Sunday, August 30, 2009

The earth is dying

Monday, August 24, 2009

American Health care

If you think that a decent health care system is socialist, then try explaining to me why your arguments do not also apply to firemen:

Harold's Left: The Socialism of Firemen
Harold's Left:There is a new group on Facebook that is meant to poke fun at the hypocrisy of the conservative argument that a public option for health care is socialism. The group is called 1 Million Strong Against our SOCIALIST Fire Dep

Tuesday, August 11, 2009

China shows its other, angry face

China shows its other, angry face

* Peter Hartcher
* August 11, 2009

illustration Simon Letch.

China has taken off the mask of friendship. In the past few months, its central government has decided to show Australia another face of China. It's a harsher vision of a possible future with the rising superpower of our region.

If there were any lingering doubt that we had entered a new phase, it was dispelled by the feverish claims published on the website of China's National Administration for the Protection of State Secrets.

In alleging Rio Tinto was involved in a six-year spying operation against China's steelworks, it accused the resources company of "winning over and buying off, prising out intelligence .. and gaining things by deceit''.

Six years, by the way, is the time in which iron ore prices have been rising. The previous two decades, when prices were falling, was just the free market, apparently. Only a conspiracy could cause prices to rise.

The most outlandish part of the story was the assertion that Rio's activities led China to pay $123 billion more for iron ore than it would have otherwise, a sum far larger than the total value of Rio sales to China in those years. "That means China gave the employer of those economic spies more than $123 billion for free, which is about 10 per cent of Australia's GDP," the piece argued.

When this was reported widely in the international media yesterday, the article, a long diatribe in Mandarin, was removed from the website. The reason is obvious. This material has nothing to do with criminal jurisprudence. It is a venomous, nationalistic rant.

It exposes the motivation, or at the very least the prejudices, of the National Administration for the Protection of State Secrets, the authority conducting the prosecution of Stern Hu and his three Rio colleagues who have now been held in China for four weeks without charge. This is now, undeniably, a political case.

We already know what it's like to live in the new China growth zone. That was all the exuberant news about resource prices. Now Beijing is instructing us in what it might feel like to live in the China political zone as well.

Together with the other evidence - Beijing's hamfisted efforts to ban a film about its Uighur minority at the Melbourne Film Festival, its angry campaign to block a visit to Australia by the exiled Uighur leader Rebiya Kadeer, its chilliness in rebuffing the Rudd Government over the Stern Hu case - this is a clear sign that the Chinese regime has consciously decided to take a tougher line with Australia.

Why? First, Australia displeased Beijing. The principal reason for Chinese interest in Australia is its resources. When the big state-owned firm Chinalco wanted to increase its share in the world-class minerals assets of Rio in a $25 billion deal, Beijing was unhappy at the political wariness with which it was greeted in Canberra.

It would have been the biggest overseas acquisition that communist China had ever made.

The Australian Government did not block the deal. Indeed, it said repeatedly Chinese investment was welcome. But Canberra did put conditions on smaller takeovers of other resource assets by Chinese state-owned companies. This entrenched a principle, and it boded ill for the Chinalco deal.

The Opposition's Peter Costello was outspoken in expressing reservations about the Chinalco bid. Rio, reading the political climate, abandoned the deal.

China's leaders seem to have decided to make this rebuff an opportunity to teach a lesson to Rio, to Australia, and anyone else watching. This is the second dimension to China's angry new attitude.

It's an old Chinese folk saying - "kill the chicken to scare the monkey." In other words, you punish the weaker enemy to frighten the stronger. With a new president in the White House and a heightened mood of protectionism in the US Congress, is Beijing using Australia as the chicken to scare the American monkey?

A China specialist at Canterbury University in New Zealand, Anne-Marie Brady, says: "I think there is clearly a new approach to dealing with Australia - it could be sending a message to the US or to other countries in general."

The US has noticed. The State Department official responsible for Asia policy, Kurt Campbell, told the Herald recently: "I know China is more complicated now in Australian politics. In many respects, Australia is mimicking the US in that the image of China stirs great hopes and some anxieties. And that's exactly the way it is in the US."

