Thursday, August 28, 2014


1.     The death of Brown and Garner has sparked national outrage, and the anti-police demonstrations have erupted into long-time looting and clashes in Ferguson, Missouri. What do you think the tragedy was rooted from and why the loss of control in public emotions happened?

The two deaths and the reaction to them are not new. The history of police overreaction and/or incompetence goes back hundreds of years in US history. The source is as unchanged as the history: racism. It took 250 years for the United States to move from the concept of “separate but equal” in its treatment of blacks to the legal concept of full equality of all citizens. The Brown v Board of Education Supreme Court decision that provided for equal education came down in 1954 and here we are 70 years later with parts of the US still effectively segregated as in Ferguson.
One major difference in the current events is new media. News is now available 24/7 on cable television and the Internet where smartphone use keeps everyone informed anytime and anyplace, all the time. China has even more experience with social media than the USA does. News in China moves at the speed of light, often ahead of the government’s attempts to regulate the flow of information. In the USA with its open information flow the situation becomes exaggerated through fear that is often the result of rumour that passes for news or other unsubstantiated reporting.
Ferguson and the behaviour of police forces in a big city like New York and tiny place like Ferguson are falsely lumped together as a single event.

When a community is aggrieved, it reacts, and often violently. In the civil rights struggle in the USA demonstrations in the 1950s and 60s were often peaceful while the reverend Martin Luther King was alive. He preached non-violence and set the moral tone for much of the black community. Prior to Dr. King violence and looting prevailed. After Dr. King the picture is mixed. In NY peaceful demonstrations have prevailed, while rioting and looting characterize Ferguson. Much of the difference is in the size and experience of the communities involved. New York City, America’s largest city and Ferguson, Missouri one of its smallest communities.

2.     Compared with Missouri’s days of violence, New York has seen large but peaceful protests after the deaths of two African Americans. What are the main reasons that contribute to the two different outcomes?

The easy answer is in the character of the two police forces. The NY City Police Department is a force of nearly 40,000 men and women including members from all of the city’s minorities. As many as 800 different languages are spoken in New York City, more than any other city in the world. 40% of the city’s inhabitants of New York are foreign born. In short, diversity is the fundamental character of the city. There is a long history of violent clashes between and among many of the minorities including everything from local gangs to organized crime families (like triads in HK and mainland China and Taiwan). But the experience of a now relatively integrated police force gives the city the opportunity to deal with threats of violence in the context of minority cultures and languages. Many minorities have learned that there is more to be accomplished through peaceful demonstration than through violence. Violent demonstrations have diminished in many large American cities.
Looters are another story. Looters are not demonstrating, they are ordinary criminals who take advantage of any situation and are nothing more than thieves who want to steal anything they can get their hands on. The police in New York City as in other large cities have learned how to deal with looters fairly effectively.

3.     Do you think the two cases mentioned above will set off African-American Civil Rights Movement? Why and how? What the activists’ appeals are mainly about?

Since the death of Dr. Martin Luther King 46 years ago the US Civil Rights Movement has not had a new national – much less international – leadership. Even local and regional leaders have been relatively weak. Part of the reason is the immigration of Mexican and Latin American minorities into the USA, the growth in the Asian population that includes significantly Japan, Korea, China, Vietnam, Cambodia, Indonesia and the Philippines. The primary and secondary public schools in the USA just this year became majority/minority. More minorities than white Americans now attend public schools in the USA.

The minority population of the USA will exceed the former white majority within the next year or two. This is a long way of saying that a combination of events and facts have diversified and thereby diminished what was the former African American Civil Rights movement. The struggle for civil rights and human rights continues but it has diversified into many minority communities and can therefore appear to be weaker than it once was.

4.    The police have been a lot argued about in the Brown and Garner deaths. Some say they are too militarized, what do you think? What can be done to establish better relations between the police and the communities they serve, especially communities of color?

Brown and Garner are two examples of the same problem. There is evidence that the adoption of high technology and deadly force weapons by police departments has outpaced the training of even the best police departments. A small police force like Ferguson demonstrated everything that is wrong. The following chart from USA Today demonstrates how the population mix in Ferguson, a suburb of St Louis Missouri, has changed.
What has not changed is the local Police force in Ferguson that remained predominantly white, underfunded and poorly trained though relatively well equipped. Much of the local police force’s equipment came from the US Department of Defense in a program meant to help underfunded small police forces to be better equipped. The problem is the military equipment included automatic weapons, and heavy armored vehicles, the kinds soldiers use to fight wars. This was the equipment the Ferguson force used to confront demonstrators when they marched to protest the shooting of a young black man by a police officer. In English the expression for this excessive display of force is called “overkill”.

By contrast the NY City Police Department has equipment and trained officers men and women for every conceivable eventuality. The NY City Police defend the representatives from 140 countries in the world who meet at the UN. There are almost daily parades that celebrate the national days and religious holidays of the many different national and ethnic populations in the city. Police are trained to prevent violence in what are daily demonstrations for a variety of causes and complaints in the city. There are the ordinary daily crimes of burglary and car theft. There are violent crimes of rape of murder. The NY City Police Department is far from perfect but what it has more than any other police department in the world is an experience and training not available elsewhere. Response to danger or crime can be nuanced to meet the different levels of threat.

