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China’s condition on May 4, 2004 ……

China's censorship machine endures

"It used to be that they would punish people who made too many mistakes. Now, you don't have the leeway to make mistakes." --- A Chinese editor, speaking on condition of anonymity

DON'T SAY IT: The country's mad rush toward capitalism had begun to create conditions favorable for freedom of speech, but officials are slamming that door shut again

NY TIMES NEWS SERVICE , BEIJING

During the Cultural Revolution, China's propaganda department often made hyperbolic charges against intellectuals -- capitalist roaders, enemies of the people -- accused of betraying Mao Zedong.

So when Jiao Guobiao, a journalism professor at Beijing University, was searching for words to describe China's still all-powerful department of censors and standard-setters more than 30 years later, he borrowed from its lexicon of vitriol.

The department is spiteful, like the Nazis, he wrote in a recent essay. It thinks itself infallible, like the pope. In the 1950s it covered up the starvation of millions of people. Today, he charged, it lies about SARS.

"Their censorship orders are totally groundless, absolutely arbitrary, at odds with the basic standards of civilization, and as counter to scientific common sense as witches and wizardry," he wrote in the article -- which has been widely circulated via the Internet in Beijing despite, not unpredictably, being banned by the Communist Party's propaganda department.

Such explicit outbursts of dissent are still rare in China. But Jiao is not alone in expressing frustration that, even after a long-awaited transition to a new generation of leaders some 18 months ago, China's political scene remains stultifying. Intellectuals, Jiao said, are "supposed to act like children who never talk back to their parents."

Many had hoped the leadership team headed by the party's chief, President Hu Jintao, would tolerate more open debate. But it has instead slapped new restrictions on free speech and the media that some say remind them of the repressive years after the 1989 Tiananmen Square crackdown.

State security agents have been scouring the Internet and pressing charges against people who use it to distribute information or express opinions deemed unfavorable. The authorities harassed scholars who took part in a debate about constitutional changes, disappointing some who believed that Hu had once invited discussion about how to strengthen the rule of law.

Last month, Beijing decided against allowing full democracy in Hong Kong, even though many in the former British colony felt they were promised that right when China assumed sovereignty in 1997.

The political environment may reflect a seasonal shift to tight controls during the spring Communist Party meetings and a state of high alert ahead of the 15th anniversary of the June 4, 1989, Tiananmen massacre.

But some see worrying signs that the leadership remains instinctively hostile to political discussion and more independent news media. Scholars say they now suspect that Hu is not as forward-looking as they once hoped and at any rate must still defer to Jiang Zemin, the military chief, who handed the formal reins of power to Hu in late 2002 but by many accounts remains a domineering influence.

"I don't think we had a real transfer of power or a turning point in leadership," said He Weifang, a law professor at Beijing University. "There was a moment after Mr. Hu took control when people were optimistic, but now things are even tighter than before."

The most conspicuous sign of that tension is in the news media. In recent years many newspapers, TV stations and Web-based media have flourished in a more market-driven environment. Diversity and competition seemed to foster more open discussion of sensitive topics, including corruption, legal reforms, foreign affairs, crime, business abuses and other matters that were once taboo.

But pressure to conform to political norms, which never went away, has been strongly reasserted in recent months, people in the industry say.

Propaganda officials have increased their presence inside news, culture and entertainment organizations, and have refined a system for pre-censorship that leaves less discretion in the hands of editors.

"It used to be that they would punish people who made too many mistakes," said the editor of a leading political magazine. "Now, you don't have the leeway to make mistakes."

Among topics now considered off-limits, the media are no longer permitted to investigate corruption without approval. That limits what many had seen as one of the few effective checks on official wrongdoing, reporters and editors said.

Hu and Premier Wen Jiabao have been promoting themselves as populists determined to address poverty in the countryside.

But when two writers in Anhui Province wrote an in-depth critique of the handling of such problems, called An Investigative Report on Chinese Peasants, the book was banned and the publishing house that issued it came under pressure, possibly because the book argued that the most severe problems had been caused by officials.