This is new. Until now it had all been about the hopes, with few anxieties. Brady explains that, after 1989, China put the US in a category of one. With most of the rest of the world, Beijing followed the principle of "looking for things in common and letting disputed points lie". This was precisely its formula for Australia and the Howard government reciprocated.

But with America, Beijing took a harder line according to the principle of "looking for commonalities and facing up to differences". What has changed this year is that Beijing has moved Australia into the same category. "I think that's what China is doing to Australia now," Brady says.

This is a powerful wake-up call for Australia. The China we must live with is not the China we thought we were dealing with.

Peter Hartcher is the Herald's international editor.

from here.

Monday, August 10, 2009

Doing business in dictatorships

Beware the wounded Chinese bureaucrat
MICHAEL PASCOE, Sydney Morning Herald
August 10, 2009 - 1:41PM

The danger in dealing with a pig-ignorant bureaucrat in an authoritarian regime is that the moment their stupidity and ineptitude is exposed, they will use all their power to blame someone else. So it seems with the China Iron and Steel Association's secretary general, Shan Shanghua, and Rio Tinto.

If it wasn't for the fact that four men are facing years in a Chinese jail because of it, the latest development in the Rio Tinto/Stern Hu case would be simply laughable - either that or Rio has been capable of greater magic than anything Harry Potter has imagined.

Maybe the China Iron and Steel Association doesn't realise Ms Rowling's books are fiction - how else could China allege Rio has overcharged by $123 billion for iron ore shipments over the past six years when that is more than the total value of its shipments?

Such a ridiculous allegation, the stuff of a loony propaganda machine, is a sign of desperation. And Shan Shanghua is understandably desperate.

Shan first came to popular attention as the goose who triumphantly hissed back in February that the proposed Chinalco bailout of Rio would ''help China break the duopoly in Australian iron ore supply over the long term''.

Dumb, Shan, plain dumb - unless you're secretly a double-agent, working for the anti-Chinalco forces. No matter how much you might have hoped it, or even if you planned it, to speak such a thought was sheer stupidity. Take a bow, Shan Shanghua, for doing as much as anyone could in sinking the Chinalco deal.

Costly mistakes

But that was just a warm-up. Shan moved on to more costly mistakes as he exerted CISA control over China's steel mills in their price negotiations with Rio.

It was Shan himself who scotched suggestions that key mills had agreed to the same new benchmark pricing as the Japanese and Korean mills.

And thus it is Shan himself who is responsible for China presently paying about 20 per cent more than it needed to for iron ore. Over time, that would add up to billions Shan - nice work.

Again, you'd have to think Shan is either grossly incompetent or a double agent.

But it's no fun being exposed as either in a totalitarian regime, even if you are a favoured son of the Party - that can change. It's even worse than the NSW Labor Party.

Hence the urgent need to blame someone else - blame Rio.

Et tu, BHP?

The weekend's escalation of a commercial dispute into the realms of fantasy and xenophobia is dangerous stuff. By strong implication, it takes this particular fight well beyond Rio to BHP Billiton and, to a lesser extent, Brazilian rival Vale.

It may have been Rio's particular misfortune to be leading the iron ore price negotiations this year. It could so easily have been BHP instead.

There's a clear warning that CISA has ''the Australian duopoly'' in its sights, not just the running dog capitalists at Rio. Note that China is now claiming that stolen goods accounted for 10 per cent of Australia's GDP - ah, the old convict streak coming out in us.

BHP reports its annual results on Wednesday. Its usual fine commodities outlook section might well be carefully worded this time round.

In particular, it might pay to be very careful in the wording of any discussion about the Pilbara joint venture with Rio. This is an issue of great concern in China that seems to have been brushed aside by the miners understandably bedazzled by the cost savings.

China's threats to sool its equivalent of the ACCC onto the joint venture should not be ignored - there's plenty of room in Chinese detention centres for more recalcitrant employs of foreign devils.

And CISA does have a point - Rio, BHP and Vale happily function as a cosy oligopoly in the annual price negotiations, as they've had to when the Japanese, Korean and now Chinese mills are similarly marshalled into a single negotiating voice.

Shan Shanghua's inability to handle that reality, his apparent lack of comprehension of the demand/supply balance, has created a desperate bureaucrat well out of his depth - a dangerous individual indeed. Maybe he should have asked Rio for a little market intelligence before running off at the mouth.