5.     Though with the guarantee of law, in reality do the communities of color still experience injustice? How often, in what way and what does that bias come from?

Any minority in the USA will have his or her stories of daily experience with bias. African Americans and dark skinned Latinos stand out from a white population and are the most frequent victims of everything from racial profiling by police who may automatically watch them more than others. Statistically, more African American are arrested and imprisoned in the USA than any other group. The lack of a coherent immigration policy has added to racial bias particularly among the recent Mexican and Latin American undocumented immigrant population. In some cities a traffic violation by an undocumented foreigner can result in deportation. The growing Muslim populations in the USA are easily identified by their dress, as are some Indians from India.
The USA is often called a “melting pot” as if the many diverse populations are integrated into a mix like a stew. That may be a nice image but it is false. The realty is that minorities tend to naturally congregate. Districts and sections of cities develop along socio-economic lines that often parallel the origins of their populations. In the US that includes ethnic, national, and religious minorities. NY for example has the largest Jewish population outside Israel. There are sections of NY where Jews form a majority locally. Chicago has the largest Polish population outside Poland. San Francisco has the largest Chinese population in the country. These are not integrated communities; they are enclaves of people with common languages, and origins.
This proliferation of populations can easily fall victim to racism. If you are considered “different” because of how you look, how you dress, the language you speak, the culture you follow, you are often treated less well than when you are part of what may be considered the mainstream population.
The NBA, as popular in China as it is in the USA, is a sport whose players are predominantly African-American. Spectators and fans of the NBA in the USA often include more whites than blacks. In this case the difference is economic. The tickets are expensive and not readily affordable by less well off African-Americans. This is an example where a white man or woman may feel discriminated against as a player, while blacks may feel discriminated against because they cannot afford the price of a ticket to a game.

6.     The piece of article by John Eligon of the New York Times, in which he used the term “no angel” to picture Michael Brown, has stirred up controversy and bounce. How do the American media deal with issues relevant to colored groups? How do they portray them and to avoid racial discrimination? Will the cultural stereotypes perpetuated by the media happen a lot? In what occasion?

I expect the editor responsible for Mr. Eligon’s article is asking him or herself the same questions. Mr. Eligon is African-American. He has said he made a mistake using the phrase “no angel” and suggested he should have said that Mr. Brown was not perfect. Much of the article dealt with positive aspects of Michael Brown’s life, but they are lost in the controversy. The controversy is a reflection of the sensitivities of minority issues and how rapidly people and groups can feel discrimination and bias. This can be difficult for many Chinese to understand. China has nearly 60 minority populations, yet the total population is more than 95% Han. How many Chinese ever see someone who is an obvious minority? Foreigners yes from the West.  I can remember when I first came to Shantou in 2003 and went downtown, little children would follow me. When I inquired why they followed me, I was told: “They have never before seen a foreigner.” That has changed by now but 2003 is barely more than a decade ago. China’s obvious minorities are in the Western and Northern Provinces, where they are often a majority population locally. Cities like Beijing and Shanghai, Shenzhen and Guangzhou, Chengdu and a few other mega cities in China are increasingly experiencing an influx of foreigners. It is more common to see people who look different, and speak other languages. But few of these people are permanent residents. They are tourists or short-term business travelers. There is less racial tension when foreigners or minorities are temporary visitors compared to permanent residents.

The US media suffers from a lack of diversity in its own ranks. Mexican and Latin Americans are relatively invisible in US mainstream media. African-American reporters and editors are not a reflection of their percentages in the population as a whole. Asians even less so. Here the development of minority media is the partial answer.
There is a selection of Spanish- speaking cable channels and radio stations in the country. African-Americans have cable networks devoted to their audiences. Cities with significant Chinese populations have Chinese cable channels. The concept of integrated media may be an ideal to some, but the reality is elsewhere. All of these developments contribute to the fact that the typical white reporter has fewer and fewer opportunities to experience or learn about minority populations and cultures in the USA.
Stereotypes are still common. A parallel example in China comes from CCTV where minorities are often portrayed wearing their native costumes. This makes it difficult for a Han Chinese to imagine a minority as a neighbor who might be an ordinary office worker, or a doctor or lawyer or schoolteacher.
If you see a very tall black man or woman, what is your first thought? Basketball player, or bus driver, or doctor or lawyer?
In New York City many of the small green grocer shops are owned and operated by Koreans. White New Yorkers often think of Koreans in that role. Many Chinese immigrants who came to New York decades ago started restaurants and dry cleaning establishments. There are still many older New Yorkers who when they see a Chinese think food or dry cleaning.
Stereotypes die hard.
Fortunately among the young as the world travels more and more stereotypes are also dying.

7.     China has shared the same characteristics with America that they are both countries with many ethnic groups. What China can learn from America's experience and lessons to deal with the ethnic minority problem

There are partial answers to this question in some of my previous answers.

There remains a larger challenge for China because its majority/minority situation is unique. India with a comparable population is a nation of minorities speaking at least 400 distinctly different languages, plus a variety of religions and ethnicities. China by contrast has a national language with hundreds of provincial and local dialects. Mandarin, China’s common language gives the population an advantage. Chinese can speak to each other, even if there are many other differences between them that include misunderstanding their common language.
Chinese tend to identify themselves through their family. After that they may consider their hometown or their home Province.
At the same time since the modern Chinese revolution in 1949, the concept of the Chinese nation has never been stronger.
But what of the 57+ minorities in China? How Chinese do they feel, and if you are a Han Chinese how do you feel about them? Are they what the Chinese constitution calls for: citizens with equal rights and privileges?
These are the challenges and opportunities facing China.

