Category Archives: China

Enter the cyber-dragon

In the September issue of Vanity Fair, Michael Joseph Gross writes:

Lying there in the junk-mail folder, in the spammy mess of mortgage offers and erectile-dysfunction drug ads, an e-mail from an associate with a subject line that looked legitimate caught the man’s eye. The subject line said “2011 Recruitment Plan.” It was late winter of 2011. The man clicked on the message, downloaded the attached Excel spreadsheet file, and unwittingly set in motion a chain of events allowing hackers to raid the computer networks of his employer, RSA. RSA is the security division of the high-tech company EMC. Its products protect computer networks at the White House, the Central Intelligence Agency, the National Security Agency, the Pentagon, the Department of Homeland Security, most top defense contractors, and a majority of Fortune 500 corporations.

The parent company disclosed the breach on March 17 in a filing with the Securities and Exchange Commission. The hack gravely undermined the reputation of RSA’s popular SecurID security service. As spring gave way to summer, bloggers and computer-security experts found evidence that the attack on RSA had come from China. They also linked the RSA attack to the penetration of computer networks at some of RSA’s most powerful defense-contractor clients—among them, Lockheed Martin, Northrop Grumman, and L-3 Communications. Few details of these episodes have been made public.

The RSA and defense-contractor hacks are among the latest battles in a decade-long spy war. Hackers from many countries have been exfiltrating—that is, stealing—intellectual property from American corporations and the U.S. government on a massive scale, and Chinese hackers are among the main culprits. Because virtual attacks can be routed through computer servers anywhere in the world, it is almost impossible to attribute any hack with total certainty. Dozens of nations have highly developed industrial cyber-espionage programs, including American allies such as France and Israel. And because the People’s Republic of China is such a massive entity, it is impossible to know how much Chinese hacking is done on explicit orders from the government. In some cases, the evidence suggests that government and military groups are executing the attacks themselves. In others, Chinese authorities are merely turning a blind eye to illegal activities that are good for China’s economy and bad for America’s. Last year Google became the first major company to blow the whistle on Chinese hacking when it admitted to a penetration known as Operation Aurora, which also hit Intel, Morgan Stanley, and several dozen other corporations. (The attack was given that name because the word “aurora” appears in the malware that victims downloaded.) Earlier this year, details concerning the most sweeping intrusion since Operation Aurora were discovered by the cyber-security firm McAfee. Dubbed “Operation Shady rat,” the attacks (of which more later) are being reported here for the first time. Most companies have preferred not to talk about or even acknowledge violations of their computer systems, for fear of panicking shareholders and exposing themselves to lawsuits—or for fear of offending the Chinese and jeopardizing their share of that country’s exploding markets. The U.S. government, for its part, has been fecklessly circumspect in calling out the Chinese.

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After historic downgrade, U.S. must address its chronic debt problems

A commentary in China’s official Xinhua News Agency says:

The days when the debt-ridden Uncle Sam could leisurely squander unlimited overseas borrowing appeared to be numbered as its triple A-credit rating was slashed by Standard & Poor’s (S&P) for the first time on Friday.

Though the U.S. Treasury promptly challenged the unprecedented downgrade, many outside the United States believe the credit rating cut is an overdue bill that America has to pay for its own debt addition and the short-sighted political wrangling in Washington.

Dagong Global, a fledgling Chinese rating agency, degraded the U.S. treasury bonds late last year, yet its move was met then with a sense of arrogance and cynicism from some Western commentators. Now S&P has proved what its Chinese counterpart has done is nothing but telling the global investors the ugly truth.

China, the largest creditor of the world’s sole superpower, has every right now to demand the United States to address its structural debt problems and ensure the safety of China’s dollar assets.

To cure its addiction to debts, the United States has to reestablish the common sense principle that one should live within its means.

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Why China won’t revolt

GlobalPost reports:

With single young men at the heart of Arab world revolt, China might seem a country ripe for uprising. But while it’s got millions of single young men, they don’t appear interested in amassing a movement for change.

China now has at least 20 million young men with no chance of ever finding a female partner, according to population experts. In short, there are too many men. Demographers predict the gender gap will grow to 35 million by 2020. The reason: China’s one-child policy and a culturally ingrained preference for male children, along with a rise in accessible ultrasound technology and sex-selective abortion, led to a staggering surplus of young men born in the 1980s and 90s.

