting viruses from bats in caves. The researchers fretted openly about the risk of infection.

These risks were not limited to the field. The Washington Post reported last week that in 2018 U.S. diplomats in China warned of “a serious shortage of appropriately trained technicians and investigators needed to safely operate” the Institute of Virology. The Wuhan CDC operates at even lower biosafety standards.

While the Chinese government denies the possibility of a lab leak, its actions tell a different story. The Chinese military posted its top epidemiologist to the Institute of Virology in January. In February Chairman Xi Jinping urged swift implementation of new biosafety rules to govern pathogens in laboratory settings. Academic papers about the virus’s origins are now subject to prior restraint by the government.
...
This evidence is circumstantial, to be sure, but it all points toward the Wuhan labs.
https://www.wsj.com/articles/coronavirus-and-the-laboratories-in-wuhan-11587486996?mod=opinion_lead_pos5
https://nationalinterest.org/blog/coronavirus/could-wuhan-coronavirus-really-have-been-released-lab-simple-answer-yes-144862?mod=article_inline
https://www.youtube.com/watch?v=ovnUyTRMERI&mod=article_inline
https://www.scmp.com/news/china/military/article/3064677/meet-major-general-chinas-coronavirus-scientific-front-line?mod=article_inline
https://www.fmprc.gov.cn/mfa_eng/zxxx_662805/t1745270.shtml?mod=article_inline
https://www.straitstimes.com/asia/east-asia/how-early-signs-of-the-coronavirus-were-spotted-spread-and-throttled-in-china?mod=article_inline
https://www.scmp.com/news/china/society/article/3052966/chinese-laboratory-first-shared-coronavirus-genome-world-ordered?mod=article_inline

[Crafty_Dog]

https://claremontreviewofbooks.com/chinas-democratic-future/

[Crafty_Dog]

https://www.nytimes.com/1971/05/19/archives/china-transformed-by-elimination-of-four-olds.html

[G M]

https://www.taiwannews.com.tw/en/news/3951673

Hey, it's 2020. Why not?

[Crafty_Dog]

https://www.patreon.com/posts/china-if-three-39315722

[G M]

https://www.patreon.com/posts/china-if-three-39315722

The destruction and loss of life would be mind boggling.

[Crafty_Dog]

A Year On, China's Tech-Focused Stock Market Is Making Strides
3 MINS READ
Jul 30, 2020 | 17:16 GMT
The STAR Market, China's equivalent to a tech-focused Nasdaq, is fueling growth in China's tech sector, but Beijing's regulation and fears of both domestic speculation and industry bubbles will constrain the exchange's potential for growth. A recent string of launches is demonstrating the STAR Market's potential power to raise capital and draw investment into the Chinese technology sector:

China's Semiconductor Manufacturing International Corporation (SMIC) raised $6.62 billion and surged 246 percent on its first day of trading on the STAR Market on July 16 — the largest mainland listing since 2010.
Ant Financial — the world's most valuable tech unicorn targeting a $200 billion valuation — announced July 20 that it would hold its IPO on a dual listing on Hong Kong and the STAR Market, shunning the U.S. and other global markets.
The STAR 50, the market's first index, launched on July 23 and showed a 49 percent rise since the start of 2020 — more than doubling the gains of its U.S. counterpart Nasdaq.
The STAR Market, known formally as the Science and Technology Innovation Board, has made it significantly easier for technology companies to list. China will likely continue to liberalize the market faster than its other domestic stock markets, as the exchange becomes increasingly central to China's overall technology ambitions amid its tech war with the United States.

Launched in July 2019, the STAR Market was designed to be the Chinese equivalent to the Nasdaq, aimed at attracting technology- and R&D-focused companies to raise capital and list on a domestic exchange instead of foreign exchanges.
The STAR Market differs significantly from other Chinese stock markets in several key ways, including a registration-based IPO system that allows pre-profit companies to list, thus granting a wider trading band for prices. 
Shanghai's STAR Market — along with China's other tech-focused exchange, Shenzhen's ChiNEXT — are central to China's ambitions of creating a domestic environment conducive to growth for companies in emerging technology sectors, (including those in the semiconductor, artificial intelligence and fintech industries) by creating future pathways for financing, which allows for more market-based incentives and easing regulatory burdens.
The board has become even more critical as the United States considers increasing pressure on Chinese companies listed on U.S. exchanges, such as the Nasdaq and NYSE, by increasing auditing requirements on Chinese companies and barring them if they have connections to the Chinese military.
The success of the STAR Market will depend on the innovativeness and quality of the companies involved in it, as well as the broader constraints to China's tech sector. Such constraints include concerns about access to international technology due to U.S. pressure, lack of competitiveness in certain industries to international peers, and government intrusion into corporate affairs and direction. Unlike other Chinese stock markets, the STAR Market is more focused on institutional investors than retail investors, but speculation around China's growing tech sector will likely remain a concern. China also fears that more liberalized stock markets could run the risk of creating more bubbles.