The national government feels challenged when there are demonstrations or riots in the minority areas of the country. The issue is how to deal with the minorities. If they want to live by their separate languages and cultures, should they be forced into integration into the Chinese mainstream? Historically that is not likely to succeed. Can a minority be forced into subjugation? Again, historically not likely?

How much representation do Chinese minorities have in mainstream China? Minorities represent less than 5% of the population, so should they have any more representation than they do? There are many more questions than answers to these issues.

The best and worst examples of minority issues are in the smaller countries. Holland has a population of about 16 million with a minority foreign-born population of about 1.6 million or 10%. Integration of the Dutch minorities, many from former colonial Indonesia have been relatively successful through education of the domestic and foreign populations.
Norway has a population of 5 million, including 600,000 relatively recent foreign immigrants. A recent survey of native Norwegians has uncovered racial and ethnic bias that includes significant strains of anti-Semitism against Jews, and a strong dislike of Muslim, Somali and Roma (gypsy) populations.

Racism is a fact in almost all countries and populations. Racism is not new. Majorities have problems with minorities because they tend to be different. The differences can be small and insignificant. What Chinese Province does not claim to have the most beautiful women and the smartest children? There is no objective truth to those claims and yet we tend to believe them, at least a little bit.
“Ethnic cleansing” whether it is the many recent genocides in Africa and the Balkans, or historic examples that almost exterminated entire native populations in North and South America including the Nazi Holocaust throughout Eastern and Western Europe, these are examples of extreme racism. How far have we advanced may be the best question to ask?  

Tuesday, August 12, 2014


This sequence involves the following analysis by RHODIUM of the outlook for China, followed by comments from an analyst and final comments from me.

