Win in China - Interview With Robert A. Compton

I reviewed the documentary Win in China yesterday. Today, I'm going to post a transcript of the discussion I had with the producer of the film, Robert A. Compton.

Compton is a businessman with lots of experience in entrepreneurship and venture capitalism. In recent years, he's had a lot of interaction with both China and India.

In addition to business dealings, he has also produced two films. His first was Two Million Minutes, which is about the state of high schools in the US, China, and India. Encouraged by the huge success of 2mm, he's continued to make films. His second is Win in China.

Last week, I had a very insightful discussion with Mr. Compton about his film and China in general. Here is what he had to say:



Mark's China Blog (MCB): How did you find out about the reality show "赢在中国?" What about the show drew you in and made you want to make a film about it?

Robert A. Compton (RAC): I heard about the show from a Chinese interpreter of mine. He knew someone who was working on the show. He told me the premise and it sounded like a great way to get in tune with China's huge growth in entrepreneurship.

China is the most entrepreneurially active country in the world. But the thing is that they keep things close to the vest. Americans, by and large, don't know what is going on there. Many Americans still have this view that China is exclusively an agrarian society. We don't understand the massive government investment in business infrastructure that is going on over there.

MCB: The simple fact that the show 赢在中国 happened shows just how comfortable China's leadership is with promoting capitalism. Tell me more about the investment in businesses and entrepreneurs that the Chinese government is making.

RAC: With the mass migration from the countryside to the cities, China needs to absorb twenty million jobs every year just to break even. China doesn't want entrepreneurs, it needs entrepreneurs.

The show, 赢在中国, was one way of encouraging more people to get involved in the process of creating businesses. But the investment runs much deeper than mere encouragement. Every university in China has a strong entrepreneurship department. Most have at least ten professors on faculty.

Developing entrepreneurship is part of a broad plan. The Chinese are very serious about developing a nation of risk-takers and business owners. As a filmmaker, this is something I want the rest of the world to know about.

MCB: The theme of China's change from collectivism to individualism is featured throughout "Win in China." How do you understand this change from "Mao to the market" took place? How far into the transition do you think the country is?

RAC: The real trigger was Deng Xiaoping. It was a series of baby steps, really. Deng pushed it along. His endorsement of the private sector was a green light for the entire country to begin making money.

The turn of the millenium saw another important step. That's when the government came in and stepped up its investment in education and entrepreneurship. Ten years ago, most people couldn't send their kids to a university. Now, Chinese universities are open to a much larger segment of the population. And in addition to simply making higher education more affordable, the government has also made it a priority to make sure that those universities, which more people are going to, are developing a new generation of business leaders.

There are over 120 million Chinese people involved in entrepreneurial activity. That's nearly the size of the entire US workforce. Patent filings are on the rise. Students at Qinghua University are switching majors from engineering to business in droves. China has made remarkable strides in accepting capitalism in a very short period of time.

MCB: I found the training aspects of the show very interesting. Jack Ma and other industry leaders came in to teach the contestants about IPOs, "start-up capital," and other financial concepts. Education of the audience was a key part of the show. What does the average 老百姓 (common man) know about entrepreneurship and/or business. What did they learn from the program 赢在中国?

RAC: Despite being repressed a few decades ago, the Chinese people have a long history of business and entrepreneurship. It's hard for me to say how much the average person knows. What exactly does the average American know about these things? I think that, despite China's recent history of repression and state-run industries, their knowledge of business and finance is about the same as an American's.

赢在中国 was wildly popular. Millions upon millions of people tuned into the show. It had to have had a big impact on those viewing. It's astounding to think that the sentiment in China has changed to the point where watching people compete for millions of dollars on CCTV is acceptable. The mere fact that the government signed off on the show is a huge endorsement of capitalism. Add on top of that that the show was a runaway success and it shows that the average Chinese person is hungry for the opportunity to get rich.

Throughout the show, CEOs and business leaders were called "heroes." Chinese people aspire to do the same things in business that these people have done. Jack Ma is a rock star in China.

MCB: One of the judges/creators of the show was quoted in the film saying, "In today's China, anyone can win." Zhou Yu (the Wolf) was the personification of this. His character is the most memorable from the television show and your movie. His name is "the Wolf" because of his cut-throat approach. Throughout the show he implemented questionable business ethics and bent the rules for his advantage. Later in the show on the finale, one of the judges said he "represents the Chinese spirit" and he also won the popular vote of the viewers.

Why was "the Wolf" so popular? Do you think he represents the ethos of the Chinese entrepreneur?

RAC: I believe the Wolf does personify China's entrepreneurship ideals. Watching the Wolf, seeing his aggressiveness, it really did make people uncomfortable. Yet he captures the spirit of today's Chinese business people.

The Wolf probably didn't finish high school. He would never say exactly what his education level was. This appealed to the common Chinese person watching the show. He truly pulled himself up by his bootstraps. The Wolf helped everyone, even those who haven't yet been lifted by China's booming economy, feel as though they have a chance to get rich and have a better life.

If I had been a judge on the show, I would've chosen the Wolf to win the competition. Great entrepreneurs are strong willed. Now, I'm not sure how well he'd do in a Board of Directors meeting. But I do know that since the show completed in 2007, his business is absolutely booming whereas the other finalist on the show is struggling.

MCB: Talk about China's growth and what it means for America.

