Liu Xiaobo, Google and the Renminbi - why China won't be ruling the world for a long time yet

Dr Willy Lam, Adjunct Professor of Chinese University of Hong Kong and Former Senior China Analyst of CNN, was the Foundation's guest speaker on 19 March 2010. This is his speech.

Good afternoon, ladies and gentlemen, and thank you George for very generous introduction. I must say a few words congratulating the organizers for the very good timing of this event - that it coincides with the latest developments in the news not just concerning RMB but also Liu Xiaobo (劉曉波). The nominations for the Nobel Peace Prize in Norway just closed two weeks ago and there were two hundred nominations for him. So it looks like at this point that Dr Liu, according to some experts, has 50/50 chance of getting the prize. The RMB theme I will discuss later, and the very interesting cat and mouse game between China and Google we shall also discuss it in good time.

First of all, concerning Liu Xiaobo which for some reason has stirred I think a lot of emotions in the hearts of all Chinese and foreigners who are concerned about the fate of the People's Republic. However, it's also as expected that Beijing has put up a spirited defence of the fairly harsh decision to slam an eleven year jail term on Dr Liu. What is perhaps surprising is that quite a number of Western so-called experts on China, including experts who don't speak much Chinese, have perhaps inevitably joined in Beijing's defense in its way of doing things concerning dissidents.

Myth No. 1: ‘Chinese values'
Let me introduce the first myth concerning Beijing's treatment of dissidents. It is the assertion that Chinese values are different. Believers in this myth say that what we do in China is different from the West because China is a different country. China is a different system. Chinese people do not desire the kind of human rights and other international norms taken for granted in the west. This is basically the view of Foreign Minister Yang Jiechi (楊潔篪) who said something like this in the National People's Congress ten days ago. He said: don't look at China through the prism of western norms, don't appreciate a traditional Chinese painting by the standards of western paintings. We have one of the Western authorities on China whom I mentioned earlier, Martin Jacques, pretty much agreeing with this perhaps distorted view ofthe picture. So we have Jacques saying that the expectation of China being a Western country or being prepared to do as the West does is false.

Let's look at a couple of western paintings versus Chinese paintings to see whether Foreign Minister Yang is correct. We see here a couple of paintings by one of my favorite painters van Gogh. Van Gogh was here doing some soul searching perhaps thinking about the liberation of his character, thinking about whether his aspirations as a painter would be realized in his time - a Western intellectual looking for liberation. In China this is perhaps one of the most Chinese paintings ever: the《清明上河圖》, we see a large number of Chinese people here but are we supposed to understand, following through logically from Mr Yang Jiechi's statement, that Chinese are somehow different, somehow in a sense to use a politically incorrect word ‘subhuman'? Do Chinese have DNA, do Chinese have genes which are not compatible with democracy? Because that is one interpretation of Foreign Minister Yang's strange remark that in China human rights are not a big deal, that people don't pay attention to human rights and so forth.

Here I think I must put up a spiritual defense of my own theory at least. Actually human rights are an important part of Chinese values. We don't need to go back too far in history. Confucius was used by various dynasties, by various emperors, to justify dynastic rule; to justify giving total authority to the emperor and suppressing the rights of citizens. Actually that is only an adulterated form of Confucianism. What Confucius actually said was that there is a social contract behind the mandate of heaven which might be given to a particular emperor. The mandate holds as long as the emperor is able to satisfy the people in accordance with the social contract. There is a famous quotation from Confucius that ‘water can keep the ship afloat but water can also overturn the ship'. If for some reason the emperor, because he's corrupt, because he's inefficient and so forth, has violated the social contract, then the people have more than ample rights to overthrow the regime.

It's quite interesting now to come to Wen Jiabao who we may discuss later on in the Q&A period - I think he undoubtedly is the most liberal member within the 25 members of the Politburo. Wen Jiabao actually said a few years ago that there are universal values to which all countries whether east or west should subscribe. He once said that democracy, the legal system, freedom, human rights, equality and so forth are not the products of capitalism alone but the joint achievements of the whole world.

