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Sunday, June 5

Bush and Rumsfeld chip away at Washington's double standard: A Head's Up for Americans doing business in China and Israeli defense contractors

On the flight to Singapore, [Donald] Rumsfeld said ties with India would strengthen while those with China could fray if Beijing did not open its society more.

Rumsfeld previewed findings of the Pentagon's annual report to Congress about the Chinese military, saying, "China's defense expenditures are much higher than Chinese officials have publicly admitted. It is estimated that China's is the third-largest military budget in the world, and now the largest in Asia."

Warnings about China's military modernization have been issued before, but Rumsfeld's remarks were notable because they came at an Asian security conference attended by defense ministers and military specialists from across Asia and the Pacific Rim.*
Actually, it was Bill Gertz who previewed the Pentagon's annual report on China's military; he did that last Sunday on Matt Drudge's radio show. Mr Gertz has impeccable credentials as an investigative journalist and he's highly connected, as they say, in the US defense/intelligence spheres. He's the author of Treachery: how America's friends and foes are secretly arming our enemies. The book is required reading for anyone still harboring the belief that a nation's survival depends on adhering to a double standard with allies.

Here are my notes on Drudge's interview with Gertz--with the caveat that Pundita doesn't do shorthand; boldface type indicates where I filled in gaps with my own language.

> The Pentagon getting ready to release it's annual report on Chinese military power. There is big debate in Washington about chapter two of the report: China's Future [with regard to military buildup, I assume]. Within 15-20 years...working on anti-US strategy in preparation [for armed conflict with US over Taiwan, I think he said?]...

> NSC staff trying to play down the report. There are two camps: State Department and Pentagon. State wants a soft approach to China--pretty much more of the same old US policy toward China: hollow tough talk. Rumsfeld for tougher approach.

Gertz: "Rumsfeld's saying wait a minute, we don't know where China is going. We're dealing with a pseudo-capitalist economy that is building up military against us."

> Gertz says that all scenarios for China military development are not good. There used to be a balance but now China shifting and building up rapidly against Taiwan..."There is a real danger of conflict by miscalculation"...

Drudge: "Where is China getting the money for the buildup?"
Gertz: "US trade is building the Chinese military for them..."

> Drudge: "How much pressure is Bush putting on Israel about their [military] technology transfers to China?"

Gertz: "Israel has had a very dynamic technology transfer with China....We need to reevaluate the military trade with China. [With Israel] it's been the greed factor..."

> Gertz says the Pentagon alarmed about the Harpie--an anti-radiation missile. "They've spotted some of these Israeli-supplied drones...[I didn't get down the rest]"

> Drudge: "Would you characterize China as a US enemy?"
Gertz: "Yes. It was big mistake to allow the Chinese to take the lead on six party talks with North Korea..."

We've gone down this road before with China but it never lasts long. Sooner or later, Washington gives into US businesses determined to use China as a plantation and US Calculator Christians salivating over the huge untapped market for conversion that China's billion-strong population represents.

And Secretary Rumsfeld's comments still avoid tackling China's geopolitical strategy.(1) This is despite the fact that in Burma, in Nepal, in Vietnam, in North Korea, in Zimbabwe, in Pakistan, in Iran--everywhere there is a regime hell-bent on sticking to despotism, there you will find China helping to prop it up.

Then Washington wonders why Vladimir Putin gets sarcastic in response to lectures about his affronts to democracy and Russia's weapons sales to Argentina and Syria.

When the Chinese are called out on their strategy they fall back on discussing America's double standard during the Cold War era. This argument overlooks that for every evil America did in the world by propping up dictators we did a thousand times more good. Indeed, we rescued China from mass starvation.

But I press on to my point, which is that Rummy's comments signal a sea change that's been building in Washington since 9/11. For decades the US Department of State ran US foreign policy, then with Clinton's entry into office State managed to hamstring the US military not to mention the CIA.

Pundita has no comment about the disputes regarding Rummy's modernization of the DoD, which are outside my purview. However, I feel safe in observing that under Rumsfeld's leadership, and with President Bush's encouragement, the Pentagon has correctly battled to take back advisory turf that should belong to the military.

There have no been no bullets fired but this has been a life-or-death battle, with America's future at stake. Foreign policy must be built on defense policy, not the other way around. Yet over the course of the Cold War defense policy came to mean 'getting along with US allies,' which devolved into pandering to allies.

That is how it came to pass that France and Germany sold weapons to Saddam's regime. That's how it came to pass that Israel sold weapons technology to China, which China turned around and sold to Israel's enemies! That is how it came to pass that Saudi Arabia bankrolled the Islamic Bomb, which Libya and several other countries were building--with China's help--before we caught them red-handed. The list goes on and on.

Yet clearly the human race has passed from the era where a double standard in foreign policy can be considered practical. It's suicidal, is what it is; Rumsfeld's tough comments about China represent a recognition of this. The question is whether State, and the US lobbies and congressionals who support a double standard toward China, will retain the high ground.

Feeling my way to an answer, I think that recent comments by Condoleezza Rice suggest that a faction at State is coming around to the radical idea that diplomacy is supposed to follow defense policy not lead it.

But State, and the congressionals who support a tougher US line on China, are up against something in transnational trade that's been termed Velocity.(1) The term is a fancy way of saying that it's how fast you get your goods to the customer and service the wholesale buyer that gives the edge in a fiercely competitive globalized market.(2)

Beijing took the pulse of the globalized business era then made sure to build and modernize infrastructures in China that facilitate rapid transport of goods around the globe. So it's not accurate to say that cheap labor explains China's business success. The success has been due to a variety of factors, which include military control to insure safety for foreign business plants and dock operations.

But the velocity factor is huge. So while it's true that the US doesn't "have" to do business in China, offshoring US plants to other developing countries that could use our business is unfeasible in many cases because they don't have the infrastructures to support big offshore trade. And the crime situation, which includes the kidnapping industry, is a nightmare for foreign companies sited in many developing countries.

Yet we could begin to invest more in countries that have a better human rights record and are friendlier to the US than China. That is the only way Beijing will listen to protests about their support of tyranny at home and abroad.

(1) For a recent analysis of China's geopolitical strategy, read Dana Robert Dillon's May 11, 2005 report for the Heritage Foundation, China's Zombie Countries .

(2) For an introduction to the velocity business concept (and how it's impacted the US military and Donald Rumsfeld's thinking), see Velocity Management: The Business Paradigm That Has Transformed U.S. Army Logistics by Marygail Brauner, et al.

* The online newspaper I quoted (azcentral.com) blocked me from returning to the page when I went to collect their URL. They wanted Pundita to run the gamut of a questionnaire before allowing me to see the URL link to the article. So I can't give the quotes proper accreditation.
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