China Forum

Does the Ability to Deceive Others Lead to Success in China?

This is what the former President of Microsoft in China states:

Deception signals Success

 

Like most rules-abiding citizens, I was amazed by Tan's audacity and blatant disregard for the truth in business and in presenting his academic records.  What's most troubling is the fact that Tan led Microsoft, one of the world's leading companies doing business in China.  Supposedly, Microsoft and its employees adhere to a much a higher standard of conducts than say some lowly Chinese companies that may routinely engage in frauds, bribery, copy-rights and intellectual property infringements.  Unfortunately, this experience tells us otherwise.

Rules, laws, standards in business and personal practice are established to protect not only primary participants (e.g., Microsoft and its competitors) but all stakeholders in business and society.  Academic credentials by themselves do not make an executive or a man/woman; they are more or less a symbol of his/her dedication to a well-established discipline of thinking and working.  They do not substitute for creativity, determination, hard work, charisma and luck.  To deliberately and perennially deceive others with false credentials highlight not success but a person who is lacking in self-confidence.  He/she realizes his/her shortcomings but is not willing to make the personal sacrifices to undertake the discipline.  I see no other reasons in the case of Mr. Tan except his own weakness to take short cuts.  While he may refer to his deception as a symbol of his own success, I see it and his rationalization as a huge shortfall in his own self image and confidence as an executive and a leader.  His employees can not follow such a hypocritical manager.

We have all faced situations that require us to choose between doing what is right or ethical and what may be beneficial personally.  Our decisions often reflect our own character and values.  I have faced such situations professionally as well.  For example:  as a consultant for a market due diligence company, I was pressured by my employer and other associates to engage in deceptive practices where I must miss-represent my intentions to unsuspecting job-seekers who are working or have worked in targeted, competitive companies.  The goal is to deceive them into disclosing proprietary information about their current or former employers.  Though the group pressure was great, I chose not to engage in their prevailing practices and relied on building a relationship with industry insiders and contacts.  Ultimately, the situation became untenable, and I had to leave the company.  Nevertheless, I made a conscious decision not to engage in deceptive practices to secure competitive intelligence on companies.  Some may say that my decision cost me a lucrative job, but I have no regrets.  We all must make our decisions based on the values that we hold dear.  Our steadfast devotion to those values as exemplified through our actions and sacrifices build the character that supports our lives.  For better or worst, may each person work and live as each person is called 

Sino American Relationship will be based on intense competition for resources and geo-political influences

 

Professional Kaplan is 70% correct

Yes, there will be turbulent time ahead for Sino-American Relationship in this century.  Professional Robert Kaplan's Op-Ed piece and his latest essay in Foreign Affairs and Atlantic Monthly highlighted concerns and challenges for the world's two superpowers as they compete rigorously for resources and geo-political influences.  I offer no opinion on Professor Kaplan's speculations as to what may or may not drive this competition/collaboration forward in the coming half century; however, I would like to outline specific steps in an action plan that can ensure our success when dealing with a rising Chinese Superpower.

 

Firstly, America must not forgo its position as the perennial-dominating superpower (economic, political, technological, cultural, spiritual and moral) in the world and especially across Asia Pacific and the Middle East.  This position requires dedication, discipline and self-sacrifice to an arcane set of ideals (e.g., democratic values, human rights, individual freedom, free and fair trade without barriers, increasing productivity through innovations and efficiency, others).  Second, Americans must learn to work smarter and harder for less short term individual rewards for the greater common good.  Consumers must buy less, save and invest more across the developed world.  For the past 30+ years, baby boomers in the US, Europe and Japan have dramatically increased consumption and spending through debt, while our government has been too cowardly to take action.  The current crisis faced by Greece, Spain, Portugal and Ireland as well as California, Illinois, Michigan and other states testify boldly to this sad fact.  It still amazed me to see how much time and money Americans waste on watching football, baseball, basketball and hockey games while neglecting critical shortfalls (education, infrastructure, energy and civil order) in their communities and nation.  The idea that as long as I am doing okay, then the hell with everyone else doesn't wash anymore.  Similarly, the notion that our government or someone else who may smarter and more able to find solutions to all of our problems is but naive and selfish denial of responsibilities.  It is time that Americans (especially those between the age of 14 and 50) stop watching Monday, Tuesday, Thursday, Saturday and Sunday football and baseball games and start investing their time, talents and energy into productive avenues to improve themselves and their communities.  Unless we want to follow in the same path as Greece, Spain, Portugal and Ireland, we need to transform ourselves to compete rigorously against our competitors from China and other emerging nations.