Of course for those of us who have studied contemporary China and who have taken pains to read the PRC constitution, there are clear-cut black and white clauses enshrining freedom of speech, assembly, religion, and so forth. Apart from that, Beijing is also a signatory of most UN Covenants on Human Rights, Civil Rights, Labor Rights and so forth. Finally, just at the NPC two weeks ago, Wen Jiabao said he committed the party to letting the people live with dignity. He even said that Chinese enjoy five rights: the right concerning election, participation in politics, the right to know, the right to express themselves, the right to supervise the government and so forth. Even though you ask an ordinary Chinese, he might have a different story to tell.

I would argue even further that whereas human rights are a cornerstone of Chinese culture, a cornerstone of Chinese norms, the problem arises only because the governing class in China, the CCP is a westernized regime. The reason is that Mao Zedong and his congress have picked up perhaps some of the worst parts of western tradition which Europe and so forth had to offer. What they picked up was basically Marxism, not the right kind of Marxism, but an adulterated kind of Marxism plus Leninism and Stalinism. What has happened since 1949 is that the CCP has been implementing values, doctrines, political campaigns not based on any Chinese or oriental traditions but based on an adulterated version of Marxism in addition to the worst excesses of Leninism and Stalinism. The question to be asked is, the question which I think most Chinese should ask their leaders is: how come the CCP is not willing to pick up the benefits which the West has to offer?

Myth No. 2: ‘Internal affairs'
I would like to come back to the issue of Liu Xiaobao and human rights and its international repercussions because I think it's not just the fate and future of a couple of dissidents but it pertains to the future development of China. Let's pay attention to what I called ‘Myth No.2' and that is Beijing's second defence against the shameful treatment of Dr Liu. The first point being made by the Foreign Ministry is: don't interfere in our internal affairs. Secondly, that the Liu Xiaobao case is being competently handled by our judiciary.

Briefly, the idea that countries cannot interfere in the affairs of other countries, this goes back to the so-called five principles of peaceful coexistence way back to the fifties of the last century. According to most political scientists and social scientists, this theory has been ranked totally obsolete not just by the internet but also by principles commonly accepted by western and Asian countries. There are some principles, for example, International Humanitarianism, which override national boundaries. That's why we saw in the past several years, a couple of so-called butchers in Serbia accused of committing genocide against the people of Kosovo being hauled before the International Court of Justice for whatever they did against innocent people, genocidal crimes against people in Kosovo. So here definitely it's proved that there is a common consensus that certain values do override international boundaries.

It's also interesting to say the least that even though Beijing claims that it's still subscribing to this nineteenth century idea of absolute sovereignty, in the past few years given China's strength in catching up with the US we see Beijing in a fairly paradoxical way starting interfering itself in the internal affairs of others.

I was in Norway on a short trip last November and I was told by my academic and journalist friends there that Chinese diplomats have been leaning very hard on the Norwegian government not to allow any Chinese dissidents to get the Nobel Peace Prize. Last Year it was Hu Jia (胡佳), this year particularly it is of course Liu Xiaobao. That is a further paradox within this. Even though in Beijing the Chinese government can perhaps do whatever they like with Chinese NGOs, the Norwegian government actually can do nothing. They cannot dictate terms to the Nobel Committee which is an NGO outside the purview of the government.

We have seen also other instances of apparent attempts by China to interfere in the internal affairs of other countries. For example, the export of censorship. Beijing told the organizers of the Frankfurt Book Fair that if they invited the two dissidents Dai Qing (戴晴) and Bei Ling (貝嶺) to the Frankfurt Book Fair Beijing wouldn't come. Unfortunately last November the Book Fair Committee did succumb to Chinese pressure. More recently the case of the University of Calgary awarding an honorary doctorate to Dalai Lama. Again Beijing resorted to what the Canadian media called bully tactics to oblige the U of Calgary to withdraw the honorary doctorate. When the U of Calgary did not succumb to pressure, they struck off U of Calgary from the list of foreign universities recognized by the Chinese Education Ministry.