The overall trend is beginning to change for new families, but there remains a bubble of young men that can’t be reversed or repaired. So why aren’t they rising up and causing trouble for the authoritarian regime of China? In short, they’re too busy.

Andrea den Boer, co-author of the 2005 book “Bare Branches,” an in-depth investigation of surplus males and related potential security issues in Asia, said China’s situation is different than that of Egypt, which suffers from what is know as a “youth bulge.”

China has the millions of single young men, but what it’s missing is massive unemployment and economic decline. With the world’s fastest-growing large economy, opportunity is abundant. Development has reached every corner of the country and work opportunities have begun taking tens of thousands of young Chinese men to Africa and other parts of the world.

“The bare branches in China could potentially mimic the effect of a youth bulge given the large numbers of males, but they would have to have a motivation for unrest,” said den Boer, referencing her book title, taken from a Chinese term for unmarriageable young men. “Given the relative stability of China and the continued economic growth and low unemployment in the state at present, China isn’t at risk for large scale unrest.”

The Washington Post reports:

Chinese officials have repeatedly stated that their country’s authoritarian but economically vibrant system has nothing to fear from the spectacle of dictatorships crumbling in distant Arab lands. Yet officials have mobilized massive resources to chase what at times seem to be little more than phantoms of unrest.

Anonymous calls on the Internet for Chinese to rally each Sunday in protest, in Beijing and other major cities, have brought out throngs of uniformed and undercover police, but few actual protesters. Foreign journalists have been harassed and, in a few cases, beaten. Human rights groups estimate that scores of dissidents and lawyers have been detained or confined to their homes.

China’s so-called “jasmine rallies” are inspired by Tunisia’s January uprising, the first in what has since become a region-wide convulsion. There is no sign that most Chinese want to follow Tunisia’s example, but the heavy-handed response of authorities has played into the hands of the mysterious organizers of China’s so-far nonexistent revolt.

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In Bibiland Iran was Germany but now Egypt is Iran

After for several years being convinced that it was 1938, Israel’s Prime Minister Benjamin Netanyahu who appears to live in a time warp, has now decided that it’s 1979. Iran was Germany and now Egypt is Iran.

From Jerusalem, the prospect of Egyptians fully-armed with votes looks more dangerous than Iranians stockpiling enriched uranium.

Further evidence of Israel’s concerns in response to the dangerous proliferation of freedom in Egypt is that hundreds of Egyptian troops are now being rushed into Sinai, heading towards Sharm el-Sheikh — the location where Hosni Mubarak is rumored to be mounting his last stand. Under the Israel-Egypt peace treaty, Sinai is a demilitarized zone and thus the troop movement required and received Israel’s consent.

Mubarak has ordered his new prime minister to begin talks with the opposition to find out their specific demands and protesters, recognizing that “Down With Mubarak!” might not be specific enough are now adding that he needs to be out by Friday.

Protesters gathering at Tahrir Square are now having their IDs check by the army. Heba Fatma Morayef, a Human Rights Watch Egypt researcher, said: “When I asked why a soldier replied: ‘it’s to keep the police out and make sure none of the escaped criminals get in.'”

Fear of public expressions of solidarity with Egyptians, now extends from Gaza, to the West Bank, and to China.

Israeli officials are appealing to Egypt’s newly-appointed Vice President Omar Suleiman to maintain the siege on Gaza.

Meanwhile, Washington dithers — I mean, continues to monitor the situation.

After emerging from a White House meeting on Egypt on Monday, Marc Lynch, a foreign policy expert who blogs on the Middle East as Abu Aardvark, wrote on his Twitter feed: “as usual a lot of what you’re hearing about the administration’s policy is wrong.”

He then responded on the social network to a plea from the Cairo-based blogger and journalist Issandr El Amrani – who wrote: “@abuaardvark Since they can’t explain themselves clearly, perhaps you can translate for us!” – by summing up the Obama administration’s current stance in this simple Twitbite:

@arabist U.S. Egypt policy translated: keep army from using violence + get transition to a post-Mubarak real democracy, but not sure how.

One of the experts at the meeting told Politico:

While the administration is considering various options — including the possibility of at some point telling Mubarak privately it’s time to leave — “I don’t think they are there yet.”

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US should exercise green power

Kevin Gallagher writes:

To kick off 2011, the Obama administration has had the audacity to file suit at the World Trade Organisation (WTO) against China’s policies to build green technologies.