The STAR board allows companies to list without being profitable, which will enable companies to raise additional capital without having to show profits first — something essential in R&D-intensive industries.
The STAR Market's ease of listing will also enable Chinese companies to use the IPO process once venture capital sources dry up or move on, allowing for innovation to continue to grow.
The streamlined IPO process, in particular, provides tech firms with another avenue for financing beyond loans to help grow their business. This is crucial as most tech companies lack physical assets to put up as collateral, given that their value is often derived from intangible assets, such as intellectual property.

[Crafty_Dog]

https://www.gatestoneinstitute.org/16306/china-genocide-xinjiang

[Crafty_Dog]

   
    The Communist Party of Every Last Inch of China
Crackdowns in places like Inner Mongolia are easier to understand when you understand the difference between threats to the state and threats to the regime.
By: Phillip Orchard

In July, Chinese authorities announced a three-year plan to phase out Mongolian-language instruction for grade schoolers in the nominally autonomous northern region of Inner Mongolia. Beijing had imposed similar changes on ethnic Uighurs and Tibetans in 2017 and 2018 as part of its draconian forced assimilation campaigns. As a result, many of the 6 million or so ethnic Mongolians living in the province were understandably unnerved, seeing the move not as a well-intentioned policy aimed at promoting national unity and development, but rather as a form of cultural genocide – and a precursor of worse to come.

When the fall school term began on Monday, and students cracked open their new state-compiled textbooks to find them written in Mandarin, the result was what qualifies as all hell breaking loose in stability-obsessed modern China. Tens of thousands of people reportedly took to the streets throughout the province. Students and teachers walked out of schools – or, more accurately in some cases, climbed and pushed their way out after authorities tried to lock them in. Videos posted on social media appeared to show several scuffles with police. Beijing responded Thursday by doubling down on its new policies and launching a fresh campaign to arrest troublemakers.

Dominating buffer zones such as Inner Mongolia is a core Chinese geopolitical imperative. It’s why the Communist Party of China is reportedly expanding its mass internment of ethnic Uighurs in Xinjiang, tightening the screws in Tibet, dismantling “one country, two systems” in Hong Kong, sparking royal rumbles in the Himalayas and putting the squeeze on Taiwan.

These moves, however, are only intensifying international pressure on Beijing at a time when it’s still grappling with the epochal political and economic crises created by the pandemic. So it would seem self-defeating to open up yet another front of unrest in the comparably stable Inner Mongolia. But Beijing doesn’t think it can manage these crises in any other way.

Around the Core

Five subordinate regions surround the ethnic Han core in China: Tibet, Xinjiang, Inner Mongolia, Manchuria and Yunnan. The regions are defined by impassable mountains, unforgiving jungle, vast desert grasslands and high tundra. When the core has been united under central rule, these features have served as shields against outsiders, their inhospitable geography giving China as a whole the defensible borders and security the Han core alone lacks. Between the Himalayas and the jungle uplands bordering Indochina, for example, southern China is protected and isolated by a true Great Wall. The west is a vast and dry expanse that would stretch thin any invading force. The North is the Gobi Desert and Siberia, bereft of major population centers. The core is exposed to overland invasion only through a pair of narrow corridors closer to the coasts, through parts of Manchuria and across the Vietnam border, allowing China to concentrate its defenses. Otherwise, China can’t easily invade anyone over land, but nor can it be invaded.
 
(click to enlarge)

Historically, however, when central authority over China’s buffer regions weakens, bad things tend to happen to China. Their geographies made them ethnically, culturally and economically distinct from the Han core, to varying degrees, and thus often outright hostile to the Han encroachment. And whenever the core has succumbed to its internal pressures, devolving into regionalism, warlordism and disarray, the outlying buffer regions have been quick to go their own way. If occupied by or aligned with an outside power – e.g. the Genghis and Kublai Khan’s Mongol invasion from north of the Gobi, the Manchu in the 1600s, the Europeans in the 19th century, the Japanese and Russians a century ago – the Han core fractures, and dynasties fall.

