Sorry, it will continue to be slower than usual over here until my classes end on Saturday afternoon. Feel free to talk amongst yourselves.

From the latest Couric interview with Palin. Heh.

KATIE COURIC: “What happens if the goal of democracy doesn’t produce the desired outcome? In Gaza, the U.S. pushed hard for elections and Hamas won.”

SARAH PALIN: “Yeah, well especially in that region, though, we have to protect those who do seek democracy and support those who seek protections for the people who live there. What we’re seeing in the last couple of days here in New York is a President of Iran, Ahmadinejad, who would come on our soil and express such disdain for one of our closest allies and friends, Israel … and we’re hearing the evil that he speaks and if hearing him doesn’t allow Americans to commit more solidly to protecting the friends and allies that we need, especially there in the Mideast, then nothing will.”

Yes, just the kind of incisive, penetrating mind we need to deal with the most complex, most fragile moment in America’s entire history. President Palin. Horrifying. Literally horrifying.

The financial crisis remain an enigma, something kind of distant and amorphous. This column made it sound a lot more real, and the comments are spirited as well.

Even if Congress backs the Paulson bail-out, the $700 billion blast cannot save the US, Britain or the world from the deepest economic slump since the Thirties. If Congress balks, God help us. The credit system is suffering a heart attack. Inter-bank lending is paralysed. Funds are accepting zero interest on US Treasury notes for the first time since Pearl Harbour, because no bank account is safe.

Wherever you look – dollar, euro, sterling Libor (the rate at which banks lend to each other), or spreads on credit derivatives – the stress has reached breaking point. If borrowers cannot roll over the three-month loans that are the lifeblood of business, they will default en masse.

“Money markets are imploding. If no action is taken very soon, there is a significant risk that the global economy will collapse,” says BNP Paribas. Almost every trader says much the same thing. So does US treasury secretary Hank Paulson, who as Toby Harnden reports, literally dropped on bended knee to beg help from Democrats on Capitol Hill.

Republican refuseniks – defying their president – have a grim responsibility if they now tip America over the edge, setting off the “adverse feedback loop” that so terrifies the US Federal Reserve. Like players in a Greek tragedy, they seem determined to repeat the “liquidation” policy that led to the Great Depression – and to Democrat ascendancy for years.

Lehman Brothers’ collapse showed the chain of inter-connections that can cause mayhem across a clutch of different markets. That was just one bank – albeit with $630 billion or so in liabilities.
Credit is the lubricant of a modern economy. A seizure now would probably lead to the bankruptcy of General Motors and Ford in short order, but it would not stop with the US car industry. Waves of job losses would set off a self-feeding spiral. Yet more people would default on their mortgages (and car loans), driving house prices down even further. That, in turn, would threaten the solvency of the best banks. That is the way to Armaggedon.

As Mr Paulson says, US taxpayers are on the hook whether they like it or not. A $700 billion fund to soak up toxic debt and stabilise the credit market is the cheapest way out. It is certainly cheaper than Depression.

No way out. I really can’t say it enough: Get rid of your dollars. At times like this, history shows, the safest place for your money is stuff, or foreign currency. ABD.

This is not the time to give the keys to the kingdom to a clown.

A very strange and confusing story that leaves the reader with many, many questions and no answers at all. Something is definitely wrong with the story the government told us back in August. Stories don’t come any more bizarre than this one. Not even in China. (I thought the post immediately below won today’s prize for bizarre, but this one runs neck-and-neck.)

Read it, and let me know if there’s any way to tie together the bits of information we have to create a scenario that makes even the slightest bit of sense. WTF happened??

During the 2004 election I repeatedly posted this quote from the great H. L. Mencken. Looking at Palin and McCain, I realize it’s time to post it yet again. Savor every word. It is spot-on.

