Boulder2Beijing | 砬到北京

Morning round-up

2009-10-30T21:12:00.003+08:00

There's lots of fun China-related items in the news this morning. The New York Times reports that, as early as next year, the entity responsible for how billions of people enter website addresses--ICANN--will allow website addresses with non-Latin character sets. So rather than requiring users to surf to website addresses like www.zhongguofalu.cn, ICANN will instead allow Chinese users, for example, to type in 中国法律.中国 instead.

Choe Sang-hun, the Times reporter, suggesta that the revised character set would allow for website addresses that entirely avoid the Latin alphabet. That may be true for languages like Arabic or Hebrew that use modified keyboard layouts, but entering any Chinese address into a browser will still require the use of a Latin keyboard and an Input Method Editor, or IME. (Granted, some IMEs do not require the use of the Latin alphabet, but most Chinese folks I know rely upon one to get online.)

The Chengdu Evening News reports (h/t: Danwei) that hospitals in Sichuan will go smoke-free by 2012. Just think about what's wrong about that statement, as well as what's wrong with the quotation in the article that suggests that Sichuanese doctors do not know enough about the deleterious effects of smoking.

Finally, American hog farmers can rejoice in the fact that China has decided to ease import restrictions on American pork products. The PRC earlier this year closed the market to American hog farmers over swine flu fears, but has now decided to allow American pork back in. As my favorite (and only) Colombian classmate once said, "in China, porks are stupid."

Tulips

2009-10-22T20:26:00.002+08:00

Remember the tulips? Back in 1637, Dutch tulip contracts sold for ten times the wages of a skilled craftsman, and a tulip speculator offered twelve acres of land in exchange for a single tulip bulb. The ensuing crash of the Dutch tulip market often serves as an example of asset bubbles like the one that the United States recently experienced in real estate.

Now comes Michael Auslin of conservative think tank AEI warning that China may be in the midst of its own tulipmania-style asset bubble. His key reference? That a bottle of wine sold for $93,000 in Hong Kong at a recent auction. To Auslin, this bottle of wine serves as indirect evidence of China's impending economic collapse, as evidenced by a series of previously-made points that he trots out for all to see.

I am not sure that I buy Auslin's argument, although he does make some interesting, albeit resuscitated points: that China has a increasingly nasty gap between rich and poor (it does) that is engendering increasing levels of social unrest, that the Communist Party of China bears striking resemblance to the overly confident Japanese leadership in the 1990s (it does) that likewise seemed infallible just before the bottom fell out, that the United States would be screwed if the Chinese stopped buying U.S. treasury bonds to maintain an artificially low currency (it would), and that a lot of wealth in China is on paper (it is, albeit stuffed in the leaky bathrooms of certain corrupt officials).

That being said, I am somewhat biased, having staked my career in part on China's rise. And I do have some nice wine in the closet.

To quote Dan Harris, "what do you think?"

How long before Evan Osnos gets his e-bike stolen?

2009-09-22T01:13:00.005+08:00

Evan Osnos, of the New Yorker, just bought an extremely nice e-bike in Beijing near the same spot where we almost bought ours about a year ago. In his blog post on the subject, Osnos laments that a love of cars prevents Americans from buying e-bikes.

I disagree with his assertion--I personally believe that when Deng Xiaoping defined prosperity in terms of bicycle ownership, he laid the foundation for an entire citizenry to trade up from acoustic to electric, Dylan-style. For what it's worth, though, Pete's Electric Bikes in Boulder is running an arbitrage play, importing souped-up Chinese e-bikes and selling them at a premium to the Boulder cognoscenti.

M&A in Chinese Steel

2009-09-18T23:18:00.002+08:00

If you don't think that this is a reaction to the BHP Billiton-Rio Tinto situation, you are kidding yourself.

Guest post on Chinese healthcare reform

2009-09-15T01:10:00.004+08:00

FYI: I wrote a guest post on healthcare for the award-winning China Law Blog. The post went up this morning.

Gone but not forgotten

2009-08-15T07:01:00.002+08:00

From Markey in Fort Morgan

I apologize for my silence these last few months.

