Sustainable boom?

Today, Andrés Martinez and Joseph Farah look at whether a one-party state is sustainable during a long-running boom. Yesterday, they debated whether China poses a military threat to the United States; they’ve also pondered Chinese imports and the broad question of U.S. engagement with the world’s most populous country. For a finale, they’ll talk about the 2008 Olympics.

It’s getting better all the time
By Andrés Martinez

Dear Joseph,

Walk the streets of Shanghai and you can’t help but be astonished by the amount of construction, the endless condo and office buildings going up. But what astonished me far more was to learn how many of those are being financed by Taiwanese investors.

One of the underappreciated aspects of the China story is the extent to which “so-called” communist China (as Ronald Reagan called it) has been taken over by the capitalist Chinese diaspora. Indeed, one reason China hasn’t suffered the boom-and-bust cycle seen in other emerging markets over the last decades is that much of the capital (and expertise) flowing in isn’t Wall Street speculative cash but money being repatriated to the motherland by wealthy Chinese in Taiwan, Hong Kong, Singapore, Indonesia and so on.

The United States is barely the fifth-largest foreign investor in the People’s Republic of China, a fact that belies the stale debate in this country about whether the U.S. should deign to allow China into the capitalist world. We’ve been a fairly minor player in that process.

Why is this intersting in a discussion of security issues?

Well, you posit China as a threat to world peace, a ticking bomb to its neighbors. You say we should confront that threat by disengaging from China and treating it as we treat Cuba or North Korea or some such. You have shed many a tear for the Taiwanese, who are in the evil empire’s sights.

And yet the Taiwanese are pouring money into the mainland and doing a lot of business there. So are Japan and South Korea. In other words, the three capitalist democracies in the region that are on the front line in this epic showdown with those conniving Maoists (in your worldview) are all in agreement that it is in everyone’s best interest to engage China and to participate in its evolution to a market economy whose people gradually enjoy more freedoms.

This is rational behavior. Beijing is a more responsible regime today than it was a decade ago, when it was more responsible and less menacing than a decade earlier, and so on.

I know this doesn’t conform to your vision of an unchanging communist monolith circa 1955, but the people of Taiwan and Japan know full well that they don’t want to live near a nuclear-armed nation of 1 billion embittered people cut off from the international community.

If I’d written in 1960 or 1970 in the Los Angeles Times that China in 2007 would be the country it is today, readers would have wondered, “What is that guy smoking?” What kind of utopian peyote?

So relax, Joseph. Our relationship with China is a complex one, as is that nation’s evolution. But I can assure you no one is more worried about that evolution than the leaders of the Communist Party, who fret that their monopoly of political power is increasingly incompatible with the society they are allowing to flourish in order to buy themselves more time. Stupid saber-rattling on this side of the Pacific, and fear-mongering about some imagined Chinese empire, could alter the script and convince the leadership to try to go backward, but it’ll soon be too late.

U.S. presidents of all persuasions have understood this. Ronald Reagan in 1980 and Bill Clinton in 1992 both ran as strident anti-China candidates -- hey, the world can be black and white when you’re hanging out in New Hampshire diners -- but became leaders eager to foster China’s greater integration into the world community.


Andrés Martinez, a former editor of The Times’ editorial page, is a senior fellow at the New America Foundation.

More like Clinton, before Huang, Riady and Chung
By Joseph Farah

Dear Andrés,

Here’s a shocker: On China, I agree with Bill Clinton.

Well, let me clarify. I don’t agree with President Clinton, or ex-President Clinton. I agree with candidate Bill Clinton.

Here’s what he said about China in a campaign speech at George Washington University Dec. 17, 1991:

The administration continues to coddle China despite its continuing crackdown on democratic reform, its brutal subjugation of Tibet, its irresponsible exports of nuclear and missile technology, its support for the homicidal Khmer Rouge in Cambodia and its abusive trade practices. Such forbearance on our part might have made sense during the Cold War, when China was the counterweight to Soviet power. It makes no sense to play the China card now when our opponents have thrown in their hand. ... We have every right to condition our foreign aid and debt-relief policies on demonstrable progress toward democracy and market reforms, and in extreme cases, such as that of China, we should condition favorable trade terms on political liberalization and responsible international conduct.

That could be Richard Gere or Rush Limbaugh or even Joseph Farah. But it wasn’t. It was Bill Clinton.

But, of course, that was before John Huang, Charlie Trie, James Riady and Johnny Chung. That was before untold amounts of money flowed mysteriously into the Democratic National Committee’s coffers from Asian banks. It was way before Norman Hsu and even Bernard Schwartz, the former chief executive of Loral Space and Communications Corp., who, I couldn’t help but notice, sits as a member of the board of directors of the New America Foundation, for which you work.

I believe only constant and vigilant pressure on Beijing will produce any positive results and reforms in that country. Is that such a preposterous, radical, fringy notion?

Joseph Farah is the Washington-based founder and editor of and the author of the new book, “Stop the Presses! The Inside Story of the New Media Revolution.” He is the former editor in chief of the Sacramento Union and served as executive news editor of the Los Angeles Herald Examiner for six years.

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