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past commentary               2009   |   2008   |   2007   |   2006   |   2005





















































































Springtime for China and Japan, December 31  


Doubling Down in Pakistan, December 29  


Who Killed Bhutto? December 28  


Castro, Clinging, December 28  


This Land Is My Land! December 24  


The Oil-for-Bananas Summit, December 22  


China and India, Hand-in-Hand, December 21  


Kidnap Victims & Nukes, December 20  


Iran in Latin America, December 19  


Missile Defense, Asian-Style, December 18  


China and Russia Rescue Iran, December 17  


Dealing Dangerous Drugs, December 16  


Goodbye Qaddafi, December 15  


Faith-Based Diplomacy on North Korea, December 14  


The $40 Billion Autocrat? December 13  


A Papal Kowtow, December 12  


Fukuda's New Low, December 11  


Graham Goes to China, December 10  


China and Climate Change, December 8  


Russian Paranoia, December 7  


More on the Hong Kong Elections, December 6  


Poisoning the Process, December 6  


Crime without Punishment, December 1  


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More Idiocy from Zbigniew Brzezinski, November 30  


New York Is Not in Mexico, November 29  


Suing the UN, November 27  


Effete Europeans in Beijing, November 26  


Reds Wearing Blue in Darfur, November 25  


The Ruddslide, November 24  


A Thanksgiving Insult, November 23  


Welcoming Trojan Horses, November 21  


"United Like a Single Fist," November 20  


A Warning for Paulson, November 19  


The UN's Last Chance, November 17  


Postmarks for Freedom, November 16  


Jabbing Japan, November 14  


Googling Anti-Semitism, November 13  


Khan and Kim, November 12  


Shutting Chavez Up, November 11  


Gates the Inoffensive, November 10  


A Step Back in Pakistan, November 9  


Out of the CFE, November 7  


Hotline to Nobody, November 6  


Musharraf and the Tragedy of American Policy, November 5  


More UN Fumbling, November 4  


China's Global Truce, November 2  


Is Russia Our Enemy? November 2  


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Destroying Missiles, October 30  


"Intraparty Democracy"? October 29  


Japan Leaves the War on Terror, October 27  


The Primakov Triangle? October 26  


Buying China, October 25  


Unrest in Tibet, October 23  


All You Really Need to Know About China, October 22  


Another Fundamental Mistake Involving Russia, October 21  


Iran: A Surprise Resignation, October 20  


Conditions for War, October 18  


Libya, Newest Security Council Member, October 17  


Tempest over Tibet, October 16  


The Persian Version, October 15  


It's Only a Chinese Moon, October 9  


Another Bad Idea on North Korea, October 8  


Party Games, October 8  


No More North Koreas, October 4  


No Way, Huawei, October 1  



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The Clash of the Titans, September 28  


"The Smartest People on Earth," September 27  


Bush's "Nothingburger"? September 26  


Mattel in Hell, September 24  


The Asian Century? September 21  


Hello, Dalai! September 20  


Russia's Question, September 19  


Unmasking China, September 18  


"The Worst, Sir, Is War." September 17  


Two Collapses, September 16  


More on the Air Strikes, September 14  


China Tells Off Thomas Friedman, September 12  


Balancing Act, September 10  


Chinese Corruption and its "Cure," September 8  


Bush's Games, September 7  


The List, September 4  


No More Civilians, September 1  


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The Darker Side of Dior, August 30  


