Those Controversial Taiwan Businessmen...

Remember the Dems and their Chinese money scandal? It's back again, this time with the McCain campaign. The Chicago Tribune via the LA Times...a teaser:

A Taiwanese firm with a nearly identical name as Hao's new California company, Asian American Entertainment Ltd., is also headed by a Shi Sheng Hao. That firm has been embroiled in a lengthy legal battle in Las Vegas over a soured partnership in an application for a casino license in Macau, the former Portuguese colony now part of the People's Republic of China.

A court filing in that case described Hao's firm as a business affiliate of the China Industrial Development Bank, a finance arm of the Taiwanese government. Hao is listed as a resident of Taiwan in corporate papers filed in the case.

It's unclear whether the Shi Sheng Hao in the lawsuit and the California ventures is the same Shi Sheng Hao using the Roselle address. But public records point to numerous coincidences, including corporations with similar names and an overlap of investors. Some political donations from the Roselle address also refer to Hao by a nickname, Marshall, the same nickname given for Hao in the Las Vegas court action.

Federal records indicate a pattern of large and coordinated donations from Hao, relatives and associates. Collectively, eight of them gave a total of $130,000 to the RNC in late September and early October of 2007.

Enjoy those mysterious Taiwanese businessmen...

[Taiwan]

Harpers on US China Policy

Yum...mei hua rou in honey-cumin BBQ sauce. Speaking of easy meat, ever wonder why our foreign policy Establishment is so pro-China? Ken Silverstein has the answer in this month's Harpers....

One of Barack Obarna's chief advisers on Asia policy is Jeffrey Bader, who frequently writes opinion pieces about China and is regularly quoted in the press on Washington-Beijing relations. Bader has been a commentator on CNN, Fox News, ABC's Nightline, and NPR, among other outlets. He frequently speaks before university, think-tank, and business audiences on the subjects of China and East Asia, and has testified on numerous occasions before various congressional committees. During the Clinton years he held top positions at the State Department and the National Security Council; under George W. Bush, he served as an assistant United States trade representative, leading the team that completed negotiations on China's accession to the World Trade Organization. In 2005, Bader joined the Brookings Institution, and invariably this is the affiliation cited when he publishes op-eds or delivers speeches. Hence, teaders and listeners must imagine that Bader isa neutral, impartial observer when he opines, as he has in recent years, that congressional opposition to China's bid for Unocal was essentially irrational and "vitriolic," or that (as he told USA Today earlier this year) "the U.S.-China relationship is a very important relationship to the U.S. for political, security and economic terms. It's not in the American interest to see an Olympic games that turns into a confrontation between China and the rest of the world."

When Bader retired from government in 2002, he went to work for Stonebridge International, one of the most sought-after advisory firms in Washington, at which he consulted on behalf of companies looking to do business in China. As is true of many consultancies, Stonebridge's stated mission seems intentionally hazy: according to the firm's website, it "works together with top multinationals to develop and implement tailored strategies to solve critical problems .... Stonebridge understands how governments around the world operate and we are in a position to help our clients navigate the system to achieve their specific objectives." Somewhat more can be gleaned from a few case studies touted on the site-in one such study, a major metals manufacturer hoping to purchase factories in Russia ran up against "deep-rooted opposition from the influential Russian scientific community," which Stonebridge helped "to neutralize"; in another, "a major U.S. chemical company," facing the potential ban of one of its products by the European Union, turned to Stone bridge for "an overall industry strategy together with white papers outlining the product's usefulness and safety." (The unnamed product remains on the market.)

Stonebridge might best be seen as a sort of one-stop shop for international fixers - a collection of former government officials who replicate, in privatized and miniaturized form, the official foreign-policy apparatus. Both the clients and the former officials benefit immensely from the exchange: for the latter, Stonebridge serves as a holding pen in which to draw a prodigious salary while awaiting a return to the State Department, say, or the Commerce Department, or the National Security Council. Stonebridge's cofounder is Sandy Berger, who before joining the Clinton Administration (in which he became the top national-security adviser) coordinated
business lobbying for China at the law firm of Hogan & Hartson. He was perhaps the foremost architect of the administration's dramatic shift in China policy; which moved in short order from solidarity with the spirit of Tiananmen Square to the promotion of trade above all else.

