Quotulatiousness

October 10, 2012

Is “national security” just another term for “protectionism”

Filed under: Business, Cancon, China, Government, Technology — Tags: , , , — Nicholas @ 10:16

Daniel Ikenson at the Cato@Liberty blog:

Chinese telecommunications companies Huawei and ZTE long have been in the crosshairs of U.S. policymakers. Rumors that the telecoms are or could become conduits for Chinese government-sponsored cyber espionage or cyber attacks on so-called critical infrastructure in the United States have been swirling around Washington for a few years. Concerns about Huawei’s alleged ties to the People’s Liberation Army were plausible enough to cause the U.S. Committee on Foreign Investment in the United States (CFIUS) to recommend that President Bush block a proposed acquisition by Huawei of 3Com in 2008. Subsequent attempts by Huawei to expand in the United States have also failed for similar reasons, and because of Huawei’s ham-fisted, amateurish public relations efforts.

So it’s not at all surprising that yesterday the House Permanent Select Committee on Intelligence, yesterday, following a nearly year-long investigation, issued its “Investigative Report on the U.S. National Security Issues Posed by Chinese Telecommunications Companies Huawei and ZTE,” along with recommendations that U.S. companies avoid doing business with these firms.

But there is no smoking gun in the report, only innuendo sold as something more definitive. The most damning evidence against Huawei and ZTE is that the companies were evasive or incomplete when it came to providing answers to questions that would have revealed strategic information that the companies understandably might not want to share with U.S. policymakers, who may have the interests of their own favored U.S. telecoms in mind.

It’s not just the United States, either: Canada is also getting wary of Huawei.

The Canadian government has said that it will be invoking a “national security exemption” as it hires firms to build a secure network, hinting that Chinese telco Huawei could be excluded.

The exemption allows the government to kick out of the running any companies or nations considered a security risk, which coming in the wake of the US report earlier this week labelling Huawei and ZTE as security threats, strongly indicates they’re out of the bidding.

Prime Minister Stephen Harper’s top media spokesman refused to say for sure whether the government had Huawei in mind when invoking the exemption.

“The government is going to be choosing carefully in the construction of this network and it has invoked the national security exception for the building of this network,” he said, according to the Calgary Herald.

October 6, 2012

Not all engineering degrees are equivalent

Filed under: China, Education, India, USA — Tags: , — Nicholas @ 11:20

In the Wall Street Journal, a comparison of university education in the US and in other countries:

Both India and China have intense national testing programs to find the brightest students for their elite universities. The competition, the preparation and the national anxiety about the outcomes make the SAT testing programs in the U.S. seem like the minor leagues. The stakes are higher in China and India. The “chosen ones” — those who rank in the top 1% — get their choice of university, putting them on a path to fast-track careers, higher incomes and all the benefits of an upper-middle-class life.

The system doesn’t work so well for the other 99%. There are nearly 40 million university students in China and India. Most attend institutions that churn out students at low cost. Students complain that their education is “factory style” and “uninspired.” Employers complain that many graduates need remedial training before they are fully employable.

[. . .]

The U.S. and the U.K. are ranked first and second, driven by raw spending, their dominance in globally ranked universities and engineering graduation rates. China ranks third and India fifth, largely on enrollment (Germany is fourth). The reasons for U.S. supremacy are clear: For one, it spends the most money on education, disbursing $980 billion annually, or twice as much as China and five times as much as India. It is also the most engineer-intensive country, with 981 engineering degrees per million citizens, compared with 553 for China and 197 for India.

American universities currently do a better job overall at preparing students for the workforce. The World Economic Forum estimates that 81% of U.S. engineering graduates are immediately “employable,” while only 25% of Indian graduates and 10% of Chinese graduates are equally well prepared. “Chinese students can swarm a problem,” a dean at a major Chinese university told us. “But when it comes to original thought and invention, we stumble. We are trying hard to make that up. We are trying to make technical education the grounding from which we solve problems.”