Thirdly, our government must adopt a proactive and long-term strategy to deal with unfair trading practices of Chinese companies and government.  If the Chinese Communist Party (CCPC) treats an American or an allied company unfairly, our government should retaliate tit-for-tat by singling out Chinese companies with special relations to senior members within the CCPC politburo with penalties and restrictions.  If one of our companies (e.g., Google) faces unreasonable restrictions in China, we can target a Chinese company (e.g., Hua Wei) with similar restrictions in the world market.  Lets face it, if the US government tell our allies that Hua Wei is not to receive any contract, our friends will be hard pressed to award a bid.  It's a case of hard ball, bullying business practice, but guess who's the biggest and meanest bully in the block.  The US government can sway political and commercial interests far more effectively than the CCPC.  The clear fact is that we need to exert our dominance whenever necessary without fear of another superpower like China.  Commercial conflicts are necessary and much preferred over a military one; if the circumstances require it, we must be ready, willing and able to fight as well.

Now, that brings us to the fourth tenet of my action plan against China.  I will elaborate further on a military-political-diplomatic doctrine that will not only ensure our success in a sustained confrontation but will portend victory before a single shot is fired.  Stay tune for my next posting. 

 

Shame on Chinese Communist Cowards

 

"Eternal Shame" on film

The Karamy disaster where Chinese communist cadres flee while 300+ performing school age students burned in a fire is disgraceful beyond words.  Speaking on behalf of victims who are unable to voice their stories of injustice, I will highlight key reasons why the Chinese Communists have no rights to reign over Xinjiang.

1.  Xinjiang has been and is populated by a separate race of people with very distinct history, culture, language and religion (Muslim) than those of the ruling Han Chinese.

 

2.  In the 40 years since Communist China seized control of this geographically expansive and mineral-rich territory, the Uyghur’s, indigenous people, has suffered economically and spiritually while their overlords have reaped enormous riches from pillaging the land and people.

 

3.  Under Chinese rule,  the Uyghur’s have not been allowed to integrate into Chinese society, economy and political system

 

4.  Uyghur’s have continued to fight for their independence from Chinese rule and are sacrificing much towards this goal.

 

5.  Chinese communist cadres and administers have shown and are showing no regards for the wellbeing of the Uyghur’s, evident by the Karamay disaster.  This grave injustice only serves to demonstrate the true nature and injustice of Chinese rule over the Uyghur’s.

 

6.  Recent history and protests by the Uyghur’s as well as the severe and violent crackdowns by the Communist administers and conspiring Han Chinese in the region testify to the unending turmoil’s there.

 

7.  It is against God's gift of Free Will to have one group of people subjugate another group by brute force.  Even though I do not share the same faith as the Uyghur’s and have enormous differences with their practices, I respect and cherish God's gift of Free Will for all people.

 

Kudos to those who speak for the victims of Karamay and all who suffer from injustice caused by tyrants.  Shame to the Chinese Communist Cadres and their conspiring cohorts as well as those self-serving mercantilists (e.g., foreign investors) who are lobbying on their behalf.

