- Jun 09, 2019
That line in The Usual Suspects: ‘The greatest trick the devil ever pulled was convincing the world he didn’t exist.’
- Jun 03, 2019
It is increasingly apparent that China, under the Chinese Communist Party (CCP), is a wanabee revisionist power. It wants the balance of power in Asia to tilt, eventually massively, towards itself, and away from the United States. It is just beginning to remold the world’s trade and financial architecture to serve its own needs. And most profoundly, its leaders view liberal democracy – at home and abroad – as a threat to their own survival, and so they try to undermine it, quietly, while actively bolstering autocracies like Venezuela and North Korea.
- Apr 27, 2019
Hey China Twitter! Thanks everyone for playing along with the special BRI-week question: Why do Beijing’s policy banks denominate all their BRI loans in US dollars, not Renminbi? I thought I’d write up some of the responses, and try to work through to some better answers. I’m grateful as most responses forced me to think harder.
- Apr 19, 2019
So how come Deng Xiaoping succeeded so spectacularly in reforming socialist China but Mikhail Gorbachev failed so disastrously to save the Union of Soviet Socialist Republics? Deng’s a superhero for just about everyone here now, but Gorbachev trails the butcher Stalin in contemporary Russia’s most-adored leaders lists. Why the hell didn’t Gorby, arriving in the top job in 1985, almost a decade into Deng’s experiments, look East and just simply copy it?
- Apr 17, 2019
We talk a lot about China’s industrial subsidies, particularly in the tech sector. (I know I do - here’s my overview piece on what I call China’s ‘Disruptive Industrial Strategy’). They are at the core of (whisper it softly, cadres) Manufacturing 2025. And right now, US Trade Representative Robert Lighthizer is on a righteous crusade to curb them. (Though, of course, he’ll fail, in no small part because his boss has decided the re-elect is more important). But, where exactly do the funds come from, and where do they go? And how should the USTR aim to curb them? I thought it would be worth laying out, in some detail, just one example of how public money flows into China’s semiconductor space. And I thought I’d chose a firm which is not even well-known nor cutting-edge, and still gets showered in taxpayer love, to reveal the scale and shape of what’s going on. Introducing; Hua Hong Semiconductor Ltd. Or Hua Hong, for short.
- Apr 07, 2019
Zhenjiang（镇江）City in Jiangsu province is in a rough spot. Officially, it has a debt of CNY 70bn (some USD 10bn), but unofficially the number is well over five times that, at least CNY 400bn (USD 60bn). We can see that figure on the balance sheets of the city’s local government financing entities (LGFEs). But on top of that there are other future fees owed on projects and miscellaneous bills owed by government departments. This for a city with general tax revenues of only CNY 30bn (4bn), and land sales of CNY 10-20bn (USD 1.4-2.8bn) a year (of which only some 50% makes it back into government coffers). The LGFEs build all the infrastructure - and might have some toll-road revenues - but generally they rely upon the municipal coffers to repay their debts. In other words, the city is not really a going concern.
- Mar 24, 2019
I am a little surprised at how little press and broader discussion ‘Forensic examination of China’s national accounts’ by CHEN Wei, CHEN Xilu, HSIEH Chang-tai and ZHENG Song (mostly at the Chinese University of Hong Kong) has generated. It’s a Brookings paper written by a bunch of smart economists (Zheng is a force of economic nature), who know China well, and who apparently got pretty good National Bureau of Statistics (NBS) access. This was not some blowhard blogpost by a guy who could not find his way around the Chinese front cover of Caixin. This was careful and serious stuff. And claiming that the second largest economy in the world has been growing 1-1.5ppts slower every year since 2008 is quite a serious accusation. Here’s their revised GDP growth trajectory.
- Mar 23, 2019
So said Dr. Evil to a gormless Austin Powers. Pacino and De Niro basically say the same to each other in that late-night cafe scene in Michael Mann’s Heat. Just with more smirks and barks and stares. Then, of course, there’s Heath Ledger’s whack-job Joker, convinced he’s found his asylum soul-mate in the buttoned-down Batman in Christopher Nolan’s Dark Knight.
- Mar 10, 2019
I met a robotics company last week. I won’t name them, but folk familiar with the industry should be able to guess. Let’s call them China Robot. They make consumer and commercial robots, the kind that teaches your kid uptight English pronunciation or that greet you at your local bank. Functionality is, of course, awful, almost as bad as the bank’s human security guard. A few teaching tasks seem to work well, but in the hotel, restaurant or bank they’re a straight-up gimmick. I doubt one could beat me at Connect Four, let alone Go.
- Feb 24, 2019
It is impossible to work through Gao Hua’s (高华) legendary history of the Yan-an Rectification Movement (延安整风) - How the Red Sun Rose （紅太陽是怎樣升起的 - the story of how Mao Zedong took over the Chinese Communist Party in the late 1930s/early 1940s - without reflecting on the lights it throws on the CCP today. Gao Hua, a former Nanjing University professor who wrote this encyclopedic history in his spare time, describes what Mao learnt from Stalin. John Garnaut’s 2017 speech on the brutal return of ideology in Beijing, recently re-upped on Sinocism, has got everyone talking again about Xi Jinping’s Maoist-Stalinist inclinations. How the Red Sun Rose is perhaps the best source to help us to consider this question of what Xi might have learnt from Mao. The book is banned in China - already a good sign.