There are plenty of very smart, very well educated and ethical Chinese bureaucrats who are doing an amazing job in steering the Middle Kingdom back towards the centre of the universe. The Party runs a business school for them modelled on the best Western MBA courses.

Unfortunately there can be a great deal of internal politics in the way of the intelligent bureaucrats taking control of an issue from the hopelessly ignorant. And bigger immediate problem again is that the latest over-the-top rhetoric and publicity make finding a solution much harder - the stupid value face much more than the wise.

Michael Pascoe is a BusinessDay contributing editor.

From here.

Thursday, July 16, 2009

The Good Women of China


My Journey Towards the Stories of Chinese Women

Early one spring morning in 1989, I rode my Flying Pigeon bicycle through the streets of Nanjing dreaming about my son PanPan. The green shoots on the trees, the clouds of frosty breath enveloping the other cyclists, the women's silk scarves billowing in the spring wind, everything merged with thoughts of my son. I was bringing him up on my own, without the help of a man, and it was not easy caring for him as a working mother. Whatever journey I went on, though, long or short, even the quick ride to work, he accompanied me in spirit and gave me courage.

'Hey, big-shot presenter, watch where you're going,' shouted a colleague as I wobbled into the compound of the radio and TV station where I worked.

Two armed policemen stood at the gates. I showed them my pass. Once inside, I would have to face further armed guards at the entrances to the offices and the studios. Security at the broadcasting station was extremely tight and workers were wary of the guards. A story circulated of a new soldier who fell asleep on night duty and was so keyed up that he killed the comrade who woke him.

My office was on the sixteenth floor of the forbidding, twenty-one-storey modern building. I preferred to climb the stairs rather than risk the unreliable lift, which broke down frequently. When I arrived at my desk, I realised I had left my bicycle key in the lock. Taking pity on me, a colleague offered to go and telephone down to the gatekeeper. This was not so easy since no junior employee at that time had a telephone and my colleague would have to go to the section head's office to make the call. In the end, someone brought me up my key with my mail. Amidst the large pile of letters, one immediately caught my attention: the envelope had been made from the cover of a book and there was a chicken feather glued to it. According to Chinese tradition, a chicken feather is an urgent distress signal.

The letter was from a young boy, and had been sent from a village about 150 miles from Nanjing.

Most respected Xinran,

I listen to every one of your programmes. In fact, everyone in our village likes listening to them. But I am not writing to tell you how good your programme is; I am writing to tell you a secret.

It's not really a secret, because everyone in the village knows. There is an old, crippled man of sixty here who recently bought a young wife. The girl looks very young - I think she must have been kidnapped. This happens a lot around here, but many of the girls escape later. The old man is afraid his wife will run off, so he has tied a thick iron chain around her. Her waist has been rubbed raw by the heavy chain - the blood has seeped through her clothes. I think it will kill her. Please save her.

Whatever you do, don't mention this on the radio. If the villagers find out, they'll drive my family away.

May your programme get better and better.

Your loyal listener,

Zhang Xiaoshuan

This was the most distressing letter I had received since I had started presenting my evening radio programme, Words on the Night Breeze, four months earlier. During the programme I discussed various aspects of daily life and used my own experiences to win the listeners' trust and suggest ways of approaching life's difficulties. 'My name is Xinran,' I had said at the beginning of the first broadcast. '"Xinran" means "with pleasure". "Xin xin ran zhang kai le yan," wrote Zhu Ziqing in a poem about spring: "With pleasure, Nature opened its

eyes to new things."' The programme was a 'new thing' for everyone, myself included. I had only just become a presenter and I was trying to do something that hadn't been done on the radio before.

Since 1949, the media had been the mouthpiece of the Party. State radio, state newspapers and, later, state television provided the only information Chinese people had access to, and they spoke with one identical voice. Communication with anyone abroad seemed as remote as a fairy tale. When Deng Xiaoping started the slow process of 'opening up' China in 1983, it was possible for journalists, if they were courageous, to try and make subtle changes to how they presented the news. It was also possible, although perhaps even more dangerous, to discuss personal issues in the media. In Words on the Night Breeze I was trying to open a little window, a tiny hole, so that people could allow their spirits to cry out and breathe after the gunpowder-laden atmosphere of the previous forty years. The Chinese author and philosopher Lu Xun once said, 'The first person who tasted a crab must also have tried a spider, but realised that it was not good to eat.' As I awaited the reaction of my listeners to the programme, I wondered whether they would think it was a crab or a spider. The number of enthusiastic letters that piled up on my desk convinced me that it was the former.

