Thursday, February 21, 2019

“Vice”, Dick Cheney’s Ghost, and the Lies of America's Team China War

One thing missing from the movie “Vice” is the Cheney China obsession.

Not just Dick Cheney.  Lynne Cheney.

In the movie Lynne Cheney is portrayed as the hard-driving, gender-disadvantaged powerseeker who upgraded Dick Cheney from underperforming smalltime Wyoming sociopath to, well, successful nation-destroying sociopath.

Well, Lynne Cheney was obsessed about the China threat.  

In 2007, James Fallows told his readers about a conversation he had with Gary Hart concerning Hart’s stewardship of the U.S. Commission on National Security in the 21st Century.  The Commission told incoming president George W. Bush the biggest threat was terrorism, a conclusion that was seen as rather prescient at the time.  But, Fallows wrote:

At the first meeting, one Republican woman on the commission said that the overwhelming threat was from China. Sooner or later the U.S. would end up in a military showdown with the Chinese Communists. There was no avoiding it, and we would only make ourselves weaker by waiting. No one else spoke up in support.

The same thing happened at the second meeting -- discussion from other commissioners about terrorism, nuclear proliferation, anarchy of failed states, etc, and then this one woman warning about the looming Chinese menace. And the third meeting too. Perhaps more.

Finally, in frustration, this woman left the commission.

"Her name was Lynne Cheney," Hart said. "I am convinced that if it had not been for 9/11, we would be in a military showdown with China today." Not because of what China was doing, threatening, or intending, he made clear, but because of the assumptions the Administration brought with it when taking office. (My impression is that Chinese leaders know this too, which is why there are relatively few complaints from China about the Iraq war. They know that it got the U.S. off China's back!)

Well, concerning Fallows casual assumption that the Chinese welcomed the Iraq war, not so fast. 
Because Plan Cheney for the Middle East was founded in the perception of the China threat, and the need to put a chokehold on China’s energy imports.

Robert Dreyfuss wrote an article for The American Prospect back in 2006 (remember when there was actually critical objective reporting on US China policy?  Good times!) titled Vice Squad, in which he detailed the Cheney Middle East energy/China fixation:

For the Cheneyites, Middle East policy is tied to China, and in their view China's appetite for oil makes it a strategic competitor to the United States in the Persian Gulf region. Thus, they regard the control of the Gulf as a zero-sum game. They believe that the invasion of Afghanistan, the U.S. military buildup in Central Asia, the invasion of Iraq, and the expansion of the U.S. military presence in the Gulf states have combined to check China's role in the region. In particular, the toppling of Saddam Hussein and the creation of a pro-American regime in Baghdad was, for at least 10 years before 2003, a top neoconservative goal, one that united both the anti-China crowd and far-right supporters of Israel's Likud. Both saw the invasion of Iraq as the prelude to an assault on neighboring Iran.

In passing it’s interesting to see some current names pop up in Dreyfuss’s account of Cheney’s shadow government.  Like Victoria Nuland, who was Cheney’s national security adviser and was supposed to be Secretary of State in the Hillary Clinton presidency.  Holy horseshoes!  And Aaron Friedberg, who was Dick Cheney’s director of policy planning, is currently a big noise on the China hawk side of things today. 

Of Cheney’s two Asianists identified by Dreyfuss, Stephen Yates (ex-NSA, fluent in Chinese because he did the Mormon missionary thing in Taiwan) is out of government and runs a consulting service coyly titled DCIA Advisory and is apparently doing pro-Taiwan stuff interfacing with the Trump administration; and Samantha Ravicher is a senior advisor to the Foundation for Defense of Democracies and was appointed by Trump as Deputy Director of the Intelligence Advisory Board. 

I’d say that current US China war fixation is built in part on Dick Cheney’s legacy.

What I think is interesting is how this history gets buried in an effort to paint the Chinese leadership as paranoids when it comes to US intentions, or that suspicion about US intentions is a cynical totalitarian ploy to gin up an external threat to justify internal repression.