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On May 4, 2004 …

Not every profit profits the nation

By Huang Tien-lin

The closer summer gets, the more serious China's power shortage becomes. Guangzhou City is implementing a plan in which 4,000 companies are now allowed to operate only five days a week with a rotating two-day weekend. The situation is just as serious in eastern China, where there have been reports that the Kunshan area in Jiangsu Province is turning off the power supply two days each week. This affects many Taiwanese businesses that have set up operations in China, including high-tech industries.

Experts estimate that China's power-supply problem will be dealt with by next year at the earliest. It is hoped that this problem will to some degree slow down Taiwanese investment in China, which would be beneficial to Taiwan's domestic investment and consumption.

There is also a shortage of Chinese high-grade steel. Steel prices soared by 28.1 percent between the first half of last year and February this year, to the joy of large and small Taiwanese steel producers. China Steel earned almost NT$37 billion last year, and pre-tax profits for the first quarter this year reached NT$12.6 billion. In 18 months the corporation's share price has increased from NT$14.9 to almost NT$35, or 134 percent. The market value of China Steel (with equity capital of NT$94.5 billion) has seen an explosive increase of NT$126.6 billion, while the steel industry as a whole has seen an increase of NT$200 billion to NT$300 billion, a considerable jump.

As it happens, of Taiwan's largest industries, the power and steel industries were the two most eager to invest in China in 1995 and 1996, but they were restricted by former president Lee Teng-hui's "no haste, be patient" policy. In 1995, Formosa Plastics chairman Wang Yung-ching signed a memorandum of intent to invest US$3 billion in the Zhangzhou Houshi Power Plant in Fujian Province. Later, the President Group announced a joint venture with Southland Corporation to invest in a hydropower plant in Wuhan.

Other groups eager to try their luck would not be left behind. Investment in big steel plants was even more popular than in power plants. Large steel manufacturers to announce investment in China from 1995 to 1996 included Chun Yuan Construction, Tah Chung Steel Corp, Yuli and Mingchia. Each project involved at least US$3 billion.

Work on the Zhangzhou power plant began in March 1997. But the other power and steel plant projects were canceled as a result of the "no haste, be patient" policy, and the Zhangzhou project shrank. At the time, they said that "if we don't leave, all the others will." But as Taiwanese businesses stayed away, so did US, Japanese and European steel and power-plant firms.

Six years later, in 2002, China began to suffer from shortages of power and steel. Looking back, it was correct to have everyone stay away according to the "no haste, be patient" policy. At the time, Taiwan seemed to have forsaken a prime business opportunity, but six years on, Taiwan's steel industry has made considerable profits. In other words, the real business opportunity lay in staying away, not in going in.

If the government hadn't differentiated between friend and foe, instead adopting a laissez-faire, "all development is good" attitude, Taiwan would have built five or six large steel plants and a dozen power plants in China, investing trillions of NT dollars.

Today, when work on the plants would have been completed, steel prices would have fallen drastically -- just like laptop prices at present. So, in addition to the constant danger that comes with investing in China, Taiwan's steel industry would also have been struggling to turn a profit. No matter how big it might be, China Steel might not have been big enough to escape the consequences. This is a salutary example of the difference between an individual company's interests and the interests of an industry.

Having a dozen Taiwanese-backed power plants would also have meant that China would not have experienced power shortages, that its economic growth would have been smoother and that it would have attracted more investment from Taiwan and the international community. Taiwan's economic growth would have decreased and, corresponding to this, China may have deployed not just 500 missiles aimed at Taiwan but aircraft carriers as well.

It is a pity that the "no haste, be patient" policy did not include the IT manufacturing industry. After 1998, many Taiwanese technology companies moved to China without the effective support of the Ministry of Economic Affairs. This helped make China the third-largest technology-producing economy after the US and Japan. We also shouldn't forget that about 70 percent of this production value is created by Taiwanese businesses.

If that hadn't happened, China's GDP would not be as high and its money diplomacy wouldn't be so cashed-up.

Nor would Boeing have refused a visit by Vice President Annette Lu over a Chinese order for 57 aircraft. Nor would French President Jacques Chirac have kowtowed to Chinese President Hu Jintao in the Elysees Palace and opposed a Taiwanese referendum on account of a high speed railway and negotiations with Airbus.

People die for wealth, birds die for food. The same goes for nations, wouldn't you agree?

Huang Tien-lin is a national policy adviser to the president.

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On May 4, 2004 …

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