The letter I received from the young boy Zhang Xiaoshuan was the first that had appealed for my practical help and it threw me into confusion. I reported it to my section head and asked what I should do. He suggested indifferently that I contact the local Public Security Bureau. I put a call through and poured out Zhang Xiaoshuan's story.

The police officer on the other end of the line told me to calm down. 'This sort of thing happens a lot. If everyone reacted like you, we'd be worked to death. Anyway, it's a hopeless case. We have piles of reports here, and our human and financial resources are limited. I would be very wary of getting mixed up in it if I were you. Villagers like that aren't afraid of anyone or anything; even if we turned up there, they'd torch our cars and beat up our officers. They will go to incredible lengths to make sure that their family lines are perpetuated so as not to sin against their ancestors by failing to produce an heir.'

'So,' I said, 'Are you telling me you are not going to take responsibility for this girl?'

'I didn't say I wouldn't, but . . .'

'But what?'

'But there's no need to hurry, we can take it step by step.'

'You can't leave someone to die step by step!'

The policeman chuckled. 'No wonder they say that policemen fight fire and journalists start fire. What was your name again?'

'Xin . . . ran,' I said through gritted teeth.

'Yes, yes, Xinran, good name. All right, Xinran, come over. I'll help you.' He sounded as if he was doing me a favour rather than performing his duty.

I went straight to his office. He was a typical Chinese police officer: robust and alert, with a shifty expression.

'In the countryside,' he said, 'the heavens are high and the emperor is far away.' In his opinion the law had no power there. The peasants feared only the local authorities who controlled their supplies of pesticide, fertiliser, seeds and farming tools.

The policeman was right. In the end, it was the head of the village agricultural supplies depot who managed to save the girl. He threatened to cut off the villagers' supply of fertiliser if they did not release her. Three policemen took me to the village in a police car. When we arrived, the village head had to clear the way for us through the villagers, who were shaking their fists and cursing us. The girl was only twelve years old. We took her away from the old man, who wept and swore bitterly. I dared not ask after the schoolboy who had written to me. I wanted to thank him, but the police officer told me that if the villagers found out what he had done, they might murder him and his family.

Witnessing the power of the peasants first-hand, I began to understand how Mao had defeated Chiang Kai-shek and his British and American weapons with their help.

The girl was sent back to her family in Xining - a twenty-two-hour train journey from Nanjing - accompanied by a police officer and someone from the radio station. It turned out that her parents had run up a debt of nearly 10,000 yuan searching for her.

I received no praise for the rescue of this girl, only criticism for 'moving the troops about and stirring up the people' and wasting the radio station's time and money. I was shaken by these complaints. A young girl had been in danger and yet going to her rescue was seen as 'exhausting the people and draining the treasury'. Just what was a woman's life worth in China?

This question began to haunt me. Most of the people who wrote to me at the radio station were women. Their letters were often anonymous, or written under an assumed name. Much of what they said came as a profound shock to me. I had believed that I understood Chinese women. Reading their letters, I realised how wrong my assumption had been. My fellow women were living lives and struggling with problems I had not dreamed of.

Many of the questions they asked me related to their sexuality. One woman wanted to know why her heart beat faster when she accidentally bumped into a man on the bus. Another asked why she broke out into a sweat when a man touched her hand. For so long, all discussion of sexual matters had been forbidden and any physical contact between a man and woman who were not married had led to public condemnation - being 'struggled against' - or even imprisonment. Even between a husband and wife 'pillow talk' could be taken as evidence of delinquent behaviour, and, in family quarrels, people would often threaten to denounce their partners to the police for having indulged in it. As a result, two generations of Chinese had grown up with their natural instincts in confusion. I myself was once so ignorant that, even at the age of twenty-two, I refused to hold hands with a male teacher at a bonfire party for fear of getting pregnant. My understanding of conception was gleaned from a line in a book: 'They held hands under the light of the moon . . . In spring they had a bouncing baby son.' I found myself wanting to know much more about the intimate lives of Chinese women and decided to start researching their different cultural backgrounds.