The Chinese Communist Party feels the "Domino effect" from Google's pullout

The Chinese Communist Party feels the "Domino effect" from Google's pullout:

Go Daddy stops playing with Chinese companies

I have been deliberately reticent about Google's announcement of its pullout from China until a more definitive picture emerges.  Now, after Google's redirection of its web traffic from China to its Hong Kong search site and the Chinese firewall blockage of the same,  I feel compelled to provide a layman's analysis of this decision and its impact on the growth of the internet in China as well as the hope for greater freedom in the Middle Kingdom.

Firstly, I applaud Google and Go Daddy for standing up for its principles in lieu of short-term profit.  It is often difficult to do the right thing rather than to do things right.  This is especially valid in a rapidly growing marketplace like China that does not have much regards for the right thing.  The media, and increasingly internet media, is under tight scrutiny by the Chinese Communist Party (CCPC), for it can stray popular opinions on a variety of sensitive subjects (e.g., Tibet, Xinjiang, Systematic corruption, endemic public inefficiency, Taiwan, Hong Kong, religious freedom, activism and many more) that are not favorable to the ruling regime and its cronies.  Matter of fact, if information were to flow freely within China, it is estimated that the tyrannical powers that control the Chinese economy, government and society will collapse within 12 to 18 months.  This may be a good thing for the populace who are exploited within the current socio-economic system but is detrimental to the ruling class and its colluding partners.  Therefore, CCPC will and must employ the full might of its resources, including but not limited to its information ministry, state security apparatus and other departments to control directly and/or to intimidate all service providers (foreign or domestic) to toll the party line and to provide otherwise confidential and personal information about their users.  Case in point: the arrest and prosecution of a Singaporean journalist for subversion through his personal emails via Yahoo in 2005.  To the self-serving dictatorship that reigns over China today, these and other tactics are an invaluable tool to its command and control as well as self-survival.  It will not relinquish this power.

What's not surprising is the lack of support or sympathy for Google and Go Daddy’s courageous stance from the American, European business communities and governments.  Microsoft, whose email accounts were breached, and Apple Computers, who prided itself with an anti-iconic image, have been silent on this subject, while multinational companies such as GE, PG, JJ and GM have actually denounced Google for standing up for its principles against the wishes of the CCPC.  Though China has a long and prosperous history and a rich culture, it is not exempt from the rule of laws, universal justice, human rights and dignity.  CCPC is a political party that does not have the support of 1.5 billion Chinese and is not representative of the citizens there.  Its ability to grant favorable access to these companies into its rapidly emerging marketplace with the potential of huge profit can not be deemed just cause for denial of basic rights to its citizens.  If the cowardly management or political leaders in the US and Europe are not willing to stand up for their long-espoused principles (e.g., "Life, Will and the Pursuit of Happiness"), I hope that they would have the decency not to decry the brave action taken by Google and Go Daddy this week.

In the words of Thomas Jefferson almost two and a half century ago:

  " ...  We hold these truths to be self-evident; among them, life, liberty and the pursuit of happiness....... We freely pledge our self, wealth and families to this course ......"

The question remains; Do the founding principles of America still hold true for Americans or does the opportunity to gain economically trump these principles after two and a half century?

Has Americans evolve to a state where self-perservation and obession with material comforts, including but not limited to watching football, baseball and basketball as well as video games on large screen HD televisions, transcend over the values that made this nation into a global superpower and the envy of the civilized world?

Is there the courage and strength to stand up against tyranny and the suppression of free will, liberty and human dignity that form the basis for the US Constitution and our Bill of Rights?

As for me, I say Kudos to Google and Go Daddy.  May God guide their path forward and bless them for doing what's right.   

The Chinese Communist Party feels the "Domino effect" from Google's pullout

The Chinese Communist Party feels the "Domino effect" from Google's pullout:

Go Daddy stops playing with Chinese companies

I have been deliberately reticent about Google's announcement of its pullout from China until a more definitive picture emerges.  Now, after Google's redirection of its web traffic from China to its Hong Kong search site and the Chinese firewall blockage of the same,  I feel compelled to provide a layman's analysis of this decision and its impact on the growth of the internet in China as well as the hope for greater freedom in the Middle Kingdom.