As for the judiciary, the second point of defense made by the Chinese leadership is that, trials as well as other procedures affecting human rights dissidents in China are totally a matter for the Chinese judiciary and they are separate from the government. But concerning the Chinese legal and judicial system, I have written a paper on this and I think it has been distributed to members of the audience. What we have witnessed, unfortunately, over the past few years is a steady deterioration of the standards of the Chinese judicial system and a relentless politicization of the judicial system.

We see quite clearly most, actually all, courts as well as prosecutors' offices are under the direct control of a senior party organ, that means the CCP Central Commission of Politics and Law. The current Chief Justice Wang Shengjun (王勝俊) as well as the Minister of Justice Wu Aiying (吳愛英) have never attended law school. They have not been a lawyer or a judge a single day of their lives. Top Judge Wang who has been taken a very high profile in the past one or two years has scandalized more liberal members of the judicial committee in China by repeating political slogans first introduced by Hu Jintao, for example, saying that the main function of the court is to promote social harmony as well as to implement the scientific theory of development. In fact, at one point, Wang Shengjun even said the work of a judge is not that different from the work of a social worker in a sense that the judge is supposed to promote social harmony. In Beijing's view that means ensuring that the destabilizing elements, including dissidents and so forth, would not be in a position to make trouble. Some more details which I won't go over, such as: Beijing has resumed the practice going back to the Cultural Revolution of recruiting soldiers and policemen as trainee judges and prosecutors and so forth, and also most the recent case of corruption amongst high level judges including the recent sentencing of the vice president of the supreme people's court Huang Songyou (黄松有) to a life sentence for corruption.

Thought control and the Internet
Turning to the second area which I think bears a lot of looking into because of its significance to the development of China - that is this titanic confrontation between China on one hand and several IT companies, in particular, Yahoo and Google, on the other hand. The story is being played out. There are contradictory news reports saying whether Google will stay or Google will indeed pull out of China. I think the essence of the fact is that here we have a leadership which has invested billions of dollars to build up this great firewall of China to control China's growing legions of netizens. The number of netizens in China is supposed to grow beyond four hundred million this year, way above the total population in the US. I think one of Beijing's central concerns is that whether many of these IT-savvy netizens might take a lead from Mao Zedong's guerilla warfare book and stage what many Chinese intellectuals called asymmetrical warfare against the leadership. That means ways through the new media, particularly Twitter and so forth, that can totally circumvent Chinese censorship and let people know what's happening in China.

We hear a testimony by Minister of Public Security Meng Jianzhu (孟建柱) saying that Internet has become the main vehicle through which "enemies infiltrate and subvert" the PRC. So perhaps from this context, we should not be surprised at the extent of surveillance and also pressure that the leadership has brought to bear on companies such as Google, Yahoo and so forth. Here, I won't tell you the source of this picture, it is a "State Secret". This is positive proof that certain Chinese companies with links to public security have been recruiting hackers to work in the Chinese Cyber warfare command. In any case, Beijing is now committed to learning from the US. The Pentagon just set up a cyber command consisting of eighty-eight cyber specialists last year, now the Chinese Government is playing catch up. Given the state of the economy and the resources available, I don't think they'll have trouble in outdoing the Americans. At this stage, there are more than Chinese 50,000 Net Cops ensuring the safety of the Internet.

RMB internationalization
We will now quickly turn to the RMB. I won't discuss the nitty-gritty of when or by how much the RMB would be allowed to appreciate again, I think most likely after this forthcoming trip Hu Jin-tao will make to Washington. After the meeting between Hu and Obama, some kind of compromise would be struck and that is that the RMB will be allowed to appreciate incrementally perhaps from July -- and by 3-5% in the twelve month period after that. But the important issue I would like to look at is the decision-making behind monetary policies in China; which I call a case of: "Severe Acute Syndrome of Systemic Malfunction". And that is, the fact that for such major decisions such as the full convertibility of the RMB, the extent to which the value of the RMB should be determined by market forces and not traditional state and party concerns.