Old Chen was the first person I told about my project. He had been a journalist for a very long time and was highly respected. It was said that even Nanjing's mayor came to him for advice. I often consulted him about my work, out of deference to his seniority, but also to draw on his considerable experience. This time, however, his reaction surprised me. He shook his head, which was so bald you couldn't tell where his scalp ended and his face began, and said, 'Naive!'

I was taken aback. Chinese people consider baldness a sign of wisdom. Was I wrong? Why was it so naive to want to understand Chinese women?

I told a friend who worked at the university about Old Chen's warning.

'Xinran,' he said, 'have you ever been inside a sponge cake factory?'

'No,' I replied, confused.

'Well, I have. So I never eat sponge cake.' He suggested that I try visiting a bakery to see what he meant.

I am impatient by nature, so at five o'clock the next morning I made my way to a bakery that was small but had a good reputation. I hadn't announced my visit, but I didn't expect to encounter any difficulty. Journalists in China are called 'kings without crowns'. They have the right of free entry to almost any organisation in the country.

The manager at the bakery did not know why I had come but he was impressed by my devotion to my job: he said that he had never seen a journalist up so early to gather material. It was not yet fully light; under the dim light of the factory lamps, seven or eight female workers were breaking eggs into a large vat. They were yawning and clearing their throats with a dreadful hawking noise. The intermittent sound of spitting made me feel uneasy. One woman had egg yolk all over her face, most probably from wiping her nose rather than some obscure beauty treatment. I watched two male workers add flavouring and colour to a thin flour paste that had been prepared the day before. The mixture had the eggs added to it and was then poured into tins on a conveyor belt. When the tins emerged from the oven, a dozen or so female workers packed the cakes into boxes. They had crumbs at the corners of their mouths.

As I left the factory, I remembered something a fellow journalist had once told me: the dirtiest things in the world are not toilets or sewers, but food factories and restaurant kitchens. I resolved never to eat sponge cake again, but could not work out how what I had seen related to the question of understanding women.

I rang my friend, who seemed disappointed with my lack of perception.

'You have seen what those beautiful, soft cakes went through to become what they are. If you had only looked at them in the shop, you would never have known. However, although you might succeed in describing how badly managed the factory is and how it contravenes health regulations, do you think it will stop people wanting to eat sponge cake? It's the same with Chinese women. Even if you manage to get access to their homes and their memories, will you be able to judge or change the laws by which they live their lives? Besides, how many women will actually be willing to give up their self-respect and talk to you? I'm afraid I think that your colleague is indeed wise.'

Tuesday, June 2, 2009

Despot dynamics: the dirty secret to survival

We'll know when the world has truly had enough of Kim's nuclear brinkmanship. The three steps to seriously disciplining North Korea? One is for Japan to take, another is for South Korea, and third is for China.

Japan would shut down the flow of hard currency that it allows its residents to send to North Korea.


Second, South Korea would shut down its trade with North Korea.


Third, China would cut off its trade with North Korea. This is the big one. Beijing is by far the biggest trading partner and biggest source of foreign exchange to Pyongyang.

by Peter Hartcher

Saturday, April 11, 2009

Graft in China Covers Up Toll of Coal Mines

When an underground fire killed 35 men at the bottom of a coal shaft last year, the telltale signs of another Chinese mining disaster were everywhere: Black smoke billowed into the sky, dozens of rescuers searched nine hours for survivors, and sobbing relatives besieged the mine’s iron gate.

The New York Times
For three months, no word leaked of the Lijiawa fire.
But though the owner and local government officials took few steps to prevent the tragedy, they succeeded, almost completely, in concealing it.

For nearly three months, not a word leaked from the heart of China’s coal belt about the July 14 explosion that racked the illegal mine, a 1,000-foot wormhole in Hebei Province, about 100 miles west of Beijing.

The mine owner paid off grieving families and cremated the miners’ bodies, even when relatives wanted to bury them. Local officials pretended to investigate, then issued a false report. Journalists were bribed to stay silent. The mine shaft was sealed with truckloads of dirt.