RAC: We've never faced an entrepreneurial competitor that's four times as large as us. There's an old Red Army saying, "Quantity has a quality all its own." There are over two hundred venture capital firms in Beijing. Now, we have to look at competition coming from Asia where in the past, we only had to worry about domestic firms.

China is already killing us on battery technology and electric cars. Warren Buffet invested $250 million in BYD last year. Now that investment is worth $9 billion. BYD electric cars are all getting between one hundred and one hundred and forth miles a charge and cost $10,000. GM just announced that its Volt will be released soon. It's going to get about forty miles a charge and will cost $40,000.

The Chinese economy is here to stay. We need to be prepared to meet its challenge.

MCB: What do you think about China and America's responses to the financial crisis?

RAC: With its stimulus, China is currently doubling the size of its ports, expanding its rail lines, and rebuilding its energy grid. Compare that to America. We're pouring billions of dollars on failed twentieth century businesses and industries. Their package is building while ours is bailing.

Which country do you think is preparing better for tomorrow?

There are a lot of problems with China's leadership and I certainly don't endorse one-party rule. But there is something to be said for what they're doing. The top leaders in China are all engineers. How many engineers are in our Congress? I know we have a lot of lawyers, but I'm pretty sure there aren't many engineers. Engineers approach economics and growth very methodically. Chinese leadership is proving to be very analytical. Their planning can be seen in the fact that the economic crisis for them means only 8% growth.

MCB: Do you think that these stimulus projects, not being driven by markets but instead by government, could be fueling mis-allocation?

RAC: I'm not sensing over-heating. I feel like China will be able to grow into over-capacity it is creating. But I'm not an economist and I don't study macro-economic numbers. I'm speaking from what I'm seeing in the business community.

MCB: What will China look like in 25 years?

RAC: China's economy will pass the United States' in about twenty five or thirty years. That seems to be the consensus from economists. Another 400 million people will be brought out of poverty. They will join the 400 million who have already been brought out of poverty in the past couple decades.

China is going to dominate battery technology and electric cars. They're doing great in green technology across the board right now.

Once Chinese become consumers, China will be the largest market. This will present a challenge to US companies. Business in China is a very subtle and complex proposition.

MCB: Thanks a lot for your time, Mr. Compton. It's been a pleasure speaking with you.

RAC: Thank you.

I'd like to thank Mr. Compton for sharing his time with me. I really enjoyed hearing his take on what is going on in China right now. Again, you can find out more about his film here.

Win in China - Review

A few weeks ago, I received an email asking me to review a documentary about entrepreneurship in China. The film, called Win in China, produced by Robert A. Compton, sounded like an interesting project and I jumped at the opportunity to view the film, review it, and then interview Mr. Compton.

Today, I'm going to post my thoughts on the movie.



"Win in China" is a documentary about entrepreneurship in China framed by highlighting the Chinese reality TV show, "赢在中国" (literally "Win in China"). Compton's film shows exclusive behind-the-scenes footage of the reality show and has extensive interviews with both the creators, contestants, and observers of the show. The TV show, "赢在中国," is now, in 2009, in its third season. Compton's documentary looks at the first season of the show in 2006-2007.

The reality show's basic premise had contestants entering a business plan competition with more than $5 million (US dollars, not RMB) in prizes. Think the Chinese version of Donald Trump's "The Apprentice." The winner of the contest received $1.5 million for their business (that sure beats Trump's prize of getting a job with Trump Industries!). To win the competition on "赢在中国," the contestants had to impress a panel of judges as well as the viewers watching, who could text message in their votes for who they thought performed best. The judges of the show were many of the top business men in China, including Alibaba.com's CEO Jack Ma (Ma is widely known as "the Bill Gates of China").

The documentary begins by laying the scene that is present-day China. This might be a review for China Hands already familiar with the ins and outs of contemporary China. But to anyone unfamiliar with Deng Xiaoping or the story of "Special Economic Zones" like Shenzhen, this introduction is very helpful in, literally, seeing what has happened in China over the past twenty plus years.

As anyone who's been to China in recent years knows, Chinese people no longer wear Mao jackets or carry little red books. Executive Producer, Wang Lifen, of the reality show, "赢在中国," is quoted in the documentary saying, "Entrepreneurs are the biggest heroes in Chinese society. Many came from nothing, yet they've created so much." Indeed, China today could not be further from the China of Mao, the "Great Leap Forward," or collectivized farming. Compton's film wants to dispel any notions from those in the West who don't know China intimately that Chinese people still think in terms of Maoism or Marxism.

One of the most interesting parts of the documentary is when a group of China's industrial leaders trained and lectured the contestants on the show. Contestants, and, of course, the millions of Chinese watching the show, were given lessons on IPOs, start-up capital, and other basic entrepreneurial practices by Mr. Ma and many of the other top executives in China. The audience was given a step-by-step how-to on how to become a successful business man.

"赢在中国" was meant to be entertaining for the masses. But there was a much bigger reason why the show happened: the Chinese Communist Party wanted more people to become better entrepreneurs. The show, being broadcast on China's Central Television in Communist China, was, essentially, capitalist propaganda. This contradiction, highlighted well by Compton's film, is one of the most fascinating aspects of contemporary China.

The theme of picking one's self up by the boot straps and, in a larger picture, China's transformation from a collective to individualistic society is another main theme of Compton's documentary. One of the creators of the reality show said, "In today's China, anyone can win." This mantra is what the CCP wanted to promote with the show. China needs millions more entrepreneurs if the country's economy is to continue growing at the break-neck pace it has been moving.