So even before the CPC had put the finishing touches on its victory in the Chinese civil war in 1949, it began turning its attention to the buffers, waging a decadelong campaign to subjugate Tibet, Yunnan and Xinjiang (to say nothing of expelling foreign forces from Manchuria). And the modern CPC, particularly under Xi Jinping, routinely cites China's historical pattern as justification for its crackdowns on the outlying ethnic regions. The party works diligently to keep the “century of humiliation” – the period between the 1830s and 1949 when the collapse of central authority in China led to it being carved up by foreign powers – in the collective Chinese consciousness. It must be neither forgotten nor repeated, or so the propaganda narrative goes, and the party will not cede to international interference in its efforts to fulfill its mandate of national rejuvenation.

It’s easy to dismiss Beijing’s historical justification for dominating the buffers as anachronistic. In theory, there are ways an outside power could use the buffers to threaten the Han core. India, for example, could try to dominate the Tibetan plateau and take control over China’s water supplies. But in reality, the days of overland invasion in China are gone, to say nothing of foreign occupation. No outside power is strong enough to overcome both the geographic barriers and the firepower China is now able to position along its borders, even if one wanted to.

And there is no threat emanating from within the buffers themselves on par with the Mongols or the Manchu of past dynasties capable of supplanting the central government. The CPC has proved capable of enforcing its writ in the most remote, geographically fractured parts of the country with brute force and a willingness to adopt draconian practices like the “re-education” centers in Xinjiang. It’s also relied heavily on more subtle and insidious measures, such as encouraging mass Han migration into the buffer regions, coopting ethnic institutions and civil society organizations like Tibetan monasteries, more tightly controlling school curricula, implementing a vast surveillance apparatus, and, of course, steadily narrowing the space for use of things like native tongues that can form the basis of a distinct identity. Winning hearts and minds has been a comparably lesser priority, but Beijing’s massive infrastructure buildouts have helped integrate the outlying regions into the economy of the heartland and create at least some incentives to buy into the CPC’s plans for national prosperity.

As a result, China’s buffers today are largely subjugated. The only real threat to the core from the periphery is Islamic terrorism. But beyond a pair of high-profile attacks – one at the gates of Tiananmen in 2013 and one in 2014 – even that has remained relatively contained to Xinjiang. A wave of self-immolations by Tibetan monks from 2009 to 2017 appears to have petered out. Inner Mongolia, in particular, has been a relative success story in ethnic integration. Occasional clashes between ethnic groups and the state mostly died out decades ago. There is lingering discontent over the forced resettlement of hundreds of thousands of nomads, and occasional protests over environmental damage done by the state’s development initiatives, particularly mining, in the resource-rich region (where ethnic Han, which now make up more than 80 percent of the population, have enjoyed the lion’s share of the extraction spoils). But there’s no substantive secessionist movement, and signs that unrest is boiling beneath the surface are rare.

Beware the Buffers

China understands that its biggest potential threats today come not from the buffers but from outside powers uniting against it. And while there’s been more bark than bite from other countries in response to Chinese oppression, the party’s human rights record makes it easier for foreign leaders to rally public support for the painful measures required to truly challenge China. They also make it more difficult for foreign businesses – ones China needs for employment, technology and diplomatic leverage – to stay in China. (See: persistent calls to boycott Western retailers that source materials allegedly produced by forced Uighur labor.)

So why does Beijing still fear the buffers – particularly one as sparsely populated and relatively placid as Inner Mongolia – so much that it would risk the backlash? The answer lies in the distinction between the interests of China as a whole and those of the CPC.

The CPC is not the 19th century Qing dynasty. The center is strong both in the core and the periphery. But while China is realistically safe from foreign invasion, it cannot fully shield itself from foreign influences. Combined with China’s immense internal pressure, these make the CPC’s hold on power inherently fragile. The party therefore has a low tolerance for any threat to social stability, even relatively minor ones. Even a pair of unsophisticated attacks by Uighur militants – which Beijing suspected were getting ideological and material support from militants in Central Asia and beyond – was enough to spook Beijing into effectively putting an entire region on lockdown. The fear of the public losing faith in its ability to provide security, and its fear of militants derailing Belt and Road Initiative projects (which are also essential to maintaining economic stability in the core) through Xinjiang to Central Asia, was evidently too overwhelming. Similarly, its fear of civil society or religious institutions being used to mobilize the public against it partially explains its desire to control Tibetan Buddhism. One of Beijing’s core fears with Hong Kong protesters, meanwhile, is the ways they could – perhaps with Western assistance – stoke instability on the mainland by funneling money and media to dissidents, airing the party’s dirty laundry, or shielding enemies of the state.