Given Berger's involvement, it is not surprising that Stonebridge has a tremendous and direct stake in greater American engagement with China. The firm is a member of the U.S.-China Business Council, which pushes for close American ties with Beijing. Indeed, Stonebridge maintains an entire Chinese subsidiary, with offices in Beijing and Shanghai, whose purpose is to help transportation, energy, pharmaceutical, and technology firms to cut deals in China. Four former senior U.S. government officials are listed as holding posts at Stonebridge China: Bader, the Obama adviser; Kenneth Lieberthal, who was a top China adviser to Hillary Clinton and who served as senior director for Asia at the National Security Council during her husband's administration; Henry Levine, who was a senior adviser on China trade policy during the present Bush Administration; and Amy Celico, who during the Clinton years served assenior director for China affairs at the U.S. trade representative's office. These officials are almost never identified in the press as Stonebridge affiliates; instead, they are identified merely as former government officials or as representatives of various think tanks - though even at such supposedly independent think tanks, it should be noted, China policy is hardly less compromised. Brookings, for example, bestowed upon Jeffrey Bader the directorship of
its John L. Thornton China Center, which is named after the chairman of the institution's board of directors and one of its leading donors; Thornton is also a director not only of corporations with huge interests in China (Ford, News Corporation) but also of large Chinese corporations (Commercial Bank of China, China Netcorn), and is even a professor at Tsinghua University.

Yeesh. Not much you can say about devastating take down like that. I'm not picking on Obama, this is just an excerpt; the same applies to the McCain side. As the piece concludes:

Yet either man will find it difficult to revamp our foreign policy in any serious way, for one simple reason: a major overhaul would require disentangling ourselves from the reality of empire. And those charged with setting our course, our so called foreign-policy experts (including my source on Africa mentioned above, who has informally advised one of this year's leading presidential candidates), are themselves so entangled overseas as to make envisioning fresh ideas unlikely, if not impossible. When it comes to China, a President Obama or a President McCain might periodically hold forth with tough, politically calculated rhetoric against the regime. But in terms of actual policy, Beijing will continue to be treated as a business partner-precisely the role that it plays for our own mandarin class.

Yup. I've uploaded the entire piece (~2.71 meg PDF).

[Taiwan]

Establishing Trust with the Chinese

Longtime Washington and US government China policy analysts Richard C. Bush and Jeff Bader are out with an all-too Establishment piece that seems to live in its own dreamworld on US-China relations, calling on Obama and McCain to Tread Lightly On China:

The Beijing Olympics coincide with our party conventions heralding the countdown to November's presidential election. With the world's media spotlight on China and the United States, both presidential candidates will undoubtedly be tested by unforeseen developments.

Contenders Barack Obama and John McCain should avoid condemning China, and instead signal their intention to develop a personal relationship of trust with their Chinese counterpart soon after taking office. China's human rights are best advanced through discrete encouragement, not negative sound bites.

In three election campaigns — in 1980, 1992 and 2000 — future U.S. presidents announced their intention to dramatically toughen national policy toward China. In each instance, the United States then endured months or years of costly fumbling. Bill Clinton, for instance, set conditions for approving Most Favored Nation status for China. But when China didn't show sufficient improvements in human rights, the new president abandoned his policy after damaging U.S. credibility and Sino-American trust.

Since President Richard Nixon's historic visit to China in 1972, all subsequent chief executives have ultimately stayed the course with the People's Republic. The logic is simple: China has massive capacity to affect the world for better or worse. Cooperating with Beijing may challenge U.S. values, but the bond between nations improves global equanimity.

Presidential candidates should signal China's leaders that they value a constructive and cooperative relationship with China. Personal relationships of trust are highly valued. The Chinese will react negatively if a new president throws difficult issues on the table before establishing such trust.