The most memorable character from the TV show, and, thus, Compton's documentary, is the contestant, Zhou Yu. Zhou personifies this notion that peasants in China can go from, as one of the commenters in the movie put it, "farming to Ferraris." Zhou was born in rural Hebei Province and (most likely) did not graduate from high school (Zhou is very coy about how much formal education he's actually received).

Zhou's nickname is "the Wolf" for his cut-throat business practices. During competitions, he spied on the other team and lied to third-party participants trying to get information. In other instances, he pushed the rules of the show as far as he could. He wanted to win and tried to by any means possible.

His practices, many of which were questionable to me, were debated by the shows judges and audience. While the other contestants on the show didn't appreciate the Wolf's "win-at-all-costs" business practices, the audience sure did. He repeatedly won the popular vote of the Chinese people watching the show. One of the judges even went so far to say that "the Wolf represents the Chinese spirit."

I won't tell you how the contest ends. It does have a twist and controversy. You'll have to view the film to see whether the Wolf is crowned the ultimate winner of the show.

Compton's "Win in China," clocking in at about an hour with additional interviews added, is worth checking out. The documentary's interviews, footage of contemporary Chinese business practices, and insight into Chinese culture make it worthwhile.

But I believe the biggest reason to watch the movie is to get familiar with the most memorable character - the Wolf. The Wolf is the ideal businessman for contemporary Chinese people. Understanding him, and to a larger extent Chinese businessmen and China's current attitudes towards business, will give one a much deeper understanding of China going forward and would be advantageous for those doing business in China to know about.

I had a very interesting conversation with the producer of the documentary, Robert A. Compton, last week. We covered a wide-ranging array of issues. Check back soon for a transcript of the interview.

The Other Side of Wind Power

China's been lauded a lot for its efforts in going green. Indeed, China does seem to be taking climate change seriously. But at the same time, China, and the rest of the world, have a long ways to go in terms of weening itself off of carbon-emitting energy sources.

From The Wall St. Journal:

Photo from CS Monitor

SHANGHAI—China's ambition to create "green cities" powered by huge wind farms comes with a dirty little secret: Dozens of new coal-fired power plants need to be installed as well.

Part of the reason is that wind power depends on, well, the wind. To safeguard against blackouts when conditions are too calm, officials have turned to coal-fired power as a backup.

China wants renewable energy like wind to meet 15% of its energy needs by 2020, double its share in 2005, as it seeks to rein in emissions that have made its cities among the smoggiest on Earth. But experts say the country's transmission network currently can't absorb the rate of growth in renewable-energy output. Last year, as much as 30% of wind-power capacity wasn't connected to the grid. As a result, more coal is being burned in existing plants, and new thermal capacity is being built to cover this shortfall in renewable energy.

In addition, officials want enough new coal-fired capacity in reserve so that they can meet demand whenever the wind doesn't blow. This is important because wind is less reliable as an energy source than coal, which fuels two-thirds of China's electricity output. Wind energy ultimately depends on wind strength and direction, unlike coal, which can be stockpiled at generators in advance.

Further complicating matters is poor connectivity between regional transmission networks, which makes it hard for China to move surplus power in one part of the country to cover shortfalls elsewhere.

China may not be alone in having to ramp up thermal power capacity as it develops wind farms. Any country with a combination of rapidly growing energy demand, an old and inflexible grid, an existing reliance on coal for power, and ambitious renewable energy-expansion plans will likely have a similar dilemma. What marks China out as different is the amount of new coal-fired capacity that needs to be added.

...

"China will need to add a substantial amount of coal-fired power capacity by 2020 in line with its expanding economy, and the idea is to bring some of the capacity earlier than necessary in order to facilitate the wind-power transmission," said Shi Pengfei, vice president of the Chinese Wind Power Association.

Read On

It's seeming more and more like significant steps towards actually getting away from our CO2-powered lives are not that close to becoming a reality.

That's unfortunate.

Last Year's Massive Earthquake

Apparently last years Sichuan earthquake was a once in a lifetime phenomenon. Actually, it was a once every four millenia phenomenon.

From AFP:

PARIS — People who were killed, injured or bereaved in the 2008 Sichuan earthquake had the cruel misfortune to be victims of an event that probably occurs just once in four millennia, seismologists said on Sunday.

In a paper published in the journal Nature Geoscience, Shen Zhengkang of the China Earthquake Administration and colleagues said the May 12, 2008 quake comprised a strong seismic wave, unusual geology and the failure of three subterranean "barriers" to resist the shock.

Using Global Positioning System (GPS) markers and data from satellite-borne interferometric radar, the scientists built up a picture of the Longmen Shan fault, on the northwest rim of the Sichuan basin, as it was gouged open by the 7.9-magnitude temblor.

Nearly 88,000 people were killed in what was the largest seismic event in China in more than 50 years.

Read On

Not that it is any consolation for those that were affected, but hopefully nothing like this will happen again for another four thousand years.

October 1st Approaches

This is a big week for China and the CCP.

From USA Today:

Image from Reuters (click this link to see a large collection of incredible photos of the anniversary's preparation)

BEIJING — With armed SWAT teams, 1 million security volunteers, a celebrity-packed hit movie and a barrage of propaganda, Beijing is gearing up for a burst of pride and patriotism for next week's 60th birthday of the People's Republic of China.