Beijing is expecting foreign pressure to intensify over the coming decades regardless of how it chooses to govern its periphery. Put plainly, in the face of mounting pressures, the party’s foremost priority is control. Undermining ethnolinguistic diversity – eroding ethnic identity as something that can supersede loyalty to the CPC – has proved to be a ruthlessly effective way to deepen its control. So too has starting the nation’s citizens on a steady drip of ideology and propaganda from a very young age.

The CPC is also betting that, at the end of the day, outside powers won’t really care all that much about human rights – at least not more than they care about strong economic or diplomatic ties with Beijing – and that its policies will succeed in the buffer zones.

And it may be right. What it’s allegedly doing in Xinjiang is horrifying. And yet, there’s been barely a whiff of meaningful outrage from governments from Muslim-majority countries such as Turkey, Pakistan and Indonesia. To the extent that there has been backlash over Xinjiang, it’s mostly come in the form of Western sanctions – mainly targeting Chinese sectors like AI and other emerging technologies, which the U.S. and friends are keen to check for geostrategic, not human rights, reasons. Matters as esoteric and plausibly well-intentioned as national curriculum standards in Inner Mongolia are hardly going to cause much of a stir abroad.

Either way, the central government seems to have concluded that pressure will eventually fade if its control is absolute. Internal movements lose support and wither. Foreign governments get distracted and move on. Shareholders in foreign firms return focus to the bottom line. The CPC, in its mind, just has to hold on tight until they inevitably do – and hope that it doesn’t suffocate the nation in the process.   

[Crafty_Dog]

   
    China’s Trial by Fire
By: Phillip Orchard

From the COVID-19 outbreak to the subsequent economic crisis, with catastrophic flooding of the Yangtze River thrown in for good measure, 2020 has subjected the Communist Party of China to one existential crisis after another. Yet, Chinese President Xi Jinping seems to have a preternatural ability to swoop in and save the day. Not only does his administration appear to have come out from these calamities unscathed, but in some ways it seems to have grown stronger, more confident and more determined to dictate terms to foes foreign and domestic than ever – with Xi himself seizing every chance to turn crisis into opportunity to cement his power. It was Xi, for example, who Chinese propagandists say commanded the decisive battles in the “People’s War” against the invisible enemy, the coronavirus. It was Xi, according to his own comments during an August inspection tour of flood damage along the Yangtze, who’s continuing a centurieslong tradition of Chinese leaders demonstrating their mandate to lead by taming floodwaters. It was Xi who successfully waged a war on financial risk and who prepared China for the day when the U.S. would try to blunt China’s rise as a way to distract from its own problems, or so the narrative goes. It’s Xi who state media has increasingly been referring to as “the People’s Leader,” elevating the president to almost Mao-like status.

All this should pour cold water on persistent rumors of discontent with Xi in the upper ranks of the Communist Party of China. Of course, as Chinese elites wrangle for power and influence ahead of the Party Congress in 2022 – when Xi is expected to shatter CPC norms by sticking around for a third term as party chairman – palace intrigue will only intensify. And in a country like China, the next crisis is always just around the corner. Beijing is invariably choosing between bad options for dealing with immense problems, with many of its short-term fixes deepening its long-term structural issues, alienating powerful constituencies at home and antagonizing foreign powers.

But the reality remains: A year like 2020 is exactly why Beijing scrapped its Deng-era consensus leadership model and broadly supported Xi’s consolidation of power. His successes this year have been inflated, sure, but they have been real enough to validate his claim that a strongman must be at the helm during trying times. The most important question then is not whether Xi is strong or China is on the brink of collapse. He and China are simultaneously, perpetually both. What matters most for China and just about everyone else is how this combination of extreme power and extreme vulnerability shapes its behavior at home and abroad. It’s not about to change course.

Crisis Averted?