China's Outlook – Now and in 2020

by Daniel H. Rosen and Anna Snyder | August 8, 2014

How does economic reform relate to China’s future economic growth potential? How big a difference does the difficult undertaking of changing the rules of the marketplace make? The answer determines whether the risks associated with reform are really worth it. In our analysis of China’s continuing growth prospects, we put the growth outlook together in a transparent way, and include scenarios for what happens if reform falls short. We find that Beijing can hope to deliver 6% annual growth come 2020 – if it does everything right. Checking with Chinese officials we find they come to the same conclusion – as do IMF economists in their new calculations. If reform comes up short, the story is more dire and China can only look forward to 1-3% GDP growth six years from now. Chinese officials share that view, and recognize that social stability is tough at those levels, which is why they are so intent on changing business as usual today.
2020 outlook: Our baseline expectation is 2020 annual GDP growth of 6%. This assumes China’s ambitious economic reform program is fully implemented. Our two downturn scenarios – what the future looks like if reform miscarries – forecast the impact of hard-landing and crisis on China’s potential growth.
View from China and view from the Fund: Recent estimates from China’s leadership and the IMF coalesce around a 6% growth story for China in 2020. While our estimates vary in a few important ways, the IMF’s downward revision to China’s growth potential is consistent with our forecast.
Conclusions: China can only count on capital deepening for half of its 2020 growth potential. The other half depends on what economists call total factor productivity, or TFP. This would be the fruit of urgent, pro-market reform: adjustment of which sectors get labor and capital, how rapidly technology advances, and whether wealthier, skilled Chinese keep their assets at home rather than sending them abroad. The challenge is that this depends on rapid transformation of financial intermediation and implementation of many other reforms. Failure to accomplish those tasks would leave GDP growth somewhere between 1-3% in 2020.
Our model for China’s potential growth to 2020 is summarized below (Table 1), with GDP growth rates year by year and resulting GDP values in constant 2013 dollars – meaning all values can be understood in today’s purchasing power terms. We explore three scenarios: our baseline, the highest likelihood soft landing outcome; a hard landing; and a crisis scenario. We incorporate these projections into a major forthcoming Asia Society study of China’s reform program to be released this fall.
We start by considering projections from the IMF, the World Bank, the Hong Kong Monetary Authority, the Chinese State Council, and private analysts, and then make adjustments based on our analysis of reform prospects. This is growth accounting: adding up possible increases in the factors that go into production (capital, labor, and “improvements”, including technological upgrading and structural adjustment) to get a more productive mix. Economists call that final set total factor productivity, or TFP. 2020 labor force growth in China is zero. Capital stock growth – if all goes well – could contribute three percentage points to GDP growth, as investment growth moderates from current rates that have pushed the debt to GDP ratio to 251% (and rising), according to Stephen Green at Standard Chartered Bank. Given China’s past performance, it is conceivable that it could generate another three percentage points of growth from TFP improvement come 2020, if reform and better enforced regulations dramatically change the industrial mix (so that private, sunrise industries get resources for a change), for a total potential of 6%.¹
Our analysis of the Chinese reform program and implications for China’s GDP outlook has been in the works since Chinese leadership broadcast an economic reform plan last November, pledging to give full play to market forces. As our outlook has taken shape, we continue to benchmark our views against other estimates, including China’s and the IMF’s, which just updated its long-term projections. In the following section we walk through these alternative outlooks and relate them to our own.
Hitting this year’s GDP target of 7.5% is a sensitive political subject which Chinese officials have little room to discuss. Finance Minister Lou Jiwei and the NDRC tried to move away from a dogmatic growth number back in April, but in the face of market anxiety Premier Li re-emphasized the primacy of the target in May and June. But talking about 2020 is okay. While a few growth-at-all-costs proponents still trumpet higher numbers, consensus is coalescing around a 6% 2020 outcome, with a 6.5% average for the five years to come – a major area of agreement with the model in Table 1. The official Chinese version of this trajectory foresees 20 million people urbanizing a year through 2020 (higher than we think) and electricity consumption growth of 6-7% through the decade (also higher than we are expecting, though we are working to understand why).
More important is a second area of agreement: what the downside risks to potential growth are and how low GDP growth would be by 2020 if they eventuated. In the hard landing scenario, a failure to implement reform sucks the TFP growth out of the economy, leaving nothing but capital stock growth, resulting in 3% GDP growth. In a crisis scenario, we imagine capital flight and an investment strike following the reform² shortfall, depleting capital stock growth and leaving the Middle Kingdom with barely 1% potential GDP growth – enough, by the NDRC’s reckoning, to generate jobs for just 1.6 million new entrants of the 10 million-plus who will be looking for work. In our model, the longer Beijing buys the kind of 7.5% GDP growth it is gunning for today, with the kind of costly debt creation it is still resorting to, the more likely there will be a crash in capital stock deepening in the out years. Chinese planners appear to share this view, understand that the reform imperative is motivating President Xi and defining China’s long-term growth potential, and agree with the range of downside outcomes. So we are basically on the same sheet music here, at least concerning the future headline GDP growth rate potential, which is about as much as long-term planners can seem to deal with.
Recently, the IMF released its annual report on the Chinese economy known as the “Article IV Consultation” – the results of an annual economic health checkup and summary of vital signs, produced in consultation with Chinese authorities (meaning a consensus must be reached between IMF economists and Chinese leadership). The Fund’s read-out on China’s economic reform agenda and impacts on China’s growth potential is broadly similar to our own. They expect a 7.4% growth rate in 2014 and project three medium-term scenarios for Chinese economic growth as well: fast reform, slow reform (baseline), and no reform.
Our picture differs from the IMF’s in two key ways. First, our baseline scenario assumes the full range of reforms laid out in the Third Plenum reform agenda are installed by 2020; by contrast, the Fund’s baseline assumes steady but slower efforts to implement reform. Their fast reform scenario closer approximates our baseline. Second, their reform scenarios model implementation of financial sector, fiscal, structural, and exchange rate reforms. In addition to those reforms, we consider the importance of redefining government’s role to focus on public expenditure priorities instead of industrial policy, pro-competition policies driving reregulation across sectors, SOE reform, trade and investment reform, land reform, environmental reform, and welfare reform (policy supports for labor and human capital). The IMF’s baseline shows growth falling to 6.3% by 2019, whereas ours shows growth slowing to 6.2% in 2019 and 6% by 2020. Slower growth in the medium-term means faster reform and a lower probability of crisis. Our balance of payments thinking therefore diverges for similar reasons; while the IMF’s current account projection hovers around 1% of GDP through 2023, our current account balance as a percent of GDP falls to zero by 2020. Our projections suggest a modest trade deficit on the horizon, offset by a positive net income figure – both effects of full-blown reform in the medium-term, successfully targeting domestic and external imbalances.
Considering the downside risks to potential growth agreed upon by both Chinese planners and foreign economists, why are we somewhat more optimistic about the balances? Internally, we continue to think the evidence of earnestness in reform since the Third Plenum is more compelling than many observers. On the external side, due to Rhodium Group’s extensive work on China’s outbound foreign direct investment imperatives, we are sensitive to just how important a balance will be to China in the years ahead, despite the indelicate tone Beijing is taking on foreign economic affairs today. Thus, our baseline assumes the fuller reform required to sustain cross-border trade and financial flows in the out years. There are caveats. First, the political challenges to reform implementation are real. The short-term, debt-driven stimulus propping up growth today is already depressing future potential, and if it is not reversed soon a hard landing will become the most likely scenario, increasing the tail risk of crisis, which would shave world GDP by 2.2% over the next six years and could consume some 20% of global economic expansion in the year 2020. Second, security fears can trump universally agreed upon economic logic, and if leaders in Beijing and elsewhere don’t do a better job tamping down rising nationalism, the obvious benefits of economic opening could be foolishly sacrificed to guard against self-generated threats.
President Xi Jinping has smartly observed that China’s market systems must “select the superior and eliminate the inferior”. Government is not smart enough to dictate how resources should flow to make that happen. What is superior and what is inferior is a market decision consumers must make. But the power to do so does not yet reside with China’s consumers; the state still determines outcomes in many respects. Over the last year Chinese leaders have started implementing market reforms, liberalizing finance, and leveling the commercial playing field to drive competition. It now appears they accept that the efficiency possible by switching from state allocation to market intermediation is the difference between 3% and 6% 2020 GDP growth rates. To make this switch the state must forego its monopoly on economic influence in principle and practice. Then high-quality regulatory institutions and talent pools must be built up. These are Herculean tasks. The trillion dollar question is whether a regulatory revolution can happen quickly enough to outrun the tsunami of challenges and enable a 6% 2020 GDP growth outcome.