October 4, 2012

The zero-sum trading myth

Filed under: Business, Cancon, China, Economics — Tags: — Nicholas @ 09:44

In Maclean’s, Stephen Gordon decries the undying myth that if one party to a trade is benefitting then the other must be losing:

In The Myth of the Rational Voter, Bryan Caplan argues that the most important obstacles to implementing sound economic policies are not lobby groups or the ability of other special interests to influence politicians, but certain systemic, irrational beliefs of the electorate. This is hardly an encouraging conclusion, but if we needed any more evidence for at least one aspect of his thesis, the CNOOC-Nexen takeover is providing it.

One of the prejudices identified by Caplan is what he calls anti-foreign bias: “a tendency to underestimate the economic benefits of interaction with foreigners.” According to popular (mis)perception, dealing with foreigners is to be mistrusted: if they want something from us, then they must perceive some benefit from the exchange. And if foreigners are gaining, then Canadians must be losing.

September 25, 2012

Chinese Navy commissions first aircraft carrier, the Liaoning

Filed under: China, Military — Tags: , , — Nicholas @ 09:13

China’s first aircraft carrier has been commissioned under the name Liaoning (not Shi Lang as most earlier reports had stated). Chinese news agency Xinhua posted this report earlier today:

China’s first aircraft carrier was delivered and commissioned to the People’s Liberation Army (PLA) Navy Tuesday after years of refitting and sea trials.

Overseen by President Hu Jintao and Premier Wen Jiabao, the carrier was officially handed over by the navy’s main contractor, the China Shipbuilding Industry Corporation, at a ceremony held at a naval base in northeast China’s port city of Dalian.

President Hu, also chairman of the Central Military Commission (CMC), endorsed a PLA flag and naming certificate to Senior Captain Zhang Zheng, commanding officer of China’s first carrier, the Liaoning.

“Today will be forever remembered as China’s Navy has entered an era of aircraft carrier,” Zhang told Xinhua on the carrier’s flight deck.

“When I received the PLA flag from the President, a strong sense of duty and commitment welled up in my heart,” said Zhang who has served as commanding officer on the Navy’s frigate and destroyer.

The carrier, rebuilt from the Soviet ship Varyag, was renamed “Liaoning” and underwent years of refitting efforts to install engines, weapons, as well as a year-long sea trial.

BBC News has a series of photos of the Liaoning from purchase to commissioning:


Click to see full-size images at the BBC website

Earlier reports on the progress of the carrier (under the name Shi Lang) can be found here.

September 24, 2012

US Navy works with Chinese Navy ship for anti-piracy exercise

Filed under: Africa, China, Military, USA — Tags: , , , — Nicholas @ 09:07

This is an unusual arrangement, but it makes sense in the larger picture:

The U.S. Navy and the Chinese Navy conducted their first joint anti-piracy drill. A Chinese frigate (the 4,000 ton Type 54A Yiyang) and an American destroyer (the 8,200 ton Burke class Churchill) carried out several training operations over five hours. This included joint use of communications as well as boarding and onboard search procedures. This was done in the Gulf of Aden, off Somalia.

While there was some PR angle to this, the crews of the two ships did get a useful look at how the other side operates. More to the point, it was a useful drill in the event that Chinese and American warships found themselves dealing with the same bunch of Somali pirates. Both sides will distribute what was learned throughout their respective fleets.

All this is part of a trend. China is becoming more inclined to work with ships from other nations patrolling the pirate infested waters off Somalia. Earlier this year, for example, China, India, and Japan agreed to have their warships off the Somali coast coordinate operations to more efficiently protect civilian ships in the area. Chinese and Indian warships have been operating independently off Somalia, while Japanese ships have been operating with Task Force 151. Most warships on anti-piracy duty belong to TF 151. Most of the remainder work with EUNFS (European Union Naval Force Somalia). But some nations continue to operate independently, more or less. In these cases there is always some communication, coordination, and sharing of information with TF 151 and EUNFS.

September 3, 2012

Military-political jockeying in the East China Sea

Filed under: China, Japan, Military — Tags: , , , , — Nicholas @ 10:26

At sp!ked, James Woudhuysen has a long essay on the many tiny islands in the East China Sea (and South China Sea) that may feature in future shooting wars:

Outside East Asia, very few people know where the Senkaku islands are. But inside East Asia, the Senkaku prompt great bitterness between Japan, China and Taiwan. At stake is the national pride of each country, which believes that it alone owns them. At stake also are each country’s hopes that it might find oil or gas nearby, and its desire to sail round them unimpeded. But there is more. The Senkaku, and islands like them, signify how, among all the continents in the world, Asia’s past century has been the most enduringly explosive — and how its next could follow the same pattern.