- Feb 08, 2019
Just finished Billion Dollar Whale. A great - and awful - read. Great: Tom Wright and Bradley Hope have done a fantastic job of telling an intricate financial tale (tho’ the endless, unbelievably-bling parties do help lighten up all the scheming). Awful, as the scale of corruption is appalling. A few very scattered thoughts:
- Jan 20, 2019
Yep, the most delayed ‘best books of 2018’ blog post in the multiverse. Stop what you’re doing, turn off that Twitter feed and order these damn books already. It’s not too late! They’re the best I read in 2018 (and, I know, I was late in getting around to some of them). In no particular order…
- Jan 20, 2019
God Almighty, the folk at Quanta really are amazing. This is a selection of their essays on (mostly) physics (they are a bit obsessed with quantum-gravity, but who isn’t?) and CRISPR-related biology. The essays go up online - which is where I first read a few of them - but a book is good as it helps me concentrate.
- Jan 12, 2019
In which Wright argues that the US must reassert a robust defense of the liberal world order. He criticizes President Obama for his ‘retrenchment’ foreign policy (which is a fashionable view these days, and while the Asian “pivot” was weak, it seemed to me that Obama’s Middle East was pretty good, given the mess he inherited), and thinks Trump a disaster. Wright, a Brookings scholar, argues that we should stop arguing about China’s ability to be Global Number One, and focus on the European & Asian regional orders.
- Dec 30, 2018
Daniel Koss’s fine book Where the Party Rules (CUP, 2018) is all about how the Chinese Communist Party (CCP) has remained in power so effectively for so long. That’s all the more remarkable once you remember that the famine which killed some 30mn+ Chinese in the late 1950s, and the destruction of their government in the 1960s, both resulted from official Party policy, hardly a winning-hearts-and-minds strategy. And the CCP did not even fight the Japanese much, preferring to let the Nationalists (Kuomindang or KMT) do all the fighting and dying (as explained in Rana Mitter’s excellent China’s War with Japan).
- Dec 16, 2018
Two fabulous movies, two directors casting their illuminated eyes over their own countries’ recent pasts, and two women, who figure out, finally, how to survive the useless men they love. Mexico City in the early 1970s, in black and white, and Datong, China coal country, in the 1990s and today, in drained colour. And our heroes, Jia Zhangke and Alfonso Cuarón.
- Dec 08, 2018
I tend not to write about my day job here, but given Huawei is, err, somewhat in the news, and I have not seen a good explainer about how the firm might be vulnerable to a possible US Department of Commerce Denial Order, I thought this short note might be useful.
- Dec 03, 2018
The War on Normal People, Andrew Yang
- Nov 30, 2018
I’ve just been catching on my ideological education, reading “A Notice on the Current Situation in the Ideological Arena” (关于当前意识形态领域情况的通知). The document was sent out by the Communist Party’s Central Office in April 2013. It’s not been published officially, but you can read about it here.
- Nov 11, 2018
Jeffrey Lewis might offer this as a “speculative novel”, but the terrifying thing - as he explains - is that every move in the plot of how North Korea launches 13 nuclear-tipped ICBMs at the continental United States - is highly credible. The 2020 Commission Report is written half as a Senate autopsy on how the conflict happened, and half as an on-the-ground thriller, mad-Trump antics and all. Its also nicely rammed full of geeky missile detail, as one would expect from the publisher of armscontrolwonk.com. You think Alaska’s Ground-based Mid-Course Defense (GMD) system - meant to blow up missiles as they glide through space - actually works?
- Nov 03, 2018
“The national bourgeois will eventually cease to exist. But at this stage, we should rally around them and not push them away.”
- Oct 04, 2018
Professor Jiang Shigong’s (强世功) “Philosophy and History: Interpreting the Xi Jinping Era through Xi’s Report” is a terrifically-interesting, era-defining essay (the excellent translation by David Ownby and Timothy Cheek is here.). In it, Jiang argues that’s China’s Communist Party leadership has got its political mojo back with what he calls Chinese socialism, but which is probably more accurately termed Han-infused nationalism. Under this banner, General Secretary Xi is the man to unify everything under heaven and to lead the awesome revival of the Chinese nation.
- Aug 02, 2018
Hollywood might hate Trump, and the feeling is no doubt mutual, but so much of what the city of angels churns out these days cements Trump’s base. I don’t mean that blockbuster films today glorify neo-Nazis - the definitive statement on that came from the awesome American History X, a film before its time. Or that its mocking Me-Too or female empowerment generally - we are now living through a very welcome surfeit of smart & brave female heroines: Wonder Woman, Jessica Chastain’s Mia in Dark Zero Thirty, Poppy in Trolls. The problem is deeper - in story structure, the ways in which movies tell us the world works, how problems can be solved, who you should distrust. Of course, these are stories we like watching, that sell - and Hollywood can’t be blamed for serving them up; but these films also teach and affirm how we see the world. And a lot of what sells these is weak and easy gruel - and dangerous. Trump just came along and pressed play - his audience was already primed.