¹ Here we don’t factor in a likely significant upward revision to GDP by the National Bureau of Statistics after its overhaul of the Chinese national accounts system this year. Neither do we include our working estimates on nominal GDP level from a separate study we are completing late this year. 
² See our forthcoming study; we define 10 clusters of policy reform focus, ranging from the financial system to SOE restructuring to competition policy reform and others. All are partly underway already, but could stall.

One analysts reaction:

 I've been to so many presentations that show how flawed the human mind is by automatically trying to find patterns where there are just hints of a match, and I think that is true of China.  It clearly is a case unto itself. 

I also think there is a difference between watching and worrying, and betting on the outcome.

I think we all have to watch and worry about everything, since the globe is so much more linked today than it ever was.  We saw that in the rising correlations among the international markets, and the growing diminishment of the diversification benefits from international investing.  But to bet on the outcome specifically is more challenging, and I think its so much more difficult not being in the thick of things.  We take transparency in some ways for granted, and while our markets and economy may be relatively more transparent than China's, it is not clear to me that they are going to make the same mistakes that we do.  They are sure to make mistakes, as we all are.  But making mistakes is just part of life and learning.  Its how you react to those mistakes -- what you do now to fix/correct them, and what you do differently in the future that determines whether its been a good or a bad lesson.  But I find it really challenging to believe that a centrally planned economy can be as successful as a relatively open one can be.  It may well be that neither
of our economies are open, and we are a lot closer than we think ....


The key to China is what the Rhodium analysis pinpoints: can the Chinese gov't, the central authority, pull off the reforms necessary to result in the estimated (guess) 6% growth by 2020?
The challenge is simple but profound. Central authority = a level of control most less-than-authoritarian regimes would give their eye teeth for. The Chinese have now had 40+ years of experience pushing and pulling the levers of an embryonic economy into the behemoth it has become.
So far so good.
But the easy part is rapidly drawing to a close. The leadership is not dumb. They know and understand the challenge they face. Xi Jinping may be better placed than Hu Jintao was to transition into reform mode. The difference is that Xi has thus far shown he has solid control of his Politburo. Hu Jintao never got there and much of the current corruption campaign is aimed at the previous members who fattened their fortunates and lined their wallets. That is step one.
The second step, reform, is the real challenge. How do you open up an economic system and reduce government control of the economy and still hold onto the levers of power that a one-party government needs to stay in power?
Here again, there is no precedent, no playbook, no prior experience. Virgin territory again as has been the case since modern China began to develop in the 1970s.
There is agreement (as the Rhodium study indicates) on what needs to be done. But how?

Thursday, August 7, 2014

I was recently asked a series of question for commentary by MODERN WEEKLY a Chinese publication that circulates nationally out of Beijing.

The questions reflect that there are many publications in China (all government owned and controlled) that are not all propaganda.

The questions and my responses in italics.

Q1: Several days ago, the House of Representatives voted to sue President Obama for abusing his power while carrying out his signature "Obamacare" health care reform bill in 2010. Though the Democrats denounced the move as a cynical election-year stunt, Obama has indeed met obstacles in getting his substantial legislation through Congress. With two years and a half left in the Oval Office, has Obama entered the lame-duck session earlier than the conventionalWhat does his governing ability depend on?

The general feeling is that there is little expectation that the Obama Administration will be able to carry out any substantive policy changes in the next two years. If the mid-term elections in November this year give the Republicans control of both the Senate and the House of Representatives the President's prospects will be even more isolated.
The President's lame-duck status has occurred earlier than usual. The cause is the  
polarization of American politics that poses a risk to the American legislative system that is fundamentally based on compromise.

2: This fall's midterm election will be an intense battleground in which the Democrats and Republicans race for Senate and House seats. Apparently what the Democrats worry most is the loss of control in the Senate. What adverse factors do you think the Democrats now face and how will the result of midterm election affect the two parties' move following up?

The fact is that in the House of Representatives there are few truly contested seats. Most Representatives have succeeded in creating what the British call "rotten boroughs", districts that overwhelmingly support the incumbent candidate. More than 80% of House members are almost automatically re-elected. a situation that threatens the foundation of electoral politics, and makes shifts in control unlikely.
Conversely Senators must stand for election throughout a state with a better balance of voters. But here too the polarization of American politics has created sections of the country where opposition parties have an increasingly difficult time being anything more than a minority at election time.
This midterm election is too close to call. If the Democrats lose control of the Senate, there are some who say this may be a better result for the President than the current split between Republicans in the House and Democrats in the Senate. The current split leaves a stalemate. An opposition legislature gives the President a clear adversary.  

Q3: Thorny domestic issues like immigration, health care, economy and so on, which one do you think Obama should put into priority in order to make gains in the next few yearsCan you have an analysis of the two parties’ policy over major domestic issues?

There are many "ifs" in this question.
If the Democrats lose control of both houses of Congress there will be no substantive legislation passed on the President's agenda. Immigration reform will be dead. The Republicans will likely attempt to nibble away at Obamacare along with attempts to push their favored economic concept: tax cuts. This will put the President in a position of vetoing Republican led legislation that will further stall the legislative process.
If the Democrats maintain control of the Senate, the President may try to produce compromise legislation on immigration reform; but the chances are slim. Obamacare will remain safe unless there are further court challenges that prove successful. 
The US economy continues to improve. If that pattern holds, the President's best bets are economic initiatives (including a rise in the federal minimum wage). 