And you don't have to lean on James Fallows'  casual take on Cheney's determination to strangle the Chinese pandadragon in its cradle a.k.a. My impression is that Chinese leaders know this too

Around about 2003, I remember reading in a highly confidential Chinese publication—a CAAC in-flight magazine fer Chrissakes—about PRC anxieties over the “Malacca dilemma”.  That’s the fear that the Malacca Straits could serve as a choke point to cut off Chinese energy imports.

This anxiety has informed billions of dollars of Chinese strategic diplomacy and investments from the natural gas pipeline deal with Russia, the crude and product pipelines from Burma to southwest China (avoiding the Malacca Strait, naturally) and the first, quixotic iteration of the CPEC: the idea of either pumping or raillifting Middle Eastern crude from Pakistan’s Gwadar Port over the Himalayas to Xinjiang.

It is one of the great exercises in geopolitical hucksterism abetted by the big media outlets that sold the US injecting itself into the South China Sea disputes and conducting provocative Freedom of Navigation operations (FONOPS) as driven by the desire to protect a vital global commons and US allies from Chinese predation. 

Here's my dismantling of Team China War's talking point: Good News World!  You Can Stop Worrying About the South China Sea

The South China Sea is vital only as an essential waterway for transport of Middle East energy to southern Chinese refineries.  Full stop.

And the main impact of a conflict in the South China Sea would be to discombobulate PRC seaborne energy imports, which is why the PRC is keen to avoid a war in the SCS while the US Navy is keen to incite one.

As to how could a conflict get started?  I go there in this episode of China Watch, and note the interesting and sinister parallels between a provocation packaged as a US Navy FONOP adjacent to the South China Sea in 1964 and the current campaign to make the SCS FONOPS more provocative and more likely to spark an incident.

The true story of the Gulf of Tonkin incident, only declassified in 2010 (46 years after the fact!) provides some guidelines on US intentions and tactics when the US Navy is tasked with inciting a war in Asia.

Here’s the link to the Youtube trailer for my China Watch episode 5000 Ways to Die: America Tightens the Noose Around China’s Neck.  You can either navigate to to subscribe and view the full episode and the entire China Watch archive, or you can go into the Youtube page description and find a link to rent the current episode on Vimeo.

Tuesday, January 15, 2019

October 2018 Taiwan Mainland Affairs Council Public Opinion Polling on Cross Strait Relations

This polling was completed in the second half of October 2018, before the DPP got waxed in the local elections, and also before the reboot of Tsai Ing-wen's cross strait policy at New Years'.

First up: an area graph showing popular attitudes towards unification, independence, or maintaining the status quo.

Popular attitudes on reunification, independence, or maintaining the status quo, area graph

Starting from the bottom:

Maintain status quo in perpetuity (navy blue): 22.3%
Maintain status quo, then see whether to go reunfication or independence (robin's egg blue): 31.1%
Maintain status quo, then go for reunification (yellow): 16%
Maintain status quo, then go for independence (purple): 14%
Immediate independence (green): 8.6%
Immediate reunification (red): 3.1%
Don't know (grey): 4.8%

All in all, 83.4% for the status quo in one form or another.

 Here's the historical trend line graph for that data with the  same color key.  At the end of the graph, one can see the uptick in the "maintain status quo, then go for reunification" (yellow line) response, exceeding for the first time the "maintain status quo, then go for independence" (purple).

I'm guessing this bewildering spike in enthusiasm for reunification provided the impetus for Xi Jinping's speech pushing reunification that Team China War rather desperately spun as the "OMG HE'S PREPARING TO INVADE" moment.

