The "Humanizing" of China x3

Like America's vaunted currency bashers, the West sometimes views China as a distant other unaccountable to, well, Western codes of conduct. Supposedly, this holds true for any number of things--the environment, human rights, and commercial conduct. We have all read about China's general nonchalance about the environment, its arbitrary detention of multinational employees, and its blase attitude towards property rights.

Or are these really so? The Financial Times offers a cornucopia of stories that suggest China is not as unaccountable as it is often made out to be. First, we have a tale of apparatchiks closing down a third plant in a month due to environmental concerns, this time due to the lead poisoning of many young'uns:

China has closed a manganese smelter after more than 1,300 children living near it were found to suffer from lead poisoning, state media said on Thursday. The scandal marks the third public case of metal contamination in less than a month. It comes at a time when the Chinese government has become increasingly worried about the environmental and health costs of pollution, and of rising public anger over the problem.

Authorities closed the Jinglian manganese smelter in Wenping town in southern Hunan province and detained two executives after 1,354 children were diagnosed with excessive lead levels in their blood, Xinhua, the official news agency, reported on Thursday. The Wugang city government said in a statement on its website that the Jinglian manganese factory had operated illegally and discharged lead exceeding legal limits...

The series of industrial pollution cases is only becoming public as escalating protests force the government’s hand. Soil and water contamination from heavy industry is widespread in China, but local authorities often ignore residents’ complaints until protests turn violent or the issue is revealed to a wider public over the internet. At Wenping, about 1,000 villagers earlier this month blocked a road and turned over a police car during a protest against toxins from the manganese smelter, the China Daily added.

My inclination is to think that Party leadership is more concerned about preventing social unrest than about environmental destruction. Witness China's unwillingness to consider its carbon emissions "until 2050." There, it's carbon caps fueling fears of being unable to provide livelihoods for rapidly urbanizing China as the cause for concern since it can foment unrest. In either case, placation, not the environment, is the thing.

Next we have China making a rapprochement with that bastion of wretched Western capitalism, Rio Tinto, after the infamous jailing of its executives. While this issue remains unresolved, both sides are trying to set it aside in the meantime while business interests predominate:

Driven by the Chinese government’s infrastructure-centred stimulus spending, the steelmakers have been restocking. To do so, they need the high-quality Pilbara iron ore whose supply is dominated by Rio, the world’s second-biggest iron ore producer, and BHP Billiton, the third-biggest.

Thanks to China’s appetite, Rio’s iron ore division accounted for more than 50 per cent of underlying first-half profits of $6.1bn (£3.7bn). Both sides know that the relationship needs to return to normality, probably through delicate, mutually face-saving solutions to two related problems.

The first is the price that the steelmakers pay Rio for their iron ore. This is still nominally agreed through a annual price negotiation, but that system is changing...The other issue that awaits resolution is the fate of the four Rio employees who were arrested in July. They were involved in the iron ore pricing negotiations and were detained on allegations of obtaining state secrets, suggesting that they knew information about Chinese steel mills that not only gave them an edge in negotiating prices but also was illegal for any non-state entity to possess.

My sense is that China will not push on these trumped up charges too much in fear of discouraging foreign investment. Still, it has demonstrated that it does not appreciate being crossed in so public a fashion and will retaliate if need be.

Our last FT feature is on software piracy in China. Here we have officials jailing four sellers of pirated copies of Microsoft Windows XP:

Microsoft said it had won a major battle against software piracy in China after four people were on Thursday sentenced to jail for illegal reproduction and distribution of the Windows XP software through a website called “Tomato Garden”. The US company said the court victory was the first successful criminal prosecution against large-scale software privacy in China.

“The judgement declares the collapse of China’s biggest online software privacy group. It is a milestone in the fight against online software privacy in China,” the company said.

Tomato Garden allowed the public to download pirated software for free, in return for advertising revenues, according to Microsoft. The software company, quoting unofficial estimates, said more than 10m “Tomato Garden” Windows XPs had been installed in China.

While long a point of dispute, my contention is that software piracy is rampant whether in China or elsewhere in the world. It is child's play to find pirated copies of software by Microsoft or others. The ultimate test, of course, is whether jailing these Tomato Garden-Mr. Potato Heads will actually lessen the distribution of pirated software in China. My answer is a clear no. Then again, showing that PRC officialdom is "doing something" about the problem does count for PR points, no?

As with many things in life, these incidences are all about play acting: pretending to be concerned about the environment to keep a lid on social unrest; pretending to be friends with Rio Tinto when (Wen?) you'd much rather kick them in the balls; and pretending to crack down on software pirates to appease IP hawks when piracy doesn't really keep you awake at night. The Chinese are becoming very good at this sort of balancing act, but I wouldn't want to be around when the farce is revealed.