On Thursday, six decades after Chairman Mao Zedong climbed the Tiananmen gate to declare the founding of Communist China, President Hu Jintao will preside over a huge military parade to mark the nation's rising strength and prosperity — and its continuing one-party rule.

After the successful, ambitious Olympics opening ceremony in Beijing last year, the government is leaving nothing to chance.

To prevent collisions when 150 planes do a ceremonial flyover, people are banned from holding kites or balloons or from releasing pigeons in the city's center.

In addition to the heavy police presence already visible, backed by volunteers wearing red armbands, Chinese security chief Zhou Yongkang mobilized what he described as a "security moat" of checkpoints in neighboring provinces to keep out potential protesters, according to the state-run Xinhua News Agency. Zhou has called for a "people's war" to guarantee that nothing — and no one — disrupts the celebration.

Read On

When I heard about this celebration last winter, I didn't have a problem with it. To me, it seemed like the Chinese version of similar celebrations that happen in America and other countries throughout the world.

At some point between last January and now though, I soured on this kind of propaganda. I'm not sure when this exactly happened, but I'm not nearly as tolerant of this kind of stuff as I was. Leaving China, and before that preparing to leave China, surely has something to do with my disillusionment. I believe that my fundamental attitude toward the China and its policies changed while I was living in the Middle Kingdom too.

When I first went to China in early 2006, I didn't know much about China or the CCP. I had a very negative impression going in from the media in the West. Over time, though, I saw that, for the most part, China is a country on the move and Chinese people are generally happy and their lives are getting better. For these reasons, I became more tolerant of the leadership of China and their actions.

The more I got into China news and the more deeply I came to understand the country though, China's methods became less endearing. To me, it seems like the powers that be are more interested in securing their own political hides and the mythical "harmony" than actually treating people like humans or developing the country in a sustainable way.

I'll be interested to see pictures and videos of the events on October 1. But I'm not going to be seduced by the greatness of the day like I maybe would have a year or two ago.

Photos of the Week - Honeymoon in St. Pete

We finished up our honeymoon yesterday. We went to a resort in St. Petersburg, Florida. It was a really good and relaxing week. We were there from Sunday through Thursday. It was great to go during these times since there were hardly any people there. That's just what we were looking for for our honeymoon.

Here are some of the better photos we took:

Edited out photos

Me (with very stupid hair) and Qian on the beach with a rainbow in the background

Our honeymoon was perfect. We couldn't have really asked for a better few days.

Honeymoonin'

With Qian down on the West coast of Florida. It's incredible. Talk with y'all later.

Recovered

I commented on a post at the excellent The Peking Duck Blog last night. In the post, Richard, the author, was lamenting coming back to America at this time when the Chinese economy has, as The New York Times reports, "recovered." He too just left China after living there for an extended period of time.

I wrote a similar post myself last month. Indeed, leaving China for America right now feels weird. America is reeling and has been for some time now. While at the same time, there is still excitement and optimism living in China.

As I've been ranting about for months, I just don't see how the reckless lending, being promoted by the government, that's been producing China's growth, is a good thing though. To me, it's all a big mirage. China is keeping itself afloat by bubble-blowing and doing the same things that got the west into trouble. How can that be lauded?!

China's bank lending was addressed in the NY Times "recovery" article Richard referenced over at the Peking Duck.

From the end of the article:

Chinese banks came into the crisis with enormous excess reserves, the result of three years of tight regulatory limits on lending to prevent the economy from overheating. When those limits were removed, and authorities urged bank executives to lend, the total value of loans outstanding shot up more in the first seven months of this year than in the previous 24 months.

...

As much as a third of the extra bank lending in China appears to have gone into real estate and stock market speculation. But the bulk has gone into investments by companies and local governments, with tangible results.

...

Still, China’s stimulus efforts could be sowing the seeds of future distress. With so much money washing into the system so fast, regulators have voiced concerns about corruption in government investment projects.

Cheap cash has a way of inflating bubbles — just ask Wall Street — that could damage China’s economy and its banks when they pop.

“You have to imagine the rigor and due diligence” that mainland banks have been showing in rushing out so many loans, said Benjamin Hung, the chief executive of the Hong Kong unit of Standard Chartered Bank.

But such concerns are so 2008.

Uh... OK...

Here's an article that I think addresses such concerns in a more, I think, adult tone.

From Reuters:

Image from The Wall St. Journal earlier this year

Risks in China's banking sector are growing as banks have pumped out large amounts of credit this year to help the economy, the top banking regulator said in comments published on Friday.

Chinese banks extended 8.15 trillion yuan ($1.2 trillion) in local currency loans in the first eight months, far exceeding the government target of 5 trillion yuan for the full-year 2009 set early this year. The sharpest rise came in the first six months.

'This year, as bank loans have increased rapidly, all kinds of risks in the banking industry are picking up,' Liu Mingkang, chairman of the China Banking Regulatory Commission (CBRC), said in a statement on the agency's website (www.cbrc.gov.cn).

It marked the most pointed recent warning from the banking regulator about increasing risks due to the explosive rise in lending

Read On

There's no doubt that this massive lending is what has China's economy clicking. Is China going to succumb to a similar crash as the US following this significantly increased lending? I don't know. Maybe it won't. But China really seems to be tempting fate by leveraging itself up in such staggering amounts of loans. The whole thing seems short-sighted to me.