- Jun 10, 2018
Three times surely cannot be a coincidence, can it?
- Jun 09, 2018
Comparisons between Xi Jinping and Mao Zedong are real tricky. The former is commonly known as China’s most powerful leader since the later. Fair enough. But that doesn’t say much. Some folk see Xi as the new Mao, and there is something to that. But its complicated by the wildly different Maos that ruled the Party over forty years - and the obvious differences in temperament and policy.
- Jun 02, 2018
I remember taking afternoon tea once at the Pudong Shangri-la with a Shanghai government official. Early 2010s, it must have been. Urbane, well-dressed, he could have been a crazy-successful-banker-intellectual in another country’s financial district, one of those guys who just knew he’d be finance minister at some point in his career. He precisely placed his bookmark, and made to put his book away as I approached. What you reading there, I asked. The latest Thomas Friedman, Niall Ferguson’s most recent, or a.n.other understand-the-barbarians bestseller? Nope. The Analects. There’s a lot of wisdom in there, you’d be surprised, he said, finger tapping on book. I got the impression that he’d been memorizing useful lines. We then got into economics. He went far - indeed, he’s still going there.
- Jan 28, 2018
OK, so here are some of the best books I read last year.
- Jan 02, 2018
Just reading Max Tegmark’s Life 3.0. Its a great overview of where we are with AI and our world. Not so detailed on how AI algorithms work, and certainly not as technically informative as his awesome Mathematical Universe (see Books of 2015), but broad, conversational and thought-provoking on the impacts on society. He is sure a thoughtful fellow.
- Oct 02, 2017
Franklin Foer manages to land a fist or two on the belly of today’s Internet giants in his new short book ‘World Without Mind’. But not anywhere close to a knock-out blow, not even a decent face-shot. He’s winded them, basically, a bit. Maybe in this age of click-bait and fast-reads, it won’t ever be a single book which makes the definitive case against Google, Amazon and Facebook. Its going to take several rounds, several fighters - ha, who I am kidding, its going to take the internet swarm to properly take them on - an unco-ordinated movement of investigators, activists, tweeters, protestors, reporters, politicians, and judges. And the regulation that results will do some good and do some bad - and their dominance will likely still grow. And that won’t be wholly for our ill, I suspect.
- Jul 31, 2017
It struck me the other day that my favourite film ever is Christopher Nolan’s Inception. I’m not sure where the idea came from. It just kind of - appeared.
- Sep 03, 2016
I just read Mark Landler’s fantastic “Ater Egos”, the story of US foreign policy through the Obama-Clinton years. Its fast-moving, grounded in interviews and revealing stories (Kurt Campbell filling his Air Force One swagbag with momentos and then getting chased across Yangon airport by the Secret Service), and is smartly nuanced. Syria, Russia, Cuba, Burma, China, Libya also star, of course, none without huge historical depth, but that’s OK. For each we get the Obama and/or Clinton approach, and all told we get two interwoven, but different foreign policy doctrines.
- May 20, 2016
Here’s a question for you: Is it possible to sin in hell? When everything around you is already damned, and where everyone rides in the same ash, can you sin? If I had to guess, I’d say unlikely. There’s no innocence to stain. There’s no white sheet to bloody. You are just smothered, permanently, with suphured air. Sin? Forget about it; no one fucking cares.
- Feb 14, 2016
I was interested in what Google Trends trends might be able to tell us about the US primaries. Thought it would be good practice for my basic R skills.
- Feb 12, 2016
Kong Dan （孔丹), former chairman of CITIC Group, son of Kong Yuan (孔原, Mao’s head of China’s ‘CIA’ 中央調查部), former Red Guard (he helped lead 首都红卫兵西城区纠察队, who were the good guys, kind of), long-time SOE head, and friend of Xi Jinping, has a thing for talking to Phoenix media. As a pre-eminent Second Generation Red (红二代), and still a believer, I think it is worth trying to understand his thinking.
He is talking for a reason - in support of Chinese Communist Party rule - and represents the views of many in the ruling class (a term he is happy to accept) in China. Reading it, I could not help thinking he and Xi likely think alike on many issues. Here are some thoughts from his February 2015 interview ‘孔丹：国企实际成了中共执政基础 我不想进官场’ with a 华夏时报 editor published on Phoenix. He talked to Phoenix in 2009 too.
- Feb 06, 2016
The story of how Wall Street blew up the world economy, one mortgage derivative semtex brick at a time, and the guys who caught a whiff of the explosive and went looking. This is venality on a trillion dollar scale - you end up hating bankers and credit raters more than you did walking in - and its told with a rare flare. Awesome clip coming up.
- Jan 17, 2016
Boy, I really love book lists. But since I’ve never written one, I thought I’d give it a go. Here’s my top eight for 2015.
- Jan 16, 2016
This is my first post to this new blog. Exciting.