Popular attitudes on reunification, independence, or maintaining the status quo, line graph
As for Tsai Ing-wen's protestations that she represents "the status quo",here's the most dramatic shift in the polling over the last couple years: the respondents who think the pace of cross strait relations is too slow has doubled to a plurality of all respondents (the green line): 39.7%

Too slow (green line): 39.7%
Just right (red line): 30%
Too fast: 10%
No opinion: 17.2%

I take this as a repudiation of Tsai's spin that refusing to endorse the 1992 consensus (and thereby putting relations with the PRC in the deep freeze while tiptoeing toward independence) was the right way forward for Taiwan.
Attitudes toward speed of exchanges across the straits

Finally, does the PRC hate the people of Taiwan, or just the government?  63% believe the PRC doesn't like the government (blue line), 40% (red line) think the PRC doesn't like the people either.

Perception that the government on the mainland is unfriendly toward us

It can be seen that the "hate the people" line is pretty steady while the "hate the government" line has not unsurprisingly spiked during the Tsai administration.

With all the usual caveats about polling, this is the picture of a risk-averse electorate and the government is going to have a hard time moving the needle toward independence.

The CCP's best move, on the other hand, is not to overplay its hand (especially by playing footsie with the KMT) and let domestic politics play out to Tsai's disadvantage.

Combine the dispiriting polling on cross-strait relations with Tsai's less-than-thrilling approval numbers, and Tsai emerging from the 2020 presidential campaign without a mandate (or even losing to the KMT candidate) is a possibility.

That's not going to make Team China War very happy, since the Pentagon is thirsting to serve as the shield for the vigorous island democracy battling for de jure independence, not standing idly by as the Taiwan electorate muddles through its options for appeasement.

For anxious hawks, the remedy is clearly Escalation!  and trying to sell the story that Taiwan's existential threat is from a Chinese invasion and subversion, not from the CCP using its economic weight to abet Taiwan's Finlandization.

That's why you get special pleadings like the Open letter to democratic Taiwan which landed in Tsai Ing-wen's inbox as she worked to reboot her administration after the November elections:

Taiwan is at a crossroads as never before. It is under an existential threat by the People’s Republic of China. While we respect the reality that Taiwan, like all democratic polities, has a range of domestic issues that must be resolved, that democratic process should proceed in a manner that does not detract from the overall national unity in the face of the larger threat to Taiwan’s existence as a free and democratic nation.

Taiwan under threat! is the keystone of Randy Schriver's narrative for China containment.  But as of November, the numbers didn't show it.  If Tsai can't move those numbers on her own, what's the Pentagon gonna do?

Wednesday, December 26, 2018

Debunking the China Debt Trap Myth, Sri Lanka/Hambantota Edition

[I've come to the opinion that a not insignificant chunk of China coverage that currently pops up in the Western media is an info op curated by China hawks in order to promote and exploit further polarization between the US bloc and the People's Republic of China.  And some of the info ops, including the articles in the big media outlets, don't hold up under close examination.

I extracted this post from the script of a China Watch show I did a year ago.  The "Hambantota debt trap" myth has served as the foundation for a year's worth of "Belt and Road" threatmongering for projects in Pakistan, Zambia, Maldives, and even Ecuador.  The data concerning Sri Lanka's debt trap--and who set the trap--makes for interesting and enlightening reading.  The China Watch episode of December 17, 2017 Donald Trump's China Hawk Clown College Now in Session, can be viewed by newsbud subscribers or rented via Vimeo.  CH 12-26-2018]

Hambantota is a Sinhalese expression meaning “flapdoodle peddled by China hawks and distributed by credulous anti-PRC journos”.  The flapdoodle in question is the assertion that the Hambantota Port is a scheme to create a debt trap against the island nation of Sri Lanka. 

The case is asserted that the PRC funds costly Belt and Road infrastructure projects the recipient can’t afford, then takes them over as strategic assets when loan repayments can’t be met.  Case in point: Sri Lanka, which is crushed by crippling forthcoming loan repayment obligations equivalent to 95% of its annual revenues.