Q4Surveys have repeatedly found Obama's approval ratings on international affairs are at an all-time low. With no apparent solution to end the violence in Ukraine, Gaza, Iraq, Syria and Afghanistan, and little breakthrough in Iran talks, is America having less impact over global issues or is Obama becoming more restrained to "lead" the world? 

The past impact of the US on foreign conflicts may seem larger than it was. That may be what we are seeing now. 
The conflicts in the Middle East have changed little in the last decade. 
The Israeli-Palestinian confrontations move from armed conflict to intractable negotiation. 
The Syrian Civil War continues but the major powers have not intervened directly on either side. If anything that is a positive. 
The Ukraine is President Putin using foreign policy to keep his domestic image popular. While successful, the US and the EU have also coordinated boycott policy to isolate Russia as much as possible. The Russian economy is weak and threatens to weaken. By some measure this is a success of US-EU foreign policy. 
Iran has no obvious imminent solution, but diplomatic talks currently underway will likely lead to a longer-term solution. One thing is clear. Neither side wants or speaks of a conflict.
This leaves the public with headlines about armed conflict in Gaza, civil war in Syria, and armed conflict in the Ukraine. The impressions are fearsome, but the facts support a view that the heavy reliance by the US and the EU on diplomacy and diplomatic tools, including economic boycott, are proving slowly but relatively successful. 
Iran may be the most positive example of change. The very lack of conflict does not make for headlines and therefore gets lost in the noise of combat elsewhere.

Q5: Will the international crises emerging in a row divert U.S.'s attention from Asia, especially as a response to China's economic and military might?

Yes and no. 
There is no question that the areas of conflict in the rest of the world preoccupy both the US and the EU and leave less time and effort for Asia. Despite the continuing conflicts over disputed islands in Asian waters, the threat of armed conflict is more noise than reality. There is the current likelihood of high level negotiations between China and Japan to lower the level of threat and tension; despite continuing verbal bluster to the contrary.
China continues her growth economically and militarily, but the economic rate of growth is reduced. That presents China with domestic concerns to provide for 22 million new jobs every year, continued reform in education, as well as the ongoing policy of fighting corruption at all levels. 
The growth of China's military can be seen two ways. The PLA as recently as the last decade was outmoded. A military based on manpower when modern military challenges are technological, not based on the size of an army and navy. 
Modernization has been the policy of Chinese military growth and will continue to be for the next decade and more. This is a long-term necessity. To others this may seem threatening, but the Chinese military and civilian leadership know that the changes are still catching-up to the reality of modern military needs.

Q6: What do you suggest Obama should do to walk himself out of the predicament and gain more room for administration?

President Obama has a good sense of humour. I expect his answer to this question might be: "Advance the calendar to January 2017 and let me get out of here."
There is little if anything President Obama can do proactively to improve his ability to govern. Too much depends on hope. 
Hope that the Democrats can hold onto the Senate majority. 
Hope that the Republicans continue their internal conflicts between their right wing and their less strident center and thereby weaken their ability to take initiatives. 
The unlikely hope, but still a hope that one of the more conservative Justices of the US Supreme Court retires and gives the President the opportunity for an appointment closer to his political philosophy.
The President can and will take foreign initiatives. He will continue to emphasize diplomacy over military engagement. If successful, this will create a better image for US foreign policy and Mr. Obama's leadership. That can have positive effects on his ability to undertake domestic initiatives.
But the final two years will be what they always are, a struggle against legislative irrelevance as the political reality looks forward to 2016 and an open race for the next American President. 

Friday, August 1, 2014


A TV series produced. and in some episodes directed and/or written by David Mamet. Since "24" and its aggressive portrayal of an America that is forceful to the point of ignoring the human rights and values the US often extols, I had not seen a similar point of view from the TV/Hollywood Community that often wears liberalism on its sleeve.

David Mamet's platform is a secret military unit (based on a book about the real "Delta Force") "created by Congress in the 1970s that answers only to the President of the US". A Praetorian Guard that reaches out to right wrongs, protect and defend its own. and wreak justice.
The action stories are often cliched, the good guys usually win, only secondary characters are killed in shootouts and firefights that would see casualty rates exceeding 60%. But this is TV tinged with enough plausibility to keep some viewers watching; me included.
I am fascinated largely because I try to understand David Mamet's participation, a writer I have long enjoyed and a deft playwright. Glengarry Glenn Ross is among Mr. Mamet's best in his understanding  and view of man's nature. So how did he become the man behind THE UNIT?
I knew Mr. Mamet as a liberal, which he was. But ten years in China made me miss a lot in the USA. I missed Mr. Mamet's political transition and then caught up it with the following from THE VILLAGE VOICE in NY city, once the bastion of Manhattan liberals:

David Mamet: 

Why I Am No Longer a 'Brain-Dead Liberal'

An election-season essay

 By David Mamet Tuesday, Mar 11 2008

John Maynard Keynes was twitted with changing his mind. He replied, "When the facts change, I change my opinion. What do you do, sir?"