This action is deeply flawed. The US should not try to beat China down, but should pursue its own green jobs policy and reform the WTO, so the rules allow countries to combat climate change.

The United States and China are the world’s largest emitters of the greenhouse gases. Together and separately, each nation should be doing all it can to develop clean technologies to mitigate and adapt to climate change.

That is not how the Obama administration has seen it. Repeatedly, at United Nations climate negotiations, the US has said that it will do little to combat climate change unless China does. Moreover, the US has stated it will not provide any financial assistance to China to help reduce emissions. With no US support, China was left to its own devices.

Fortunately, the government rose to the challenge. In 2009, China added more wind power than any other country, including the United States. China already has the largest solar thermal capacity in the world and now leads the world in installed renewable energy capacity.

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How the US and China colluded to undermine Copenhagen climate summit

Der Spiegel reports:

Last year’s climate summit in Copenhagen was a political disaster. Leaked US diplomatic cables now show why the summit failed so spectacularly. The dispatches reveal that the US and China, the world’s top two polluters, joined forces to stymie every attempt by European nations to reach agreement.

In May 2009 the Chinese leaders received a very welcome guest. John Kerry, the powerful chairman of the Senate Foreign Affairs Committee, met with Deputy Prime Minister Li Keqiang in Beijing. Kerry told his hosts that Washington could understand “China’s resistance to accepting mandatory targets at the United Nations Climate Conference, which will take place in Copenhagen.”

According to a cable from the US embassy in the Chinese capital, Kerry outlined “a new basis for ‘major cooperation’ between the United States and China on climate change.”
At that time, many Europeans were hoping the delegates at the Copenhagen summit would agree climate-change measures that could save the planet from the cumulative effects of global warming. But that dream died pitifully in mid-December 2009, and the world leaders went their separate ways again without any concrete achievements. Confidential US diplomatic cables published by WikiLeaks now show just how closely the world’s biggest polluters — the United States and China — colluded in the months leading up to the conference. And they give weight to those who have long suspected that the two countries secretly formed an alliance.

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WikiLeaks row: China wants Korean reunification, officials confirm

The Guardian reports:

China supports the “independent and peaceful reunification of the Korean peninsula” and cannot afford to give the North Korean regime the impression it has a blank cheque to act any way it wants, Chinese officials based in Europe said today.

The officials, who asked not to be identified, spoke after the Guardian revealed that senior figures in Beijing, exasperated with North Korea behaving like a “spoiled child”, had told their South Korean counterparts that China was leaning towards acceptance of reunification under Seoul’s control.

China’s moves to distance itself from the North Korean regime were revealed in the latest tranche of leaked US embassy cables obtained by WikiLeaks and published yesterday by the Guardian and four international newspapers.

One Chinese official said today reunification was not going to happen overnight and China’s first priority was to calm down the situation, restart a dialogue, and maintain stability in the region. But Beijing had always backed peaceful reunification as a longer term goal.

The officials admitted to a sense of frustration in Beijing over North Korea’s recent actions, including its nuclear and missile tests – which China opposed – and last week’s lethal artillery bombardment of a South Korean island.

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How China lost patience with North Korea

The Guardian reports:

China’s willingness to accept Korean reunification, revealed in private conversations between senior Communist party officials and US and South Korean diplomats, reflects Beijing’s deep, previously concealed exasperation with its wayward ally North Korea.

But the leaked US diplomatic cables suggest there is no consensus on how to proceed towards this goal, with Beijing and Washington looking to each other to take the lead.

China’s reluctance to confront its ally was highlighted last week after the North launched a one-hour artillery bombardment of a South Korean island, plunging the peninsula into one of its worst crises since the Korean war. The White House swiftly deplored what it called an “outrageous” act and pledged military solidarity with South Korea. But Beijing declined to condemn Pyongyang, instead calling for calm and a resumption of talks on the North’s nuclear programme.

Admiral Mike Mullen, chairman of the US joint chiefs of staff, was among several American officials who subsequently demanded China take a stand. US pressure seems to have yielded limited results, with Beijing today inviting a North Korean official for talks in an apparent mediation effort. A senior Chinese diplomat has also travelled to Seoul as part of what China is calling “emergency consultations”.

It was reported last night that US, Japanese and South Korean officials will meet in Washington on 6 December to discuss the crisis with North Korea.