Nothing much has been done by the administration, even though as recently as two or three years ago, the Chinese leadership raised aspirations for the RMB to become a world currency which might one day challenge the "dollar hegemony" of the US. And Beijing is setting up Shanghai as a global financial centre to be operational by 2020. One would have thought that more solid steps would have been taken by the State Council in terms of currency reform and so forth. But apparently, nothing much has been done. Beijing is still responding on an ad hoc basis, sometimes to lobbying by domestic exporters, sometimes to lobbying by different government agencies, and sometimes just reacting to pressure from the US and the EU.

To give you an example of systemic failure on part of the administration to tackle core issues at the heart of Chinese interests. Just a few months ago, Beijing set up, after a delay of seven to eight years, the National Energy Commission to handle energy-related policies. This Commission is pretty much identical to the State Council with ministers from more than twenty major departments, from the Party and even from the PLA sitting on this National Commission. It is basically another State Council or Cabinet. So this testifies to the fact that in such an institution, everybody seems to be involved, everybody has a say - but at the end of the day, nobody is in charge. The decision-making becomes convoluted and this is at a time when people expect that China, being a member of the Group of Two, might take more forthright, a more vigorous approach - at least to allow market forces to do the job instead of relying on traditional bureaucracy and government fiats.

So we come to the final conclusion, that is, to look at the future of China. I would submit that in spite of all these off the top projections of China - China would be ruling the world in ten years - the actual case is going to be different. I am not arguing that China will collapse. I am saying that the system is too big to fail. It will muddle on. It will muddle through. At the same time, because the system does not have democratic institutions to enable the leadership to keep abreast of events within the country and around the world, its only obsession is to remain in power. So you can imagine this manifesto - We just want to hang on to power, period. There are no other visions for revolutionary improvements and on political, economic or social fronts. Concerning this obsession with stability and the party's ruling status, the leadership, in the past few years, instead of investing in reforms - market and democratic institutions - the leadership has been investing big money - 514 billion Yuan on security forces. For the first time in history, the budget for the police is almost as big as the PLA's budget.

Looking at China in cultural and philosophical terms, here I would like to recommend a book, Rethink of Chinese Culture《中國文明的反思》written by Xiao Jiansheng (蕭建生), whose main argument is that China is a country with no memory. Because all the potentially destabilizing memories - June 4th, the Cultural Revolution -- have been purged. Here, we have an administration which is moving ahead with no relevant signposts, no references, the only guidance is self-preservation and self-glorification. It is also a country with no faith, no rules of the game. The major reference is - anything goes, as long as it promotes the Party's interest, as long as the Party remains the sole ruling party.

So to answer this easy or difficult question - Will such a country be well equipped enough to rule the world? If so, what kind of world will that be? My argument is that if we have a sense of history - the "Golden Eras", the Tang Dynasty etc. - in those eras, the Emperors, even though they were following an autocratic system, they were much more tolerant of alien ideas. There were no Great Walls, Bamboo Curtains or Firewalls to prevent potentially politically incorrect or destabilizing ideas come into China. In fact, the viewpoint of the Emperors was, let all ideas come in and we will assimilate any alien cultures which will at first feel strange and not good for stability. Any sign that China is unlikely to be ruling the world is that the more senior the officials, the less faith they seem to have in the future of the Party. According to my calculation, at least half of the 320 Central Committee Members have kids and spouses with permanent residence in the US.

I think I have gone beyond my allotted time. I would like to say that those who have made the most upbeat projections about China in the near or longer term future seem to be non-Chinese speaking experts, particularly those who have heavy vested commercial interests in China. Thank you.

The above does not necessarily represent the views of the Foundation.
Reproduction of the article requires written permission from the author.

 by Willy Lam