Yes, it is 2008 and there really are American policy thinkers still asking that we treat China "like a Ming vase." Bush and Bader argue that when America gets tough with China, it results in policy failure, and instance the Clinton Administration failure on MFN. But the problem arises because China knows that because there are plenty of people working to undermine clear US policies on China, all it has to do is be patient and it can outlast any policy -- there is a whole class of American officials and analysts dedicated to explaining that it isn't China's fault and we should just understand China better -- just like this piece, whose position is that we should let Chinese reactions determine how we treat China -- in other words, hand off our China policy to the Chinese. The reality is that China does whatever it wants no matter how it is treated, and the only way to negotiate with Beijing is with a Really Big Stick. "Trust" in the China case cannot lie in personal relationships between leaders, but must be instantiated in routines of interaction between the two states.

In a moment we'll discuss why these two officials are so important, but I think once again it is time to bring out The Kitty Hawk Paragraph, to which I have added a few new events, and show how China treats its good friends and those who trust it:

Anyone who has observed China's relations with the outside world for any length of time has seen this pattern again and again. In the midst of negotiations with the Vatican, it consecrates two bishops for the state Church. In the midst of negotiations over the Olympic Torch coming to Taiwan, it denies a visa to the representative of the city of Kaohsiung to discuss the games to be held there in 2009. Arriving in India for negotiations, its ambassador announces a whole Indian state is part of China. Last year the Chinese government shut down an expat magazine in China that was widely considered the most sympathetic and supportive expat rag in that nation. After attending the ASEAN meeting in November where it has positive interactions with ASEAN members, it immediately goes out and holds war games in waters disputed by those nations, without informing them. With ally Ma Ying-jeou newly elected President of Taiwan and needing 3,000 tourists a day, what do they send him? 1,000. After many years of France helping China, emphasizing its 'special relationship' with China and demanding the Europe drop the post-Tiananmen ban on weapons sales to Beijing, who does China protest against during the Olympic Torch mess? France. And of course China gets the Olympics with promises to upgrade its rights situation, yet crackdowns on the internet and journalists intensify, while state security arrests double. Catch the pattern?

Particularly apropo is that last sentence, because China once again this week showed how effective the policy of "discreet encouragement" is: the IOC was Kitty Hawked by Beijing. The original agreement between the International Olympic Committee stipulated that Beijing must reporters in Beijing unrestricted internet access. And the IOC trusted Beijing....

The International Olympic Committee failed to press China to allow fully unfettered access to the Internet for the thousands of journalists arriving here to cover the Olympics, despite promising repeatedly that the foreign news media could “report freely” during the Games, Olympic officials acknowledged Wednesday.

Since the Olympic Village press center opened Friday, reporters have been unable to access scores of Web pages — among them those that discuss Tibetan issues, Taiwanese independence, the violent crackdown on the protests in Tiananmen Square and the Web sites of Amnesty International, the BBC’s Chinese-language news, Radio Free Asia and several Hong Kong newspapers known for their freewheeling political discourse.

The restrictions, which closely resemble the blocks that China places on the Internet for its citizens, undermine sweeping claims by Jacques Rogge, the International Olympic Committee president, that China had agreed to provide full Web access for foreign news media during the Games. Mr. Rogge has long argued that one of the main benefits of awarding the Games to Beijing was that the event would make China more open.

“For the first time, foreign media will be able to report freely and publish their work freely in China. There will be no censorship on the Internet,” Mr. Rogge told Agence France-Presse just two weeks ago.[MT: Sucka!]

......

Jonathan Watts, president of the Foreign Correspondents Club of China, said he was disappointed that Beijing had failed to honor its agreement to temporarily remove the firewall that prevented Chinese citizens from fully using the Internet.

“Obviously if reporters can’t access all the sites they want to see, they can’t do their jobs,” he said. “Unfortunately such restrictions are normal for reporters in China, but the Olympics were supposed to be different.”

As the NY Times report indicated, the fiasco was complete when US Senators, fresh from empowering the Bush Administration to spy on US citizens and curtail our liberties, introducing a resolution demanding that China not spy on its hotel guests even though those selfsame Senators have given the Bush Administration a green light on warrantless surveillance. There's a point where interaction with the stupidity, hypocrisy, and spinelessness of the US Congress transcends the bounds of ordinary human cognitive abilities and becomes almost like an ecstatic religious experience....