But China’s immediate Korea priorities continue unchanged: maintaining stability, a benign economic environment, and if possible, a peaceful dialogue. Notwithstanding its openness in the longer term to the idea of reconciliation and reunification, Beijing remains unwilling to do anything that could force the North Korea into a corner and increase the possibility that it might lash out unpredictably.

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The new rules: globalization’s massive demographic bet

Thomas PM Barnett writes:

By calling the Chinese out explicitly on their currency manipulation in his concluding address to the G-20 summit last week, President Barack Obama may have torpedoed his relationship with Beijing for the remainder of what China’s bosses most certainly now hope is his first and only term. Burdened by a Republican-controlled, Tea Party-infused House, and bathed in hypocrisy thanks to the Fed’s own, just-announced currency manipulation (aka, QE2), Obama seems not to recognize either the gravity of his nation’s long-term economic situation or the degree to which his own political fate now hinges on his administration’s increasingly stormy ties with China.

Here’s the larger picture: Asia, anchored by China, is now the global economy’s center of gravity when it comes to deployable savings. As Europe heads into retirement and the U.S. refuses to come to grips with its unsustainable trajectory, China stands tall thanks to its capacity to spend and invest — even as that capacity seems woefully insufficient for the bevy of historical tasks at hand. Beijing must already see to the care and feeding of 22 percent of humanity, the bulk of whom remain impoverished by anybody’s reasonable standards. But in addition, China is now expected to cover the spendthrift West’s need to boost exports, while also serving as income-elevating engine for the rest of the world’s developing economies — largely through the Middle Kingdom’s ravenous resource demands.

And if all that wasn’t intimidating enough, China’s demographic clock is ticking like no other nation’s in human history. Already losing its cheap-labor advantage right now, China is set to stockpile elders from here on out at a pace never before witnessed. By 2050, it will have more non-working old people (400 million plus) than America’s total projected population (400 million). At that point, the U.S. median age will still be just below 40, while China’s will be closer to 50. It took Europe a century for its elder population to gradually rise from 10 percent of total population to the 20-percent level. America’s still-unfolding journey along the same path will run about six decades. But China will have 20 years, if it’s lucky.

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America’s power has already been eclipsed in Asia

As many a conservative American commentator remains obsessed with the question as to how the United States can retain its position as the world’s preeminent power, Pankaj Mishra indicates why that question is already moot: it is a position America has already lost.

He points out:

India has many more likely and rewarding partners in booming Asia than in the recession-hit west. Politically damaged Thailand as well as Hong Kong, Singapore, South Korea and Taiwan have recovered from the downturn. Last year India signed a major free-trade deal with Asean. Not surprisingly a columnist in the Star, Malaysia’s leading newspaper in English, deemed the Indian prime minister’s visit to Kuala Lumpur last week more important than the jaunt of Hillary Clinton, the US secretary of state, to the region at the same time.

A tangle of bilateral trade agreements underpins Asia’s new economic unity. China and Asean countries already constitute the biggest free-trade zone in the world. Asian fears of China’s rise, which the United States keenly monitors, look minor beside the fact that China is now the largest export market for Japan, South Korea and Taiwan, in addition to being India’s biggest trading partner.

All this sounds a planet away from those Tea-Partying Americans who think that the US can bomb its way out of any political and economic difficulties abroad. It now falls to Obama to advance their education; and he’ll most likely fail in this thankless task.

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Bloomberg to America: lay off the Chinese

The Wall Street Journal reports:

New York City Mayor Michael Bloomberg, on a visit to Hong Kong and the neighboring city of Shenzhen, had some harsh criticism for his own fellow Americans: Stop blaming the Chinese for their problems.

As the debate rages over China’s trade and currencies policies, the 68-year-old Bloomberg, now in his third term as mayor of New York, was tough on China’s critics in the U.S. He spoke to reporters Saturday in Hong Kong after addressing a meeting of leaders from top cities around the world, dubbed the C40, focused on climate change and environment.

“I think in America, we’ve got to stop blaming the Chinese and blaming everybody else and take a look at ourselves,” he said.

A day earlier, Mr. Bloomberg visited several businesses (incluing a solar panel maker) in Shenzhen, a manufacturing hub that borders Hong Kong.

