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(p. 5) . . . subsidies, . . . , have spurred excess capacity and created a dangerous political dynamic in which these investments have to be propped up at all cost.

China has been building factories and production capacity in virtually every sector of its economy, but it's not clear that the latest round of investments will be profitable anytime soon. Automobiles, steel, semiconductors, cement, aluminum and real estate all show signs of too much capacity. In Shanghai, the central business district appears to have high vacancy rates, yet building continues.

. . .

Over all, there is a lack of transparency. China's statistics on its gross domestic product are based more on recorded production activity than on what is actually sold. Chinese fiscal and credit policies are geared toward jobs and political stability, and thus the authorities shy away from revealing which projects are most troubled or should be canceled.

Put all of this together and there is a very real possibility of trouble.

For the full commentary, see:

TYLER COWEN. "Economic View; Dangers of an Overheated China." The New York Times, SundayBusiness Section (Sun., November 29, 2009 ): 5.

(Note: the online version of the commentary has the date November 28, 2009.)

(Note: ellipsis added.)

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"A woman examined bouquets and messages left by Google users on Wednesday outside the Internet search company's headquarters in Beijing." Source of caption and photo: online version of the NYT article cited way below (after the citation to the quoted article, which is a different article).

David Smick in The World as Curved, has suggested that restrictions on the internet in China, limit entrepreneurship, and ultimately economic growth.

(p. 5) BEIJING -- At the elite Tsinghua University here, some students were joking Friday that they had better download all the Internet information they wanted now in case Google left the country.

But to many of the young, well-educated Chinese who are Google's loyal users here, the company's threat to leave is in fact no laughing matter. Interviews in Beijing's downtown and university district indicated that many viewed the possible loss of Google's maps, translation service, sketching software, access to scholarly papers and search function with real distress.

"How am I going to live without Google?" asked Wang Yuanyuan, a 29-year-old businessman, as he left a convenience store in Beijing's business district.

. . .

Li An, a Tsinghua University senior, said she used to download episodes of "Desperate Housewives" and "Grey's Anatomy" from sites run by BT China that are now closed. "I love American television series," she said with frustration during a pause from studying Japanese at a university fast-food restaurant on Friday.

The loss of Google would hit her much harder, she said, because she relies on Google Scholar to download academic papers for her classes in polymer science. "For me, this is terrible," Ms. Li said.

Some students contend that even after Google pulls out, Internet space will continue to shrink. Until now, Google has shielded Baidu by manning the front line in the censorship battle, said a 20-year-old computer science major at Tsinghua.

"Without Google, Baidu will be very easy to manipulate," he said. "I don't want to see this trend."

A 21-year old civil engineering student predicted a strong reaction against the government. "If Google really leaves, people will feel the government has gone too far," he insisted over lunch in the university cafe.

But asked whether that reaction would influence the government to soften its policies, he concentrated on his French fries. "I really don't know," he said.

For the full story, see:

SHARON LaFRANIERE. "Google Users in China, Mostly Young and Educated, Fear Losing Important Tool." The New York Times, First Section (Sun., January 17, 2010): 5.

(Note: the online version of the article has the title "China at Odds With Future in Internet Fight" and is dated January 16, 2010.)

(Note: ellipsis added.)

The source of the photo at the top is the online version of:

KEITH BRADSHER and DAVID BARBOZA. "Google Is Not Alone in Discontent, But Its Threat Stands Out." The New York Times (Thurs., January 13, 2010): B1 & B4.

(Note: the online version of the article has the slightly different title "Google Is Not Alone in Discontent, But Its Threat to Leave Stands Out" and is dated January 14, 2010.)

The reference to the Smick book is:

Smick, David M. The World Is Curved: Hidden Dangers to the Global Economy. New York: Portfolio Hardcover, 2008.

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"James Chanos made his hedge fund fortune predicting problems at companies and shorting their stock." Source of caption and photo: online version of the NYT article quoted and cited below.

Chanos' views discussed below are plausible and worth taking seriously. Earlier and overlapping worries about the sustainability of China's boom were expressed in a credible and scary book by David Smick called The World is Curved.

In addition to some of the concerns expressed by Chanos, Smick also emphasizes that China's restrictions on the internet will dampen the ability of its entrepreneurs to succeed. That view seems prescient given China's growing attempts to censor the internet and to hack Google.

(p. B1) SHANGHAI -- James S. Chanos built one of the largest fortunes on Wall Street by foreseeing the collapse of Enron and other highflying companies whose stories were too good to be true.

Now Mr. Chanos, a wealthy hedge fund investor, is working to bust the myth of the biggest conglomerate of all: China Inc.

As most of the world bets on China to help lift the global economy out of recession, Mr. Chanos is warning that China's hyperstimulated economy is headed for a crash, rather than the sustained boom that most economists predict. Its surging real estate sector, buoyed by a flood of speculative capital, looks like "Dubai times 1,000 -- or worse," he frets. He even suspects that Beijing is cooking its books, faking, among other things, its eye-popping growth rates of more than 8 percent.

"Bubbles are best identified by credit excesses, not valuation excesses," he said in a recent appearance on CNBC. "And there's no bigger credit excess than in China." He is planning a speech later this month at the University of Oxford to drive home his point.

. . .

(p. B4) . . . he is tagging along with the bears, who see mounting evidence that China's stimulus package and aggressive bank lending are creating artificial demand, raising the risk of a wave of nonperforming loans.

"In China, he seems to see the excesses, to the third and fourth power, that he's been tilting against all these decades," said Jim Grant, a longtime friend and the editor of Grant's Interest Rate Observer, who is also bearish on China. "He homes in on the excesses of the markets and profits from them. That's been his stock and trade."

Mr. Chanos declined to be interviewed, citing his continuing research on China. But he has already been spreading the view that the China miracle is blinding investors to the risk that the country is producing far too much.

"The Chinese," he warned in an interview in November with Politico.com, "are in danger of producing huge quantities of goods and products that they will be unable to sell."

For the full story, see:

DAVID BARBOZA. "Shorting China: the Man Who Predicted Enron's Fall Sees a Bigger Collapse Ahead." The New York Times (Fri., January 8, 2010): B1 & B5.

(Note: the online version of the article has the title "Contrarian Investor Sees Economic Crash in China" and is dated January 7, 2010.)

(Note: ellipses added.)

The reference to the Smick book is:

Smick, David M. The World Is Curved: Hidden Dangers to the Global Economy. New York: Portfolio Hardcover, 2008.

"Now Mr. Chanos is betting against China, and is promoting his view that the China miracle has blinded investors to the risks in that economy." Source of caption and poster: online version of the NYT article quoted and cited above.

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"Wu Jinglian helped to create China's market economy, and now he is defending it against conservative hardliners in the Communist Party." Source of caption and photo: online version of the NYT article quoted and cited below.

(p. 1) AT 79, Wu Jinglian is considered China's most famous economist.

In the 1980s and '90s, he was an adviser to China's leaders, including Deng Xiaoping. He helped push through some of this country's earliest market reforms, paving the way for China's spectacular rise and earning him the nickname "Market Wu."

Last year, China's state-controlled media slapped him with a new moniker: spy.

Mr. Wu has not been interrogated, charged or imprisoned. But the fact that a state newspaper, The People's Daily, among others, was allowed to publish Internet rumors alleging that he had been detained on suspicions of being a spy for the United States hints that he is annoying some very important people in the government.

He denied the allegations, and soon after they were published, China's cabinet denied that an investigation was under way.

But in a country that often jails critics, Mr. Wu seems to be testing the limits of what Beijing deems permissible. While many economists argue that China's growth model is flawed, rarely does a prominent Chinese figure, in the government or out, speak with such candor about flaws he sees in China's leadership.

Mr. Wu -- who still holds a research post at an institute affiliated with the State Council, China's cabinet -- has white hair and an amiable face, and he appears frail. But his assessments are often harsh. In books, speeches, interviews and television appearances, he warns that conservative hardliners in the Communist Party have gained influence in the government and are trying to dismantle the market reforms he helped formulate.

He complains that business tycoons and corrupt officials have hijacked the economy and manipulated it for their own ends, a system he calls crony capitalism. He has even called on Beijing to establish a British-style democracy, arguing that political reform is inevitable.

Provocative statements have made him a kind of dissident economist here, and revealed the sharp debates behind the scenes, at the highest levels of the Communist Party, about the direction of China's half-market, half-socialist economy.

In many ways, it is a continuation of the debate that has been raging for three decades: What role should the government play in China's hybrid economy?

Mr. Wu says the spy rumors were "dirty tricks" employed by his critics to discredit him.

"I have two enemies," he said in a recent interview. "The crony capitalists and the Maoists. They will use any means to attack me."

. . .

(p. 7) In interviews, Mr. Wu says he feels compelled to speak out because conservatives and "old-style Maoists" have been gaining influence in the government since 2004. These groups, he said, are pressing for a return to central planning and placing blame for corruption and social inequality on the very market reforms he championed.

At the same time, Mr. Wu says, corrupt bureaucrats are pushing for the state to take a larger economic role so they can cash in on their positions through payoffs and bribes, as well as by steering business to allies.

"I'm not optimistic about the future," Mr. Wu said. "The Maoists want to go back to central planning and the cronies want to get richer."

For the full story, see:

DAVID BARBOZA. "China's Mr. Wu Keeps Talking." The New York Times, SundayBusiness Section (Sun., September 26, 2009): 1 & 7.

(Note: ellipsis added.)

Source of timeline graphic: online version of the NYT article quoted and cited above.

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"A man walks past a tire store in Beijing on Sunday. A new U.S. tariff on Chinese tires could lead to shortages in the lower-cost-tire market segment as retailers scramble to find alternative sources in other countries." Source of caption and photo: online version of the WSJ article quoted and cited below.