Why the reduction in posts? Well, I've been helping a Colorado-based company apply for funds made available by the American Recovery and Reinvestment Act for broadband deployment. Since May, I have travelled across Colorado, Nebraska, and the District of Columbia in an effort to muster the support of local governments and elected officials. I set up a PR event in Fort Morgan, Colorado to demonstrate our proposed plans for Congresswoman Markey.

The craziness should let up next week, however, at which point I'll be able to start posting again. Wish me--and our team--luck.

Photographs from Beijing and Kyoto

2009-06-01T10:17:00.001+08:00

Back in Beijing

2009-05-25T09:06:00.002+08:00

We returned to Beijing last Saturday after a nine-month absence. (We'll post videos and pictures tomorrow, when we're in Japan) Despite attempts to defend our dissertations in the United States, either by teleconference or with Chinese law professors doing international exchanges in New York, we had to fly 13 hours for a twenty-minute defense at Peking University. We both passed and we will both receive our degrees in July.

People who visit China intermitently often talk about the amazing changes in the PRC that occur between their visits. For us, however, China seems mostly the same. Internet access stinks. Crushing polution, illegal street vendors, and migrant workers returned with a vengeance once the Olympic whitewash ended. Shops again display pirated DVDs and pirated goods again, including a trademark infringement "two-fer" in the form of fake Crocs with air holes in the shape of Mickey Mouse. Chinglish t-shirts say things like, "Def Foxy," "Ticklish Little Big Chief," and "Color Yourselves Up with Robinhood," while our hotel reservation was for a room with "twin bads." A new-to-China American made fast friends after we showed him how to use the ticket machine in the subway.

In small ways, though, Beijing changed significantly. My old firm laid off four people in Beijing. The video monitors on the subway play music videos about how the 2008 Olympics rocked. Close friends and classmates who defined our experience in China left for other cities. Once oblivious paramilitary guards now stop every entrant to our school's campus and check for student identification, presumably because of Project 6521 and the fact that several transformative social events in China's history, including the Tian'anmen square incident, began at Peking University. "Beijing Review," a magazine left in our hotel room, highlights China's role in ending feudalism in Tibet. An hotel next to the infamously expensive CCTV tower remains a burned-out shell thanks to an errant fireworks display.

The government has also shifted priorities. Due to the H1N1 influenza scare, health ministry staff used infrared technologies to scan all incoming passengers for fevers at the airport at least three times. We completed special immigration forms which asked if we had "been in close contact with pig within the past 1 week." State-owned media seems to have convinced cab drivers throughout Beijing that we brought swine flu into China.

Perhaps because of the continued pollution in Beijing and the risk of unrest, the environment has assumed center stage. CCTV-9 spent at least one third of last night's evening news broadcast on renewable energy stories. A classmate wrote his thesis on China's renewable energy law. China Daily, the English language newspaper in China, contains a number of stories about biomass, solar, and wind farms. The CEO of ABB, appearing on local television, spouted platitude after platitude about government efforts to improve the environment in China.

Overall, our return feels strange. We visited with some friends, classmates, mentors, and former colleagues, but we know that we will not see some of them again. Whereas returning home involves familiar faces, returning to China feels like returning to a high school reunion with half of our class missing.

I hope I feel differently when we next come back.

Accounts

2009-05-15T02:19:00.003+08:00

NYT has an interesting article on Zhao Ziyang's memoir, Prisoner of the State: The Secret Journal of Premier Zhao Ziyang. There's clearly some bias in Zhao's accounts, but it nonetheless sounds like interesting Kindle fodder.

Second star to the left...

2009-05-08T06:08:00.005+08:00

Peking University Law School has not yet approved our dissertation defenses. The government may even deny our visa request, now that Colorado's count of H1N1 cases has risen.

And yet, due to the wonders of 14-day advance purchase rules, we have purchased plane tickets that place us in Beijing from the 23rd through the 26th. Not long, I know, but we also want to spend some time in Kyoto if we're going to be in Asia.

We thought about staying at the Zhongguancun Furama Xpress, for old time's sake, but the Wenjin on Chengfulu looks more appealling these days. Four stars is better than two.