China’s big push into solar and other environmentally friendly energy technologies has begun to attract negative attention. Last month, the U.S. Trade Representative’s office said it would investigate China’s policies over complaints that the country was using tactics that violated its World Trade Organization commitments to shut other countries out of the burgeoning market for clean energy.

Mr. Bloomberg attacked the notion that using Chinese-made technology to promote green energy in the U.S. was politically objectionable. “Let me get this straight: There’s a country on the other side of the world that is taking their taxpayers’ dollars, and trying to sell subsidized things so we can buy them cheaper, and have better products, and we’re going to criticize that?”

Earlier, in an interview, the mayor was deeply, undiplomatically critical of provincialism and populism in U.S. Congress.

“If you look at the U.S., you look at who we’re electing to Congress, to the Senate—they can’t read,” he said. “I’ll bet you a bunch of these people don’t have passports. We’re about to start a trade war with China if we’re not careful here,” he warned, “only because nobody knows where China is. Nobody knows what China is.”

The mayor said his biggest impression from meeting his mayoral counterparts from China (the C40 includes about a half dozen heads of major cities in China) was their focus on environmental issues.

In the past, he said, “they have focused on jobs, jobs, jobs, economic development at all costs. Now all of a sudden they are realizing their rivers are becoming undrinkable, their air is killing people.”

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Israel: smart enough to create Stuxnet and stupid enough to use it

Ever since speculation began, suggesting that Israel is the source of the Stuxnet malware, there has been a buzz of excitement in the Zionist corner of the blogosphere. The DEBKAfile — trusted source for pro-Israel fantasists all over the world — declared that if it turns out that millions of Iranian industrial units have been hit, “this cyber weapon attack on Iran would be the greatest ever.”

Glee at such a prospect is not shared by observers who lack the Zionist pathological obsession with Iran.

Stephen Spoonamore, a veteran cybersecurity consultant interviewed by NPR said: “I can think of very few stupider blowback decisions” than to release code that controls most of the worlds’ hydroelectric dams or many of the world’s nuclear plants or many of the world’s electrical switching stations.

The fallout from Stuxnet is clearly going global.

AFP now reports:

The Stuxnet computer worm has wreaked havoc in China, infecting millions of computers around the country, state media reported this week.

Stuxnet is feared by experts around the globe as it can break into computers that control machinery at the heart of industry, allowing an attacker to assume control of critical systems like pumps, motors, alarms and valves.

It could, technically, make factory boilers explode, destroy gas pipelines or even cause a nuclear plant to malfunction.

The virus targets control systems made by German industrial giant Siemens commonly used to manage water supplies, oil rigs, power plants and other industrial facilities.

“This malware is specially designed to sabotage plants and damage industrial systems, instead of stealing personal data,” an engineer surnamed Wang at antivirus service provider Rising International Software told the Global Times.

“Once Stuxnet successfully penetrates factory computers in China, those industries may collapse, which would damage China’s national security,” he added.

Another unnamed expert at Rising International said the attacks had so far infected more than six million individual accounts and nearly 1,000 corporate accounts around the country, the official Xinhua news agency reported.

Jeffrey Carr, author of “Inside Cyber Warfare,” describes what he believes is the first example of Stuxnet’s destructive power: the loss of India’s INSAT-4B communications satellite which shut down in July. The satellite’s control systems use Siemens S7-400 PLC and SIMATIC WinCC software, both of which are targeted by Stuxnet.

If speculation that Stuxnet was created by Israel has been driven by the circumstantial evidence that Israel’s nemesis Iran appears to have been the primary target, there is now some subtle but concrete evidence again pointing in Israel’s direction.

Computerworld reports:

Buried in Stuxnet’s code is a marker with the digits “19790509” that the researchers believe is a “do-not infect” indicator. If the marker equals that value, Stuxnet stops in its tracks, and does not infect the targeted PC.

The researchers — Nicolas Falliere, Liam O Murchu and Eric Chen — speculated that the marker represents a date: May 9, 1979.

“While on May 9, 1979, a variety of historical events occurred, according to Wikipedia “Habib Elghanian was executed by a firing squad in Tehran sending shock waves through the closely knit Iranian Jewish community,” the researchers wrote.

Elghanian, a prominent Jewish-Iranian businessman, was charged with spying for Israel by the then-new revolutionary government of Iran, and executed May 9, 1979.