(p. A3) Consumers who buy low-price Chinese tires -- the bulk of the tires China exports to the U.S. -- will be hit hardest by the new tariff, as shortages in this market segment cause retailers to scramble to find alternative sources in other countries.

The tariffs, which apply to all Chinese tires, will cut off much of the flow of the more than 46 million Chinese tires that came to the U.S. last year, nearly 17% of all tires sold in the country.

The low end of the market will feel the impact of the tariff most, as U.S. manufacturers, who joined the Chinese in opposing the tariffs, have said it isn't profitable to produce inexpensive tires in domestic plants.

"I think within the next 60 days you'll see some pretty significant price increases," said Jim Mayfield, president of Del-Nat Tire Corp. of Memphis, Tenn., a large importer and distributor of Chinese tires. He estimates prices for "entry-level" tires could increase 20% to 30%.

For the full story, see:

TIMOTHY AEPPEL. "Tariff on Tires to Cost Consumers; Higher Prices Expected at Market's Low End, Where China Focuses Its Exports." The Wall Street Journal (Mon., SEPTEMBER 14, 2009): A3.

(Note: the online version of the article has the date Tues., Sept. 15.)

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The small dark blue squares indicate the "number of nations that have imposed protectionist measures on each country" and the light blue squares indicate the "number of measures imposed on each category of goods." Source of quotations in caption and of graph: online version of the WSJ article quoted and cited below.

(p. A5) BRUSSELS -- This weekend's U.S.-China trade skirmish is just the tip of a coming protectionist iceberg, according to a report released Monday by Global Trade Alert, a team of trade analysts backed by independent think tanks, the World Bank and the U.K. government.

A report by the World Trade Organization, backed by its 153 members and also released Monday, found "slippage" in promises to abstain from protectionism, but drew less dramatic conclusions.

Governments have planned 130 protectionist measures that have yet to be implemented, according to the GTA's research. These include state aid funds, higher tariffs, immigration restrictions and export subsidies.

. . .

According to the GTA report, the number of discriminatory trade laws outnumbers liberalizing trade laws by six to one. Governments are applying protectionist measures at the rate of 60 per quarter. More than 90% of goods traded in the world have been affected by some sort of protectionist measure.

For the full story, see:

JOHN W. MILLER. "Protectionist Measures Expected to Rise, Report Warns." The Wall Street Journal (Tues., SEPTEMBER 15, 2009): A5.

(Note: ellipsis added.)

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"BOOK VALUE: Berkshire Hathaway's Charles Munger reads businesses well -- and, as a bibliophile, he goes through several books a week." Source of caricature and caption: online version of the WSJ article quoted and cited below.

At a Berkshire Hathaway annual meeting a few years ago, I remember hearing Warren Buffett say that he stays away from technology stocks because he does not know how to judge which technologies are likely to succeed in the long-run. So I was a bit puzzled by the news that Berkshire Hathaway was investing in BYD, a Chinese company producing an electric car.

The passages quoted below may partially solve the puzzle: the investment in BYD was pushed by Charlie Munger and David Sokol, and was based more on a judgment about the quality of BYD's management, than the prospects for BYD's technology.

(p. C1) Mr. Munger's views have pushed Berkshire into some surprising directions. Several years ago, Mr. Munger learned of an obscure Chinese maker of batteries and automobiles called BYD Inc., which hopes to create a cheap, functional electric car.

A Chinese tech company is nothing like the shoe and underwear makers Berkshire had been buying. But Mr. Munger was enthusiastic, less about the technology than about Wang Chuanfu, who runs BYD. Mr. Wang, Mr. Munger says, is "likely to be one of the most important business people who ever lived."

Mr. Buffett was skeptical at first. But Mr. Munger persisted. David Sokol, chairman of Berkshire utility MidAmerican Energy Holdings Co., paid a visit to BYD's factory in China and agreed with Mr. Munger's assessment. Last year, MidAmerican paid $230 million for a 10% stake in BYD.

"BYD was Charlie's idea," Mr. Buffett said. "When he encounters genius and sees it operating in a practical way, he gets blown away."

For the full story, see:

SCOTT PATTERSON. "Here's the Story on Berkshire's Munger." Wall Street Journal (Fri., MAY 1, 2009): C1 & C3.

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(p. 236) What redeemed the life of a rice farmer, however, was the nature of that work. It was a lot like the garment work done by the Jewish immigrants to New York. It was meaningful. First of all, there is a clear relationship in rice farming between effort and reward. The harder you work a rice field, the more it yields. Second, it's complex work. The rice farmer isn't simply planting in the spring and harvesting in the fall. He or she effectively runs a small business, juggling a family workforce, hedging uncertainty through seed selection, building and managing a sophisticated irrigation system, and coordinating the complicated process of harvesting the first crop while simultaneously preparing the second crop.

And, most of all, it's autonomous. The peasants of Europe worked essentially as low-paid slaves of an aristocratic landlord, with little control over their own destinies. But China and Japan never developed that kind of oppressive feudal system, because feudalism simply can't work in a rice economy. Growing rice is too complicated and intricate for a system that requires farmers to be coerced and bullied into going out into the fields each morning. By the fourteenth and fifteenth centuries, landlords in central and Southern China had an almost completely hands-off relationship with their tenants: they would collect a fixed rent and let farmers go about their business.

"The thing about wet-rice farming is, not only do you (p. 237) need phenomenal amounts of labor, but it's very exacting," says the historian Kenneth Pomerantz. "You have to care. It really matters that the field is perfectly leveled before you flood it. Getting it close to level but not quite right makes a big difference in terms of your yield. It really matters that the water is in the fields for just the right amount of time. There's a big difference between lining up the seedlings at exactly the right distance and doing it sloppily. It's not like you put the corn in the ground in mid-March and as long as rain comes by the end of the month, you're okay. You're controlling all the inputs in a very direct way. And when you have something that requires that much care, the overlord has to have a system that gives the actual laborer some set of incentives, where if the harvest comes out well, the farmer gets a bigger share. That's why you get fixed rents, where the landlord says, I get twenty bushels, regardless of the harvest, and if it's really good, you get the extra. It's a crop that doesn't do very well with something like slavery or wage labor. It would just be too easy to leave the gate that controls the irrigation water open a few seconds too long and there goes your field."

Source:

Gladwell, Malcolm. Outliers: The Story of Success. New York, NY: Little, Brown, and Co., 2008.

(Note: italics in original.)

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Source of graphic: online version of the NYT article quoted and cited below.

(p. A8) Taiwan, where for years the government encouraged information technology companies with tax breaks, cheap land, loans and more, is probably the most endangered of the small Asian economies. The result of that government largess is an economy extremely dependent on a single industrial sector that has been devastated by plunging worldwide sales of electronics. "Half of the industries just got a bad cold, they probably can recover quickly -- the other 50 percent, they've got, not cancer, but close," said Preston W. Chen, a chemicals tycoon who is also the chairman of Taiwan's Chinese National Federation of Industries.

For the full article, see:

KEITH BRADSHER. "Memo From Singapore - East Asia's Small Edens of Trade Wilt as Need for Exports Dries Up." The New York Times (Thurs., March 5, 2009): A8.

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"Songs about a mythical alpaca-like creature have taken hold online in China." Source of screen capture and caption: online version of the NYT article quoted and cited below.

(p. A1) BEIJING -- Since its first unheralded appearance in January on a Chinese Web page, the grass-mud horse has become nothing less than a phenomenon.

A YouTube children's song about the beast has drawn nearly 1.4 million viewers. A grass-mud horse cartoon has logged a quarter million more views. A nature documentary on its habits attracted 180,000 more. Stores are selling grass-mud horse dolls. Chinese intellectuals are writing treatises on the grass-mud horse's social importance. The story of the grass-mud horse's struggle against the evil river crab has spread far and wide across the Chinese online community.

Not bad for a mythical creature whose name, in Chinese, sounds very much like an especially vile obscenity. Which is precisely the point.

The grass-mud horse is an example of something that, in China's authoritarian system, passes as subversive behavior. Conceived as an impish protest against censorship, the foul-named little horse has not merely made government censors look ridiculous, although it has surely done that.

It has also raised real ques-(p. A12)tions about China's ability to stanch the flow of information over the Internet -- a project on which the Chinese government already has expended untold riches, and written countless software algorithms to weed deviant thought from the world's largest cyber-community.

For the full story, see:

MICHAEL WINES. "Mythical Beast (a Dirty Pun) Tweaks China's Web Censors." The New York Times (Thurs., March 12, 2009): A1 & A12.

(Note: the online title of the article is: "A Dirty Pun Tweaks China's Online Censors.")

"The popularity of the grass-mud horse has raised questions about China's ability to stanch the flow of information." Source of screen capture and caption: online version of the NYT article quoted and cited above.

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Here is a significant claim from "an elderly Chinese professor" (p. 76) who was talking to Robert Payne in 1943. Payne was "a writer and teacher who befriended Needham in China." The passage is quoted in an entertaining new book by Simon Winchester.

(p. 77) ". . .; we invented an airplane, and quite rightly executed the inventor; . . . "

Source:

Winchester, Simon. The Man Who Loved China: The Fantastic Story of the Eccentric Scientist Who Unlocked the Mysteries of the Middle Kingdom. New York: HarperCollins Publishers, Inc., 2008.

Winchester does not document his source for the quote, but it is presumably one of these two books by Payne, that are listed in Winchester's bibliography:

Payne, Robert. Chinese Diaries 1941-1946. New York: Weybright and Talley, 1945.

Payne, Robert. Chungking Diary. London: Weybright and Talley, 1945.

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(p. C1) Thanks to its aggressive push into renewable energies, cloud-wreathed Germany has become an unlikely leader in the race to harness the sun's energy. It has by far the largest market for photovoltaic systems, which convert sunlight into electricity, with roughly half of the world's total installations. And it is the third-largest producer of solar cells and modules, after China and Japan.