Two hundred nautical miles (nm) west of the Japanese prefecture of Okinawa, 200 nm east of the province of Fujian in the People’s Republic of China, and just 120 nm north-east of Taiwan, there lies an archipelago of five uninhabited islands, covering just seven square kilometres and covered in jungle. Coming from Tokyo, a team of 25 city officials, surveyors and — inevitably — estate agents circled the islands just this weekend, hoping to reinforce Japan’s control over them. In the past, similar moves by both Japan and China have prompted fury, and not a little diplomatic concern elsewhere.

In mid-August, a group of Chinese sailed to the islands in order to uphold Beijing’s claim to them, only to meet with deportation at the hands of Japan. A little later, 150 Japanese nationalists came by in a flotilla and 10 of them swam ashore to raise the Japanese flag. Then, in the latest of a series of tit-for-tat episodes stretching back years, demonstrators in several Chinese cities insisted that Japan get out of the islands. All that’s missing now is that, on top of Tokyo’s rule over what it calls Senkaku and Beijing’s claim over what it calls Diaoyu, is a Taiwanese incursion over what they call the Diaoyutai.

What’s going on? Could all this lead to some kind of fearsome war between Japan, China and Taiwan? And why are there disputes not only in the East China Sea, but also in the South China Sea? There, south-east of Hainan Island (China) and east of Vietnam, China controls the Paracel Islands and resists the complaints of Taiwan and Vietnam about them. There, too, all three parties occupy and are in contention over the myriad Spratly islands, which, lying west of the Philippines and north of Malaysia and Brunei, are also partly controlled and certainly contested by these three nations.

September 2, 2012

The (mostly) forgotten Soviet-Japanese conflict of 1939

Filed under: China, History, Japan, Military, WW2 — Tags: , — Nicholas @ 11:17

Japan’s conduct of the opening stages of World War 2 were literally schizophrenic: the Imperial Japanese Navy viewed their primary opponent as the United States, while the Imperial Japanese Army viewed their primary opponent as the Soviet Union. The army’s fears were based on a little-known but very significant campaign in an undeclared war fought between Japan and the Soviet Union in 1939:

In the summer of 1939, Soviet and Japanese armies clashed on the Manchurian-Mongolian frontier in a little-known conflict with far-reaching consequences. No mere border clash, this undeclared war raged from May to September 1939 embroiling over 100,000 troops and 1,000 tanks and aircraft. Some 30,000-50,000 men were killed and wounded. In the climactic battle, August 20-31, 1939, the Japanese were crushed. This coincided precisely with the conclusion of the German-Soviet Nonaggression Pact (August 23, 1939) — the green light for Hitler’s invasion of Poland and the outbreak of World War II one week later. These events are connected. This conflict also influenced key decisions in Tokyo and Moscow in 1941 that shaped the conduct and ultimately the outcome of the war.

This conflict (called the Nomonhan Incident by Japanese, the Battle of Khalkhin Gol by Russians) was provoked by a notorious Japanese officer named TSUJI Masanobu, ring-leader of a clique in Japan’s Kwantung Army, which occupied Manchuria. On the other side, Georgy Zhukov, who would later lead the Red Army to victory over Nazi Germany, commanded the Soviet forces. In the first large clash in May 1939, a Japanese punitive attack failed and Soviet/Mongolian forces wiped out a 200-man Japanese unit. Infuriated, Kwantung Army escalated the fighting through June and July, launching a large bombing attack deep inside Mongolian territory and attacking across the border in division strength. As successive Japanese assaults were repulsed by the Red Army, the Japanese continually upped the ante, believing they could force Moscow to back down. Stalin, however, outmaneuvered the Japanese and stunned them with a simultaneous military and diplomatic counter strike.

[. . .]

But what if there had been no Nomonhan Incident, or if it had ended differently, say in a stalemate or a Japanese victory? In that case, the Japanese decision to move south might have turned out very differently. A Japan less impressed with Soviet military capability and faced with choosing between war against the Anglo-American powers or joining Germany in finishing off the U.S.S.R., might have viewed the northern course as the best choice.