Earlier, the New York Times reported:

Deep inside the computer worm that some specialists suspect is aimed at slowing Iran’s race for a nuclear weapon lies what could be a fleeting reference to the Book of Esther, the Old Testament tale in which the Jews pre-empt a Persian plot to destroy them.

That use of the word “Myrtus” — which can be read as an allusion to Esther — to name a file inside the code is one of several murky clues that have emerged as computer experts try to trace the origin and purpose of the rogue Stuxnet program, which seeks out a specific kind of command module for industrial equipment.

Not surprisingly, the Israelis are not saying whether Stuxnet has any connection to the secretive cyberwar unit it has built inside Israel’s intelligence service. Nor is the Obama administration, which while talking about cyberdefenses has also rapidly ramped up a broad covert program, inherited from the Bush administration, to undermine Iran’s nuclear program. In interviews in several countries, experts in both cyberwar and nuclear enrichment technology say the Stuxnet mystery may never be solved.

There are many competing explanations for myrtus, which could simply signify myrtle, a plant important to many cultures in the region. But some security experts see the reference as a signature allusion to Esther, a clear warning in a mounting technological and psychological battle as Israel and its allies try to breach Tehran’s most heavily guarded project. Others doubt the Israelis were involved and say the word could have been inserted as deliberate misinformation, to implicate Israel.

The same report cites Shai Blitzblau, the technical director and head of the computer warfare laboratory at Maglan, an Israeli company specializing in information security, who said he was “convinced that Israel had nothing to do with Stuxnet.”

“We did a complete simulation of it and we sliced the code to its deepest level,” he said. “We have studied its protocols and functionality. Our two main suspects for this are high-level industrial espionage against Siemens and a kind of academic experiment.”

Did Blitzblau present his findings at this week’s VB Conference in Vancouver where Stuxnet was the focus of attention? No — which is not surprising given his vacuous claim to have studied the code at its deepest level while other experts say it will take months to penetrate the thousands of lines of code contained in a 500kB piece of software.

As for why Israeli programmers would have inserted clues about about authorship deep inside the malware, the most obvious explanation would be the most prosaic: pride.

Even when the utmost secrecy is called for, there are those who cannot resist the temptation to leave their mark.

As for the significance of another finding — June 24, 2012 is the “kill date” after which the worm will refuse to execute — again, we can only speculate.

Is this the cut-off point for Israel’s campaign of cyber warfare against Iran after which will come the time for real war? Right in the run up to the 2012 US presidential election.

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Washington stuck on the sanctions track

As if to demonstrate that Washington refuses to be upstaged by lesser powers, Hillary Clinton blazed away in the campaign to impose not-quite crippling sanctions on Iran, after winning Russia and China’s agreement today on a draft resolution that will go to the Security Council.

The Wall Street Journal reports:

Washington called the proposed sanctions the toughest to date, but U.S. officials acknowledged they had to be softened in key areas to gain Russian and Chinese agreement.

And even as China joined in, Beijing also praised the last-minute deal Iran made with Brazil and Turkey to try to pre-empt the sanctions, calling the two efforts “dual tracks” and leaving some uncertainty over where China would ultimately side.

The agreement on a draft U.N. resolution was reached within the last several days. Senior administration officials said the timing of the announcement was intended as a direct response to the Turkish-Brazilian pact, in which Tehran renewed an offer to swap much of its nuclear fuel outside its borders for enrichment.

“This announcement is as convincing an answer to the efforts undertaken in Tehran over the last few days as any we could provide,” Secretary of State Hillary Clinton said on Tuesday.

Russian ambassador Vitaly Churkin told reporters that Russia would have preferred to wait a day or two after the Brazil-Iranian deal, but the U.S. wanted to put it on the table right away.

Western officials feared that the deal reached in Tehran could throw up new hurdles to the already-delayed sanctions regime.

Mrs. Clinton said Tuesday that while the U.S. believed Turkey and Brazil’s moves were “sincere efforts,” the U.S. and its fellow permanent members of the U.N. Security council were “proceeding to rally the international community on behalf of a strong sanctions resolution.”

There was no immediate, public reaction from Iranian officials late Tuesday to the announcement of a sanctions deal.

The Turkish and Brazilian efforts still could throw a wrench into the U.S. plans. Maria Luiza Ribeiro Viotti, Brazil’s ambassador to the U.N., told reporters outside the Security Council after seeing the draft that Brazil wasn’t ready to engage in negotiations over the text because of the “new situation” presented by the fuel-swap deal.