Now, though, with so many solar panels on so many rooftops, critics say Germany has too much of a good thing -- even in a time of record oil prices. Conservative lawmakers, in particular, want to pare back generous government incentives that support solar development. They say solar generation is growing so fast that it threatens to overburden consumers with high electricity bills.

. . .

(p. C7) At the heart of the debate is the Renewable Energy Sources Act. It requires power companies to buy all the alternative energy produced by these systems, at a fixed above-market price, for 20 years.

. . .

Christian Democrats, . . . , say the law has been too successful for its own good. Utilities, they note, are allowed to pass along the extra cost of buying renewable energy to customers, and there is no cap on the capacity that can be installed -- as exists in other countries to prevent subsidies from mushrooming.

At the moment, solar energy adds 1.01 euros ($1.69) a month to a typical home electricity bill, a modest surcharge that Germans are willing to pay. That will increase to 2.14 euros a month by 2014, according to the German Solar Energy Association.

But the volume of solar-generated energy is rising much faster than originally predicted, and critics contend that the costs will soar. Mr. Pfeiffer, the legislator, said solar power could end up adding 8 euros ($12.32) to a monthly electricity bill, which would alienate even the most green-minded. With no change in the law, he says, the solar industry will soak up 120 billion euros ($184 billion) in public support by 2015.

For the full story, see:

MARK LANDLER. "Solar Valley Rises in an Overcast Land." The New York Times (Fri., May 16, 2008): C1 & C7.

(Note: ellipses added.)

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"The Travelodge chain in Britain is building two hotels from stackable metal containers imported from China. One of the hotels, in Uxbridge in West London, is shown under construction at right and in a rendering at left." Source of the caption and photo: online version of the NYT article quoted and cited below.

(p. 23) TRAVELODGE, one of the largest budget hotel chains in Britain, is a company in a hurry.

. . .

Once the company finds a location, it turns to a construction partner with equally aggressive plans: Verbus Systems, a London-based company that builds rooms in metal containers in factories near Shenzhen, China, and delivers them ready to be stacked into buildings up to 16 stories tall.

Verbus Systems' commercial director, Paul Rollett, said his company "can build a 300-room hotel anywhere on the planet in 20 weeks."

. . .

When they arrive at Heathrow, the containers will be hoisted into place by crane. The containers, which are as large as 12 by 47 feet, will support one another just as they do when they are crossing the ocean by ship, Mr. Rollett said. No additional structure is necessary.

. . .

DON CARLSON, the editor and publisher of Automated Builder, a trade magazine based in Ventura, Calif., said that in hotels, "modular is definitely the wave of the future." Modular buildings, he said, are stronger, and more soundproof, because stacking units -- each a fully enclosed room -- "gives you double walls, double floors, double everything."

Mr. Rollett agreed, saying that with the steel shipping container approach, "You could have a party in your room, and people in the next room wouldn't hear a thing."

. . .

He is working with his British clients, which, he said, include a Travelodge competitor, Premier Inn, to make the best possible use of the assembly-line method. "We're increasing the degree of modularity," he said, noting that the latest units come with fully fitted bathrooms and "even the paint on the walls."

The only thing they don't have, he said, "is the girl to put a chocolate on your pillow."

For the full article, see:

FRED A. BERNSTEIN. "CHECKING IN; Arriving in London: Hotels Made in China." The New York Times, SundayBusiness Section (Sun., May 11, 2008): 23.

(Note: ellipses added.)

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"Zhang Xiaogang's "Bloodline: The Big Family No. 3."" Source of caption and photo: online version of the NYT article quoted and cited below.

(p. B1) BEIJING -- Sotheby's sold $51.77 million worth of Chinese contemporary art in three auctions in Hong Kong on Wednesday, allaying concerns that the global economic slowdown would depress the prices.

. . .

The star of that auction was a 1995 painting by Zhang Xiaogang, one of China's most prominent artists, which sold for just over $6 million, the highest price ever paid for a painting by a Chinese contemporary artist.

That oil on canvas, "Bloodline: Big Family No. 3," depicts a family of three during the tumultuous Cultural Revolution in China, when children were sometimes led to denounce their parents. Three collectors bid feverishly for the piece, which sold for far above its high estimate, about $3.4 million.

For the full story, see:

DAVID BARBOZA. "Chinese Art Continues To Soar at Sotheby's." The New York Times (Thurs., April 10, 2008): B1 & B5.

(Note: ellipsis added.)

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"Jiang Guohua, the Communist Party boss of Mianzhu, knelt Sunday to ask parents of earthquake victims to abandon their protest." Source of caption and photo: online version of the NYT article quoted and cited below.

(p. A10) One man shouted, "Was this a natural disaster or a man-made disaster?" In unison, the parents shouted back: "Man-made!"

For the full story, see:

JAMES T. AREDDY. "Reporter's Notebook; Tears and Anger Flow as Parents Cast Blame in Children's Deaths." The Wall Street Journal (Tues., May 20, 2008): A10.

(p. A1) DUJIANGYAN, China -- Bereaved parents whose children were crushed to death in their classrooms during the earthquake in Sichuan Province have turned mourning ceremonies into protests in recent days, forcing officials to address growing political repercussions over shoddy construction of public schools.

Parents of the estimated 10,000 children who lost their lives in the quake have grown so enraged about collapsed schools that they have overcome their usual caution about confronting Communist Party officials. Many say they are especially upset that some schools for poor students crumbled into rubble even though government offices and more elite schools not far away survived the May 12 quake largely intact.

On Tuesday, an informal gathering of parents at Juyuan Middle School in Dujiangyan to commemorate their children gave way to unbridled fury. One of the fathers in attendance, a quarry worker named Liu Lifu, grabbed the microphone and began calling for justice. His 15-year-old daughter, Liu Li, was killed along with her entire class during a biology lesson.

"We demand that the government severely punish the killers who caused the collapse of the school building," he shouted. "Please, everyone sign the petition so we can find out the truth."

The crowd grew more agitated. Some parents said local officials had known for years that the school was unsafe but refused to take action. Others recalled that two hours passed before rescue workers showed up; even then, they stopped working at 10 p.m. on the night of the earthquake and did not resume the search until 9 a.m. the next day.

Although there is no official casualty count, only 13 of the school's 900 students came out alive, parents said. "The people responsible for this should be brought here and have a bullet put in their head," said Luo Guanmin, a farmer who was cradling a photo of his 16-year-old daughter, Luo Dan.

Sharp confrontations between protesters and officials began over the weekend in several towns in northern Sichuan. Hundreds of parents whose children died at the Fuxin No. 2 Primary School in the city of Mianzhu staged an impromptu rally on Saturday. They surrounded an official who tried to assure them that their complaints were being taken seriously, screaming and yelling in her face until she fainted.

The next day, the Communist (p. A10) Party's top official in Mianzhu came out to talk with the parents and to try to stop them from marching to Chengdu, the provincial capital, where they sought to prevail on higher-level authorities to investigate. The local party boss, Jiang Guohua, dropped to his knees and pleaded with them to abandon the protest, but the parents shouted in his face and continued their march.

Later, as the crowd surged into the hundreds, some parents clashed with the police, leaving several bleeding and trembling with emotion.

The protests threaten to undermine the government's attempts to promote its response to the quake as effective and to highlight heroic rescue efforts by the People's Liberation Army, which has dispatched 150,000 soldiers to the region. Censors have blocked detailed reporting of the schools controversy by the state-run media, but a photo of Mr. Jiang kneeling before protesters has become a sensation on some Web forums, bringing national attention to the incident.

. . .

. . . all at once the women doubled over in agony, a chorus of 100 mothers wailing over the loss of sons and daughters who, because of China's population control policy, were their only children. The husbands wept in silence, paralyzed by the storm of emotion.

For the full story, see:

ANDREW JACOBS. "Parents' Grief Turns to Rage at Chinese Officials." The New York Times (Weds., May 28, 2008): A1 & A10.

(Note: ellipses added.)

"A memorial service for hundreds of students of Juyuan Middle School in Dujiangyan, where a mother held a picture of her son, turned into an angry protest." Source of caption and photo: online version of the NYT article quoted and cited above.

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(p. 316) India is fast becoming two entities: a rising kernal of world-class modernity within a historic culture that has been for the most part stagnating for generations.

This kernal of modernity appears to have largely leapfrogged the twentieth-century labor-intensive manuafacturing-for-export model embraced by China and the rest of East Asia.

Source:

Greenspan, Alan. The Age of Turbulence: Adventures in a New World Economic Flexibility. New York: Penguin Press, 2007.

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In the passage quoted below, the "commission" refers to China's "National Development and Reform Commission."

(p. A6) The commission estimates China's energy efficiency is about 10% below that of developed countries because of obsolete technology. But many experts say Beijing's policy priorities are a bigger obstacle.

Worries about social unrest and inflation led Beijing to put the brakes on pricing overhauls, at tremendous cost to state refiners PetroChina Co. and China Petroleum & Chemical Corp., known as Sinopec.

"Market prices are a very important and key issue because they send out the right signal to the customer to save energy," said Yang Fuqiang, vice president of the Energy Foundation in Beijing.

For the full story, see:

David Winning. "Why Energy Efficiencies Prove Elusive in China." Wall Street Journal (Tues., Nov. 6, 2007): A6.

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      "At the Dahon bicycle plant in Shenzhen, China, pay has risen 10 to 15 percent a year, but productivity gains have held down costs."  Source of caption and photo:  online version of the NYT article quoted and cited below.

(p. A1) SHENZHEN, China, Aug. 28 -- At the Dahon bicycle factory here, Zhang Jingming's fingers move quickly and methodically -- grabbing bicycle seats, wrapping them in cardboard and smoothly attaching them to frames.