 

Firstly, I applaud Google and Go Daddy for standing up for its principles in lieu of short-term profit.  It is often difficult to do the right thing rather than to do things right.  This is especially valid in a rapidly growing marketplace like China that does not have much regards for the right thing.  The media, and increasingly internet media, is under tight scrutiny by the Chinese Communist Party (CCPC), for it can stray popular opinions on a variety of sensitive subjects (e.g., Tibet, Xinjiang, Systematic corruption, endemic public inefficiency, Taiwan, Hong Kong, religious freedom, activism and many more) that are not favorable to the ruling regime and its cronies.  Matter of fact, if information were to flow freely within China, it is estimated that the tyrannical powers that control the Chinese economy, government and society will collapse within 12 to 18 months.  This may be a good thing for the populace who are exploited within the current socio-economic system but is detrimental to the ruling class and its colluding partners.  Therefore, CCPC will and must employ the full might of its resources, including but not limited to its information ministry, state security apparatus and other departments to control directly and/or to intimidate all service providers (foreign or domestic) to toll the party line and to provide otherwise confidential and personal information about their users.  Case in point: the arrest and prosecution of a Singaporean journalist for subversion through his personal emails via Yahoo in 2005.  To the self-serving dictatorship that reigns over China today, these and other tactics are an invaluable tool to its command and control as well as self-survival.  It will not relinquish this power.

 

What's not surprising is the lack of support or sympathy for Google and Go Daddy’s courageous stance from the American, European business communities and governments.  Microsoft, whose email accounts were breached, and Apple Computers, who prided itself with an anti-iconic image, have been silent on this subject, while multinational companies such as GE, PG, JJ and GM have actually denounced Google for standing up for its principles against the wishes of the CCPC.  Though China has a long and prosperous history and a rich culture, it is not exempt from the rule of laws, universal justice, human rights and dignity.  CCPC is a political party that does not have the support of 1.5 billion Chinese and is not representative of the citizens there.  Its ability to grant favorable access to these companies into its rapidly emerging marketplace with the potential of huge profit can not be deemed just cause for denial of basic rights to its citizens.  If the cowardly management or political leaders in the US and Europe are not willing to stand up for their long-espoused principles (e.g., "Life, Will and the Pursuit of Happiness"), I hope that they would have the decency not to decry the brave action taken by Google and Go Daddy this week.

In the words of Thomas Jefferson almost two and a half century ago:

  " ...  We hold these truths to be self-evident; among them, life, will and the pursuit of happiness....... We freely pledge our self, wealth and lives to this course ......"

 

The question remains; Do the founding principles of America still hold true for Americans or does the opportunity to gain economically trump these principles after two and a half century?

As for me, I say Kudos to Google and Go Daddy.  May God guide their path forward and bless them for doing what's right.   

Second Act is more challenging than the first

Premiere Wen's speech to the Peoples Congress in March of 2010

Premiere Wen set some pretty ambituous growth and inflation targets for the Chinese economy for 2010 to 2015 during the Peoples Congress last week.  Will he pull off the "hat-trick" for the 2nd act after the global financial collapse of 2008?

Here are seven concerns that will affect the Chinese economy:

1)  Dealing with excessive liquidity

2)  Dealing with excessive property speculations and prices

3)  Dealing with Tibet and other ethnic concerns

4)  Dealing with endemic and systematic corruption

5)  Dealing with a chronic shortage of clean drinking water and a worsening ecological and environmental disaster

6)  Dealing with populist dissatisfaction of an inept, corrupt and tyrannical regime

7)  Competing against the US for supremacy in East Asia   

Each concern requires a near-herculean effort; conquering all seven will be epic for the Chinese leadership in the coming years.  Will China suceed?

Waste not, Want Not ?