Fidel's Favorite, August 29  


Talking with the Taliban, August 28  


Wen to Merkel: Mind Your Own Business, August 27  


Hillary and Terror, August 27  


(New) Leader of the Free World, August 24  


Russian Bare, August 23  


A Different Kind of Danger, August 22  


Shall We Give Aid to North Korea? August 20  


Japan's Bad Memories, August 16  


Fidel at 81, August 14  


Should We Invade Pakistan? August 12  


Georgia on My Mind, August 10  


China's "Nuclear Option," August 9  


Dirty Olympics, August 8  


Mao Bites Dog, August 7  


A-Rod Nation, August 6  


Lead Lobbying, August 5  


Cold(er) War, August 3  


The PLA at 80, August 2  


My Father at 90, August 1  


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Goodbye, Abe, July 30  


The Sochi Effect, July 28  


If You Can't Beat 'Em . . ., July 27  


Free Trade on Planet Kristof, July 26  


Piracy Bust, July 25  


Raptors to Japan, July 25  


Let Taiwan In, July 23  


Mao, Coming Soon to the Big Screen, July 20  


"War Control"? July 19  


Irrational Exuberance on NK, July 18  


The Big Disconnect, July 18  


Elders (Not Betters), July 17  


No Room to Maneuver, July 16  


See Ya, CFE, July 14  


Dept. of Walking and Chewing Gum, July 13  


Banned in China, July 12  


China, in the Black, July 12  


Lost in Translation, July 10  


Peace in Our Time, July 9  


Rice's China Correction, July 8  


Show Trials in China, July 7  


Kim Jong Il, July 6  


The Politics of Investment, July 5  


What China Doesn't Want Us to Know, July 3  


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Ten Years After the Handover, June 29  


A Weekend in Kennebunkport, June 27  


Come Home, Mr. Hill, June 21  


The HRC's Failed First Year, June 21  


China's Arms Trail, June 18  


China's Visible Hand, June 14  


The Totalitarian Olympics, June 13  


Warships for China? June 12  


Charm Offensive by Joshua Kurlantzick, June 11  


Vladimir the Sly, June 8  


China's Population Crisis, June 5  


Forgetting Tiananmen, June 4  


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Iran's Enabler, May 31  


Seoul Train, May 25  


Will China Collapse? May 22  


China's Buying Spree, May 21  


Beyond Japan's "Peace Constitution," May 18  


Trade Showdown with China, May 16  


Taiwan's Missile Gap, May 10  


Exporting Repression, May 7  


The Dangers of Patience, May 3  


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April 15, 2007

North Korea Misses a Deadline

Yesterday marked the deadline for North Korea to shutter its only working reactor. It failed to do so. So how should the United States respond?

Last February, at six-party disarmament talks sponsored by Beijing, North Korea agreed to a two-step plan to dismantle its nuclear weapons program. In the first stage, which ended yesterday, the militant state said it would shut down and seal its reactor in Yongbyon, north of the capital of Pyongyang. Inspectors from the U.N.’s International Atomic Energy Agency would monitor this activity. In the second, the North Koreans committed themselves to disabling all their nuclear facilities and disclosing all nuclear programs.

Not formally part of the deal is America’s promise to allow the return of about US$25 million of North Korean funds held in Banco Delta Asia. In September 2005, the Treasury Department had effectively frozen the funds by designating this Macau bank a “primary money laundering concern.” Banco Delta Asia had previously helped North Korean leader Kim Jong Il hide his money, distribute counterfeit American currency, and launder the proceeds of other state criminal activities. Pyongyang had earlier refused to continue participating in disarmament talks until all frozen funds were returned, and the Chinese took the side of their neighboring ally in the standoff. Washington, in a humiliating about-face, ultimately bowed to Beijing’s demarche and freed all monies.

The North Koreans, however, have taken no steps to claim their funds, which have been available since last Wednesday. Moreover, they have not invited back IAEA inspectors to monitor the shutdown of Yongbyon.

When North Korea failed to meet yesterday’s deadline, Beijing counseled patience and Seoul called the default a technicality. Yet the dispute over the funds in Macau was never about the money, a small sum even by North Korean standards. The dispute was Pyongyang’s way of testing Washington’s will. Having prevailed in forcing America to unfreeze the money—and thereby making it give up most of its leverage—North Korea is now pushing its advantage to the limit by seeing how much longer it can keep its nuclear weapons program.