Working a 45-hour week, Mr. Zhang makes the equivalent of $263 a month; as recently as February, he was making just $197. Some of his higher pay comes from working more efficiently. "When I first started, I wasn't this fast," he said.

But a good portion reflects a raise Mr. Zhang got: to 1.45 cents for each bicycle seat from 1.32 cents. It is a small difference that signifies major change.

Chinese wages are on the rise. No reliable figures for average wages exist; the government's economic data are notably unreliable. But factory owners and experts who monitor the nation's labor market say that businesses are having a hard time finding able-bodied workers and are having to pay the workers they can find more money.

And higher wages in China are likely to lead to higher prices in the United States -- at the mall, at the grocery, even at the gas pump.

Chinese companies are already passing along some of their higher costs to overseas customers. Prices for goods from China, after years of gradual decline, have risen 1.2 percent since February, according to the Labor Department. July's increase was the biggest yet: 0.4 percent compared with June. Chinese companies and contractors are also passing on the cost of the rising value of their currency, the yuan, up 8.8 percent against the dollar in the last two years.

For decades, many labor economists said that China's vast population would supply a nearly bottomless pool of workers. So many people would be seeking jobs at any given time, this rea-(p. A9)soning went, that wages in this country would be stuck just above subsistence levels. As recently as four years ago, some experts estimated that most of the perhaps 150 million underemployed workers in the countryside would be heading to cities.

Instead, sporadic labor shortages started to appear in 2003 at factories in the Pearl River delta of southeastern China. Now those shortages have spread to factories up and down the Chinese coast, specialists say.

. . .

(p. A9) The hardest variable to judge in China's changing labor market is the pace of productivity growth. Since there are few reliable statistics, the best way to assess productivity is to look at individual factories like the Dahon operation here, which produces bicycles that collapse for easy storage.

David T. Hon, chief executive of the privately held Dahon Group, said that while he had been raising wages 10 to 15 percent a year, the average labor cost for each bicycle had actually edged downward. This is possible, he said, because sales are growing 30 percent a year and increasingly large-scale production has brought savings. The cost of engineering a new bicycle design, or handling the accounting and other back-office operations, is spread over more and more bicycles as production rises.

For the full story, see: 

KEITH BRADSHER.  "Wages Are on the Rise in China As Young Workers Grow Scarce."  The New York Times   (Weds., August 29, 2007):  A1 & A9.

(Note: ellipsis added.)

    Source of graph: online version of the NYT article quoted and cited above.

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   Source of image:  edited scan from page 21 of Levathes's book cited below.

It is an enduring puzzle why the West has been so much more succesful than China in achieving economic growth over the past several centuries.  The puzzle arises because there is considerable evidence of early Chinese acheivements in technology.

One example would be the exploratory voyages of Zheng He.  As can be seen in the image above, the Chinese ships were much, much larger than those of Christopher Columbus.  But as Clayton Christensen has shown in a more modern context, size does not always matter as much as nimbleness and motivation. 

(And another part of the story involves culture and institutions.)

The reference for the Levathes book, is:

Levathes, Louise. When China Ruled the Seas: The Treasure Fleet of the Dragon Throne, 1405-1433. Oxford, UK: Oxford University Press, 1996.

The most complete account of Christensen's thinking, so far, is his book with Raynor:

Christensen, Clayton M., and Michael E. Raynor.  The Innovator's Solution:  Creating and Sustaining Successful Growth.  Boston, MA: Harvard Business School Press, 2003.

(Note:  I am grateful to Prof. Yu-sheng Lin for first showing me the image at the top of this post.  I am also grateful to Prof. Salim Rashid, and Liberty Fund's Mr. Leonidas Zelmanovitz, for my having the opportunity to encounter Prof. Lin.)

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"Looking for usable coal at a cinder dump in Shanxi Province in China. Inadequate coal in the north limited power production." Source of the caption and photo: online version of the NYT article quoted and cited below.

The article quoted below uses the word "tariff" in the sense of "price."

(p. C4) HONG KONG -- The Chinese government issued an "urgent notice" on Wednesday to the country's power generators, coal companies and railways to address an electricity shortage that has led to rationing in more than a third of China's provinces in recent weeks.

The rationing, mostly achieved by telling factories that their power will be shut off for a day or two each week, coincides with the annual frenzy of factory production to meet orders before shutting down for the Chinese New Year holidays, which fall in early February this year.

. . .

Power executives and government statements attributed the electricity shortfall this winter to a confluence of problems. Many of the problems appear to have their roots in the government's imposition of a long list of price controls in recent months in an attempt to tamp down inflation, which reached 6.9 percent at the consumer level in November.

Trucks did not deliver adequate coal stockpiles to power plants before winter snows arrived in northern China, partly because of nationwide diesel shortages. Refiners had cut back on the production of diesel because price controls were forcing them to sell the diesel for slightly less than the cost of the crude oil needed to make it.

. . .

Low electricity tariffs, particularly for residential users, have been another problem.

The central government issued an official "suggestion" to provincial governments last fall that they not allow increases in electricity tariffs charged to customers, as part of national price controls.

Provincial governments have responded by freezing tariffs, and even reducing them in the case of Guangdong Province in southeastern China, the home of much of the country's export-oriented light industry.

The low tariffs have made it uneconomical for oil-fired plants to operate, and many have stopped doing so.

"It makes absolutely no sense for anyone to run a diesel- or oil-fired plant. They're all shut down," said a power company executive in China who asked not to be identified because of the sensitivity of commenting on regulatory policies.

The executive added that even when ordered by the government to resume operating at a loss, many state-owned oil-fired plants had not done so, scheduling maintenance and repairs instead.

For the full story, see:

KEITH BRADSHER. "Pinched by Price Controls, Power Plants in China Scale Back." The New York Times (Thurs., January 24, 2008): C4.

(Note: ellipses added.)

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   "Emily Prager at her lane house in Shanghai."  Source of caption and photo:  online version of the NYT article quoted and cited below.   

The centers of dynamism are not set in stone.  I once asked the philosopher Alan Donagan why the Scottish enlightenment had occurred where (Edinburgh) and when (in the mid-late 18th century) it did.  With his usual good humor he told me that I was asking a bad question--that my question assumed that enlightenments were determined.  He instead believed that they were chance occurrences resulting from the free-will choices of individuals.

I think that there was something to what he said.  But I also believe that some institutions, and some policies of government, can greatly increase the probability that fruitful dynamism will occur.  For instance, free markets tend to tolerate diversity and experimentation, and to reward initiative. 

In the past, locations of economic dynamism, also were often locations of intellectual dynamism.  I wonder if the connection is still true today, and if not, why not? 

Among past centers of dynamism were Miletus, Athens, Florence, Amsterdam, Edinburgh, and New York City.  Today, centers of economic dynamism include Las Vegas, Dubai and Shanghai.  The article quoted below paints a generally appealing picture of Shanghai.

(p. D1)  I decided to move myself and my 12-year-old daughter, Lulu — whom I had adopted as a baby in China — from the old capital of the world to the new: to make a home in Shanghai, a city of the future.

I knew something about Shanghai, having been here on trips several times in the last few years. The city was always so excited it could hardly contain itself. It is a microcosm of the Asian boom, stuffed with people giddy on hope and thrilled to be changing. It recalls the greatness of New York in the early ’70s, except for one thing: Like the rest of China, Shanghai was largely closed to the outside world, and real economic growth, for nearly 50 years after World War II. It is a place where every car on the road is brand new and every pet recently acquired, but the person you just met might trace his family back 70 generations. The modernity and polish that Manhattan learned between 1945 and 1995, Shanghai is cramming for as fast as it can, and it’s fascinating to watch.

. . .

(p. D6)  Pets are new to Chinese people and they don’t know very much about them. Dogs are not neutered and they are walked without leashes. Many people are terrified of dogs, particularly given the country’s serious rabies problem.

Twice when I was walking Skippy, young women caught sight of him and screamed in terror at the top of their lungs. Because having a pet is so new, there is a video showing how to pick up after a dog and wash his paws after his walk, which appears many times a day on a huge video screen on Huaihai, the city’s other main shopping street.

For the full story, see: 

EMILY PRAGER. "At Home Abroad; Settling Down in a City in Motion."  The New York Times  (Thurs., July 19, 2007):  D1 & D6. 

(Note:  ellipsis added.)

   "On the streets of Shanghai, the author's injured foot attracts less attention than her pet dog, still a rare sight in the city."  Source of caption and photo:  online version of the NYT article quoted and cited above.

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     "Wong Yuen enjoying breakfast at a Hong Kong restaurant. The government, he says, "shouldn't be telling anyone how dim sum should be served.""   Source of caption and photo:  online version of the NYT article quoted and cited below.

Longtime dim sum lovers are indignant.

"The government is putting its thumb on every part of citizens' lives, and it shouldn't be telling anyone how dim sum should be served," said Wong Yuen, a retired mechanic and truck driver who says he has eaten dim sum every morning for the last two decades. "People can make their own decisions. If it's unhealthy, they can eat less. They don't need the government to tell them."

For the full story, see: 

KEITH BRADSHER.  "HONG KONG JOURNAL; Dim Sum Under Assault, and Devotees Say 'Hands Off'."  The New York Times  (Thurs., April 28, 2005):  A4.

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   "Infosys employs workers in Brno, Czech Republic."   Source of caption and photo:  online version of the NYT article quoted, and cited, below.

(p. A1)  MYSORE, India — Thousands of Indians report to Infosys Technologies’ campus here to learn the finer points of programming. Lately, though, packs of foreigners have been roaming the manicured lawns, too.

Many of them are recent American college graduates, and some have even turned down job offers from coveted employers like Google. Instead, they accepted a novel assignment from Infosys, the Indian technology giant: fly here for six months of training, then return home to work in the company’s American back offices.

India is outsourcing outsourcing.