Two weeks ago, in a triumphant speech, Xi said, “The CCP’s strong leadership is the most reliable backbone when a storm hits. The pandemic once again proves the superiority of the socialist system with Chinese characteristics.” But if there were ever a moment when the Chinese public lost faith in the ruling party’s ability to govern competently, the pandemic could’ve been it.
The government’s mishandling of the virus could be attributed directly to its rigidly enforced top-down decision-making structure and institutional cultures shaped by censorship and paranoia. Indeed, when a popular doctor in Wuhan succumbed to the virus in early February, Chinese censors lost control of a flood of outrage over Beijing’s cover-up of the outbreak, and it briefly looked as if things had reached an inflection point. But the censors regained control of the narrative, and China’s lockdown made it impossible for anger online to become anger on the streets. More important, it largely succeeded in containing the virus, capping deaths at just a fraction of the numbers seen in major powers across the globe. By March, the president, who had been conspicuously absent from state media for much of the first two months of the year, reemerged to “take command” of the response just as the infection curve was being driven downward. A month later, he was declaring victory. Since then, bungled responses in the U.S., Europe, India and elsewhere have bolstered his argument that the CPC is uniquely well-suited to crisis response. (Democracies like Taiwan, South Korea and New Zealand have something to say about this.)

The systemic shock from the pandemic could well have exposed China’s economy as a house of cards. China shut down the bulk of its domestic economy almost overnight. Millions were abruptly out of work. Countless small businesses – which were already weighed down by tariffs and a credit crunch before the pandemic – faltered, searching for rescue from an immature banking system that had already proved ill-suited for meeting the needs of China’s burgeoning private sector. China’s convoluted financial system, already awash in shadow lending and toxic loans, appeared on the brink. Once Beijing was able to reopen most of the economy, it faced a secondary crisis in the form of collapsing demand for Chinese exports as the rest of the world sunk into crisis.

And yet, Beijing has somehow been able to keep its myriad interlocking systemic risks from triggering a cascading crisis. It never even needed to unleash a firehose of stimulus as it did after 2008 – measures that contributed directly to its staggering financial risks today. This week, the Organization of Economic Cooperation and Development predicted that China would be the only one of the world’s 20 leading economies to post positive growth this year. Here, Xi can rightfully take credit for pushing through a series of painful measures to curb financial risk beginning in his first term; these worked better than many expected. Meanwhile, his emphasis on strengthening state-owned enterprises – which in normal times have sapped the economy of its dynamism and are at the core of Western trade grievances – has been validated since SOEs have sopped up surplus labor and kept industrial production humming. Perhaps most important, Beijing’s worst nightmare – a massive spike in unemployment – came true, but without the attendant social unrest. There’s a case to be made that the experience will ultimately make Beijing confident enough to adopt a more sustainable economic model that doesn’t prioritize stable employment at the expense of profitability and dynamism.

Much of Xi’s success could have been undone by the collapse of the Three Gorges Dam, a structure that best embodies the vast potential and pitfalls of China’s ruthlessly ambitious approach to development. It's huge – so large that its construction in 1994 apparently slowed the earth’s rotation – illustrating China’s capacity to dream big and build bigger. It's critical; the 22,500 megawatts per day it can produce are vital for meeting the country’s insatiable energy appetite, breakneck urbanization drive, and soaring public expectations for prosperity.

But it also illustrates the fragility of the contract the CPC has made with the Chinese people. The dam was dogged by warnings about its structural integrity even before it was built, and its construction displaced tens of millions of people, many of whom saw their farms and ancestral lands submerged for good. These people were promised prosperity. If the dam collapsed – or even, as it did in this case, proved inadequate for controlling flooding around economic engines like Chongqing and Wuhan, killing hundreds of people and displacing millions more – they might quite reasonably wonder if the CPC was capable of honoring its end of the bargain. But it didn’t fail. In mid-August, Xi showed up in flood-ravaged Anhui province to hail his government’s success in taming the floods and implicitly compared himself to a legendary Chinese emperor who built a network of canals more than 4,000 years ago.

The Tip of the Iceberg

This run of purported successes can be interpreted in seemingly contradictory ways. On the one hand, you could see it as evidence of the Xi administration’s singular ability to marshal resources and take on colossal challenges – or at least validation of its insistence on centralizing power and micromanaging the country’s affairs. On the other hand, you could simply see it as a series of narrow escapes that expose just how many intertwined, potentially catastrophic crises are keeping Chinese leaders awake at night. You could see Xi’s propaganda blitzes as demonstrations of true triumph and confidence – or desperate bids for credit that betray a thinly veiled anxiety about the CPC’s tenuous hold on power.

