THE CHINA QUESTION

by Ronald Gordon Ziegler THE CHINA QUESTION

THE SLOW BOAT TO CHINA

Not far into the next century, the singular standing of the
United States as a super-power is going to be challenged by
the Peoples' Republic of China. With its recent rate of
economic growth, that will be inevitable, and in and of
itself that is not the sort of problem that some might
suppose it to be. After all, China is making tremendous
strides toward market economics even if it is not
'developing' politically very rapidly toward democracy.
Even the Peoples' Liberation Army is becoming one of the
major players on the world economic stage with its
capitalistic ventures. As they become increasingly
enmeshed with the US as a trading partner, we will have
tremendous potential for working peaceably together in our
mutual self-interests, and the huge currency and profit
influxes out of that trade are being used by China to leap
ahead into a more modern economy. Even free market
economists have touted the advances. The argument has become
almost axiomatic -- except that there is something wrong with
this picture. We may be racing headlong and blindly into
a crisis which will put even the heyday of the Cold War
in the back of people's minds.


At some level, the economic arguments do seem to possess some
reasonability. Mutual interdependency does pose a strong
argument for pursuit of heightened inter-relationship, and
out of it, at least coexistence, if not considerably more.
Movement toward a market economy will produce forces inside
China which will move it further along the road toward
political democracy and freedom. What seems to be largely
overlooked in such analysis, however, is the prospect that
China may not have changed its stripes quite to the extent
that some would like to have us believe. That possibility
suggests some genuine reasons for concern that we should
approach the tiger with caution.


THE PEOPLES LIBERATION ARMY AND CAPITALISM

A popular wisdom has it that while China has been slow to
approach liberalization of political forms, it has been much
more amenable to adopting capitalism, or at least vestiges
of the capitalist system. There is without question some
validity to this assessment. Where it suffers the greatest
shortcoming, however, and this may be symptomatic of the
entire Chinese approach to capitalism, is in regard to the
PLA's supposed movement toward capitalism. The mere
involvment in markets of the PLA does not by any stretch of
the imagination qualify it as a pro-active capitalism form.
If it,for instance, operates a business such as COSCO, such
operation hardly qualifies as capitalist, unless one wishes
to expand the definition of capitalism to encompass what
is sometimes referred to as state capitalism. And that
is nothing but socialism. 'Profits' from such involvements are
simply plowed back in to military build-ups. However many
times this line is trumpeted, the fact that it is not free
enterprise cannot be overcome. One must wonder at the
motives or wisdom of those who would foster such illusion.


There has been free enterprise permitted in the Peoples'
Republic which genuinely deserves the label. Such
developments are indeed positive. But these cannot reach to
include the much more common examples of state capitalism
typified by the PLA activities. At their most innocuous,
they might be termed bureaucratic capitalism, but they are
still collectivist to the core. At their worst, they may
approach corporatist forms of the variety associated with
Mussolini rather than even the collectivism of the same name
in the designs of such as Robert Russo, Robert Reich, and
others.
What is more, and what is worse, is that the motivation of
the PLA in its exploitation of free markets is little more
than a method of capital accumulation which can be utilized
to fund the expansion of the Chinese military operation.
And in addition to simply expanding the military operational
capability of the PLA, the efforts of the PLA amount to an
expansion of Chinese military presence around the globe, and
particularly around the Pacific rim. Such Chinese adventurism
has brought it to an active presence in the former American
air base at Subic Bay in the Phillipines (the government of
which has grown increasingly edgy over what has been taking
place). Through COSCO, China has also obtained lease access
at both ends of the Panama Canal, and it has moved to begin
to occupy under long term lease arrangements large parts of
the abandoned Naval ShipYards in Long Beach, California.
Chinese adventurism has already pushed them to also establish
bases on uninhabited islands off the Philippines, as part of
a general push to expand their effective control over the
first tier of islands, with obvious designs on further
expansion, as they project their shadow further to the east.
An immediate impact will be to increase their control over
the shipping lanes and thus trade of the greater east Asian
sphere. And, short of nuclear, or at least general war,
neither of which we are prepared or able to wage, there is
little we can do about it, at least under an administration
apparently in the tight grasp of Chinese influence, and very
much at their bidding from all appearances.