One of the constants of the global economy has been companies moving their tasks — and jobs — to India. But rising wages and a stronger currency here, demands for workers who speak languages other than English, and competition from countries looking to emulate India’s success as a back office — including China, Morocco and Mexico — are challenging that model.

Many executives here acknowledge that outsourcing, having rained most heavily on India, will increasingly sprinkle tasks around the globe. Or, as Ashok Vemuri, an Infosys senior vice president, put it, the future of outsourcing is “to take the work from any part of the world and do it in any part of the world.”

. . .

(p. A14)  Such is the new outsourcing: A company in the United States pays an Indian vendor 7,000 miles away to supply it with Mexican engineers working 150 miles south of the United States border.

In Europe, too, companies now hire Infosys to manage back offices in their own backyards. When an American manufacturer, for instance, needed a system to handle bills from multiple vendors supplying its factories in different European countries, it turned to the Indian company. The manufacturer’s different locations scan the invoices and send them to an office of Infosys, where each bill is passed to the right language team. The teams verify the orders and send the payment to the suppliers while logged in to the client’s computer system.

More than a dozen languages are spoken at the Infosys office, which is in Brno, Czech Republic.

For the full story, see: 

ANAND GIRIDHARADAS.  "Outsourcing Comes Full Circle As India Starts to Export Jobs."  The New York Times   (Tues., September 25, 2007):  A1 & A14.

(Note:  the somewhat different title of the online version was:  "Outsourcing Works So Well, India Is Sending Jobs Abroad.")

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   Source of table:  "World Publics Welcome Global Trade -- But Not Immigration." Pew Global Attitudes Project, a project of the PewResearchCenter. Released: 10.04.07 dowloaded from: http://pewglobal.org/reports/display.php?ReportID=258

(p. A10) WASHINGTON, Oct. 4 — Buoyed and battered by globalization, people around the world strongly view international trade as a good thing but harbor growing concerns about its side effects: threats to their cultures, damage to the environment and the challenges posed by immigration, a new survey indicates.

In the Pew Global Attitudes Project survey of people in 46 countries and the Palestinian territories, large majorities everywhere said that trade was a good thing. In countries like Argentina, which recently experienced trade-based growth, the attitude toward trade has become more positive.

But support for trade has decreased in recent years in advanced Western countries, including Germany, Britain, France and Italy — and most sharply in the United States. The number of Americans saying trade is good for the country has dropped by 19 percentage points since 2002, to 59 percent.

“G.D.P. growth hasn’t been as dramatic in these places as in Latin America or Eastern Europe,” said Andrew Kohut, president of the Pew Research Center, referring to gross domestic product, the total value of the goods and services produced in a country. “But worldwide, even though some people are rich and some are poor, support for the basic tenet of capitalism is pretty strong.”

For the full story, see: 

BRIAN KNOWLTON. "Globalization, According to the World, Is a Good Thing. Sort Of."  The New York Times   (Fri., October 5, 2007):  A10. 

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Wu Ping's house stands as a testament to her tenacity in defending her private property.  Source of the photo:  online version of the NYT article cited below.

CHONGQING, China, March 23 — For weeks the confrontation drew attention from people all across China, as a simple homeowner stared down the forces of large-scale redevelopment that are sweeping this country, blocking the preparation of a gigantic construction site by an act of sheer will.

Chinese bloggers were the first to spread the news, of a house perched atop a tall, thimble-shaped piece of land like Mont-Saint-Michel in northern France, in the middle of a vast excavation.

Newspapers dived in next, followed by national television. Then, in a way that is common in China whenever an event begins to take on hints of political overtones, the story virtually disappeared from the news media after the government, bloggers here said, decreed that the subject was suddenly out of bounds.

. . .

What drove interest in the Chongqing case was the uncanny ability of the homeowner to hold out for so long. Stories are legion in Chinese cities of the arrest or even beating of people who protest too vigorously against their eviction and relocation. In one often-heard twist, holdouts are summoned to the local police station and return home only to find their house already demolished. How did this owner, a woman no less, manage? Millions wondered.

Part of the answer, which on meeting her takes only a moment to discover, is that Wu Ping is anything but an ordinary woman. With her dramatic lock of hair precisely combed and pinned in the back, a form-flattering bright red coat, high cheekbones and wide, excited eyes, the tall, 49-year-old restaurant entrepreneur knows how to attract attention — a potent weapon in China’s new media age, in which people try to use public opinion and appeals to the national image to influence the authorities. 

. . .  

“I have more faith than others,” she began. “I believe that this is my legal property, and if I cannot protect my own rights, it makes a mockery of the property law just passed. In a democratic and lawful society a person has the legal right to manage one’s own property.”

Tian Yihang, a local college student, spoke glowingly of her in an interview at the monorail station. “This is a peculiar situation,” he said, with a bit of understatement. “I admire the owner for being so persistent in her principles. In China such things shock the common mind.”

. . .  

With the street so choked with onlookers that traffic began to back up, Ms. Wu’s brother, Wu Jian, began waving a newspaper above the crowd, pointing to pictures of Ms. Wu’s husband, a local martial arts champion, who was scheduled to appear in a highly publicized tournament that evening. “He’s going into our building and will plant a flag there,” Mr. Wu announced.

Moments later, as the crowd began to thin, a Chinese flag appeared on the roof with a hand-painted banner that read: “A citizen’s legal property is not to be encroached on.”

Asked how his brother-in-law had managed to get inside the locked site and climb the escarpment on which the house is perched, he said with a wink, “Magic.”  

For the full story, see: 

HOWARD W. FRENCH.  "CHONGQING JOURNAL; Homeowner Stares Down Wreckers, at Least for a While."  The New York Times  (Tues., March 27, 2007):  A4.

(Note:  ellipses added.)

   On left, Wu Ping, with her tall brother in the background.  On right, a map showing the location of Chongqing in China.  Source of photo and map:  online version of the NYT article cited above.

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   Source of graphic:  online version of the WSJ article cited below.

Market participants consider futures the next big thing for China's financial-sector development. The exchange currently trades contracts in copper, aluminum, natural rubber and fuel oil -- commodities that China imports in large quantities.

But trading is largely closed to foreigners. Futures on financial products, such as stock indexes and currencies, don't yet exist in China, though they are integral to other market economies.

Reviving Case for Futures

China banned exchange-traded financial derivatives in 1995 in response to a meltdown in its bond-futures market. Within minutes, $10 billion in market value was wiped out, in what remains the country's most damaging market debacle to date. By contrast, last week's drop in stocks has revived the case for financial futures.

Officials now say share prices probably wouldn't have fallen so abruptly on Feb. 27 if index futures existed. That's because shares probably wouldn't have surged as quickly as they did last year -- the Shanghai Composite Index rose 130% -- if investors had had the chance to use stock-index futures to bet against the market on its way up.

Futures contracts are thought to build more of a two-way market, because they give investors the right to buy -- and sell -- based on expectations about how the value of an index, stock, currency or commodity might move within a particular time frame. Without them, the only way for investors to make money is in a rising market, a risky prospect over the long term.

For the full story, see:

JAMES T. AREDDY.  "Futures Could Help Cure China's Boom-Bust Cycles."  The Wall Street Journal  (Thurs., March 8, 2007):  A2.

(Note:  the online version had a slightly different title:  "China Tries Longer-Term Response to Stock Volatility.")

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   Shenzhen, China.  Source of photo:  online version of the NYT article cited below.

Are starving citizens, or a growing midddle class, more likely to stand up for their rights?  In the ongoing debate, here is a bit of evidence in favor of the middle class. 

(In economics, a "normal good" is one where, ceteris paribus, more is consumed, when income increases.  So in the language of economics, the following article supports the view that political freedom is a normal good.)

(p. A1)  When residents here in southern China's richest city learned of plans to build an expressway that would cut through the heart of their congested, middle-class neighborhood, they immediately organized a campaign to fight City Hall.

Over the next two years they managed to halt work on the most destructive segment of the highway and forced design changes to reduce pollution from the roadway. It became a landmark in citizen efforts to win concessions from a government that by tradition brooked no opposition.

And it was no accident that the battle was waged in Shenzhen, a 26-year-old boomtown that was the first city to enjoy the effects of China's breakneck economic expansion and that has served as a model for cities throughout the country. 

. . .

. . .   Possibly the greatest force taking shape here is the quiet expansion of the middle class, thicker on the ground here than perhaps anywhere else in China. This middle class is beginning to chafe under authoritarian rule, and over time, the quiet, well-organized challenges of the newly affluent may have the deepest impact on this country's future.

''Many people laughed at me, because they don't have confidence in the government,'' said Qian Shengzeng, a 62-year-old former rocket scientist who led the movement against the expressway. ''They think the government is hopelessly rotten. However, our view is that maybe there is a remaining sliver of hope, and the government needs to be pushed.''

In newly rich Shenzhen, as in much of China, social change is being driven by economic transformation and, more than anything else, property ownership.

For the full story, see: 

HOWARD W. FRENCH.  "In Chinese Boomtown, Middle Class Pushes Back."  The New York Times  (Weds., December 18, 2006):  A1 & A8.

(Note:  ellipses added.)

  Map showing Shenzhen's proximity to Hong Kong.  Source of map:  online version of the NYT article cited above.

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In Free to Choose, Milton Friedman compared Hong Kong's free market, with India's state control of the economy.  The dynamism and growth of Hong Kong was a stark contrast to the inertia and stagnation of India.  In the decades since Free to Choose, India has become more free and, alas, Hong Kong less free:   

(p. A14) . . . it was sadly unsurprising to see Hong Kong's current leader, Donald Tsang, last month declare the death of the policy on which the territory's prosperity was built.