The New York Times says that China has recovered. I can't say that I'm utterly convinced things are so clear-cut though.

Internet Access, Climate Calamity, and Politicking

It's been a while since I've had the time to sit down, type "China" into Google News, and read about what's going on in the country. Maybe it's because I haven't been online in a while, but I was really intrigued by a number of articles today.

First, an article from the Los Angeles Times on the newest of China's netizens - low-paid workers:

Image from nataliebehring.com

Reporting from Shenzhen, China - When Jiang Dabao lost a hand to a molding machine three years ago, his boss said he wasn't eligible for workers' compensation. Unemployable, Jiang whiled away his days in the Internet bars that thrive in China's manufacturing heartland.

Eventually he tapped into QQ, a popular social networking service, where he found a worker advocacy group that helped him win a $30,000 settlement, said Jiang, who identified himself by his childhood nickname for fear of official reprisal.

Forums have become the Chinese proletariat's equivalent of Facebook or Twitter and are seen by some as the beginnings of a labor movement.

Authorities and factory owners are eyeing the networks warily. Sites dedicated to grievances have been shut down, and stories about worker rallies are regularly deleted, according to labor advocates. The QQ forums are capped at 100 users, making mass mobilization more difficult.

Still, the potential remains for groups to organize through social networking.

Authorities alleged that exiled separatists used the Internet to urge ethnic Uighurs to riot in China's western Xinjiang province in July; the government cut Web access in the region for days.

"Nobody can predict when the Chinese working class will have uproar. It may be once in a lifetime, but if it happens, it will change everything," said Jack Qiu, a professor at the Chinese University of Hong Kong who follows the Internet in China.

Until a few years ago, factory workers missed out on the Internet boom. But that changed with the explosion of Internet cafes and cheap cellphones that enabled users to go online.

Read On

It's great that new technology is giving the bottom rung of China's society the opportunity to get online. China is going to continue to clamp down on its country's internet as much as possible. But I like to think that the more people that get online and get used to having a voice the better. It'll be harder for the powers that be in China to restrict people the longer people are used to having the ability to enjoy some degree of freedom online.

Second, an article from AP on the future of climate change:

Image from The Guardian

BEIJING — If China's economy continues to expand rapidly and rely heavily on coal and other fossil fuels until the middle of the century, its power demands could exceed what the entire planet can withstand, according to a study by government think tanks released Wednesday.

The two-year study, supported by the U.S.-based Energy Foundation and the international environmental group WWF, also said if China's energy usage structure remains unchanged, its emissions of greenhouse gases blamed for global warming would reach 17 billion tons a year by 2050. That would represent 60 percent of total global emissions and three times China's current production, it said.

"If the current mode of economic development drags on, the scale of China's fossil fuel consumption will be shocking," said the study, titled "China's Low Carbon Development Pathways by 2050."

The researchers said global warming will challenge China more than many other countries, with its developed east coast cities contending with rising sea levels, and already drought-prone agricultural areas suffering further water shortages.

Read On

I've talked before about the contradiction/irony/tragedy of climate change. The West has been developing and industrializing for two hundred years, yet now it is China's recent growth that may very well push the world past the brink. The West been enjoying the fruits of industrialization for generations, yet now that China is getting there, there's a climate crisis and they can't use (is pillage more appropriate?) the Earth in the same way already industrialized nations have.

I'm not saying that China shouldn't change or that the West is evil or anything. I just think the whole situation is pretty interesting when broken down.

Third, an article from Asia Sentinel on the things being discussed at China's annual CCP Plenum:

While most plenary sessions of the Chinese Communist Party's Central Committee – usually held once a year – merely endorse decisions made by the supreme Politburo Standing Committee, the plenum now taking place in Beijing deserves special attention.

Party insiders say Vice-President Xi Jinping, 56, may be promoted to the vice-chairmanship of the CCP's Central Military Commission. This will not only confirm Xi's status as Hu's successor as party general secretary and state president, but also spell a bonanza to the political fortune of the "Gang of Princelings" – the offspring of party elders – that Xi heads.

Xi, the son of former vice-premier Xi Zhongxun, does not come from the Communist Youth League faction led by President Hu Jintao. And Hu, who has been military commission chairman since 2004, has maneuvered to delay Xi's induction to the policy-setting military organ. One reason is that while the princelings are heavily represented in the top echelons of the People's Liberation Army, very few youth league affiliates have attained senior ranks in the defense forces.

Within the standing committee put together at the 17th Party Congress in late 2007, Xi outranks long-time Hu protégé Li Keqiang, who as First Vice-Premier is expected to take over from Wen Jiabao as premier in 2013. It is understood, however, that Hu has hoped to delay Xi's induction to the military commission so as to allow Li, a former party boss of the Youth League, time to build up a power base at the top.

However, recent events in Xinjiang, in which more than 200 people were killed in ethnic violence since early July, have dealt a blow to the Youth League faction. The bulk of the top cadres running Xinjiang and Tibet, including their party secretaries, respectively Wang Lequan and Zhang Qingli, are veteran youth League affiliates.

Read On

I have a hard time getting excited about Chinese politics. But succession debates and possible grabs for power at the top are always gripping theater.

Given how chaotic things have been for China recently (really for a couple years now), I'm not surprised that a serious look at what's going on with China's power structure is happening. I wouldn't think that the upheaval and general "disharmony" that's taken place over the past couple years in the Middle Kingdom is sustainable.