Many have criticized the Bush administration for agreeing to the February deal and for unfreezing the funds in Macau. The deal looked unworkable from the start, but at this point there is no need to continue arguments about Pyongyang’s intentions. A senior American official said that Washington was willing to give Pyongyang “a few more days.” So by the middle of this week we will know whether the President has adopted the right tack. Either the North Koreans will have adhered to their promise or they will have not.

If they refuse to shut down Yongbyon this week, there will be pressure from Beijing and Seoul to give Pyongyang even more time to comply. Agreeing to another grace period would be a mistake. It will then be clear that we need a completely new policy approach. I believe Washington should then pull out of the ongoing talks and impose new sanctions on North Korea. If the Chinese thought we were resolute, they just might use their leverage to disarm North Korea in order to keep stability in North Asia. After all, Beijing constructively used its influence on Pyongyang in 1994 when the Clinton administration was in the process of adopting a tougher line.

In any event, there is no sense in continuing failed policies. New ones might not work, but at least they have a chance of succeeding.


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March 30, 2007

Iran: Why Has It Taken Hostages at This Time?

Last Friday, Iran’s Revolutionary Guards seized fifteen British sailors and marines in Iraqi waters, provoking an international incident. Since then, there has been much speculation why this powerful military organization, which reports directly to Supreme Leader Ayatollah Ali Khamenei, would undertake such a blatant act. Some speculate that Tehran was looking to swap the British captives for Iranians held by American forces in Iraq while others believe Iran wanted to intimidate or punish London for taking such an active role in then-ongoing nuclear-sanctions discussions in the Security Council.

Perhaps no one outside Tehran knows the motivation for the provocation. Yet the important point is that Khamenei evidently felt he could get away with the seizure. And he may have felt that way because of the general collapse of American foreign policy. From Iraq to North Korea to Sudan, Washington is failing to achieve even interim objectives, much less accomplishing its goals. Now, small states are outwitting and outmaneuvering the world’s sole superpower.

For example, last week North Korea humiliated Washington by forcing the Treasury Department to agree to the return of about US$25 million in funds, which are thought to be the proceeds of counterfeiting and other illegal activity. The Bush administration reversed its long-held anti-money laundering position in order to restart—again—talks with Pyongyang on its nuclear program. The Iranians surely noticed Pyongyang’s victory in a test of will lasting more than a year. Perhaps the timing of the seizure of the British military personnel is no coincidence, especially because during the last half decade the Iranians have been closely watching America’s response to a series of provocations of North Korea’s Kim Jong Il.

In any event, weak regimes engaging in particularly aggressive acts can foreshadow an historic shift in the global balance of power. In other words, we may be seeing the beginning of a quick erosion of the American-led international system. As geopolitical analysts note, when hegemons begin to fail, they usually fall fast.

In the past, the United States was able to recover from what appeared to be terminal decline. Now, the challenge for Washington is to reverse the trend of current events and restore order in the Middle East and elsewhere. If it is not able to do so, there will be more hostage-taking and other instances of brazen behavior. If the international community does not respond to Iranian acts of war now, just imagine what Tehran will attempt after building its first nuclear weapon.


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February 27, 2007

China: Stock Market Plunge

On Tuesday, China’s stock markets plunged 8.8 percent, wiping away about US$140 billion of value. The fall, biggest in a decade, came just one day after Chinese stocks reached an all-time record. The news of the sell-off helped trigger today’s 416-point drop in the Dow Jones Industrial Average and similar declines in other American indexes.

The news of the fall in Chinese stocks should have come as no surprise to American investors. For weeks, Beijing has been taking measures to cool local markets, which are driven more by government policies than anything else, including market fundamentals. A large correction was only a matter of time.