“[W]hen a candidate for public office faces the voters he does not face men of sense; he faces a mob of men whose chief distinguishing mark is the fact that they are quite incapable of weighing ideas, or even of comprehending any save the most elemental – men whose whole thinking is done in terms of emotion, and whose dominant emotion is dread of what they cannot understand. So confronted, the candidate must either bark with the pack or be lost…

[A]ll the odds are on the man who is, intrinsically, the most devious and mediocre – the man who can most adeptly disperse the notion that his mind is a virtual vacuum. The Presidency tends, year by year, to go to such men. As democracy is perfected, the office represents, more and more closely, the inner soul of the people. We move toward a lofty ideal. On some great and glorious day the plain folks of the land will reach their heart’s desire at last, and the White House will be adorned by a downright moron.”

H. L. Mencken, in the Baltimore Sun, July 26, 1920.

That vision was fulfilled, of course, in 2004. Let’s do all we can to make sure we don’t elect another moron. Are you registered, and do you have your absentee ballot if you’re living here? Don’t let Palin or the sage who selelcted her anywhere near DC. Your vote really does matter.

Thanks to ESWN for leading me to this story that says a lot about the state of the media in China. I think it crosses into those areas PR people want to keep out of the public eye, the industry’s “dirty little secret” (not really so secret anymore) that you cannot take anything you read in the Chinese media at face value, especially if it is corporate-related. Chances are quite high that what you are reading is either advertorial, complete BS, a press release — in other words, the writer was a PR person or propagandist, not a “news reporter” as we understand the term to be. What boggles the mind about this story is just how blatant this crisscrossing of PR, propaganda and journalism was.

The article starts by noting Sanlu was conspicuously awarded an honor for its great contributions to China shortly before we learned their products cause infant kidney stones and death.

The August 6 article reporting the “30 Years” honor bestowed on Sanlu was written by Miao Wanfu (苗万福) and appeared virtually everywhere — in scores of newspapers, at the website of the official People’s Daily, at Tianya, at Sina, and at a leading food industry website, to mention just a few.

And who is Miao Wanfu?

As the Oriental Daily and others have reported, Miao runs Sanlu’s internal public relations machine. But readers of the above “news” would never have guessed as much. Miao is identified — when a byline appears at all — as “correspondent Miao Wanfu” (通讯员苗万福).

On the People’s Daily website, Miao manages to come off as a staff reporter for the CCP’s top daily. And when the report runs subsequently at China’s leading food industry website it is attributed again to “correspondent Miao Wanfu.” We are told that the news comes from “People’s Daily Online.”

Misrepresentations of this sort are perpetuated across China’s media, where a lack of professional standards means “news” space is stuffed routinely with material from valuable advertising clients.

Here is “correspondent” Miao Wanfu again for People’s Daily Online, and for Hebei Daily. And here he is apparently reporting for the Central Propaganda Department’s Guangming Daily in June 2006 about the purchase of a stake in Sanlu by New Zealand’s Fronterra Group.

When Southern Metropolis Daily broached the topic last week of how Chinese media had contributed to the tragedy of China’s tainted milk crisis it was opening up a great big can of worms.

There are many hard and searching questions to answer. As the newspaper asked, why, before the breakthrough report by Oriental Daily journalist Jian Guangzhou (简光洲), did media suggest only that “certain brands” of milk powder had problems? And why, even as questions were beginning to surface about the safety of milk powder from Sanlu, were the company’s supposed contributions to the lives of ordinary Chinese being trumpeted so loudly.

Chinese media will not be given an opportunity to delve very deeply into these questions. The answers, after all, point to the ugliness of state media controls and the failure of media policy as well as to runaway commercial greed. The Chinese media’s role in the tainted milk crisis should remind us again just how poisonous the combination of rigorous press controls and unfettered commercialization can be.

This is always a dilemma when PR people talk to their multinational clients about winning domestic coverage. Does the PR person simply say it’s all a racket, and that much of the coverage the client will get is pay for play?

