Sun Tzu: "To subdue the enemy without fighting is the acme of skill."

I expected some disagreement with my admittedly unconventional view - especially that of China. I was surprised, however, that no less a personage than Mr. Gave chose to do so. Through a number of John Mauldin's letters I'm familiar with Mr. Gave's new paradigm of the "platform company" and his "we think, they sweat" view of markets, trade, and profit distributions.

His example of Singapore as a model for future Chinese governmental development is instructive. Lee the Younger is Singapore's third PM (his father was its first, elected in '59); both come from the PAP (People's Action Party) which has never suffered an electoral setback. Singapore may well be the garden spot of the Chinese world. Press reports are almost unanimous in hawking this view. Those papers that disagree are quickly slapped, followed by lawsuits (which they win) followed by injunctions that prohibit further publication.

I confess to having a westernized view of things - I am a westerner. But it is possible, I admit, to adopt an Eastern view; I would suggest that most do, in fact, take Mr. Gave's view and see China as a new land (a new America some believe) rich in opportunity, resources, and labor. To date little of that promise has been realized. In that respect, China is little different from Russia.

In fact, the countries are remarkably similar in their courting of Western investment and technology, and equally remarkable in attempting to steal what cannot be purchased. Most seem to shrug this off as a "folkway" of the East and as acceptable as expense account padding is here. Demosthenes saw Philip of Macedonia doing the same thing to Greece and stated they had "conceded to him a right, which in former times has been the subject of…war.…The right of doing what he pleases, openly fleecing and pillaging.…"

I know it's considered woefully passé to label anyone or any country as Communist and worse still to use the phrase "communist conspiracy." But the idea that China is innocently toddling towards its own peaceful manifest destiny has some flaws. The Middle Kingdom has been inward looking for close to a millennium. Now they have a blue-water and a green-water navy, nuclear missiles, an army of 200 million, the ability to shoot down satellites hundreds of miles in space, and the ability and will to shoot down and hold in detention an American fighter plane and its crew. These developments lead me to believe they possess aspirations beyond their own borders.

Much of the Sino-Soviet relationship, its history, its structure, and its plans are laid out in detail in Anatoliy Golitsyn's New Lies For Old. book is unique in that it was written in '82 and in which he reveals the planned downfall of the Soviet state and its ultimate resurrection. It also reveals how phony splits were created between the two nations that lead the Western powers (chiefly the U.S.) hungry Unlike histories told by other ex-KGB agents, Golitsyn'sfor an ally, to help modernize Chinese armaments."Both in relation to the Soviets in the 1960s and to the Chinese in the 1970s and 1980s, the West has forgotten the error of the German General Staff in helping to rearm the Soviet Union after the Treaty of Rapallo in 1922. The Sino-Soviet scissors strategy has not been recognized for what it is."

And the strategy was ingenious. Why did Western politicians like Nixon, Thatcher, and Reagan seem to have a better rapport with the Chinese? Because making nice to the Left would have triggered an immediate negative response among conservatives. But it was the Right that feared the Soviets more, so they were the natural dupes for the rearmament pitch ("the enemy of my enemy is my friend"). The only thing that was essential was maintaining a fiction of friction. And they've done an admirable job.

Do we have a Sino/Soviet-American war in the future or can the Chinese accomplish the same thing by simply putting its trillion dollars worth of U.S. paper up for sale? The effect would be devastating and would accomplish exactly what bin-Laden has been promoting.

Sixteen years ago we thought the USSR was dead and a new day of freedom and "peace dividends" was upon us. Today Russia is once again run by a gang of thugs that can trace their lineage to the KGB, and Putin's replacement will have the same pedigree. Why should we expect China which, if anything, has been historically more repressive, to be any different?


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