More importantly, however, the Wenjin is across the street from Ganges (best Indian food on the planet, hold the Mumbai) and our favorite Anhui restaurant, not to mention within walking distance of our old stomping ground (and that of every other Haidian laowai), the Bridge Cafe. Who needs the Great Wall when you can eat the Chinese equivalent of shtetl food, "Across the Bridge Noodles"?

Nimen hao, y'all.

China Visa slow-down

2009-05-05T23:50:00.003+08:00

Dan Harris of China Law Blog recently discussed (in two parts) rumors indicating that the PRC has slowed down visa applications due to 6521 fears. In corresponding with the U.S.-China Chamber of Commerce, however, they indicated to me that there were no hold-ups in visa processing applications...until yesterday. But as of yesterday, the Chinese Consulate suspended expedited visa processing and now requires a declaration that shows where you have been in the past two weeks, presumably because of concerns for the swine flu.

The Amazing Race

2009-05-04T09:12:00.001+08:00

I would not watch the Amazing Race if not for the fact that it involves sending a bunch of clueless Americans running around China for three episodes (thus far). It's all there--the frequently evil cab drivers, the inability to speak Chinese, the barber shops, the crazy street food on Wangfujing, the electric bicycles, the PLA, the painful foot massages, Beijing opera, Chinese racism towards people of African descent, the rude foreigners assuming that everyone in the world should speak/understand English, the Bird's Next, the tricycles, the cab drivers refusing to pick up foreigners...what's not to like?

I am SO looking forward to being in Beijing in May.

Resources for Colorado companies interested in sourcing products from China

2009-05-01T06:48:00.008+08:00

I am helping a start-up in Fort Collins figure out how to import products from the PRC. But in corresponding with the Colorado Office of Economic Development and International Trade (OEDIT), I learned that the Centennial State does not help its taxpayers to identify overseas suppliers. Given limited resources and constitutional limitations on tax increases, it only makes sense that OEDIT focuses on the attraction and retention of businesses in Colorado, and on helping those businesses to export their products elsewhere.

That being said, OEDIT's director of trade & investment for Asia and the Pacific Rim did send along a list of local resources and local people who can help to transact with the PRC. I have reproduced portions of the list below and added in a few contacts of my own that were missing. If you can think of anything or anyone that I've missed, aside from myself, please let me know.

Accounting Firms

GHP Horwath, P.C.
Haiyan Zhang
PWC-Denver
Mark Williams

Finance

ROW Capital
Shan Atira Asian Ventures

Law Firms

Faegre & Benson (my wife works there)
Greenberg Traurig
Marc Musyl
Hogan & Hartson (I used to work there)
Andy Spielman or Ty Harvey
Holland & Hart
Ashley Wald
Lau & Choi (Immigration)
Sarah Doll
Schuchat, Herzog & Brenman (International Trade Regulation)
Frank Schuchat

Seminars/Courses

Strategy and Sourcing Consultants

The dissertation

2009-04-29T04:54:00.002+08:00

The process for getting a master's degree in China is an odd one: first you submit your dissertation to the government-overseen administration of your college or university, which decides whether your work merits a degree or a certificate. A certificate signifies completion of coursework, whereas a degree signifies satisfaction of all requirements and that you will get the full master's credential. Assuming that you did not write your thesis about the inner workings of the Party or the June 4th incident, you get the chance to defend your work in front of a panel of professors from your home institution, who then vote on whether to grant you a master's degree. Then, if you're a Chinese student, you compete with your peers over the few jobs available for college graduates (h/t: Dan Harris) on the Mainland.

For Chinese students, this process is the culmination of many years of education, as I detailed in my thesis:

Education is the central focus of Chinese family life. Chinese children progress through an educational system that includes pre-school, primary school, junior middle school, senior middle school, higher education, and adult education. The central government funds nine years of compulsory schooling through direct financial transfers to sub-national governments. Local governments provide compulsory education until senior middle school, but funds from the central government decline rapidly past that point. Upon graduating from senior middle school, also referred to as high school, students can enroll in three types of institutions: universities, colleges, and junior colleges. (A growing vocational system parallels high school and higher education, and provides post-baccalaureate training as well, in part to reduce the demand for higher education. ) But admission to higher education largely depends upon test scores from the national college entrance examination, a three-day event that occurs every June and that transfixes the nation. (The entrance exam traces back to the seventh century, when China used the科举 (keju) exam to select Imperial officials. ) The MOE uses the 高考 (gaokao, or high exam) to sort the vast majority of students into schools based upon their performance on the national examination, an experience associated with the opportunity for advancement through education. Not surprisingly, educational expenses represent the top consumption category for Chinese households.