“It is the first time that the Iranians, at such a high level, have put in writing the swap, which creates a new confidence building,” she said. The fuel-swap deal is not “meant to address all the issues,” she added, “but it is a very important first step and we should seize this opportunity.”

Trita Parsi says:

Washington’s reaction to the Brazilian-Turkish deal has created some apprehension in the international community. The Obama administration has worked diligently to overcome the credibility gap America developed with the international community under President George W. Bush. One element of this effort was to utilize diplomacy as a premier tool of US foreign policy.

Punitive measures such as war or sanctions would no longer be the instruments of first resort. But the reaction to the Brazilian-Turkish deal may undo some of the progress the Obama administration has achieved with the international community. Washington’s lack of appreciation for the breakthrough may fuel suspicions of whether sanctions are pursued to achieve success in diplomacy, or whether diplomacy was pursued to pave the way for sanctions – and beyond.

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After the Massachusetts massacre

After the Massachusetts massacre
By Frank Rich, New York Times, January 24, 2010

It was not a referendum on Barack Obama, who in every poll remains one of the most popular politicians in America. It was not a rejection of universal health care, which Massachusetts mandated (with Scott Brown’s State Senate vote) in 2006. It was not a harbinger of a resurgent G.O.P., whose numbers remain in the toilet. Brown had the good sense not to identify himself as a Republican in either his campaign advertising or his victory speech.

And yet Tuesday’s special election was a dire omen for this White House. If the administration sticks to this trajectory, all bets are off for the political future of a president who rode into office blessed with more high hopes, good will and serious promise than any in modern memory. It’s time for him to stop deluding himself. Yes, last week’s political obituaries were ludicrously premature. Obama’s 50-ish percent first-anniversary approval rating matches not just Carter’s but Reagan’s. (Bushes 41 and 43 both skyrocketed in Year One.) Still, minor adjustments can’t right what’s wrong.

Obama’s plight has been unchanged for months. Neither in action nor in message is he in front of the anger roiling a country where high unemployment remains unchecked and spiraling foreclosures are demolishing the bedrock American dream of home ownership. The president is no longer seen as a savior but as a captive of the interests who ginned up the mess and still profit, hugely, from it. [continued…]

The man Obama needs to fix America is … Karl Marx
By Tony Karon, The National, January 23, 2010

There is something almost tragi-comic in Hillary Clinton’s use of the Berlin Wall as an analogy for China’s internet censorship. The Chinese Communist Party hardly shares the American view of Cold War history; the implication that unrestrained Googling will bring down authoritarian regimes is unlikely to persuade Beijing that internet censorship is a bad thing.

But while Winston Churchill’s metaphorical “iron curtain” separated western capitalism from the sclerotic planned economies of the socialist world, what lies behind the US secretary of state’s “information curtain” is the world’s most dynamic capitalist economy, providing credit on which the US’s own economy now depends. While the West endures anaemic growth rates and massive unemployment, China’s double-digit stimulus-based recovery is the envy of all.

The transition from third-world agrarian basket case to the world’s second largest economy in just three decades has been overseen by a Communist Party with a monopoly on power and complete dedication to the pursuit of wealth through capitalism. Its response to the recession was to inject hundreds of billions of dollars into infrastructure projects, consumer subsidies and measures to ensure that banks kept on lending.

Despite (indeed, perhaps because of) that programme’s evident success, doom-mongers abound in the western media. China will overheat; its property bubble will burst; it will be dragged down by over-capacity; the absence of democracy will strangle its entrepreneurs. And so on. But these prophecies are not new, and Chinese capitalism has proven remarkably resilient, nurtured by a government that is authoritarian but not unresponsive. [continued…]

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Why America and China will clash

Why America and China will clash
By Gideon Rachman, Financial Times, January 18, 2010

oogle’s clash with China is about much more than the fate of a single, powerful firm. The company’s decision to pull out of China, unless the government there changes its policies on censorship, is a harbinger of increasingly stormy relations between the US and China.

The reason that the Google case is so significant is because it suggests that the assumptions on which US policy to China have been based since the Tiananmen massacre of 1989 could be plain wrong. The US has accepted – even welcomed – China’s emergence as a giant economic power because American policymakers convinced themselves that economic opening would lead to political liberalisation in China.