My favorite example of a change of mind was Norman Mailer at The Village Voice.

Norman took on the role of drama critic, weighing in on the New York premiere of Waiting for Godot.

Twentieth century's greatest play. Without bothering to go, Mailer called it a piece of garbage.

When he did get around to seeing it, he realized his mistake. He was no longer a Voice columnist, however, so he bought a page in the paper and wrote a retraction, praising the play as the masterpiece it is.

Every playwright's dream.

I once won one of Mary Ann Madden's "Competitions" in New York magazine. The task was to name or create a "10" of anything, and mine was the World's Perfect Theatrical Review. It went like this: "I never understood the theater until last night. Please forgive everything I've ever written. When you read this I'll be dead." That, of course, is the only review anybody in the theater ever wants to get.

My prize, in a stunning example of irony, was a year's subscription to New York, which rag (apart from Mary Ann's "Competition") I considered an open running sore on the body of world literacy—this due to the presence in its pages of John Simon, whose stunning amalgam of superciliousness and savagery, over the years, was appreciated by that readership searching for an endorsement of proactive mediocrity.

But I digress.

I wrote a play about politics (November, Barrymore Theater, Broadway, some seats still available). And as part of the "writing process," as I believe it's called, I started thinking about politics. This comment is not actually as jejune as it might seem. Porgy and Bess is a buncha good songs but has nothing to do with race relations, which is the flag of convenience under which it sailed.

But my play, it turned out, was actually about politics, which is to say, about the polemic between persons of two opposing views. The argument in my play is between a president who is self-interested, corrupt, suborned, and realistic, and his leftish, lesbian, utopian-socialist speechwriter.

The play, while being a laugh a minute, is, when it's at home, a disputation between reason and faith, or perhaps between the conservative (or tragic) view and the liberal (or perfectionist) view. The conservative president in the piece holds that people are each out to make a living, and the best way for government to facilitate that is to stay out of the way, as the inevitable abuses and failures of this system (free-market economics) are less than those of government intervention.

I took the liberal view for many decades, but I believe I have changed my mind.

As a child of the '60s, I accepted as an article of faith that government is corrupt, that business is exploitative, and that people are generally good at heart.

These cherished precepts had, over the years, become ingrained as increasingly impracticable prejudices. Why do I say impracticable? Because although I still held these beliefs, I no longer applied them in my life. How do I know? My wife informed me. We were riding along and listening to NPR. I felt my facial muscles tightening, and the words beginning to form in my mind: Shut the fuck up. "?" she prompted. And her terse, elegant summation, as always, awakened me to a deeper truth: I had been listening to NPR and reading various organs of national opinion for years, wonder and rage contending for pride of place. Further: I found I had been—rather charmingly, I thought—referring to myself for years as "a brain-dead liberal," and to NPR as "National Palestinian Radio."

This is, to me, the synthesis of this worldview with which I now found myself disenchanted: that everything is always wrong.

But in my life, a brief review revealed, everything was not always wrong, and neither was nor is always wrong in the community in which I live, or in my country. Further, it was not always wrong in previous communities in which I lived, and among the various and mobile classes of which I was at various times a part.

And, I wondered, how could I have spent decades thinking that I thought everything was always wrong at the same time that I thought I thought that people were basically good at heart? Which was it? I began to question what I actually thought and found that I do not think that people are basically good at heart; indeed, that view of human nature has both prompted and informed my writing for the last 40 years. I think that people, in circumstances of stress, can behave like swine, and that this, indeed, is not only a fit subject, but the only subject, of drama.

I'd observed that lust, greed, envy, sloth, and their pals are giving the world a good run for its money, but that nonetheless, people in general seem to get from day to day; and that we in the United States get from day to day under rather wonderful and privileged circumstances—that we are not and never have been the villains that some of the world and some of our citizens make us out to be, but that we are a confection of normal (greedy, lustful, duplicitous, corrupt, inspired—in short, human) individuals living under a spectacularly effective compact called the Constitution, and lucky to get it.

For the Constitution, rather than suggesting that all behave in a godlike manner, recognizes that, to the contrary, people are swine and will take any opportunity to subvert any agreement in order to pursue what they consider to be their proper interests.

To that end, the Constitution separates the power of the state into those three branches which are for most of us (I include myself) the only thing we remember from 12 years of schooling.

The Constitution, written by men with some experience of actual government, assumes that the chief executive will work to be king, the Parliament will scheme to sell off the silverware, and the judiciary will consider itself Olympian and do everything it can to much improve (destroy) the work of the other two branches. So the Constitution pits them against each other, in the attempt not to achieve stasis, but rather to allow for the constant corrections necessary to prevent one branch from getting too much power for too long.

Rather brilliant. For, in the abstract, we may envision an Olympian perfection of perfect beings in Washington doing the business of their employers, the people, but any of us who has ever been at a zoning meeting with our property at stake is aware of the urge to cut through all the pernicious bullshit and go straight to firearms.

I found not only that I didn't trust the current government (that, to me, was no surprise), but that an impartial review revealed that the faults of this president—whom I, a good liberal, considered a monster—were little different from those of a president whom I revered.