Stories in the Western press on Sri Lanka’s debt crisis are usually illustrated by the Hambantota Port project on the south coast of Sri Lanka.  The Sri Lankan government just finalized an agreement to lease the port, a notorious white elephant, to the PRC on a 99 year agreement.

It looks like there is indeed a conspiracy here: a conspiracy by the ex-president of Sri Lanka, Mahinda Rajapaksa, to build an impregnable economic, patronage, and political base in his rural home province on the remote southern coast of Sri Lanka.  Rajapaksa borrowed money from the PRC to build a world class port, a world class international airport, a world class cricket stadium, and world class highways linking the prosperous north to impoverished Hambantota.  Didn’t work.  All of these magnificent facilities are unused and generating virtually no cash flow to pay back the loans to the PRC.

Rajapaksa was strongly pro-PRC thanks to the unstinting diplomatic and material support the PRC provided him during his war of annihilation against the Tamil insurgency.  In a detail neglected by fans of the world’s biggest democracy and current US Indo-Pacific bestie India--but rather important to our story--the Hindu Tamil insurgency was originally supported by India, trained by India’s Research and Analysis Wing, and, in a classic case of blowback, ended up assassinating Indian president Rajiv Gandhi.  

When Rajapaksa needed help to crush the insurgency, he turned to the PRC, not India, and when Rajapaksa wanted to build his follies at Hambantota, Hu Jintao—not fearsome BRI overlord Xi Jinping—was there to help.

However, Rajapaksa lost his bid for re-election in 2015 partly as a result of alleged Indian finagling, and the new government had no interest in trying to make Rajaipaksa’s hometown boondoggle turn the corner.

The whole “Hambantota debt trap” story plays out in an interesting way.

Sri Lanka faces a massive debt repayment burden of almost $4 billion dollars in the coming year; but the Hambantota port and airport account for less than $200 million of that.  That’s just 5% of the total.

Most of that obligation is now gone because the PRC took over 80% of the port in a debt for equity swap.  And under the terms of the lease, the PRC has to make a payment of $292 million dollars immediately out of total lease payments of $1.2 billion.  

That means that the Hambantota deal has freed up about $450 million dollars in cash for debt service next year.  Pretty sweet.

 The Hambantota deal was apparently a factor in the IMF’s decision to free up another quarter billion dollar tranche of loans on December 7 to help Sri Lanka with its balance of payments problem.

All in all, the Hambantota boondoggle is turning into something of a net positive for Sri Lanka.  And, if you look beyond the teeth gnashing by China hawks, the PRC’s move is a reassuring indication to BRI partners that the PRC will step up for refis and work outs of really crap projects.

In addition, India put in a bid for $300 million to operate the white elephant Rajapaksa Airport next to the port.  Vital counter chess move to deny air terminal facilities to a potential PRC naval base?  Or the price tag for staying in the political game in Sri Lanka by providing the government with another $300 million dollar windfall?

The other interesting number is this: Sri Lanka’s sovereign external debt is $50 billion.  Only $8 billion of that, about 16%, is held by the PRC.

Sri Lanka’s big debt repayment headache is not the Chinese.  It’s that the Sri Lankan government sold somewhere between one to two billion dollars of sovereign debt almost every year at near junk interest rates for rebuilding and social peace, well, social buy offs, after the catastrophic civil war with the Tamils.  

There was some economic growth going on but not enough to service those loans.  They’re starting to mature and guess what?  Those government bonds are held by international investors and, unlike the PRC government, those international investors aren’t interested in delay, rescheduling, renegotiating, or conversion.

So Sri Lanka’s in the arms of the IMF for bridge financing—linked, of course, to demands for domestic revenue and financial reforms—so it can go back to the international lending well again to roll over the debt it still can’t pay.

Who created the debt trap for Sri Lanka?  The usual suspects: money center banks like Citigroup, Deutsche Bank , HSBC and Standard Chartered and fund managers primarily in the US and Europe.