The Emerging China Red Menace OR

Friendly Global Capitalist Trading Partner?

What the experts think

Gou Jian of Yue & Fu Chai of Wu

Chinese Provinces Today

Background – 300 years of foreign domination Opium Wars 1842-1858 Boxer Rebellion 1900 Japanese invasion 1937 Communist Victory 1949 Tibet invasion 1950 “Great Leap Forward” 1959 Cultural Revolution 1966

Opening to the West 1972 Deng Xiaoping begins economic reforms in 1978

The Emerging Threat? The economic threat China holds a large part of U.S. public & private debt (1.4-2 trillion dollars) Our inter-reliance on trade with each other Foreign ownership within the United States The cultural distortion of America

Chinese Share of Global GDP China is the world’s largest producer of coal China is the 2nd largest consumer of energy Chinese share of global GDP estimated to pass the US in 2039

Chinese Economic Growth China has grown 10% per year for 30 years

Growing US/Chinese Trade China’s exports to the US have soared from $39 billion to $197 billion in the last 20 years

Chinese Share of the US Economy China currently holds about $500 billion in US treasury bills Japan still holds twice that many Trade imbalance can be looked at two ways

Chinese Currency Value Chinese currency is currently 6.9-7.5 Yuan to the dollar Most experts believe that is approximately 30% undervalued/i.e. $2000 on a car Impact on trade? Wages? A limited float announced 2012

Chinese Copyright Violations

China and the WTO MFN

China: Rich or Poor? China has grown at 10% per year growth rate for 30 years China has moved 400 million people out of poverty (<$1 per day) China has quadrupled the average income

China: Rich or Poor? More than 1 billion Chinese still below the world poverty line 150 million live on less than $1 per day Unemployment above ten per cent and growing

Inequality and Disparity One of the most economically unequal societies in the world The growing urban-rural gap The “two-class” system The call for reform – protests and unrest have become commonplace

China: Rich or Poor?

China and Global Warming Failure to initially join the Kyoto Protocol China passed the U.S. in December of 2007 as the world’s largest emitter of greenhouse gases China is the world’s second largest oil consumer with crude oil imports increasing at 18% per year. China’s demand is driving up global crude prices

Product Safety March 2007 – Warnings and recalls on Chinese produced pet food May 2007 – Chinese toothpaste (some counterfeit) found to contain poisonous chemicals June 2007 – Chinese toys discovered to contain high levels of lead paint July 2007 – Chinese tires found to have major defect 20% of all Chinese products produced for domestic consumption were declared substandard

Chinese Military Expansion Chinese interventions in Vietnam (1979) & the Spratley/Paracel Islands Influence with North Korea Military spending increases have kept pace with GDP growth US 600 B v. China 100 B

Quemoy and Matsu Chinese declaration to intervene if Taiwan declares independence Truman & the Sino-American Mutual Defense Treaty - “The attack upon Korea makes it plain beyond all doubt that communism has passed beyond the use of subversion to conquer independent nations and will now use armed invasion and war.”

Spratley Islands Senkaku/Diaoyu Islands ADIZ

Chinese Cyber Attacks PLA unit 61398 Operation “Shady Rat” 2002-11

Chinese Democracy Tienanmen Square 1989

Chinese Democracy Tienanmen Square 1989 May 1989, over a million protesters gather over what started as a protest on dorm food June 3rd 1989, hundreds of students gunned down or arrested

Chinese Democracy Topics Range Results World Democracy overall rank1-150 126 Political Rights 1-7 7 Civil Liberties 1-7 6 Press Freedom 0-150 135 Corruption 0-145 57

Chinese Development v. Chinese Democracy In 2003, 3 million people participated in 58,000 protests The number increased to 74,000 in 2004 In 2016, there was a record number of protests, 2774 incidents Can you have development without democracy?

The Summer Olympics Opportunity for influence missed? Chinese oil purchases in Sudan Chinese spending over 40 billion on Olympic infrastructure Pollution during the Olympics

Discussion Is the United States entering a pact of mutually assured destruction with China by linking the two economies so closely? Is China a threat militarily? How could the United States counter any potential military threat posed by China?

The Discussion Strikes Back… So far, China has been successful in suppressing the discontent from much of its rural population. Will China be able to continue this successfully in the future? Can a nation liberalize economically without liberalizing politically?