Presumably, all these interpretations are valid. Xi’s administration will need all the luck it can get and all the savvy at its disposal because China has no shortage of crises on the horizon. The current pandemic may be under control, but the culture of censorship and institutional rigidity fostered by Xi may keep Beijing unprepared for the next one. The scale of the structural damage on the Chinese economy left behind by the pandemic won’t be fully apparent for years to come. The “grey rhinos” and black swans Xi is always warning about in the financial sector are still out there – and many of Beijing’s critical reform plans aimed at thwarting them have been put on hold. The pandemic, along with the CPC’s increasing dependence on state control, has accelerated the slide toward open hostility between China and the West. The Three Gorges Dam cannot realistically be upgraded. Floods will return. The problems exposed this year are really just the tip of the iceberg.

But to Beijing, the lesson of this year is evidently: trust only the party’s power. Its solution to a dysfunctional public health sector, for example, is to tighten central control over it. The only way to stave off a financial collapse is through painful measures aimed at curbing financial risk, and these can only be implemented with the brute force required to remove opposition and contain the fallout. If the Three Gorges Dam is flawed or insufficient, in the CPC's mind, then state power is needed to build more and build better – and to forcefully move the population out of harm’s way. If people are inclined to get upset about such things, then the state must be capable of preventing a revolt. If the West is going to turn against it, then Beijing must have the power to make clear that it won’t be bullied and reshape the region around its needs. And so forth.
Mao may have thrived on a doctrine of perpetual revolution, but Xi appears to be inescapably driven by permanent crises. This mindset is perhaps the inevitable result for a government haunted by China’s history – by the weight of rising public expectation, by the impossible task of meeting the needs of 1.4 billion people, and by the inherent difficulty of trying to make the massive machinery of the state run efficiently through sheer force of central will and ideology. But the downside risk of this mindset for Beijing is obvious – and for China’s neighbors, it’s particularly alarming. Either way, it's the one Beijing is sticking with, whatever storms may come.   

[Crafty_Dog]

China's Economic Recovery Continues
3 MINS READ
Sep 16, 2020 | 18:40 GMT

HIGHLIGHTS
China is likely the only major economy that will have positive growth for 2020 as a whole....

China is likely the only major economy that will have positive growth for 2020 as a whole, with gross domestic product now above its end-2019 pre-COVID-19 level, leading to a somewhat less deep global recession than anticipated. The economic recovery continued in August, with a small increase in retail sales from a year earlier and a slowing in the decline of private investment leading to a pickup in domestic demand, which until now lagged supply-side improvements. Still, that will not bring the global economy back to positive growth.

China's GDP grew by 11.5 percent (quarter-on-quarter) in 2020-Q2 after a decline of 8.3 percent in Q1, with further positive growth expected when Q3 data is released in October.

Previously, supply-side improvements led the recovery, with industrial production up 5.6 percent (year-on-year) in August after a 4.8 percent increase in July.

Industrial production was boosted by stronger than expected exports, which were up by 9.5 percent in August owing to increases in medical supplies, but also to higher consumer electronics exports.

Export demand is still at risk of a sudden potential increase in U.S. trade tensions ahead of the November election, which if realized would subtract from China's growth.

A 0.5 percent year-over-year increase in August retail sales indicates the beginning of a recovery in private domestic demand. This was mainly the result of further easing of COVID-19 lockdowns and less social distancing, as the virus is largely under control with an average of only about 20 new cases a day, according to Johns Hopkins University's daily tracker. Looser restrictions on service providers such as movie theaters boosted consumption and revenue, with box office receipts in late August at about 90 percent of where they were a year ago. Retail sales overall were still down by 8.6 percent in the January-August period, as high household indebtedness likely dampened spending.

What recovery there was previously in domestic demand until now was due mainly to government-supported infrastructure investment.

Fixed asset investment was off by only -0.3 percent from January to August compared to the same period last year, after declining by 1.6 percent through July.

The fiscal impulse from on-budget spending is substantial this year, with the general government consolidated deficit expected to reach about 11 percent of GDP, nearly double that of 2019.

Private sector investment remains depressed, declining 2.8 percent in January-August — although that's a narrowing of the 5.7 percent decline through July, which suggests that component of domestic demand is improving, too.

China's growth, while recovering, is still far below potential and the recovery remains uneven, especially with world demand sluggish. The latest data, however, relieves pressure on the People's Bank of China for monetary policy easing and will continue to support the yuan's appreciation against the dollar. Unlike advanced economy counterparts, the Chinese central bank has avoided flooding markets with liquidity and large cuts in interest rates, and seems to have acquiesced in the recent strengthening of the yuan in foreign currency markets