What happens when something more serious occurs in China? The real risk China poses to global markets is not so much the severity of a financial crisis as the unexpected nature of such an event. Today, the concern about China in the West is that the country will dominate the global economy. For many, if not most, people in the financial and business communities, the possibility of an economic crisis inside China is remote. For them, it is an “unknown unknown.” Yet all the underlying conditions necessary for such a crisis exist. When it occurs, market participants will probably be caught completely unaware as they were today. After all, how well have the markets predicted turmoil in other countries in the past?

There may be little we can do to avert a financial crisis in China, but public discussion of such a development would at least give market participants the opportunity to take that event into account, thereby making future market adjustments less painful.

In short, the more we discuss the possibility of financial turmoil inside China, the better off we will be. After all, the global financial markets are deep and flexible and can handle almost any emergency we plan for. Michael Pettis, a director of the Galileo Global Horizons fund, says market participants don’t talk about a problem until it is too late, at which time they talk about nothing else.

We should do better with regard to China.


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January 21, 2007

Will Israel Attack Iran?

Iran’s president, Mahmoud Ahmadinejad, recently said neither Israel nor the United States would dare attack his country. Is he right?

Earlier this month President Bush gave his critics what they said they wanted: a strategy to win the war in Iraq. His plan, however, dismayed many of them and not just because of the much-discussed troop “surge.” The embattled leader stated America would stop Iran and Syria from interfering in their troubled neighbor. In recent days, the American military has taken Iranians into custody in Iraq and uncovered evidence of Tehran’s involvement in its historical enemy’s affairs. Not only has Iran been supplying Iraq’s Shiites with military assistance, but it has also been counseling them against any compromise with the Sunni minority. A compromise, most believe, would go a long way toward quelling the fighting in Iraq.

Americans are right to be concerned about a wider war in the Middle East. But if the conflict spreads, it will not be because of something their country does. It will be because of something it does not do. The United States has not been able to stop Iran’s nuclear weapons program by working through the United Nations. The Security Council passed two resolutions last year to stop that program, but neither of them was tough enough to impress Tehran’s “atomic ayatollahs.” If Washington cannot find a peaceful way to block their ambitions to develop a nuclear arsenal, there will undoubtedly be conflict in the near future.

Why? “Israel will do anything in its power to prevent the Iranian nuclear nightmare from becoming a reality,” said Ehud Olmert as he was concluding his recent three-day visit to Beijing. These words of the Israeli prime minister took on special significance because London’s Sunday Times, citing Israeli military sources, reported this month that Israel had put together plans to attack Iran’s nuclear facilities with tactical nuclear weapons, specifically “bunker busters.” Israeli pilots were already flying missions to Gibraltar to simulate a 2,000 mile round-trip strike on Iran. It is unlikely that the leak to the newspaper, occurring before the prime minister flew to Beijing, was a coincidence.

China provides significant diplomatic support to Iran and has aided its nuclear weapons program. For instance, in 2004 China sent Iran beryllium, which is used to trigger nukes. In 2005, various sources reported that China sold either centrifuges or centrifuge parts to Iran (centrifuges are machines that spin at supersonic speeds to separate uranium into its different isotopes and upgrade the potent ones to weapons-grade purity). And Chinese nuclear weapons scientists were working in Iran at least as late as the end of 2003.

Ahmadinejad has repeatedly said “Israel must be wiped off the map.” Soon, he will have the capability to incinerate it: Israel has often stated that Tehran will acquire nuclear weapons capability in a short period, perhaps within two years. The time for diplomacy, therefore, appears increasingly short because Israelis correctly view the fiery Iranian as an existential threat.

Unfortunately, there seems to be little progress toward finding a peaceful solution at the United Nations. Despite Olmert’s best efforts to get the Chinese to take a strong stand, his hosts only made perfunctory statements unlikely to rattle Tehran. Russia, Iran’s other big-power sponsor, has also shown little indication that it will try to disarm the Iranians. The reluctance of these two nations to slow down Ahmadinejad makes some sort of conflict between Israel and Iran appear inevitable, perhaps even a nuclear one.


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 © 2006 Gordon G. Chang