If Japan had decided to attack northward in 1941, that could well have changed the course of the war, and of history. Many believe that the Soviet Union could not have survived a two-front war in 1941-1942. The Soviet margin of victory in the Battle of Moscow, and at Stalingrad a year later, was excruciatingly thin. A determined Japanese foe in the east might have tipped the balance in Hitler’s favor. Furthermore, if Japan had moved against the Soviet Union in 1941, it could not also have attacked the United States that year. The United States might not have entered the war until a year later, under circumstances in Europe far more unfavorable than the actual grim reality in the winter of 1941. How then would Nazi domination of Europe been broken?

August 14, 2012

O’Neill: London outdid Beijing in politicizing the Olympics

Filed under: Britain, China, Sports — Tags: , , , — Nicholas @ 08:22

Brendan O’Neill says that the London Olympics were far more politicized than the Beijing games in 2008:

From the flurry of fanboy commentary that followed Danny Boyle’s am-dram opening ceremony to the insistence that the Games represented the coming to fruition of the post-Diana dream of a new, less stuffy Britain, the urge to politicise the Games has been intense. That the political classes have sought so shamelessly to usher in ‘another kind of Britain’ on the back of the Games speaks volumes about their desperate need for a new national narrative, and their disillusionment with the democratic route to social overhaul.

Normally we frown upon elites that heap their political obsessions on to mass sporting events. We think of Hitler turning the Berlin Games into an advert for Aryan superiority (a vision shot down by Jesse Owens) or of the Beijing opening ceremony’s thousands of fantastically coordinated drummers and boastful history lesson, described by one British hack last week as ‘crypto-fascist’. And yet, Britain’s ostensibly liberal observers thought nothing of turning 2012 into an advert for their own allegedly superior way of life and thinking.

The tone was set by Labour MP and historian Tristram Hunt, who described Boyle’s opening ceremony as the ‘march past’ — that is, victory parade — of his side in the Culture Wars. The ceremony was proof, said Hunt, that ‘the left took victory in the Culture Wars’, and moreover that a New Britain was being born: if the Queen’s Jubilee celebrated a ‘staid and nostalgic national identity’, this ceremony ‘offered an attractively contradictory, complicated, and above all creative conception of these Isles of Wonder’.

There has since been a concerted effort to turn the ‘bonkers’ opening ceremony into a new national narrative. Somewhat defensively, the Guardian’s Jonathan Freedland insists that it is ‘not just Guardian types’ who are exalting in the new political vision provided by both the ceremony and the multicultural message of the Games that followed — the whole nation is, apparently, recognising that ‘we have glimpsed another kind of Britain’, and that we should ‘love the country we have become — informal, mixed, quirky — rather than the one we used to be… reactionary’.

August 13, 2012

After five years, the Great Recession still shows little sign of ending

Filed under: China, Economics, Europe, USA — Tags: , , — Nicholas @ 09:02

For your daily dose of doom, here’s Ambrose Evans-Pritchard at the Telegraph:

The world remains in barely contained slump. Industrial output is still below earlier peaks in Germany (-2), US (-3), Canada (-8) France (-9), Sweden (-10), Britain (-11), Belgium (-12), Japan (-15), Hungary (-15) Italy (-17), Spain (-22), Greece (-27), according to St Louis Fed data. By that gauge this is proving more intractable than the Great Depression.

[. . .]

The original trigger for the Great Recession has since faded into insignificance. America’s house price bubble — modest by European or Chinese standards — has by now entirely deflated. Warren Buffett is betting on a rebound. Fannie and Freddie are making money again.

Five years on it is clear that subprime was merely the first bubble to pop, a symptom not a cause. Europe had its own parallel follies. Britons were extracting almost 5pc of GDP each year in home equity by the end. Spain built 800,00 homes in 2007 for a market of 250,000. Iceland ran amok, so did Latvia and Hungary. The credit debacle was global. If there was an epicentre, it was Europe’s €35 trillion banking nexus.

[. . .]

A study by Stephen Cecchetti at the Bank for International Settlements concludes that debt turns “bad” at roughly 85pc of GDP for public debt, 85pc for household debt, and 90pc corporate debt. If all three break the limit together, the system loses its shock absorbers.