Well, this coffee-induced news round-up has been fun!

Living in the Shadows

At the end of 2008 and in the first few months of 2009, I wrote a lot about the plight of Chinese migrants. There were a lot of media reports about the millions upon millions of migrant workers who were either struggling to find work in Chinese metropolises or who had simply returned to the countryside dejected.

I haven't seen too many reports about migrants in recent months. I have to assume that most of the millions struggling at the beginning of 2009 eventually found work. The last figure I saw said that there were (only...) four million still looking for work. So it appears as if the crisis of unemployed migrants from last winter is not too severe right now.

I got an email from someone at The Global Post the other day. They directed me to some recent reporting that they've done on Chinese migrant workers entitled: Living in the Shadows. I suggest you click that link and go check out what they've put up over there. The videos, in particular, give the viewer a fascinating glimpse into the daily struggle of those on the edge of China's growth.

Tires and Chickens

Is protectionism about to kick into higher gear?

BEIJING -- China indicated it would restrict U.S. imports of chicken and auto products and demanded trade talks after Washington's move to slap punitive sanctions on Chinese tire imports, raising tensions in ahead of two planned meetings between the countries' leaders.

Many observers in China say ties between the nations should remain unharmed, noting that China's measures could limit imports in two areas that it already tightly controls -- and thus might not have a huge effect on U.S. exports. But the measures add to worries about trade protectionism amid rising unemployment around the world.

Citing a jump in Chinese imports, the Obama administration said Friday it would impose stiff tariffs on Chinese-made tires for the next three years, invoking a section of trade law that China agreed to as a condition for its joining the World Trade Organization in 2001. The move essentially would cut off the source of nearly 17% of all tires sold in the U.S. last year and hit cost-conscious consumers particularly hard, as retailers will have to find alternative sources for the lower-end tires that make up much of what China sends to the U.S.

Beijing responded quickly. Sunday, its Ministry of Commerce said it was starting antidumping procedures against U.S. exporters into China of chicken and auto products. It said it had received complaints from local producers that the U.S. products were being dumped in China at below-market prices. The ministry denied that the move, which could lead to sanctions, was protectionist.

"China has consistently opposed trade protectionism, and the country's actions since the financial crisis have reflected this stance," the ministry said on its Web site. "China is willing to continue to act in accordance with countries around the world to push forward the world's economic recovery."

Read On

The end of the article quotes some observers and analysts who say that this spat isn't that big of a deal and is, in fact, inevitable given the state of the world economy. I can see where this point of view is coming from. It's understandable that US politicians are feeling pressure from unions and other groups dissatisfied with what is going on these days and feel like they have to act.

It'll be interesting to see whether this is a one off event (or just a series of small disagreements) or the beginning of a larger trade war.

I don't think it'd be wise for the US to try to ramp things up here. Sure, the economy sucks and there are a lot of people who'd love to see Chinese products blocked from entering the country. But I think that closing down free trade right now is going to make things much worse than they already are.

Personally, I'd rather not live through a reincarnation of Smoot-Hawley.

Chinese Bunnies

Hugh Hefner is proud of his company's growing presence in China.

From The Press Association:

Image from Shanghaiscrap.com

Hugh Hefner hopes his Playboy brand can help encourage democracy in China.

The 83-year-old said the bow-tied Rabbit head was a popular emblem in the communist country, adding that it represented freedom.

He added that this was the case despite the magazine not being permitted on the mainland.

Speaking during a Q&A session at the Toronto Film Festival, Hef waxed lyrical about the power of the Playboy brand.

He told the audience that in China "the rabbit is increasingly representing - for men and woman - personal, economic and political freedom. That is what I want."

Read On

Playboy brand clothes are all over China. I'd always thought that the clothes were shanzhai and didn't have anything to do with the actual brand. But apparently Hef is down with Playboy's presence in China, so that must mean he's getting a cut of at least some of the products over there.

I just asked Qian whether Chinese people even know that Playboy is a pornographic magazine. She thought that many don't know. It's not as if the Chinese could actually access any Playboy material on the country's locked down internet. So I'm not surprised that many wearing the bunnies on their shirts don't even know what they represent in the West.

While Hef sees his company as a beacon of liberalism in communist China, he probably shouldn't get ahead of himself in what his bunnies actually represent in the country. It's probably more of a trendy label rather than an endorsement of his open lifestyle.

NFL Reality TV

This is a weird one.

From The Washington Post:

Image from letsgomobile.com

On a pockmarked Loudoun County field of mud and weeds, the National Football League came to sell itself to China, a country it once never believed to be interested in football. It did this in an experiment the buttoned-down league has never dared to try before, with one of Asia's most beloved rock bands running around a children's flag football game last week, trailed by a film crew, making of all things -- a reality TV show.

"We've started to understand what the code is to get into the Chinese market," said Chris Parsons, the NFL's vice president in charge of international operations. This has almost nothing to do with the game of football itself, something the NFL has had little success pushing anywhere internationally, but with something far different: American culture.

Which is how Stone, Monster, Ashin, Masa, and Ming -- the members of a Taiwanese band called Mayday -- happened to spend 10 days riding a bus around the Northeast this month, meeting cheerleaders and marching bands and playing flag football for a TV show that will run on China Central Television, or CCTV, this fall. All in the hopes of converting tens of millions of Chinese into fans of American football.