The really amazing phenomenon is that, for half a century, his predecessors resisted the temptation to tax and meddle.  Though a colony of socialist Britain, Hong Kong followed a laissez-faire capitalist policy, thanks largely to a British civil servant, John Cowperthwaite.  Assigned to handle Hong Kong's financial affairs in 1945, he rose through the ranks to become the territory's financial secretary from 1961-71.  Cowperthwaite, who died on Jan. 21 this year, was so famously laissez-faire that he refused to collect economic statistics for fear this would only give government officials an excuse for more meddling.  His successor, Sir Philip Haddon-Cave, coined the term "positive noninterventionism" to describe Cowperthwaite's approach.

The results of his policy were remarkable.  At the end of World War II, Hong Kong was a dirt-poor island with a per-capita income about one-quarter that of Britain's.  By 1997, when sovereignty was transferred to China, its per-capita income was roughly equal to that of the departing colonial power, even though Britain had experienced sizable growth over the same period.  That was a striking demonstration of the productivity of freedom, of what people can do when they are left free to pursue their own interests.

For the full commentary, see: 

MILTON FRIEDMAN.  "Hong Kong Wrong."  Wall Street Journal  (Fri., October 6, 2006):  A14.

(Note:  ellipsis added.)

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  Source of graphic:  scanned from p. B1 of NYT article cited below.

Leonard Read in his classic "I, Pencil" told the story of how the various compenents of a mere pencil came from different suppliers the world over.  People who did not know each other, and might not like each other if they met, but who were brought together in productive co-operation through the power of the market.  Milton Friedman frequently presented his own verison of this story.  The cover of my 1980 edition of Free to Choose has a picture of Friedman holding a pencil as if in the middle of this story.  And there is a short video-clip of Friedman telling the story.

A similar story could be told with many other products, and several sources have presented the raw materials in print to tell the story for laptop computers.  (By "raw materials" I mean that they list the diversity of sources of the inputs; but usually without drawing all the lessons that Reed and Friedman drew.)  One source is a chapter in Thomas Friedman's The World is Flat. 

Two other sources are articles that appeared within a few days of each other in The New York Times and The Wall Street Journal. 

The reference to The New York Times article is:

DAVID BARBOZA.  "An Unknown Giant Flexes Its Muscles; Amid Talk of Deal With I.B.M., Lenovo of China Sheds Some Obscurity."  The New York Times (Sat., December 4, 2004):  B1 & B3.

The reference to The Wall Street Journal article is:

Jason Dean and Pui-Wing Tam.  "The Laptop Trail; The Modern PC Is a Model Of Hyperefficient Production And Geopolitical Sensitivities."   The Wall Street Journal  (Thurs., June 9, 2005):  B1 & B8. 

  Source of graphic:  scanned from p. B1 of WSJ article cited above.

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  Shanghai friends watch downloaded, subtitled, episode of "Friends."  Source of photo:  online version of the NYT article cited below.

SHANGHAI, Aug. 8 — For the past year and a half, said Ding Chengtai, a recent university graduate, friends have wondered why he seems to have disappeared.

Mr. Ding, 23, an Internet technology expert for a large Chinese bank, chuckled at the thought.  He has kept himself in virtual seclusion during his off hours, consumed with American television programs like “Lost,” “C.S.I.” and “Close to Home.”

He is no ordinary fan, though; none of the shows he watches can be seen on Chinese television.  Instead, he spends night after night creating Chinese subtitles for American sitcoms and dramas for a mushrooming audience of Chinese viewers who download them from the Internet free through services like BitTorrent.

. . .

To a person, the adapters say they are willing to devote long hours to this effort out of a love for American popular culture.  Many, including Mr. Ding, say they learned English by obsessively watching American movies and television programs.

Others say they pick up useful knowledge about everything from changing fashion and mores to medical science.

“It provides cultural background relating to every aspect of our lives:  politics,  history and human culture,” Mr. Ding said.  “These are the things that make American TV special.  When I first started watching ‘Friends,’ I found the show was full of information about American history and showed how America had rapidly developed.  It’s more interesting than textbooks or other ways of learning.”

On an Internet forum about the downloaded television shows, a poster who used the name Plum Blossom put it another way.

“After watching these shows for some time, I felt the attitudes of some of the characters were beginning to influence me,” the poster wrote.  “It’s hard to describe,  but I think I learned a way of life from some of them.  They are good at simplifying complex problems, which I think has something to do with American culture.”

For the full story, see: 

HOWARD W. FRENCH.  "Chinese Tech Buffs Slake Thirst for U.S. TV Shows."  The New York Times  (Weds., August 9, 2006):   A6.

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  Source of book image:  http://www.holtzbrinckpublishers.com/henryholt/Search/SearchBookDisplayLarge.asp?BookKey=1524294

(p. B29) This improbable journey, from Maoist orthodoxy to the entrepreneurial quasicapitalism officially described as “socialism with Chinese characteristics,” is the main theme of “Chinese Lessons,” but Mr. Pomfret, a reporter for The Washington Post, gives his tale a twist.  He tells it not only through his own experiences as a student and journalist but through the life stories of five university classmates, who suffered through the Cultural Revolution as children, found inspiration and hope in the growing democracy movement and lived to see a China that neither they nor their parents could have imagined.  . . .

All the lives Mr. Pomfret explores are extraordinary, and each sheds its own light on recent Chinese history.  Perhaps the most endearing of his characters is Guan Yongxing, better known as Little Guan, who as an 11-year-old suffered social ostracism after accidentally using a piece of paper with “Long Live Chairman Mao!” on it to wipe herself in the bathroom.

After classmates threw her to the ground, no doctor would treat her dislocated shoulder, leaving her crippled for life.  Her father’s job as a schoolteacher made the Guan family a prime target for abuse, and Little Guan, rather than endure ridicule and torment at school, picked cotton and sprayed fertilizer on the fields, her back constantly burned by chemicals leaking from the tank on her back.  Tough, determined and highly intelligent, she survives and eventually prospers in the new China.

. . .

Zhou Lianchun, called Book Idiot Zhou by a contemptuous Communist Party official, meted out insults and torture as part of a Red Guard brigade.  “I did what I was told and, being 11, I liked it,” he tells Mr. Pomfret.

. . .

More even than sex, students want just a little bit of the good life that seems to be in reach as China’s rulers relax their economic policies.  To get it they master a strange kind of doublethink, pledging allegiance to the party and Communist ideals while scheming to start a business.

Book Idiot Zhou, a history teacher by day, jumps into a business partnership to process urine for the pharmaceutical industry.  “Several days a week, he taught Marxism, Leninism and Maoist thought and railed against the exploitation of the capitalist class,” Mr. Pomfret writes.  “The rest of the time he spent as a budding entrepreneur, employing dozens at rock-bottom wages, working the system to enrich himself, his partners and his family.”

. . .

His classmates have done well.  But their lives, and the China described in “Chinese Lessons,” bear a heavy load of suppressed grief, terrible compromises and boundless cynicism.  At a new drive-in called the Happy Auto Movie Palace, Mr. Pomfret notices something strange about the concrete slabs underneath his feet.  They show the marks of tank treads.  The drive-in owner bought them after the government repaved Tiananmen Square.

This strikes Mr. Pomfret as bizarre, but not the owner.  “It was a good deal,” he says.

For the full review, see: 

WILLIAM GRIMES. "Books of The Times; Twisting Along China’s Sharp Curves." The New York Times (Fri., August 4, 2006):  B29.

(Note: ellipses added.) 

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  Source of graphic:  online version of the WSJ article cited below.

Despite fears of "running out" of oil, Cambridge Energy Research Associates' new analysis of oil-industry activity points to a considerable growth in the capacity to produce oil in the years ahead.  Based upon our field-by-field examination of current activity and of 360 new projects that are either underway or very likely, we see capacity growing from its current 89 mbd to 110 mbd by 2015, a 25% increase.  A substantial part of this growth reflects the advance of technology, i.e., the rapid growth in "non-traditional" hydrocarbons, such as from very deep offshore waters, Canadian oil sands, and liquids made from natural gas.  (We are not counting in this increase the additional supplement that will come from ethanol and other fuels made from plants.)

There are important qualifications, however.  First, this is physical capacity to produce, not actual flows, which, as we have seen over the last year, can be disrupted by everything from natural disasters to government decision, to conflict and geopolitical discord.  Second, while prices are going up rapidly, so are costs;  and shortages of equipment and people can slow things down.  Third, greater scale and technical complexity can generate delays.  Still, a 25% increase in physical capacity by 2015 is a reasonable expectation, based upon today's evidence, and that would go a long way to meeting the growing demand from China, India and other motorizing countries.

Admittedly, it may be hard to conceive of this kind of increase when oil prices are climbing the wall of worry, when each new disruption reverberates around the world, when Iranian politicians threaten $100 or $250 oil in the event of sanctions, and when so many geopolitical trends seem so adverse.  All this underlines the fact that while the challenges below ground are extensive, the looming uncertainties -- and risks -- remain above ground. 

For the full commentary, see:

Daniel Yergin.  "Crisis in the Pipeline."  The Wall Street Journal  (Weds., August 9, 2006):  A10.   

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Surfing the Web last fall, a Chinese high-school student who calls himself Zivn noticed something missing.  It was Wikipedia, an online encyclopedia that accepts contributions or edits from users, and that he himself had contributed to.

The Chinese government, in October, had added Wikipedia to a list of Web sites and phrases it blocks from Internet users' access.  For Zivn, trying to surf this and many other Web sites, including the BBC's Chinese-language news service, brought just an error message.  But the 17-year-old had had a taste of that wealth of information and wanted more.  "There were so many lies among the facts, and I could not find where the truth is," he writes in an instant-message interview.

Then some friends told him where to find Freegate, a tiny software program that thwarts the Chinese government's vast system to limit what its citizens see.  Freegate -- by connecting computers inside of China to servers in the U.S. -- allows Zivn and others to keep reading and writing to Wikipedia and countless other sites.