It might be contended that such establishments by the PLA
amount to efforts to involve themselves through these
surrogates in market operations in the areas delineated, but
it also affords them a military extension into some tender
spots of American interest. When some of the exploits of
these forces in these areas are taken into account, however,
there arise real questions of security and motivation. It has
been caught red-handed using these windows to bring some
rather auspicious trade into the American sphere of interest,
and actually into the American mainland. American authorities
have, for instance, had to pursue legal action against PLA
surrogates including COSCO for trafficking weapons, drugs,
and similar 'commodities' into the U.S., while it utilizes
the means to pirate American technology out.

The most adamant opposition to such Chinese adventures may be
the U.S. Navy. It has made a strong case in questioning what
the Peoples' Republic is up to. The most startling event in
this series of activities occurred in the Pacific on the high
seas off California last February (1997). For an extended
period at that time, the U.S. Navy stopped a COSCO ship from
approaching its landing on the west coast. It insisted on
boarding and inspecting the vessel involved for contraband.
A stand-off that lasted as long as a week developed, with
Chinese authorities refusing to turn back or allow the
inspection. Even more amazing was the complete lack of
coverage that this event was accorded in the American media.

The illusion propagated of Chinese motives in these exploits
is exposed in such episodes as these. The purpose clearly is
other than merely seeking access to American markets. These
actions are tantamont to acts of war against the United
States, and call into question the objectives of the overall
encroachment of Chinese power into the Pacific rim, as well
as those of they who pose as apologists.

MOST FAVORED NATION STATUS, BREACH OF SECURITY, AND CONSTRUCTIVE ENGAGEMENT
In the meantime, the United States has continued to allow
China to enjoy its special 'most favored nation' trading
status with us. Even Republicans in Congress supported the
bill and Clinton campaigned in its behalf. This is not a new
policy, but continues one in effect for years, and promoted
by both Reagan and Bush. It has been a major factor in the
huge trade deficit that has developed in US trade with China,
which provides the Chinese with huge amounts of capital for
buying US technology. Free trade advocates support MFN status
on the basis of what comes down to 'constructive engagement,'
reasoning that interdependency and trade with the US will
foster pressure for movement toward more open economies
in China.

The problem with this approach is that it may neglect the
breach of security that some of the Chinese pursuits
presents. The two approches need not be mutually exclusive.
We need not embargo China trade to maintain pressure for
Chinese reform and against Chinese threats to our security.
Constructive engagement or not, the costs may well outweigh
any benefits which may accrue in any foreseeable future
period.

THE PEOPLES' REPUBLIC AND THE ELECTION OF 1996

Mounting evidence suggests that Communist China set about a
course of attempting to influence the 1996 Presidential
election with huge influxes of illegal campaign contributions
to the Clinton and DNC coopted war chests. FBI Director Freeh
is conducting a substantive investigation of such matters
that goes far beyond hearings conducted in the Congress, as
by Senator Fred Thomas' committee. But above and beyond such
allegations, it would be more serious if it could be
demonstratably established that there were resultant policy
shifts favoring Chinese interests, especially if they came at
the expense of American national economic and security
interests. But there were also examples of promoting mainland
China interests that prompted the Clinton shifts in policy
that won him Chinese favor.