“Debt is a two-edged sword. Used wisely and in moderation, it clearly improves welfare. Used imprudently and in excess, the result can be disaster,” he said.

Did China peak in 2008?

Filed under: China, Economics, Environment — Tags: , , , , , , — Nicholas @ 07:53

Walter Russell Mead wonders if the Chinese economy actually hit its peak in 2008 and will not be able to get back to that level of performance:

According to The Diplomat, the long term outlook is even more depressing. China will have to confront a series of structural challenges if it is to continue to achieve the kind of dynamic growth that lifted the country from economic backwater to emerging great power in just three decades.

The most obvious challenge is demographics. A RAND study observed that the proportion of the Chinese population of working age peaked in 2011 and began slowing this year. The share of the elderly population is rising. Healthcare and pension costs will soar as a result. So will labor costs. Investment and savings will diminish. In short, China may face the prospect, unknown in human history, of growing old before it gets rich.

The environment presents another dilemma. Like many rapidly industrializing economies, China sacrificed environmental protection at the altar of economic growth. But the effects of this approach have taken a toll: already, argues The Diplomat, ”Water and air pollution today cause 750,000 premature deaths and around 8 percent of GDP.” And as Via Meadia recently pointed out, the political costs of this approach are starting to mount as well. An outbreak of NIMBYism has forced many local officials to cancel major industrial projects as ordinary Chinese citizens demand an end to environmentally unsound development.

Of greater concern is that China has backed away from market reforms in the last decade and embraced a version of “state capitalism” that emphasizes the state far more than it does capitalism. But as state-run entities have become more powerful, their political backers — and financial beneficiaries — have an even greater stake in blocking attempts at reform.

H/T to Jon, my former virtual landlord, for the link.

August 12, 2012

China’s economic situation in Keynesian and Austrian terms

Filed under: China, Economics — Tags: , , , , — Nicholas @ 09:27

Tyler Cowen in the New York Times:

Keynesian economics holds that aggregate demand — the sum of all consumption, investment, government spending and net exports — drives stability, and that government can and should help in difficult times. But the Austrian perspective, developed by the Austrian economists Ludwig von Mises and Friedrich A. Hayek, and championed today by many libertarians and conservatives, emphasizes how government policy often makes things worse, not better.

Economists of all stripes agree that China may be in for a spill. John Maynard Keynes emphasized back in the 1930s the dangers of speculative bubbles, and China certainly seems to have had one in its property market.

[. . .]

The Austrian perspective introduces some scarier considerations. China has been investing 40 percent to 50 percent of its national income. But it is hard to invest so much money wisely, particularly in an environment of economic favoritism. And this rate of investment is artificially high to begin with.

Beijing is often accused of manipulating the value of its currency, the renminbi, to subsidize its manufacturing. The government also funnels domestic savings into the national banking system and grants subsidies to politically favored businesses, and it seems obsessed with building infrastructure. All of this tips the economy in very particular directions.

The Austrian approach raises the possibility that there is no way for China to make good on enough of its oversubsidized investments. At first, they create lots of jobs and revenue, but as the business cycle proceeds, new marginal investments become less valuable and more prone to allocation by corruption. The giddy booms of earlier times wear off, and suddenly not every decision seems wise. The combination can lead to an economic crackup — not because aggregate demand is too low, but because the economy has been producing the wrong mix of goods and services.

Lots of earlier discussion of the problems in China’s economy here.

Relative poverty is not a very useful measurement

Filed under: China, Economics — Tags: , — Nicholas @ 08:37

At the Adam Smith Institute blog, Tim Worstall explains why measuring relative poverty isn’t helpful:

Here actually is the problem with using relative poverty as a measure:

    Compared to the 1960s, China today has higher income inequality, but also incomparably lower levels of material poverty. By Brady’s definition, China was less impoverished in the near-starvation years of the 1960s than it is as an economic superpower today. According to the OECD, during the last three decades the share of Chinese living in absolute poverty dramatically declined from eight in ten to one in ten (Garroway and de Laiglesia 2011). During the same period, relative poverty, measured exactly as Brady measures it, roughly doubled. Although inequality and relative poverty are not irrelevant for measuring the well-being of a society, we should be apprehensive about a measure of poverty that is incapable of detecting the largest decline in material poverty in human history.