And Bush and Bader say we should tread lightly with China and cultivate trust. Perhaps President Obama can include President Hu in his guanxi network and send him a red envelope now and then, but trust? By all means let us cultivate trust, but let us do it with a large Pacific navy and fat airbases brimming with late model fighter aircraft, and an alliance system that includes all the nations around China.

The worst aspect of this letter is not that its advice is bad. It is that the letter writers, longtime Dems, are advisors to the Obama campaign. I have not condemned the Dems for their Taiwan and China stances because I have heard good things privately -- that new draft policy for the Dems calls for upgraded relations with Taiwan, and of course, as Randall Shriver said at his talk in Taipei earlier this month, both campaigns had asked the Bush Administration to unfreeze the arms sales to Taiwan. Those were hopeful signs. But an open and public call for policy like this is not a hopeful sign at all. It appears obvious, at least at this point, that US-China and US-Taiwan policy are going to be better off if McCain is elected. And that's sad, because the world needs Obama, and not McCain.

A few years ago there was a controversy over facilitated communication, where the mother of the autistic child holds its hand as it types on a keyboard or writes. Subsequent studies went on to show that in fact the autistic child's writing skills were the product of the facilitator, and not the child. For the center of the US political Establishment, US policy on China has become little more than a case of facilitated communication.

[Taiwan]

Talk Given by Randall Shriver, July 17, 2008, on Taiwan-US relations

Author and blogger J Michael Cole, a frequent commentator in the Taipei Times, and an attendee at Thursday's presentation.

On Thursday the 17th I had the great good fortune to attend a talk given by Randall Shriver, a longtime Taiwan booster who has held a number of US government posts concerned with Taiwan and Asia policy. With Shriver was Mark Stokes, a longtime Taiwanophile who has worked in DoD and private industry posts concerned with Taiwan, and as an attache in China. The two of them founded Project 2049, a thinktank concerned with Asian security issues (the name refers to the midpoint of the century, and the centennial of several key historical events). Shriver is currently a policy advisor to the McCain campaign. The talk was arranged by the Taiwan Foreign Correspondents Club (TFCC), and was held at the Caesar Park Hotel in Taipei.

Key points:

China's growing clout in Washington means that pro-Taiwan moves by the US now come at a high and increasing cost. Hence the Bush Administration needs to drop the freeze now, since it will be very costly for the next Administration to do so. Both campaigns are trying to persuade the Bush Administration to end it before they come in.

the lack of clarity in the Ma Administration's foreign policy. What end state does Ma want to achieve in cross-strait relations? What is Ma's future policy or strategic vision for Taipei's relations with Washington and Tokyo?

The freeze is unprecedented in Taipei-Washington relations, not only in its duration, but also in its size. 7 8 systems are blocked now, including spare parts for Taiwan's current F-16s (!), and not including the requested 66 F-16s.

++++++++++++++

Shriver opened with a discussion of US-China relations. "There's a very common narrative that I am sure all of you have heard about US-China relations, and that narrative focuses on their consistency, and the unchanging US policy toward China." He went on to list how all administrations since we recognized China has followed the One China policy, worked for engagement with China, and all have gravited toward a more Sino-centric view of the Asia-Pacific region whatever their starting point was. He pointed out that this narrative could be decieving, because during the Bush Administration "significant" changes have occurred in the implementation and practices and habits of interaction between the two powers.

First, the breadth of the interaction has changed, he pointed out. A decade ago the dialogue was limited to Taiwan, trade, and human rights. It was very predictable and scripted. The quality of the cooperation was restricted. But now, when we sit down with the Chinese, he observed, the talks "touch every part of the globe." Discussions with the Chinese range across peacekeeping in Haiti, the Sudan situation, Iraq and the Middle East, climate change, energy security, North Korea and other Asian issues. "This is a dramatic change from ten years ago," he said.

The second change he identified was that the frequency and scope of the interactions has changed. Every one of the major bureaucracies in the government has its own dialogue with the Chinese. For example, Treasury has its Strategic Economic Dialogue. This is mirrored at every level of the bureaucracy, Shriver noted, and is now routinized. This is something that is very different from previous administrations.