“It was so dark and evil in that place,” said the wife of one miner who missed his shift that day and so was spared. “No one dared report the accident because the owner was so powerful.”

Indeed, the Lijiawa mine tragedy might still be an official non-event, but one brave soul reported the cover-up in September on an Internet chat site. The central government in Beijing stepped in, firing 25 local officials and putting 22 of them under criminal investigation. The results of the inquiry are expected this month.

Such a wide-ranging cover-up might seem unusual in the Internet age, but it remains disturbingly common here. From mine disasters to chemical spills, the 2003 SARS epidemic to the past year’s scandal over tainted milk powder, Chinese bureaucrats habitually hide safety lapses for fear of being held accountable by the ruling Communist Party or exposing their own illicit ties to companies involved.

Monday, April 6, 2009

Evolution in a market economy

Morality is not a survival trait in the markets.

Sunday, April 5, 2009

Windpower and Climate change

Um, a word about windpower as a "renewable resource":

- is it just me, or has somebody else considered what will happen to climate (such as cooling, heat redistribution, etc) if we take so much energy out of the wind?

Tuesday, March 31, 2009

I will not do suppliers' market research for them

XXX, I appreciate your help and concern.

I have never bought a new car before, and I am finding this process a little frustrating. It is my intention to trade over my salary packaged car every few years, and so a relationship is important.

However, I tend to find that a lot of dealers of cars and of high cost items, such as TVs etc expect me to do their work for them. If you really believe that you can offer me the best price, then please do so.

Imagine my situation. Let's say the best price I could get in buying an item is $500, but its retail price is $900. However, I do not know the true value of the item, and so the only way I can get a better deal is to do research by checking out other dealers. Every dealer wants the chance of being allowed to have a second go at bidding. Why? Because, then they don't have to give me best price first up.

So, in this example, a dealer might offer me a price of $700. If I then spend time and energy getting a better price (and I don't want to pay extra for a car in the form of wasting days doing research), then I might find another dealer offering me a price of $600. Why then should I come back to the first dealer? Why should I give him the benefit of my research, finding out that the rest of the market is willing to take $600, so he can offer me $590 at a second go rather than $500 at a first go. If he knows that he can have a second go, then there is no way he will give me a good price first up. So I get a bad quote, and end up doign market research for the dealer. If you want me to do your market research, then we can organise a separate consultancy agreement.

When I buy, I buy like this. I go to a supplier, and I give them one chance to bid. I tell them that they will not have a second chance, so they must give me their best price. I then move on to the next supplier. If prices get lower, then I stop when each new dealer cannot offer me much more. After about 3 close quotes, I come back to the supplier offering me the best quote. If the quotes are close, then I choose the guy I think helped me the most.

This is the way I buy electronic equipment, home renovation materials, etc. It is also the way I apply for jobs; basically, for anything over $1000. I never give someone a second chance. I always get the best price.

My basic rules:
1) never give anyone a second go at bidding, because then their first bid will not be their best price, and so I will be wasting my time.
2) never tell anyone whether they are first or second or whatever in line. Every supplier must think they are the first, they must not know whether I am informed or naive. If they think I am naive, they will give me a bad price. And, as part of this process, they will also suffer, because they lose my business (see rule 1).

I'm sorry, but many years ago I got sick of doing pricing work for suppliers. if you want my business, then you give me your best price.

Sorry for sounding so frustrated, but most other suppliers seem quite able to understand my approach. For some reason, auto dealers seem not able to. Moreover, they then try adding "delivery charges". I mean, what are those? Noone else does that (except for QANTAS). A price is a price is a price.

I want a XXX.
So, give me your best price.

Best wishes,

Hi Robert,

Thank you for your email, It has been great pleasure to deal with you since beginning of the month because of that I would really like to earn your business and build a relationship as your local dealer, however as I was trying to explain on the phone.

If pricing what it takes to earn your business I can tell you that quite confidently I would be able to provide you a better pricing than any other dealer. There are two reason which allows me to that, we are the largest XXX Dealer in NSW, on top of that all the vehicles in our possession paid cash by XXX these two reasons gave us greater advantage than our competitors.

It would be much appreciated If you could let me know your thoughts.

Kind Regards,