As pointed out, a measure of poverty that not just ignores, but actually gets the sign wrong on, the largest reduction in poverty in the history of our species is of limited value.

[. . .]

Which leads us to something of a conclusion: it’s fine to consider the distribution of incomes within a society. But we do it rather too much with the constant political obsession over relative poverty. We need to be paying a lot more attention to absolute standards of living: most especially how these change over time. Most specifically I’m thinking about the effects attempts to reduce relative poverty might affect our ability to increase absolute standards of living in the future.

August 1, 2012

Badminton in the headlines, but not in a good way

Filed under: Britain, China, Sports — Tags: , , , , — Nicholas @ 09:53

It’s not a sport that generally attracts a lot of attention during the Olympics, but several Badminton players are accused of deliberately losing games to secure better match-ups in the elimination round:

China’s Olympic sports delegation has begun an investigation into allegations two badminton players “deliberately lost” their match, state media say.

Doubles players Yu Yang and Wang Xiaoli are among eight players charged by the Badminton World Federation (BWF) with “not using one’s best efforts to win”.

Four players from South Korea and two from Indonesia have also been charged.

Some of the players said they were saving energy. Reports say they wanted to lose to secure an easier draw.

It may not be a technical violation of the rules to “take it easy” in a non-critical game, but it does sound as if these particular players didn’t even bother to make it look like they were competing.

The match between the top-seeded Chinese duo and South Koreans Jung Kyung-eun and Kim Ha-na came under scrutiny after the longest rally in their game lasted four shots.

Match referee Thorsten Berg came on court at one point to warn the players, who also appeared to make deliberate errors.

Both pairs were already through to the quarter-finals.

The Chinese duo lost, meaning — Xinhua noted — that if both Chinese pairs continue to do well, they will not meet until the final.

Update: The IOC Badminton World Federation (BWF) brings out the ban hammer:

EIGHT female badminton players have been sent home from the Olympics, disqualified by the sport’s world federation after throwing matches in a case condemned by London Games boss Sebastian Coe as “depressing” and “unacceptable”.

A disciplinary hearing held this morning, which Australia’s badminton coach made a submission to, found that four players from South Korea, two from Indonesia and the competition’s top seeds from China deliberately tried to lose their qualifying matches in an attempt to manipulate their draws.

The four sets of doubles teams were charged after matches on Tuesday littered with basic errors. Accused by badminton’s international governing body of “conducting oneself in a manner that is clearly abusive or detrimental to the sport”, they were ultimately found guilty of trying to lose with the motive of improving their positions for the knockout stages.

The spectators who attended the matches on Tuesday night will not be offered refunds by the London organizers, according to the BBC:

Update, the second: I couldn’t find any actual footage of the match in question until CTV posted it (not embeddable, unfortunately). It’s amazingly bad. The audience absolutely deserve a full refund.

July 23, 2012

China’s latest ploy in the South China Sea

Filed under: China, Military, Pacific — Tags: , , , — Nicholas @ 12:29

To cement Chinese claims to the vast majority of the South China Sea, a garrison is being established in the Paracel Islands:

China’s powerful Central Military Commission has approved the formal establishment of a military garrison for the disputed South China Sea, state media said, in a move which could further boost tensions in already fractious region.

The Sansha garrison would be responsible for “national defence mobilisation … guarding the city and supporting local emergency rescue and disaster relief” and “carrying out military missions”, the Xinhua news agency said on Sunday.

China has a substantial military presence in the South China Sea and the move is a further assertion of its sovereignty claims after it last month upped the administrative status of the seas to the level of a city, which it calls Sansha.

Sansha city is based on what is known in English as Woody Island, part of the Paracel Islands also claimed by Vietnam and Taiwan.