The third thing that has changed on the Bush Administration's watch is "the tremendous influence that China has in Washington now," Shriver said. Now some of the most skilled diplomats in the world serve in China's embassy in DC. Corporate America is very energized and willing to work for Beijing on sticky bilateral issues, and the Chinese also employ lobbyists. Finally, Shriver added, there are the old friends of China. When there is an issue that the Chinese want to move on in Washington, he said, the amount of attention can be extremely intense and extremely effective.

"What I'm really describing is an inheritance that doesn't get rolled back easily," he continued, referring to the problems the next Administration in Washington will face. What does that mean for Taiwan?

The next Administration is going to inherit a diminished, weakened US-Taiwan relationship, one that is "fairly dysfunctional." Shriver then moved on to one of the key points of his presentation, the idea of the "cost" of repairing relations and of carrying out actions on Taiwan's behalf in the next Administration. Pursuing a more robust Taiwan agenda, as Shriver says he and others in Washington are in favor of, will come at a higher cost, due to the pressure Beijing will assert on Washington to temper that.

Shriver next outlined some of the reasons for the impaired relationship between Washington and Taipei. Shriver argued that both sides, not just any particular individual, were responsible for the decline in relations. He observed that while there was a core of individuals in the Administration in 2001 who knew something about Taiwan, what they knew was the old KMT Taiwan -- they had no experience working with the DPP. The US also sent mixed messages to Taiwan. He added that the US had also contributed to the arms purchase problems as well.

The feeling in Washington was that the 2008 Taiwan Presidential election offered the opportunity for a fresh start no matter who won, Shriver described. He pointed out that in Washington there was/is a period of caution in dealing with the new Ma Administration, and Shriver said that this was a mistake. "We are losing some valuable time," he said, in strengthening the relationship immediately so that the next Administration can "do the right thing" and restore the US-Taiwan relationship.

Shriver and Stokes both agree that the US-Taiwan relationship can be more robust, with a range of areas full of "untapped potential." However, Shriver is concerned that the Bush Administration is not doing its part to repair things. Some in Washington believe that the recent Taiwan-China reapproachment is a true watershed in the region and a historic opportunity, while others see things as going too much, too fast.

"Seems to me that too much, too fast is not the right set of questions," he said. The Ma Administration has a mandate to pursue changes in cross-strait relations, but they've really pursued "the low-hanging fruit." Many of Ma's successes were set up by the DPP, as was the increase in the number of tourists. These were relatively easy initiatives for Ma to pursue. What are the right questions to ask of these developments?

Shriver answered this by pointing out that the real question is what the leadership in Taipei is thinking in terms of end goals and end state. We need to think about end points and what is sacrificed or compromised in the process, he pointed out, or else we will end up in an unwanted or unanticipated place.

What is Taiwan's policy toward the US? What efforts is Taipei making to strengthen the relationship? Shriver said it isn't clear to him what Taipei's policies toward strengthening relations with Washington and Tokyo are, and toward increasing its international space -- "other than requesting more and more from Beijing."

What about the more difficult issues, the non-low hanging fruit? The WHO next year will be a test of China's real sincerity. What happens to cross-strait relations if that fails?

Shriver concluded by saying that his greatest interest at present is looking at what the Bush Administration can do in its waning days, and what the next Administration can do. At the moment the Bush Administration is focused on the high profile Olympic visit and the North Korean issue. It is unlikely that new initiatives on Taiwan will be undertaken.

What about the arms sales? Is there a freeze? Things are muddled, he said. From the outside there is every appearance that the Bush Administration has decided, unilaterally, to suspend arms sales to Taiwan.

Shriver said the record on Taiwan's position is clear. The Ma Administration has stated publicly and privately that it wants the weapons. The Legislative Yuan has already authorized the funds -- and thus, the obstacle is clearly in Washington. Shriver attributed the de facto freeze to the Bush Administration's perception that it needs China's cooperation on global and regional issues, and on the view of some in the Administration that this is best for Taiwan.