Bush got us into Iraq, JFK into Vietnam. Bush stole the election in Florida; Kennedy stole his in Chicago. Bush outed a CIA agent; Kennedy left hundreds of them to die in the surf at the Bay of Pigs. Bush lied about his military service; Kennedy accepted a Pulitzer Prize for a book written by Ted Sorenson. Bush was in bed with the Saudis, Kennedy with the Mafia. Oh.

And I began to question my hatred for "the Corporations"—the hatred of which, I found, was but the flip side of my hunger for those goods and services they provide and without which we could not live.

And I began to question my distrust of the "Bad, Bad Military" of my youth, which, I saw, was then and is now made up of those men and women who actually risk their lives to protect the rest of us from a very hostile world. Is the military always right? No. Neither is government, nor are the corporations—they are just different signposts for the particular amalgamation of our country into separate working groups, if you will. Are these groups infallible, free from the possibility of mismanagement, corruption, or crime? No, and neither are you or I. So, taking the tragic view, the question was not "Is everything perfect?" but "How could it be better, at what cost, and according to whose definition?" Put into which form, things appeared to me to be unfolding pretty well.

Do I speak as a member of the "privileged class"? If you will—but classes in the United States are mobile, not static, which is the Marxist view. That is: Immigrants came and continue to come here penniless and can (and do) become rich; the nerd makes a trillion dollars; the single mother, penniless and ignorant of English, sends her two sons to college (my grandmother). On the other hand, the rich and the children of the rich can go belly-up; the hegemony of the railroads is appropriated by the airlines, that of the networks by the Internet; and the individual may and probably will change status more than once within his lifetime.

What about the role of government? Well, in the abstract, coming from my time and background, I thought it was a rather good thing, but tallying up the ledger in those things which affect me and in those things I observe, I am hard-pressed to see an instance where the intervention of the government led to much beyond sorrow.

But if the government is not to intervene, how will we, mere human beings, work it all out?

I wondered and read, and it occurred to me that I knew the answer, and here it is: We just seem to. How do I know? From experience. I referred to my own—take away the director from the staged play and what do you get? Usually a diminution of strife, a shorter rehearsal period, and a better production.

The director, generally, does not cause strife, but his or her presence impels the actors to direct (and manufacture) claims designed to appeal to Authority—that is, to set aside the original goal (staging a play for the audience) and indulge in politics, the purpose of which may be to gain status and influence outside the ostensible goal of the endeavor.

Strand unacquainted bus travelers in the middle of the night, and what do you get? A lot of bad drama, and a shake-and-bake Mayflower Compact. Each, instantly, adds what he or she can to the solution. Why? Each wants, and in fact needs, to contribute—to throw into the pot what gifts each has in order to achieve the overall goal, as well as status in the new-formed community. And so they work it out.

See also that most magnificent of schools, the jury system, where, again, each brings nothing into the room save his or her own prejudices, and, through the course of deliberation, comes not to a perfect solution, but a solution acceptable to the community—a solution the community can live with.

Prior to the midterm elections, my rabbi was taking a lot of flack. The congregation is exclusively liberal, he is a self-described independent (read "conservative"), and he was driving the flock wild. Why? Because a) he never discussed politics; and b) he taught that the quality of political discourse must be addressed first—that Jewish law teaches that it is incumbent upon each person to hear the other fellow out.

And so I, like many of the liberal congregation, began, teeth grinding, to attempt to do so. And in doing so, I recognized that I held those two views of America (politics, government, corporations, the military). One was of a state where everything was magically wrong and must be immediately corrected at any cost; and the other—the world in which I actually functioned day to day—was made up of people, most of whom were reasonably trying to maximize their comfort by getting along with each other (in the workplace, the marketplace, the jury room, on the freeway, even at the school-board meeting).

And I realized that the time had come for me to avow my participation in that America in which I chose to live, and that that country was not a schoolroom teaching values, but a marketplace.

"Aha," you will say, and you are right. I began reading not only the economics of Thomas Sowell (our greatest contemporary philosopher) but Milton Friedman, Paul Johnson, and Shelby Steele, and a host of conservative writers, and found that I agreed with them: a free-market understanding of the world meshes more perfectly with my experience than that idealistic vision I called liberalism.

At the same time, I was writing my play about a president, corrupt, venal, cunning, and vengeful (as I assume all of them are), and two turkeys. And I gave this fictional president a speechwriter who, in his view, is a "brain-dead liberal," much like my earlier self; and in the course of the play, they have to work it out. And they eventually do come to a human understanding of the political process. As I believe I am trying to do, and in which I believe I may be succeeding, and I will try to summarize it in the words of William Allen White.

White was for 40 years the editor of the Emporia Gazette in rural Kansas, and a prominent and powerful political commentator. He was a great friend of Theodore Roosevelt and wrote the best book I've ever read about the presidency. It's called Masks in a Pageant, and it profiles presidents from McKinley to Wilson, and I recommend it unreservedly.

White was a pretty clear-headed man, and he'd seen human nature as few can. (As Twain wrote, you want to understand men, run a country paper.) White knew that people need both to get ahead and to get along, and that they're always working at one or the other, and that government should most probably stay out of the way and let them get on with it. But, he added, there is such a thing as liberalism, and it may be reduced to these saddest of words: " . . . and yet . . . "

The right is mooing about faith, the left is mooing about change, and many are incensed about the fools on the other side—but, at the end of the day, they are the same folks we meet at the water cooler. Happy election season.