White Elephant Projects a waste of Stimulus Cash

Four Trillion Yuan (RMB) or US$500 billions + is a lot of money for a developing country like China where the average rural resident earns less than 300 Yuan or US$40 a year.  Therefore, the announced 4 trillions in stimulus spending should spur (on the surface) economic growth across China.  Undoubtedly, projects to build roads and other infrastructure will employ millions of rural and mostly unskilled laborers.  So why the fuss?

Concerns about waste, corruption and the systematic/rampant abuse of resources may best be explained by the social, political and administrative structure within China and more specifically its Communist Party apparatus.  Because of its singular focus on maintaining its tyrannical control of power and resources, the elite standing committee within the Chinese Communist Politburo allows and encourages nepotism, corruption and operational abuse of administrative powers within its ranks.  By allowing cadres to steal from the public coffers and to rob citizens, loyalty is assured through  a collusive network of friends and underlings, which the Chinese termed "Quan-xi".  Though highly inefficient and ultimately self-destructive as the populace will have no alternative but to rebel against this tyrannical and corrupt regime, Standing Committee Members of the Chinese Communist Party elite Politburo have been effective in maintaining loyalty within the ranks and control of the Party itself.

Now, as global markets suffer from a deleveraging of credit and risks, the same individuals who have ruled over China and its 1.5 billion citizens (yes, I am counting those 200 millions living in rural China and who were left out of the Chinese census in 2000) have to address an impending crisis brought on by hundreds of millions of migrant workers without employment or a mean to sustain themselves or their families.  Their concerns lie not in the welfare of these migrant workers or the masses across China but their own monopolistic control.  Therefore, it is in their own best interests to introduce an effective stimulus program that will provide work/pay to the millions of unemployed workers and rural residents as well as to spur on domestic consumption to compensate partly from the fallout in exports and foreign direct investments.  Unfortunately, the resources allocated for this stimulus program will have to pass through the same well entrenched network of corrupt cadres and administrators who are acculturated to stealing from public funds and robbing from the poor.  It is as unnatural for these Chinese Communist Party officials and administrators to place the survival-needs of the poor ahead of their own interests as it is for Wall Street executives to forego their multi-millions $$$ bonuses in this depression: (It may seem ironic to link Chinese communist cadres with Wall Street Executives in the same sentence, but the truth is that they share unifying core-values driven by incessant greed with little to no concerns for anyone else).  With the trillions RMB in stimulus, we can expect at a minimal hundreds of billions RBM in waste, abuse and missing funds.

The question ahead should be about the transformation/revolution required to address the widespread and deep-endemic needs of Chinese and the structural problems preventing government from meeting those needs.  The answer may be straight-forward, but options are limited.  What other groups: political, civil, religious, professional can replace the current overlords in China today? 

Is China an emerging lion or a pretenous mouse?

China's Gaza Role

What I love most about Lawrence Brahm's analysis is his unabashed rancor against the hypocritical practices of the Chinese Communist Party (CPC), both at home and abroad.  Indeed, we share a kindred spirit regarding all forms of corruption.  However, in the case of China's reticence on Israel's  military incursion of the Gaza Territory, I must disagree with my esteemed friend.  It is prudent not to interject unnecessary fuel into this long and seemingly-unresolvable religious-ethnic fire.  There are more than enough political opinions from the US, UK, EU, Russia and the Islamic World that provide no tenable option other than an all-out war to either destroy Israel or the Arabia.  Both sides have demonstrated unreasonable zeals with very little compassionate understanding or empathy for the other side.

China may be an emerging superpower but can not offer a better response than silence for now.  Instead of pouring more fuel into this raging inferno, China should demonstrate its much-desired world-leadership standing by introducing social and political reforms to encourage individual liberty, universal justice and compassionate citizenship both at home and abroad.  I would be greatly impressed if/when the Chinese Communist Party declare itself the single biggest impediment to social advancements at home and world peace and then disband.  As the US, UK, EU and Russia have demonstrated again and again, political verbiage is no match for genuine action driven by doing what is right for the many instead of the few or elite.