The next US administration will have a difficult position, he observed. If it inherits a freeze, it will be costly to undo it -- there will be a price. Shriver expressed the hope that they would undo the freeze, and that they would pursue a more robust policy with Taiwan.

The first question was on the freeze. Shriver responded by saying that both the Obama and McCain campaigns have said they don't want to inherit a freeze, and both are trying to persuade the Bush Administration to do the right thing. Shriver argued that both US law and US interests decree that the US should make weapons available to Taiwan. "The threat is clear," he noted.

Shriver was then asked about the reports that the KMT asked the US for the freeze. "We've asked the question directly, and been told it is not true."

What if the F-16s don't go through? Shriver answered that the consequences would be serious. "You don't fall behind linearly, but exponentially." Recovery befores more difficult as time goes by, he said. For Ma to fulfill his ambitious agenda, he needs to be negotiating from a position of strength, Shriver averred. There are also credibility issues for the US, Shriver pointed out.

Mark Stokes picked up the thread of Shriver's reply. There are three issues, he stated. First is the budget. Taiwan already has passed the funding, and if the money is returned to the treasury, then resurrecting it in the next budgeting round will be "a bureaucratic nightmare." Second, there is the simple problem that every day Taiwan does not have the systems, it falls one day behind. Finally, the current weapons systems in Taiwan are aging, Stokes observed. The credibility issue is also a problem. Stokes pointed out that the US Administration has criticized Taiwan for many years for not defending itself. When Taiwan finally gets a consensus on what it needs, suddenly the Bush Administration reverses its stance and refuses to sell the island weapons, he said. There's a credibility issue there.

Shriver was then asked about the views of DoD on the arms freeze. He said that the Defense Department is more focused on China, and giving a lot of interest and attention to the direction that China is taking. He then gave a short plug for Project 2049 latest project, envisioning alternate futures for the island. Shriver pointed out that because the US has refrained from specifying what outcome it wants in the Taiwan Strait, requiring only that it be peacefully arrived at, essentially the US position asks US soldiers to "die for a process."

He was also asked about Japan's views, and said that in Tokyo, Ma comes to power "with a little bit of baggage" and the verdict is still out in Tokyo. The cross-strait changes are even more on the radar in Tokyo than in Washington, he said, and they are not comfortable with the current state of affairs. According to Shriver, Tokyo wants a more concrete strategic vision from Taipei, and a better feel for what Washington it doing. Washington's policy was simply to give a big sigh of relief after the election, "and we haven't finished exhaling," he added. Washington needs to give more thought to what comes next, he said.

The next question returned to the freeze, and Shriver reiterated his previous point: lifting the freeze will come at a cost. China will still be important no matter who the next president is. The easiest way to avoid the problems with China is to have the Bush Administration do the right thing, rather than push it onto the next Administration. Will there be legal action on the basis of the Taiwan Relations Act if the freeze is not lifted? You'd see noise about legal action, replied Shriver. Stokes pointed out that Congress has the power under the Arms Export Control Act to take action, if it likes.

Stokes and Shriver both agreed that such a freeze is unprecedented in the history of US-Taiwan relations. Shriver's said that from his outsider's perspective it is a consensus opinion at the cabinet level in multiple agencies. But several times he cautioned that his was an outsider's perspective.

Stokes then added that the other unprecedented thing about the arms freeze is that it involves seven or eight systems that were originally approved back in 2001-2, including the submarine designs, Apache helicopters, Javelin missiles, Patriot ground units, utility helicopters, and spare parts for Taiwan's current F-16s. More are coming down the pipeline too, he observed. What they should have done, he said, was approved them as each came in. Instead, they've been allowed to pile up -- $11 billion in weapons systems, not including the current request for 66 F-16 fighters. The amount that is built up is unprecedented.

The discussion then ranged over a number of issues, including Taiwan's indigenous defense industry, and what weapons systems the island needs. Asked about the possibility of Obama or McCain Administration to push for more international space for the island. Shriver pointed out, as many US commentators have, that movement on international space is important for the Ma Administration. Shriver said that he expects that the next Administration will followed the stated policy of the Bush Administration, but that much would depend on how Beijing and Taipei handled the issues.

[Taiwan]