This is something that goes unspoken, more or less. Everyone knows all about the “transportation allowance” handed out to the journalists at every event, along with a generous gift. Everyone knows that much of what’s in the domestic publications is advertorial or propaganda. There is an understanding between the PR people and the client that this is how it works but I don’t think they ever quite say so, and in some ways all the players go through the motions of pretending it’s like getting coverage in the Western media: they make message documents, Q & As, briefing books, all the bells and whistles, while knowing the reporters will report what they are told. And often – though certainly not always – there is payment in one form or another.

With international media in China, as in the US, we are used to our pitches being declined. It takes lots of calls and hard work and message shaping to convince a real reporter to cover your story. That’s not usually the case when it comes to the Chinese media, where press releases are often printed verbatim. The domestic media will sit through just about any press conference, no matter how long and sleep-inducing, and then write their story. After you hand them the goody bag.

Reform of the Chinese media is a tough nut to crack. The red envelope and the advertorial and all sorts of pay for play games keep a lot of the publications functional. How do you reform an industry that’s rotten from head to toe? As usual, there’s a thin beam of light that offers some hope. It was, once again, Southern Metropolis Daily that helped get this story out. There are some “real” publications out there, and a lot of journalists who are anxious to report real news and who feel far more frustrated than we do that the government won’t let them.

So maybe stories like this one, that flip the rock over so we can see the bugs scurrying away, will help keep up the pressure to reform. But the process will be glacial, and there will be kicking and screaming every inch along the way. Whoever controls the mouthpiece to the people controls the country. It’s in this area that Hu Jintao has been most disappointing, especially after the hope he generated in the wake of the SARS scandal of 2003, and I don’t expect to see real reform of the media for years to come.

The Chinese have no choice but to be kept in the dark, with only the Internet and word of mouth to challenge what they see on CCTV. But I sometimes think we in the West – especially in the corporate world – are willfully ignorant that this is how the Chinese media work, and continue to convince ourselves that working with China Daily is like working with the NY Times. It’s not.

A final word about Sanlu: Anyone who sees anything in this saga worthy of praise, as some sort of proof of the effectiveness of China’s self-correcting system that protects its people and illustrates the nation’s ability to pinpoint and manage crises is simply living on another planet. There are so many levels of rottenness in this story it’s impossible to know where to begin. The deception occurred at every level and there are no heroes except those the government sought to keep silent.

If Tina Fey isn’t one, who is? What a performance. Leave this site now and watch the clip here. Don’t have anything in your mouth as you’re watching.

At the risk of igniting a blog war, I feel I have to point out what might be the very worst post on China I have read in a long, long time, from a blog I respect enough to include on my blogroll. When I say bad, when I say dumb, when I say wrong – let’s just say it’s the equivalent of what I’d expect Sarah Palin to write about the Iraq war, saying how it was an exercise in successful American can-do determination and that no civilians were hurt and it all went like a cake-walk. I mean the type of post where you have to willfully block out any and all hints of truth as you arrive at your own fact-free truthiness.

It’s about the milk scandal, and it could have been written by HongXing:

While dismayed by the rogue manufacturers’ ability to abuse the public for such a long time (a year, I heard), I am relieved that eventually the scams were exposed, exclusively by forces within the Chinese society. No foreign White knight was in a position to rescue the Chinese people from their rulers and deliver them from their misery. In fact, the New Zealand diary company who owned a stake in the main culprit, Sanlu Diary Corporation, was part of the problem. The Western media have been on the sideline; their opinions on this event are largely irrelevant to the Chinese public. It has been the Chinese parents’ outrage and the Chinese media’s probing and revelations that constitute the main source of the Chinese authorities’ embarrassment and the main forces that prompted them into action. Heads have been rolling, with the resignation of a mayor and a cabinet member, and an executive’s arrest.

An indigenous and home-grown momentum of change is a hopeful sign of the Chinese society at these turbulent times. The society has demonstrated the means and resilience to channel the momentum into productive movements of improving the way businesses are supervised in particular and social activities regulated in general, developing mechanisms for righting wrongs and addressing grievances. The same resourcefulness and resilience were demonstrated in the revelation of kidnapped and enslaved teenagers in Shanxi province’s brick making factories, in the organized reactions when the snow storms in southern China stranded millions of migrant workers on their way home for the spring festival in railway stations, and when earthquake struck Sichuan.