Right now, Chinese and foreign students alike are waiting to discover whether they will get to defend their theses. It's a bit frustrating, but the system results from efforts to modernize higher education in China:

Despite sweeping organizational changes, education in China thus far seems to emphasize access and size over skills and quality. In the past decade, the number of college graduates grew four-fold, the number of institutions reached 1,792, the number of enrolled undergraduates hit 16 million, and the number of enrolled postgraduates reached almost one million. Between 2000 and 2005, the number of junior colleges quadrupled and the number of vocational schools quintupled. The PRC awards four million tertiary degrees each year and has 700 million workers, but has only 40 percent of the skilled laborers found in OECD countries (per capita) and less than half of its college graduates find jobs within months of leaving school. China produces more engineers than any other nation, but those engineers tend to lack the skills required by the marketplace, their instructors focus on theoretical concepts and lack practical experience, and technicians lack the social status and compensation of more highly-regarded scientists who engage in basic research. The Ministry of Education now mandates a 14:1 student-to-teacher ratio in higher education and certain minimum qualifications for instructors that revolve around educational attainment, but individual institutions struggle to comply with the mandates, and the Ministry of Education lacks the staff necessary to enforce them. To expand the number of teachers in rural areas, a pilot program initiated by the State Council will pay for the tuition and expenses of college students majoring in teaching at six normal universities managed by the central government, so long as those students agree to spend tens years teaching in primary and junior-middle schools in rural areas. The Ministry of Education also encourages universities to set up independent colleges, but specifies that the universities involved in creating independent colleges must have “relatively high teaching quality.” As such, despite the importance of education in Chinese culture, China does not prepare its graduates to compete in the global economy.

Looking back on it now, I am beginning to question the wisdom of submitting a dissertation concerned with the failings of Chinese education law to a Chinese institution of higher education run by the central government. Oh well.

You heard it here second

2009-04-22T23:01:00.002+08:00

The DOJ announced today that my mentor, Phil Weiser, will be serving as a Deputy Assistant Attorney General of the Antitrust Division. It's a great move for Phil, and I wish him all the best.

Someone needs to say this?

2009-04-22T21:51:00.001+08:00

According to Tian Lipu, head of China's State Intellectual Property Office (SIPO), imitation and copies are not a form of innovation.

Well, duh.

F-35 files hacked

2009-04-22T00:37:00.002+08:00

Wired reports this morning that our bank took interest in some files relating to the F-35 joint strike fighter. Why was any of this stuff sitting on a networked system?

Interesting posts

2009-04-21T23:17:00.003+08:00

The Beijinger has a great interview up with James Fallows, China correspondent for the Atlantic Monthly. Danwei, on the other hand, has a great series of art photos depicting various scenes in a Chinese hotel room. Note to self: do not stay in standard Chinese hotel rooms.

Something different

2009-04-21T03:08:00.002+08:00

This post has nothing to do with China or technology. I recommend that everyone watch the feature associated with this article in the New York Times, which reccounts a fire fight between American soldiers and Taliban forces in Afghanistan.

Counterfeit pandas

2009-04-01T23:09:00.003+08:00

Evidently the pandas sent to Taiwan by the PRC a few months back are brown forest bears with bad die jobs. The zookeepers figured out the problem when the bears' roots started to show and when they started going at it with one another every morning, a distincly un-panda-like behavior.

Done!

2009-03-29T23:07:00.003+08:00

Our master's dissertations are finally done and submitted. Now we wait and see if the administrators at Peking University approve them for oral defense...

SMRT

2009-03-26T05:46:00.003+08:00

My master's dissertation, due Monday, concerns the impact of Chinese law on educational quality and economic growth. While doing some last-minute research to bulk up some footnotes, I tripped across the following video in which Yale University President Richard Levin opines on some of the same issues covered by my dissertation.

For whatever reason, this video gave me a sense of validation. Is that wrong?

They're coming!