It speaks to just how desperate the NFL is to make this happen.

...

There is little interest in football in China, where the most popular sports are table tennis and badminton. And while many young Chinese are big fans of the NBA and English Premier League soccer, both of which are broadcast on local television, the glimpses they have gotten of American football are bewildering.

"It's like explaining cricket to us," said Chad Lewis, the former Philadelphia Eagles tight end who as a student at Brigham Young University spent two years doing his Mormon mission in Taiwan and has become familiar with China in recent years.

Read the whole article

I wrote a LONG post about the NFL in China several months ago (this post is actually one of the best I've ever written, in my opinion at least). So I'm not going to get into the details of the inherent reasons why (American) football getting big abroad will be difficult right now since I've already done so.

The use of the band super pop group Mayday to promote the NFL is bizarre. I suppose the NFL has to get creative in trying to get its product into China. But having a group of Taiwanese teeny-boppers running around NFL headquarters and schmoozing with cheerleaders with the hopes of getting the Chinese masses into the game is going to be... interesting.

Our American Wedding

Our wedding on Sunday was just awesome. It, somehow, was on par with the Chinese ceremony we had (and I said that that day was one of the best days of my life). I don't really know where to begin with what happened on Sunday night. I'm just going to throw out a few highlights (although I'm sure I'll be leaving out tons).

About eighty-five people came to the Vietnam Vets' Hall where the ceremony took place. My mom told me that the hall was, originally, a church built in the 1800s. It was an intimate group of family and friends.

Our two readings during the ceremony were as follows:

From the I Ching:

When two people are at one
in their inmost hearts,
they shatter even the strength of iron or bronze.
And when two people understand each other
in their inmost hearts,
their words are sweet and strong,
like the fragrance of orchids.

And from Song of Songs, chapter 2, verses 10 - 13 (also a reading from my parents' wedding):

10

My lover speaks; he says to me,
"Arise, my beloved, my beautiful one,
and come!

11

"For see, the winter is past,
the rains are over and gone.

12

The flowers appear on the earth,
the time of pruning the vines has come,
and the song of the dove is heard in our land.

13

The fig tree puts forth its figs,
and the vines, in bloom, give forth fragrance.
Arise, my beloved, my beautiful one,
and come!

The minister who performed the ceremony was class. The overarching theme of his homily focused on us finding each other after growing up so far apart and the concept of yuan fen. The minister is someone I've known for a number of years and I knew that he'd do a great job.

After the ceremony, we all pigged out on a BBQ buffet provided one of Kansas City's best BBQ houses: Jack Stack. There were three kinds of meat: beef brisket, burnt ends, and turkey. There were also a few side dishes of vegetables and such. I heard rave reviews from just about everyone I talked with on the food.

To accompany the food, we had a half-barrel keg of Boulevard's Unfiltered Wheat Beer. I figured the delicious brew would satisfy my more alcoholic friends while at the same time placating the attendees who aren't in to drinking really heavy beer. We also had Budweiser and Bud Light bottles, although hardly anyone drank them. And for wine, we had Red Diamond Shiraz from Washington state and Cavit Pinot Grigio.

Our "first song" was "What a Wonderful World" by Louis Armstrong. This song was also prominently featured in our Chinese wedding. Everybody should know this song. It is, of course, amazing. I'm not sure music gets much better.

Instead of hiring a DJ for a hundred bucks an hour, I asked three of my friends to help DJing. To kick off the dancing part of the night, I compiled the first few songs in hopes of getting a dance party started:

Get on the Floor - Michael Jackson
Hey Ya! - Outkast
Burning Down the House - Talking Heads
Stay Forever - Ween

A few people got out for these songs. Unfortunately, we had a technical problem with the sound all night and the quality was pretty horrible (it had something to do with the sound board being "mono" and all of our laptops being "stereo")

There were people out dancing all night despite the sound quality. Qian and I were certainly out there cutting rug all night.

At about 11PM when we only had an hour left, I took control of the music again and put together a pretty ridiculous set of music. It was awesome (to me):

Star Guitar - Chemical Brothers
Sex Shooter - 6 Appollonia
Stronger - Inez
What's the Difference - Dr. Dre
Otto's Journey - Mylo
In My Arms - Mylo
Don't Stop 'Til You Get Enough - Michael Jackson
So Easy - Royksopp
Timmy Tucker - moe.

It was just a hardcore dance party. Was so great.

At the end of the night, a couple of our friends took us to Kansas City's Intercontinental Hotel on the Country Club Plaza. The hotel is one of the nicest in Kansas City. That, too, was amazing.

I'm going to wrap this post up. I've left off so much. Overall, there was just so much warmth and happiness in the room. I had a great group of family and friends there celebrating the love between Qian and myself. I'm pretty sure the love and graciousness from everyone in attendance are the things Qian and I will remember most from the evening.

I'll post some pictures when we get them from the photographer.

Getting Married Tonight

Woo hoo!!!!!!!!!!!!!!

The Non-Anonymous Internet

The powers that be in China are not appreciating that anonymity that the internet allows.

From The New York Times:

Image from xyberlog.com

BEIJING — News Web sites in China, complying with secret government orders, are requiring that new users log on under their true identities to post comments, a shift in policy that the country’s Internet users and media have fiercely opposed in the past.

Until recently, users could weigh in on news items on many of the affected sites more anonymously, often without registering at all, though the sites were obligated to screen all posts, and the posts could still be traced via Internet protocol addresses.