Behind Freegate is a North Carolina-based Chinese hacker named Bill Xia.  He calls it his red pill, a reference to the drug in the "Matrix" movies that vaulted unconscious captives of a totalitarian regime into the real world.  Mr. Xia likes to refer to the villainous Agent Smith from the Matrix films, noting that the digital bad guy in sunglasses "guards the Matrix like China's Public Security Bureau guards the Internet."

. . .

(p. A9)  . . . , with each new version of Freegate -- now on its sixth release -- the censors "just keep improving and adding more manpower to monitor what we have been doing," Mr. Xia says.  In turn, he and volunteer programmers keep tweaking Freegate.

At first, the software would automatically change its Internet Protocol address -- a sort of phone number for a Web site -- faster than China could block it.  That worked until September 2002, when China blocked Freegate's domain name, not just its number, in the Internet phone book.

More than three years later, Mr. Xia is still amazed by the bold move, calling it a "hijacking."  Ultimately he prevailed, however, through a solution he won't identify for fear of being shut down for good.

Confident in that solution, Mr. Xia continues to send out his red pill, and users like Zivn continue to take it.  The teen credits his cultural and political perspective to a "generation gap" that has come of having access to more information.  "I am just gradually getting used to the truth about the real world," he writes.

For the full story, see: 

Geoffrey A. Fowler.  "Chinese Internet Censors Face 'Hacktivists' in U.S."  The Wall Street Journal  (Monday, February 13, 2006):  A1 & A9.

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If Warren Buffett is as serious about doing good with his wealth, as he was in becoming wealthy, he would ponder the Wall Street Journal's sage editorial page advice:

We can't think of two people less in need of our two cents than Messrs. Buffett and Gates.  But since giving free advice is our business, we'd suggest that they put at least a smidgen of their money back into strengthening the foundations of the free-market system that has allowed them to become so fabulously rich.  There's something to be said for reinvesting in the moral capital of a free society and trying to sustain and export free-enterprise policies.

Capitalism has done very well not just by Mr. Buffett but also by the world's poor, as several hundred million Chinese and Indians might attest.  African nations in particular need property rights and a rule of law as badly as they need vaccines.  On that score we were encouraged by a report this week that the Gateses thanked Mr. Buffett for his gift by presenting him with a book from their personal library:  Adam Smith's "The Wealth of Nations."

For the full editorial, see:

"Mr. Buffett's Gift."  The Wall Street Journal  (Weds., June 28, 2006):  A14.

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   Tall grass grows where Qingtu Lake used to be; and the desert encroaches on the grass.  Source of image:  online version of the NYT article cited below.

(p. A1)  An ever-rising tide of sand has claimed grasslands, ponds, lakes and forests, swallowed whole villages and forced tens of thousands of people to flee as it surges south and threatens to leave this ancient Silk Road greenbelt uninhabitable.

Han Chinese women here cover their heads and faces like Muslims to protect against violent sandstorms.  Farmers dig wells down hundreds of feet.  If they find water, it is often brackish, even poisonous.

Chinese leaders have vowed to protect Minqin and surrounding towns in Gansu Province.  The area divides two deserts, the Badain Jaran and the Tengger, and its precarious state threatens to accelerate the spread of barren wasteland to the heart of China.

The national 937 Project, set up to fight the encroaching desert, estimated in April that 1,500 square miles of land, roughly the size of (p. A14) Rhode Island, is buried each year.  Nearly all of north central China, including Beijing, is at risk.

Expanding deserts and a severe drought are also making this a near-record year for dust storms carried east in the jet stream.  Sand squalls have blanketed Beijing and other northern cities, leaving a stubborn yellow haze in the air and coating roads, buildings, cars and lungs.

. . .

Government-led cultivation, deforestation, irrigation and reclamation almost certainly contributed to the desert's advance, which began in the 1950's and the 1960's, and has accelerated.  Critics warn that some lessons of past engineering fiascoes remained unlearned.

During the ill-fated Great Leap Forward in the late 1950's, Mao ordered construction of the giant Hongyashan reservoir near Minqin, which diverted the flow of the Shiyang River and runoff from the Qilian Mountains into an irrigation system.  It briefly made Minqin's farmland fertile enough to grow grain.

But Minqin is a desert oasis that gets almost no rainfall.  The Shiyang and its offshoots had been its ecological lifeline.  With the available water resources monopolized for farming, nearly all other land became a target for the desert.

Today, patches of farmland that cling to irrigation channels are emerald islands in a sea of beige, an agricultural Palm Springs.

Even the irrigated plots risk extinction. Competing reservoirs on upper reaches of the Shiyang reduced its flow so severely by 2004 that the Hongyashan went dry for the first time since its construction in 1959.  It was refilled after Beijing ordered an emergency diversion of water from the Yellow River, which now runs dry through much of the year here in its northern reaches.

Local officials, whose promotions in the government and Communist Party hierarchy depend more on increasing economic output than on improving the environment, have tried desperately to preserve Minqin's farming.

. . .

"This is not a natural disaster — it is man-made," Mr. Chai said.  "And unless people study the lesson of Minqin, it will repeat itself clear across China." 

For the full story, see: 

JOSEPH KAHN.  "A Sea of Sand Is Threatening China's Heart."  The New York Times (Thurs., June 8, 2006):  A1 & A14.

  Women wear headresses and face masks, not out of modesty, but to protect against the sand.  Source of photo:  online versio of the NYT article cited above.

Close, and distant, maps of the areas effected.  Source of maps:  online version of the NYT article cited above.

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Source of graphic:  online version of WSJ article cited below.

(p. A1)  BEIJING -- When Chinese President Hu Jintao visits the U.S. in mid-April, he is sure to field tough questions about Beijing's trade and economic policies amid a wave of rising protectionism.  But he also is grappling with a similar backlash at home.

Amid one of the longest and fastest growth streaks of any modern economy, China is wrestling with concerns from a rising wealth gap to corruption to environmental damage.  But the latest uproar has turned on foreigners, targeting the many outside investors that have piled into China and prospered -- even while fueling much of the country's growth.

. . .

(p. A8)  In some ways, the 63-year-old Mr. Hu faces a more complex situation than his predecessors, as China becomes more like the U.S., with greater tolerance of dissenting views and organized interest groups.  Resistance to some market-oriented changes is mostly driven by special interests such as disenfranchised farmers, private businessmen and ministries trying to hold on to their powers.  At the national legislature's March meeting, lobbying by interest groups picked up markedly.

For the full story, see:

KATHY CHEN.  "Amid Tension With U.S., China Faces Protectionist Surge at Home."  The Wall Street Journal  (Fri., March 31, 2006):   A1 & A8.

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  Source of graphic:  online version of the WSJ article cited below.

(p. A1)  The so-called Doha round of talks, which began in 2001, were designed to boost developing nations; among other things, they want lower barriers to their agricultural exports.  France has vowed to veto any deal that doesn't protect its farmers.  A pivotal missed deadline April 30 has led to predictions the talks could die by summer if countries including France don't change their stance.

The standoff shows how cultural and emotional factors can combine with politics to stifle free-trade goals that most economists believe would provide a net benefit to the world.  The tariff cuts envisioned by Doha would not only help developing countries sell their minerals and food products, but would also lower barriers to the industrialized world's exports of goods and services.  The World Bank calculates that Doha would boost the global economy by around $100 billion.

Overall, France itself likely would be a major economic gainer from a global (p. A10) deal.  Though it's the world's second-largest agriculture exporter after the U.S., farming accounts for just 2.5% of the French economy.  World-class manufacturing and service companies, such as car maker Renault SA and insurer AXA SA, are larger engines of the French economy.  France could gain more income than it would lose in opening its agricultural markets to budding farm superpowers like Brazil.

Even in agriculture, France can be a formidable competitor, notably in products such as wine and cheese.  Its brand is well-known the world over.  And its farms are increasingly home to capital-intensive agribusiness companies, not just small family producers.  Most of the $11.5 billion in European Union subsidies that France receives each year goes to the largest, most commercially viable farms.

WTO chief Pascal Lamy, a Frenchman, says he doesn't understand France's position.  "As an efficient farm producer, the strategy should be to reduce subsidies and prices, because others won't be able to compete with you," he said in a recent interview.

. . .

The French rural tradition, however, is changing.  Between 1993 and 2004, the number of arable farms fell by nearly a third.  Wide swaths of neglected land are now home to unsightly scrub, and the farms people see as they drive down France's immaculate highways are often parts of major business enterprises.  Oxfam says as much as 60% of subsidies went to the richest 15% of French farmers in 2004, the latest figures available.

Oxfam believes the EU's tariffs and farm subsidies, which total over €40 billion annually, are harmful to the world's poorest countries.  High customs duties keep products from poor nations out of the wealthy EU market.  At the same time, EU farmers overproduction is dumped cheaply abroad, driving down global prices and harming farmers in the developing world.

For the full story, see:

SCOTT MILLER.  "Food Fight; French Resistance To Trade Accord Has Cultural Roots; WTO Talks Promise Benefits But Farmers Retain Hold On the Nation's Stomach; 'Politicians Are Frightened'."  The Wall Street Journal  (Tues., May 16, 2006):  A1 & A10.

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Li Qiao tries to stay warm in unheated apartment in Wuhan. Source of image: online version of WSJ article cited below.

(p. B1) WUHAN, China -- As a winter wind howled through this central Chinese city, university lecturer Li Qiao settled down in his two-bedroom apartment for what should have been a cozy evening of reading. Around his apartment were signs of China's new prosperity: a color television, refrigerator, washing machine and air conditioner. The only thing missing: heating.

Even though winter temperatures in Wuhan dip into the 30s with occasional snow, virtually none of the city's homes are heated. "The cold is cutting into my bones," lamented Mr. Li, who was bundled up in a down coat and a quilt, with an electric heater blowing warm air toward him. "Why doesn't Wuhan have heating?"