2009-03-26T00:35:00.007+08:00

The Pentagon recently released the 2008 version of its annual report, entitled Military Power in the People's Republic of China. (PDF) According to NASA:

The wide-ranging report is founded on the premise that China not only is a rising international economic power in the community of nations, but also is a rising military power with new and emerging capabilities that have global implications.

The Report highlights a number of concerns, including China's demonstrated ability to defeat space-based weapons and disrupt telecommunications networks in the event of armed conflict. I should note, however, that these are all things we've heard about before.

Back in 2007, I described the cyber-security threat in a paper entitled, "Exploit Derivatives & National Security." (PDF) I said,

A sustained computer network attack originating in China continues to target the United States government’s information systems with almost seven years of unabated activity and little means of defense. A 2002 war game on critical infrastructure revealed that the most vulnerable infrastructure components were the Internet itself and the computer systems that underpin the financial sector. And even though DHS created US-CERT to provide better information about computer network attacks in the hopes of reducing vulnerabilities, international, federal, and state laws inhibit reporting. Indeed, one can argue that critical infrastructure remains vulnerable largely because of the regulations and government bodies created to enhance our national security.

I also highlighted China's use of information warfare and disruptive technologies in the wake of the first Gulf War. Two PLA colonels described the strategy in a book called Unrestricted Warfare in which they described the following scenario:

[I]f the attacking side secretly musters large amounts of capital without the enemy nation being aware of this at all and launches a sneak attack against its financial markets, then after causing a financial crisis, buries a computer virus and hacker detachment in the opponent’s computer system in advance, while at the same time carrying out a network attack against the enemy so that the civilian electricity network, traffic dispatching network, financial transaction network, telephone communications network, and mass media network are completely paralyzed, this will cause the enemy nation to fall into social panic, street riots, and a political
crisis. There is finally the forceful bearing down by the army, and military means are utilized in gradual stages until the enemy is forced to sign a dishonorable peace treaty.

This all sounds kind of scary today, especially when you consider that (A) the colonels wrote the doctrine in the wake of the Asian financial crisis and(B) we've seen evidence of China building the very capabilities that would create the situation described above. It's also somewhat frightening when you think about propaganda like the following Mao-era poster, which reads "The American Invaders will be defeated":

But here's the rub: as JG recently pointed out:

[A] few strategic strikes of national railroad lines would throw China into a major food crisis within 2-3 days. Last winter’s storms were a fine example of what can happen when a few trains stop. When food is brought into the equation, you usually get more of the war arguer’s attention, though anyone who is bent towards war usually doesn’t have much of a realistic sense of a future, even 2-3 days ahead. And they’re usually not very hungry for education, either.

So given the timing of the 2008 Report and the Pentagon's recent protests about Obama's efforts to reduce its budget, I can't help but read the Report with a more skeptical eye. And, in light of China's recent military build-up, I also wonder whether there's more Sino-US military cooperation going on than most people realize, at least with respect to the budget process.

UPDATE: In perennial fashion, China's leaders took a few days to read the Pentagon's annual report on PRC military power and then trotted out some talking heads who proceeded to go ballistic (pun intended) about America's hostility and interference in China's internal affairs. Qin Gang, a Foreign Ministry spokesman, recycled last year's slogans about the Pentagon's "Cold War" mentality and "peaceful development." Hu Changming, spokesman for the Defense Ministry, said that "China unswervingly sticks to a path of peaceful development and pursues a national defense policy which is purely defensive in nature." Clearly, the peacefullness of shooting down satellites and hacking into computers at the US Department of Commerce is beside the point.

SSRN Top 10

2009-03-17T02:55:00.003+08:00

The folks at SSRN inform me that my paper, "International Law & State Corporatism" hit the top ten in downloads for the category "Corporate Governance: International/Non-US and INUS: China (Topic)." I would be flattered if not for the fact that my paper was only downloaded 15 times.

Ruh-roh

2009-03-14T01:22:00.002+08:00

The US Navy kicked it up a notch, in Emeril parlance, by sending a guided missle destroyer to protect the USNS Impeccable in the South China sea. If you're at all curious about the legal theories underlying this latest pissing contest, check out my post on Exclusive Economic Zones from last August.