If that assumption changes, American policy towards China could change with it. Welcoming the rise of a giant Asian economy that is also turning into a liberal democracy is one thing. Sponsoring the rise of a Leninist one-party state, that is America’s only plausible geopolitical rival, is a different proposition. Combine this political disillusionment with double-digit unemployment in the US that is widely blamed on Chinese currency manipulation, and you have the formula for an anti-China backlash. [continued…]

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Iran praises West’s ‘realism’ on nuclear issue

Iran praises West’s ‘realism’ on nuclear issue
AFP, January 19, 2010

Ian on Tuesday welcomed what it called the West’s newfound “realism” on Tehran’s nuclear programme after world powers failed to decide on new sanctions.

China, meanwhile, urged flexibility on the standoff over Iran’s nuclear drive and a return to negotiations.

However, Defence Minister Ahmad Vahidi renewed a warning that Iran’s forces could hit Western warships in the Gulf if it comes under attack over the nuclear standoff.

On the diplomatic front, foreign ministry spokesman Ramin Mehmanparast told reporters: “Speaking of sanctions is repetitive and it is not constructive.

“Some Western countries … should correct their approach and be realistic about our (nuclear) rights. And we feel there are traces of realism to be seen,” he added. [continued…]

China urges flexibility over Iran
AFP, January 19, 2010

China on Tuesday urged flexibility in the standoff over Iran’s nuclear drive, as well as a return to negotiations, after world powers failed to reach a decision on whether to hit Tehran with new sanctions.

“China has all along proposed the proper settlement of the Iran nuclear issue through dialogue and consultation,” foreign ministry spokesman Ma Zhaoxu told reporters.

“We hope relevant parties can enhance consultations, show flexibility and promote the early peaceful solution of the relevant issue in a proper manner.”

Ma was speaking after representatives of six world powers who met in New York on Saturday failed to reach a decision on whether to impose new sanctions on Iran over its long-standing nuclear defiance.

The meeting brought together senior officials from four of the five permanent UN Security Council members — Britain, France, Russia and the United States — as well as Germany.

But the fifth member China, signalling its reluctance to back tougher sanctions pushed by the West, sent a lower-level diplomat, winning praise from Tehran. [continued…]

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Chinese evade U.S. sanctions on Iran

Chinese evade U.S. sanctions on Iran
By Peter Fritsch, Wall Street Journal, January 4, 2010

Chinese companies banned from doing business in the U.S. for allegedly selling missile technology to Iran continue to do a brisk trade with American companies, according to an analysis of shipping records.

A unit of state-owned China Precision Machinery Import-Export Corp., for example, has made nearly 300 illegal shipments to U.S. firms since a ban was imposed on CPMIEC and its affiliates in mid-2006, according to an analysis of shipping records by the Wisconsin Project on Nuclear Arms Control, a nonprofit proliferation watchdog.

A Wall Street Journal review of the records and interviews with officials at some of the American companies indicate that the U.S. firms likely were unaware they were doing business with banned entities, and in many cases were tripped up by altered company names. [continued…]

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Three key lessons from Obama’s China tour

Three key lessons from Obama’s China tour
By Tony Karon, Time, November 21, 2009

Russia may be engaged in a geopolitical chess game with the U.S. aimed at recovering from the demise of its great power status, but China is different. It pushes back against U.S. initiatives only when those are deemed inimical to its national interests. Iran is a good example. Beijing’s heavy investment in and reliance on Iran’s energy sector make it extremely averse to serious sanctions or strategies that create political turmoil in Tehran. While insisting on compliance with the non-proliferation regime, Beijing does not believe Iran represents an imminent nuclear weapons threat. And its response to North Korea going nuclear suggests that a nuclear armed Iran is something it could live with.

Obama went to China arguing that its emergence as a major power gives it greater responsibility, as a partner to the U.S., in helping run the world and tackle such global challenges as climate change and Iran. Indeed, there was a collective shudder in Europe’s corridors of power at the idea of global leadership being concentrated in a “G2” partnership between Washington and Beijing. They needn’t have worried. China’s response to Obama could be read as: “Running the world is your gig, we’re focused on running our own country, and ensuring security in our immediate neighborhood. We want harmonious relations with you, but don’t expect us to do anything that we deem harmful to our national interests.” That means no serious sanctions against Iran, regardless of what deals are struck between Washington and Moscow, because China’s national interests require growing Iran’s energy exports. [continued…]

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