Mr. Li isn't the only one asking. Heating systems are one of the last areas that remain under China's former centrally planned economy, with government regulators still setting the thermostat for homes, classrooms and offices across the country. Under the policy, which dates back to Mao Zedong in the 1950s, the government provides heat in the northern half of China, and, to save money, it provides no heat in the southern half. As a result, northerners often wilt in steaming apartments, while those in southern provinces shiver through the winter.

With no heat, even residents of modern cities like Shanghai spend much of the winter trying to get warm.

. . .

(p. B2) Mr. Li, the university teacher, and his wife ward off the cold air that seeps into their apartment at the university with an electrical heater, a hot-air fan and a wall unit air-conditioner that also blows out heat. At night, they wriggle into long underwear before piling under two sets of thick quilts. Although he has a three-hour lunch break, Mr. Li seldom goes back to his apartment, opting instead to hole up in his heated office.

His students aren't so lucky. Classrooms aren't heated, so they listen to his lectures swathed in down jackets, caps and gloves. Some students even carry hot-water bottles to keep their hands warm and cushions to place on the icy chairs.

For the full story, see:

Cui Rong. "China's Winter of Discontent; Mao-Era Policy Provides Heat Up North but None in South; Shivering Citizens Are Fed Up." The Wall Street Journal (Tues., March 14, 2006): B1 & B2.

Source of graphic: online version of WSJ article cited above.

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Commentary on the Kyoto Protocol:

(p. 3) . . . the current stalemate is not just because of the inadequacies of the protocol. It is also a response to the world's ballooning energy appetite, which, largely because of economic growth in China, has exceeded almost everyone's expectations. And there are still no viable alternatives to fossil fuels, the main source of greenhouse gases.

Then, too, there is a growing recognition of the economic costs incurred by signing on to the Kyoto Protocol.

As Prime Minister Tony Blair of Britain, a proponent of emissions targets, said in a statement on Nov. 1: ''The blunt truth about the politics of climate change is that no country will want to sacrifice its economy in order to meet this challenge.''

This is as true, in different ways, in developed nations with high unemployment, like Germany and France, as it is in Russia, which said last week that it may have spot energy shortages this winter.

. . .

The only real answer at the moment is still far out on the horizon: nonpolluting energy sources. But the amount of money being devoted to research and develop such technologies, much less install them, is nowhere near the scale of the problem, many experts on energy technology said.

Enormous investments in basic research have to be made promptly, even with the knowledge that most of the research is likely to fail, if there is to be any chance of creating options for the world's vastly increased energy thirst in a few decades, said Richard G. Richels, an economist at the Electric Power Research Institute, a nonprofit center for energy and environment research.

''The train is not leaving the station, and it needs to leave the station,'' Mr. Richels said. ''If we don't have the technologies available at that time, it's going to be a mess.''

For the full commentary, see:

ANDREW C. REVKIN. "THE WORLD; On Climate Change, a Change of Thinking." The New York Times, Section 4 (Sun., December 4, 2005): 3.

(Note: ellipsis added.)

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Source of image: Amazon.com

The protests occurred on ''a cold day in February 1999.'' Ms. Rivoli was watching as students gathered at the gothic centerpiece of Georgetown to demonstrate against the International Monetary Fund, the World Trade Organization, and other putative villains of international trade. The crowd, Ms. Rivoli noticed with characteristic acuity, had ''a moral certainty, a unity of purpose'' that permitted it to distinguish black from white and good from evil ''with perfect clarity.'' One woman seized the microphone and asked: ''Who made your T-shirt? Was it a child in Vietnam? Or a young girl from India earning 18 cents per hour? Did you know that she lives 12 to a room? That she shares her bed and has only gruel to eat?''

Ms. Rivoli did not know these things, and she wondered how the woman at the microphone knew. But she decided to find out. In the rest of her narrative, the author tells the story of ''her'' T-shirt, which she purchased for $5.99 by the exit of a Walgreen's in Fort Lauderdale, Fla. ''It was white and printed with a flamboyantly colored parrot, with the word 'Florida' scripted beneath.'' A company in Miami had engraved the front, after buying the shirt from a factory in China. The Chinese manufacturer had purchased the cotton used to make the shirt from Texas. Eventually it will end up as part of a large but little-known market for used clothing destined for resale in East African ports.

. . .

By looking across history to the shifting center of textile manufacturing from Manchester, England, to Lowell, Mass., to South Carolina to Japan and, finally, the developing nations of Asia, Ms. Rivoli discovers a universal truth. Without making light of the horrors experienced by workers, she asserts that their jobs were a little better than other available options (usually farm work) and, what's more, that textile factories led to advances in industrialization and, just as dependably, in living standards. It is not too much to say that she uses the T-shirt to tell the story of progress.

For the full commentary on Rivoli's book, see:

ROGER LOWENSTEIN. "OFF THE SHELF; Travels With My Florida Parrot T-Shirt." The New York Times, Section 3 (Sun., August 21, 2005): 7.

The book is:

Pietra Rivoli. The Travels of a T-Shirt in the Global Economy: An Economist Examines the Markets, Power, and Politics of World Trade. John Wiley & Sons, 2005. ISBN: 0471648493

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"People here have tried everything you can think of to get the problem solved before this happened," said a resident who gave his name as Chen. "They talked to the village committee, the township and municipal governments. One of them even went to Beijing. But nothing is done - the village officials just simply ignore them."

Mr. Chen described the peak of the protests, on Saturday night, when the deaths occurred. "It was like a war, so real and so brutal," he said. "I did not see who started it, but I saw policemen were beating the villagers and the villagers were fighting back with stones and firecrackers."

Since then, villagers said, many residents are being forced to report each morning to the police, who detain them until late in the evening, when they are allowed to return home until the next morning.

As with so many recent rural protests, Panlong's problems began with land. Many villagers told stories of having been deceived by corrupt local officials who they said had enriched themselves by selling off rights to the villagers' farmland.

"Two years back, one day some villagers were asked to attend a routine meeting," said a 42-year-old farmer who gave his name as Fang. "They went and they paid 10 yuan for participation fees, and they signed in as usual. Later, when we discovered our land was being sold, we asked the village committee to explain what's going on, and they answered that we had signed the contract. Suddenly we remembered that meeting, and everyone understood that we had already been cheated."

For the full story, see:

FRENCH, HOWARD W. "Panlong Journal: Visit to Chinese Anytown Shows a Dark Side of Progress." The New York Times (Thurs., January 19, 2006): A4.

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Source of book image: http://www.holtzbrinckpublishers.com/stmartins/Search/SearchBookDisplayLarge.asp?BookKey=3008997

Here is an excerpt from a review of a posthumously published memoir, by a well-known British author, recounting three years of childhood in the Hong Kong of the early 1950s:

(p. B12) He has written an extraordinarily happy book, filled with hilarious set-pieces and pulsating with Hong Kong's vibrant street life. Unlike monochrome Britain, with its dull diet and pinched economy, Hong Kong offered color, variety and adventure.

. . .

Most of Mr. Booth's encounters were curious rather than dramatic, like the incident of the plink-plonk man, a street musician with a monkey outfitted like a mandarin from the Ming dynasty. One day, as Martin watched, the monkey managed to bite through his leather leash. In a flash, he was up a tree, where, ignoring his master's pleading and cursing, he carefully disrobed and flung his costume to the street below. Then, in one magnificent act of repudiation, he sent a perfectly aimed stream of urine down on the man's upturned face, to the delight of the crowd that had gathered. Where in England could you see that?

WILLIAM GRIMES. "Books of The Times: Hong Kong Is Fantasy Land for a Young Adventurer." The New York Times (Weds., December 21, 2005): B12.

(Note: ellipsis added.)

Information on the book reviewed:

Martin Booth. Golden Boy: Memories of a Hong Kong Childhood. St. Martin's Press, 2005. (342 pages. $25.95.)

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(Li Ao on 9/19/05. Source: NYT online, see below)

BEIJING, Sept. 22 - China's leaders may have felt they had no better friend in Taiwan than Li Ao, a defiant and outspoken politician and author who says that Taiwan should unify with Communist China.

But when China invited Mr. Li to tour the mainland this week, the Communist Party got a taste of its rival's pungent democracy.

During an address at Beijing University on Wednesday evening, broadcast live on a cable television network, Mr. Li chided China's leaders for suppressing free speech, ridiculed the university administration's fear of academic debate and advised students how to fight for freedom against official repression.

"All over the world leaders have machine guns and tanks," Mr. Li told the students and professors in the packed auditorium. "So I'm telling you that in the pursuit of freedom, you have to be smart. You have to use your cunning."

. . .

Though Mr. Li did not criticize President Hu directly, he made pointed references to the lack of freedoms in China and suggested that the "poker-faced" bureaucrats of the Communist Party did not have enough faith in their legitimacy to allow normal intellectual discussion.

With several top university officials sitting by his side, he called the administrators "cowardly" for ferreting out professors at the school who were suspected of opposing Communism.

JOSEPH KAHN. "China's Best Friend in Taiwan Lectures in Beijing About Freedom." New York Times (Fri., September 23, 2005): A7.

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<262> The ideal country in a flat world is the one with no natural resources, because countries with no natural resources tend to dig deap inside themselves. They try to tap the energy, entrepreneurship, creativity, and intelligence of their own people--men and women--rather than drill <263> an oil well. Taiwan is a barren rock in a typhoon-laden sea, with virtually no natural resources--nothing but the energy, ambition, and talent of its own people--and today it has the third-largest financial reserves in the world. (pp. 262-263)

Friedman, Thomas L. The World Is Flat: A Brief History of the Twenty-First Century. New York: Farrar, Straus and Giroux, 2005.
(italics in original)

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