It is heartening to observe that foreign elements and forces have little influence over the Chinese authorities, on either their legitimacy or policy preferences.

The light at the end of this dreary tunnel: the commenters on this site ripped the writer to shreds, called him out on his fact-averse approach and made a fool of him, in the spirit of the blog’s title. This post is all about looking at some of China’s most shameful recent catastrophes and pointing to each as proof of China’s greatness. Now, I’m not saying China isn’t great. It is. (That and much more.) I think America is great, but I don’t point to the Abu Ghraib photos and say there’s the proof of our greatness.

The whole things is a bit surreal, like a big practical joke, like a parody of the party propagandist transforming a nation’s flaws into virtues. And then there’s the closing sentence: “This is the silver lining I see in the scandals and disasters inflicted upon us in the year of 2008” – as if these scandals were “inflicted upon us” by some passive-voiced villain, and not by the sleazy corruption that is a defining characteristic of the CCP.

Nothing in this post seems to make any sense. It’s a Sarah Palin interview. Unless I’m missing something. Am I missing something?

This is an intriguing article from China Daily, written by a government researcher. It sheds some light on the question the whole world has been wondering about lately, i.e., how will China react to the collapse of America’s leading financial institutions at a time when it’s so heavily invested in US dollars? I am wondering if it’s representative of the government’s concerns, and whether it’s hinting at things to come.

The US government has its own criteria in determining what it ought to rescue, and Lehman Brothers was left to its own devices because of its high proportion of foreign investment.

As a result, foreign investors suffered more than their US counterparts from the collapse of the century-old financial body.

As the crisis unfolds, more American financial bodies are expected to follow in Lehman Brothers’ footsteps, with Asian nations and oil exporters holding a large sum of dollars expected to be the greatest victims….

The US financial crisis leads us to ask some questions.

First of all, is it the end of US financial hegemony? In addition to the latest financial crisis, the US has so far experienced another financial crisis since the turn of the century – the bursting of its technological bubble. Many foreign investors have suffered heavy losses in these two crises. Some economists even warned that such cyclical formation of bubbles will seriously compromise foreign investors’ confidence in the US financial market.

Second, what losses have Chinese financial bodies suffered as a result of this crisis? Available data shows that Chinese financial bodies had not purchased that many mortgaged US financial derivatives, and will therefore not suffer too many losses from this crisis. So, it is impossible for the country to be plunged into an economic recession like Japan in the 1980s.

More questions, more reflection, and a few hints of the usual propaganda (sense of victimhood, China is invulnerable to recession, conspiracy to protect US investors at foreign investors’ expense) so you may want to read it all. As my source [blocked in the good old PR of C] for this article writes,

What could be more unnerving than having your largest creditor begin pondering your financial demise?

“Indeed.” If this writer is speaking for the Chinese government, there are some grim implications here.

I’ve been avoiding China’s milk scandal because so many other blogs have done such a great job covering it. But today’s story in the NY Times simply must be read to be believed. It’s one of those detailed investigative pieces that remind us great newspapers are absolutely indispensable.

We all remember how the government knowingly suppressed the fact that SARS was a danger in Beijing in 2003 so as not to cast a negative light on their annual National People’s Congress, right? (If not, search through this blog archives from January – April 2003.) Well, as that crisis ended many of us said it heralded a new age of transparency, when the government would never again deliberately hide information from its citizens about health risks that could kill them.

Fast-forward to 2008, and we learn that the same script is replayed. This time its an event even more important than the NPC, it’s the Olympic Games, China’s launchpad, the dawn of a new day for the rising superpower. And so once more the government lied and covered up, and once again innocents were the victims. Just a sample of the intensity of this article:

Fu Jianfeng, an editor at one of China’s leading independent publications, Southern Weekend, recently used a personal blog to describe how his newsweekly discovered cases of sickened children in July — two months before the scandal became public — but could not publish articles so close to the Games.