Lawrence is correct in pointing out that the fallacies of the CPC, and I share in his mission to do likewise.  However, in this latest Gaza incident, silence is golden.  The best course of action is liberate inaction for the time-being.

Will the RMB 1.18 Trillions stimulus package work?

 

What's wrong with spending RMB 1.18 Trillions

Lawrence Brahm has provided very insightful analysis of drivers (e.g., exports and investments) behind China's economic growth of the last 10 years.  No doubt, China will face a hard and severe recession in the face of the global credit crunch and deleveraging of consumers in the US and EU, institution funds and private equity companies.  Even cash-rich MNCs such as Microsoft, IBM and Philips Morris have scaled back dramatically their acquisitions and investments in China.  What does this mean for China and its continued quest for growth?

As much as I agree with Lawrence's analysis from a sound historical background, I see great potential for China to restructure its economy given the lack of easy capital chasing the super-inflated "China Miracle".  Instead of relying on American and European money-to seed its wasteful and inefficient expansion (e.g., overcapacity in manufacturing, white-elephant projects, empty residential & commercial buildings and infrastructures to nowhere), Chinese officials and managers must now evaluate investments with sound financial management principles and a discipline to return value for investors and stakeholders.  Moreover, they must now address critical problems stemming from its ecological crisis, endemic unemployment, lack of value-adding enterprises, social inequity, systemic corruption, cultural abandonment and spiritual vacuum.  If they are successful, China will embark on a renaissance where the dignity of its poorest and weakest will be valued as highly as the interests of its elites and where cultural advancement & innovations take precedence over rampant exploitation of under-age workers to produce cheap goods for export.

Though this may seem "Poly-annish", I am optimistic.  We could just as easily expect a catastrophic revolution to change this government and commercial administration as it was the case in 1949.  From chaos come opportunities; from destruction come new life and from fear come hope.  Given the level of fear from the current economic depression/recession, we can hope for an equally big and much needed transformation in China.  In any event, changes are imminent!

Economic Partner or Military Foe

 

A new Chinese aircraft carrier Group

The Chinese Communist People Party (CCPC) has engaged in the latest and surest path towards developing its military might to match its growing economic prowess. It is building an aircraft carrier group that will enable its reach not only across the Taiwan Straits and the South China Sea but  expand its physical and military presence to Japan, Korea, Southeast Asia, India, Middle East, Africa, Europe and the Americas.  More than any other weapon or battle-system, except for its inter-continental ballistic missiles (which China is rapidly developing as well), a naval battle group anchored by an aircraft carrier with state-of-the-arts electronics and missile-guidance systems will have enormous offensive capabilities.  It is the use of highly advanced aircrafts (fighters/strikers and bombers) supported by missiles and guidance systems that gave the United States its dominance of surface warfare at sea.  Undoubtedly, CCPC is emulating on the success and supremacy of its American counterpart.  At the same time, it has been allocating much resource to build both tactical and ballistic submarines and other stealth-mode weaponries.  In-short, CCPC is determined to develop and/or acquire all necessary weapons and technologies to meet and push back the American presence in the Pacific theater and to project its physical might to areas (e.g., SE-Asia, Africa and the Americas) where it is acquiring vital resources.

As American companies are transferring its technologies and know-how to China, CCPC is actively engaged in converting those technologies and know-how for its military expansion as well as in acquiring other technologies through its well-developed and expansive espionage network overseas. Matter of fact, the war of convert intelligence and spying have been waged for decades between the US and China.  As in the case of our economic competition and advancement, the Chinese side is winning hands down.  What Americans need to recognize now is that they do not have a natural or divine-willed competitive advantage in industry, economy, financial markets or military/security.  Unless, they are willing to do everything and anything possible to fight off the eminent Chinese military threat, Americans will loose just as badly in its security as it had in its economy and industries.  

Americans simply spent too much free time watching football and baseball and not on effort to strengthening their economic and physical security.  This must change!