July 19, 2012

The messy internal state of North Korea

Filed under: Asia, China, Economics, Media — Tags: , , , , , , — Nicholas @ 09:49

Strategy Page on internal affairs of North Korea in the early stage of Kim Jong Un’s leadership:

China remains the foreign power with the most influence over North Korea, but that isn’t saying much. When given unwelcome advice from China, which represents nearly 80 percent of foreign trade and the only source of free food and fuel aid, North Korea still tends to adopt a suicidal attitude. For the northern leadership, it’s “death before dishonor” and that means Chinese demands, even backed by threats of aid cuts, are ignored. For this reason, China is believed involved in the current reorganization of the senior North Korean leadership. China has long developed friends and relationships among the North Korean elite. As corruption became more of a factor in the last decade, China knew how to cope. China is awash in corruption, and Chinese leaders have learned how to use it (even as they struggle to lose it). In effect, China’s decade-long effort to overwhelm the “old school” faction in North Korea appears to have succeeded. But the “old school” crowd are still numerous, scared and armed. This could get messy. This does not bother China, which has plenty of experience with messy.

In the last month or so North Korea’s new leader (Kim Jong Un) has removed hundreds of military and government officials and promptly installed younger replacements. Un has made it clear, in public announcements, that it’s time for a new generation. Many of the dismissed older officials were seemingly loyal to and supportive of Un, so this appears to be more a desire to shake up the leadership, than to purge opponents. Kim Jong Un isn’t doing this by himself, as he has a small group of advisors he relies on a lot. This includes his uncle, Jang Sung Taek, who is married to Kim Jong Ils sister. Jang has long been a powerful government official, and is believed to be quite wealthy. That’s because Jang has a lot to say about how North Korea earns (by legal, or illegal means) foreign currency. In a country so extremely poor, the man who controls the most money has a lot of power. Jang, for example earlier this year ordered house searches of families believed to be hoarding foreign currency (Chinese or American), rather than, as the law demands, putting it in the bank. People do not want to put their foreign currency in the bank because the government pays you less for it (in North Korean currency) than the black market money changers (who give fair market value). Jang understands how the North Korean economy really works, and is trying to increase government control over the “new economy.” Yang and his wife have a lot more knowledge of, and experience with, the North Korea government and economy than their nephew Kim Jong Un and, for the moment, they have his ear, and trust.

[. . .]

The food situation in the north is getting worse, with food prices (in the growing number of free markets) at record levels. Government distributions of food are declining. Worse, the government is printing more money, increasing inflation (because there’s now more money chasing the same amount of food.)

North Korean censors finally caught on to the fact that young North Koreans had been taking South Korean or Western popular songs, adding new lyrics that have a double (anti-government) meaning in the north, and spreading them widely. North Korea doesn’t have much Internet access, but there are memory sticks, CDs and floppy disks. Stuff gets around, and now the police have been ordered to crack down on a list of over 500 subversive songs. The cops love this sort of thing, as it creates plenty of new bribery opportunities. That’s because many of those involved in this music conspiracy are children of ruling families, and can afford a fine (rather than anger their parents by getting arrested.)

Update: In the Guardian, Paul Watson says we’re all sheep and ignoring the horrific crimes of South Korea and vilifying the peace-loving, friendly, warm-hearted North Koreans:

Reunification and conciliation are usually portrayed as South Korean concepts, while North Korea is seen as a closed state, hostile to such talk on “idealistic grounds” – a view perpetuated by media outlets’ lack of interest in all recent North Korean initiatives. In fact it is almost impossible to find any piece of positive European journalism relating to the Democratic People’s Republic of Korea (DPRK). The days of cold war pantomime journalism and great ideological battles might be over, but North Korea remains an area in which journalists have free licence for sensationalism and partiality.

The lack of western sources in North Korea has allowed the media to conjure up fantastic stories that enthrall readers but aren’t grounded in hard fact. No attempt is made to see both sides of the Korean conflict: it is much easier and more palatable to a western audience to pigeonhole the DPRK as a dangerous maverick state ruled by a capricious dictator and South Korea as its long-suffering, patient neighbour.

These roles are dusted off whenever there are flare-ups, such as the Yeonpyeong Island incident of 2010 when North Korea was condemned for firing shots at South Korean military and civilians in an “unprovoked attack”. It was not widely reported that South Korea had been test firing artillery in a patch of ocean that North Korea claims ownership of or that North Korea’s repeated demands for an explanation were ignored. While military intervention may not have been wise, it was far from the random act of hostility it was made out to be.

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