“As a news editor, I was deeply concerned,” Mr. Fu wrote on Sept. 14. “I had realized that this was a large public health disaster, but I was not able to send reporters to do reporting.”

Even earlier, on June 30, a mother in Hunan Province had written a detailed letter pleading for help from the food quality agency, the General Administration of Quality Supervision, Inspection and Quarantine. The letter, posted on the agency’s Web site, described rising numbers of infants at a local children’s hospital who were suffering from kidney stones after drinking powdered formula made by Sanlu.

The mother said she had already complained in vain to Sanlu and local officials.

“Urgent! Urgent! Urgent!” she wrote. She called on Beijing authorities to order a product recall, release the news to the Chinese media and provide medical exams for babies who had consumed Sanlu formula. “Please investigate whether the formula does have problems,” she wrote, “or more babies will get sick.”

Reading the article will sicken you. It is apparently “an open secret that milk was adulterated….Some dairies routinely watered down milk to increase profits, then added other cheap ingredients so the milk could pass a protein test.” Sanlu knew, the government knew, the media knew – and still there was silence. Only when New Zealand started to voice concerns and it became a global issue did the government finally respond.

We all know of companies elsewhere selling products they know are harmful. Merck and its painkiller Viox is a classic example. It is rare, however, to have so many people in the know, including government and the media – the supposed watchdogs – while the public is kept in the dark, continuing to poison their own children. I wrote back then, in 2003, words that I regretted later. I don’t think I was right – it is far too simplistic and black/white; however, reading this Times article, I understand again exactly how I felt as I wrote those words:

As I prepare to leave this country, I worry less and less about telling the truth. To say that another way, I have always tried to tell the truth here, but often I felt I had to tone down my rancor, soften the blows. Right now, I just don’t care, and I want whoever happens to stop by this little site to know the truth about China, or at least what I perceive that truth to be: China is the Evil Empire, a tottering, power-drunk, paranoid nation of thugs dressing themselves up as saviors — a bad country. It was for the bastards we saw smiling and waving at the “People’s Congress” that my God made hell.

Knowing full well that this was dramatic in the extreme, with the potential to be misread, I immediately added an addendum. I couldn’t condemn all of China because there was so much here that I loved. (And I don’t apologize for being dramatic – the situation was dramatic, as is the present situation.)

Footnote: I refer only to the Chinese government here. The people I know here are gracious, kind and good. They know, to a large extent, what their “leaders” are all about. Luckily for these good people, the SARS fuck-up has been of such great magnitude that it could end up resulting in long-term change and improvement here. Maybe. It has certainly opened the eyes of the world as to what “the new China” is all about.

This article, like Philip Pan’s book, reaffirms my belief in the goodness of the Chinese people, and the badness of many who govern them. Read it and see. It’s just so terrible that those over-wrought words I wrote about the government then, in 2003, half a decade ago, apply with just as much power and accuracy today. And those men who allow this to happen and tell the media to lie to the people, knowing those lies can result in death – well, let’s just say it was for them that my God, if I believed in one, would have made hell.

China is changing? China is getting better? I see it all the time, I hear it all the time, I say it to myself. I say it so often I get narcotized by it, like a chant. And then I see the closing line of today’s great story:

This week, China Central Television, the government network, has been offering reassurances that the dairy products still on the shelves are safe

And I wonder. And I ask myself how far this country really can go, even if America’s economy disintegrates. Like America, China needs a stable-sweeping on a scale hitherto unimaginable. Can it happen? It has to, at least at some point, if China is to be a true superpower. As in America, the future of the nation depends on it. I see it (the stable-sweeping) coming to America, and it will be painful. I don’t know when it will come to China, but it can’t be a moment too soon. Catastrophes like this can make the whole house of cards fall down.

Nearly 1am. Hope all the different points I wanted to pull together formed a cohesive whole. I’m too tired to tell.