The Democrat National Committe has admitted tacitly that such
illegal campaign efforts did in fact take place. Just the
returning of millions of dollars in illegal campaign
contributions to foreigners was such an admission. But this
only occured when the facts came out, and after the money had
been spent. When they said they were returning the money,
they were actually in a deficit situation, without the funds
to repay the illegal donations. The Chinese connection to
much of this money is indisputable. It is also difficult to
imagine how the DNC could not have been aware of the
illegality involved. In fact, the DNC and Clinton campaign
staff, reaching to the office of at least Vice President Gore
(if not, as appears to be a certainty, to Clinton himself),
were playing a pro-active role in soliciting the funds, and
in organizing what can only be termed 'scams' to launder the
money, such as the 'non-fund raiser' at the Buddhist temple
in California which Gore attended and at which monks bound by
a vow of poverty were given money to contribute to the
campaign. And then there is the case of the Chinese
'gardener' who gave a huge contribution at one of the White
House 'coffees' at which he told Clinton personally, and on
videotape that he had been sent by their mutual friend Riati.

Given the closeness of the 1996 election outcome, there can
be little doubt that the impact of Chinese efforts was to
alter the election result. Furthermore, DNC borrowing to
repay the illegal contributions must be held suspect because
having raised the money through loans might have been
illegal, though it is being passed off as not illegal to
borrow money to repay the illegitimate contributions! On one
of the notorious White House videos, Clinton is heard telling
contributors meeting at the White House that his position in
the polls -- and the inference is that his re-election --
were dependent on the illegal contributions scheme he
coordinated. His stated rationale is a variation of the
repeated assertion that they had to do it to counter the
'Republican juggernaut,' stated as a belief that 'we' had
nothing to counter the Rush Limbaughs and other Republican
resources. This conveniently overlooks the reality that it
is the GOP which has no counter to such suspect campaign
money support sources such as the war chests of the unions.

THE CURTAILMENT OF AID TO TAIWAN

During the recent election campaign in Taiwan, mainland
China made a lot of noise about its view of the situation.
The saber rattling it engaged in may have been more hype than
substance, but it was unsettling. After considerable delay,
the Clinton Administration made a show of sending U.S. Navy
ships through the Strait of Formosa. At least as far as the
dominant U.S. media was concerned, this settled the matter.
It virtually stopped talking about the situation. China, of
course, did not attack or invade the island. One could have
gotten the inference from this that China backed off if it
did not back down. The election and installation of the
Taiwanese leader went ahead according to plan. Clinton got
good headlines and the crisis abated. Or did it?

A cynical analysis might suspect that the show was staged --
perhaps a payback by the Communist regime for proper
treatment by the White House? On the other hand, China may
have been testing the waters to see how much it could get
away with. Both answers could stem from the same source.
China has gotten preferential treatment from Washington for
some time now. This has been strikingly true since at least
1993. Such treatment may have begun before that, but with
Clinton, it took a decided turn in China's favor. While
continuing to proclaim our support for Taiwan, the Clinton
Administration has drastically curtailed U.S. assistance to
the island state. This has been most strikingly the case in
regard to military aid. Taiwan remains a major U.S. trade
partner, but we have turned a virtual cold shoulder on what
was once 'Nationalist China.' The mainland could have read
this as a lack of resolve on behalf of the U.S., or the saber
rattling and what resulted could have been payback for our
pulling the rug out from under Taiwan.

It should not be dismissed as possibility that the entire
affair was in actuality a ploy of American media to show the
President in a favorable light. They have repeatedly engaged
in such tactics on a number of fronts. The PRC regularly and
continuously makes threats, and the trumpeting of them might
well have been something even orchestrated out of the White
House, if not simply a media sponsored stroking of American
public opinion for someone who has been one of their
darlings. As it went on before the supposed 'crisis,' the
rhetoric has continued since. Taiwan probably feels no more
secure, and perhaps somewhat less so for the circus. And the
change in U.S. policy toward Taiwan could well be a basis for
the support the Communist Chinese displayed for the Clinton
re-election prospects. Even more dangerous, the entire affair
may well serve to demonstrate to the leaders of the Peoples'
Republic that we no longer view Taiwan as an unapproachable
(from their standpoint) prize. Merely the suspicion of such
on their part is a dangerous development to permit.

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