But in early August, without notification of a change, news portals like Sina, Netease, Sohu and scores of other sites began asking unregistered users to sign in under their real names and identification numbers, said top editors at two of the major portals affected. A Sina staff member also confirmed the change.

The editors said the sites were putting into effect a confidential directive issued in late July by the State Council Information Office, one of the main government bodies responsible for supervising the Internet in China.

The new step is not foolproof, the editors acknowledged. It was possible for a reporter to register successfully on several major sites under falsified names and ID and cellphone numbers.

But the requirement adds a critical new layer of surveillance to mainstream sites in China, which were already heavily policed. Further regulations of the same nature also appeared to be in the pipeline.

Read On

I've been too forgiving in the past towards China's locking down of the internet. China has no interest in keeping its internet open and a genuine sharing of information. This can be evidenced the blocking of YouTube, Twitter, Blogspot, and a number of other sites as well as this move. It's really sad China is locking things down considering how many benefits the internet has already given the country.

Now that I've left China, I'm really appreciating the freedom of expression we have in America. America has its own set of issues across the board, but at least I can go to websites that I want to and don't have to be self-regulating when speaking about politics (in China, you've always got to be aware of avoiding "the 3 T's.")

Sure, religion and politics are things that are probably better not discussed in America. But at least there's no chance of becoming an enemy of the state for questioning authority or speaking one's mind about such topics.

Copenhagen Talks Already Stalling?

Many have hoped that the Copenhagen Climate Summit later this year will be a productive and positive step forward. There's a chance that it will be, but any progress or agreement is going to be horribly difficult though.

From Forbes:

Image from treehugger.com

China has just laid out its negotiating position for the upcoming summit in Copenhagen, where diplomats will gather in December to try to hammer out an agreement on how to battle climate change.

The West is not going to like it. Essentially, China will argue that Western consumers buying Chinese-made goods should pay their fair share of the cost of cutting the pollution used to make the goods.

West and East have been arguing for years about who is to blame for climate change and how to cut down on the greenhouse gas emissions that cause global warming. Broadly speaking, developed countries like the U.S. have looked with alarm at the fast increase of pollution in the East and insisted that nations like China and India must save the planet by acting quickly to curb pollution.

Developing nations have cried foul, arguing that cutting pollution levels would unacceptably slow down their economic development, keeping tens of millions of people mired in poverty. They argue that the West was allowed to pollute during its period of industrialization, and that they should be allowed to do the same. They say it would be unfair to penalize poor countries when richer Americans and Europeans consume far more energy than Asians do on a per-capita basis.

...

Fan and his colleagues lay out a common-sense approach to determining responsibility for greenhouse gas emissions and use a complex formula based on accumulated emissions from 1950 to 2005 to quantify how much responsibility, in China's view, each nation should shoulder. Their reasoning? "The production is because of consumption, the supply is because of demand, the export is because someone wants to import," according to their August study, "The Low Carbon Development: China and the World." Fan is director of China's National Economic Research Institute.

Using their calculations, China's share of the burden is tiny, despite the fact that China will be the world's biggest polluter by year-end. The U.S. bears the biggest responsibility, with the 27-member European Union just behind the U.S.

...

The leader of the U.S. delegation at the talks, former Deputy Secretary of the Treasury and Deputy Secretary of State Kenneth Dam, said after hearing the Chinese presentation, "I'm very pessimistic on the outcome of the Copenhagen talks." He felt negotiators should take a pragmatic approach that allows for climate improvement, rather than holding out for a comprehensive deal. U.S. negotiators should only agree to what the U.S. Senate will accept, Dam said, to avoid torpedoing any agreement reached in Copenhagen.

Read On

The author of this piece, Robyn Meredith, did a really good job capturing the nuances and contradictions that are going to come up this fall and winter.

I've talked about these issues before recently on my blog. I see both sides' arguments.

China is, in fact, producing goods for the rest of the world. Sure, it's growing quickly and consumption is definitely increasing throughout the country (see the sprawl of shopping malls in any major city as evidence), yet its standard of living is nowhere near what the west's is or has been. China, I think rightly, doesn't believe that it should be fully-burdened for filling Wal-Mart's shelves with goods. The end user of a lot of China's products, and the pollution that chokes China, are Americans and others in the west.

At the same time, I can see why the US doesn't want to let China's pollution and carbon release get out-of-hand. A China that is completely oblivious to its affect on climate change doesn't sound like a good or tenable position to take.

I'm not sure what the middle ground is or could be on these negotiations. Both sides are just going to have to end up compromising.

Considering how polarized things are, both in American and world politics, I wouldn't be at all surprised to see gridlock and nothing significant happen at this critical juncture in human history. That would be sad.

This Blog: One Year Old

I started Mark's China Blog at markschinablog.blogspot.com one year ago today on September 1st, 2008.

It's been quite an adventure so far here at the latest incarnation of "Mark's China Blog." 2008/2009 has been an absolutely fascinating year to observe. I've learned tons about China. Hopefully you, the reader, feel like you have too.

I'm optimistic that Qian and me moving to America will add a whole new element of interest to this site. I'm still not quite ready to delve back into China news/analysis/musings yet. But I plan on doing so again after the wedding, honeymoon, and getting settled that will take place in the coming days and weeks.

So bear with me for the time being. Hardcore China news will be back before too long!