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Senate Minority Report, Another US Deficit -- China and America -- Public Diplomacy in the Age of the Internet, February 15, 2011

A report prepared by the staff of the Republican minority on the US Senate Committee on Foreign Relations. Senator Richard Lugar, ranking minority member, released the report.
February 15, 2011

Concern in the United States over events in China is nothing new, dating back to the ‘‘loss’’ of China in 1949, through the 1989 Tiananmen Square crackdown, Congress’s 1999 ‘‘Cox Report’’ on Chinese military espionage activities and the attempted Chinese cover-up of the SARS epidemic in 2003. In part because of recent events, Americans now believe, for the first time, that Asia is more important to the United States than Europe—a truly historic shift.

There is no question that China’s recent explosive economic advances are of new concern to Americans with our ever-mounting bilateral trade deficit (which has exceeded $200 billion every year since 2005) 2 coupled with China’s continued dominance as the number one holder of U.S. Treasury securities3 and its $2.4 trillion in foreign currency and gold reserves. This erosion of our economic position in the world, and the concomitant loss of manufacturing jobs, blamed by many on China,5 has only added to the rising tensions between our two nations. China’s recent actions in the South China Sea and Beijing’s refusal to join the rest of the world in trying to contain North Korea’s nuclear program and Pyongyang’s aggression towards South Korea are further stress points.

The economic liberalizations that began slowly in the late 1970’s and grew exponentially in the last decade have transformed much of China’s urban landscape as virtually every major city, particularly those on the coast, are gleaming beacons of China’s new wealth, with their towering skyscrapers, the ultra-modern, efficient public transportation systems and traffic packed with brand-new luxury cars. One need not even visit China to experience this new level of confidence; a trip to any retail store in America, and indeed most of the world, will demonstrate the economic export dominance coming from China today. Everything from inexpensive apparel to high-end sophisticated electronics is now stamped ‘‘Made in China.’’

Meanwhile, state-sponsored troupes of Chinese dancers, acrobats and orchestras criss-cross the United States packing philharmonics and community centers alike. China’s hosting of the globally televised 2008 Summer Olympics in Beijing and the 2010 World Expo in Shanghai drew millions of viewers and visitors alike, with the former serving to ‘‘introduce China to the world,’’ the second as the ‘‘world coming to China.’’

The new China now presents itself as an alternative center of power, and financial largesse, to the United States—and has the resources to back it up. Having flexed its muscles to reinforce this new position, Beijing sought to allay growing fears that China’s success might pose either an economic or military threat with the establishment in 2005 of the ‘‘Peaceful Rise of China’’ Public Diplomacy campaign. China’s successful implementation of this campaign in playing down the possible negative consequences of China’s ever-increasing dominance was illustrated in President Obama’s response to a question during the recent 2010 state visit by President Hu, ‘‘I absolutely believe that China’s peaceful rise is good for the world, and it’s good for America.’’

Few in the United States appreciate how far China has rebounded from its nadir. For most of America’s time as an independent nation, China was a weak and divided shadow of its former self. Many forget that for hundreds of years, while Europe was plunged into its Dark Ages, China was the preeminent power in the world and the source of many so-called ‘‘European inventions,’’ which actually originated in China hundreds if not thousands of years before.

Today, Chinese students are taught of this vaunted past, and many see their nation’s recent economic success, with its current lead in green technologies and record-setting high speed trains, as a clear sign that China is reclaiming its former glory. Some in China argue that we are now in a ‘‘bi-polar’’ world, while others contend China will soon overtake the U.S. as the new, lone ‘‘super power.’’

However, just as Japan’s rise in the 1980s provoked unwarranted fears of American decline, it is important to note that life is not perfect in the ‘‘Middle Kingdom.’’ Inland from the coast, many areas remain poverty-stricken; environmental degradation is worsening by the year, profiteering, corruption and land grabs by local officials continually provoke protests, working conditions are often dangerous, and quality control is lax. Recent recalls for excessive lead in toys made in China and tainted baby-formula produced in China,11 as well as toxic drywall produced in China, have led to a significant backlash both here in the United States and within China. Even Beijing’s vaunted Olympic ‘‘Birds nest’’ stadium is already showing signs of disuse.

China’s aging population and one child policy have led to a socalled 4-2-1 pyramid where one adult’s salary has to support his/her own two parents and four grandparents. China’s recent aggressive moves in the fall of 2010 in the East China Sea have driven many of the nations surrounding it to look to the United States for greater military cooperation and possible arms sales. China’s aggressive economic activities have sparked riots in other nations as they too begin to suffer from ‘‘Made in China’’ fatigue and job loss.

There seems little question that the next fifty years will witness a competition between our two countries in much the same way the United States and the Soviet Union vied for allies and global influence during the last fifty. The great unknown is whether this competition will shift from the economic sphere to a more military-oriented direction. What is known is that our nation is not doing all it can to prepare for the increasingly prominent role China will play in our economic and foreign policy.

As a public, our knowledge of China is limited and concentrated among a few diplomats and academics. Not enough students are learning Chinese in our schools. While China sends almost 130,000 students each year to the United States, roughly one-tenth of that number of Americans make the reverse trek. Chinese students return home with a better understanding of the value of multiparty democracy, free speech, and the power of the individual, as well as knowing our language, our culture and our world-view. While the Obama Administration’s recently announced program to increase Americans studying in China to 25,000 a year over four years through private sector support—the so-called ‘‘100,000 Strong’’ project—is laudable, it remains woefully under-resourced by some of the very sectors of our economy who carry out the most trade with China and who would therefore most benefit from a bilingual workforce.

China, for its own reasons, is helping to teach Americans about China. Beijing has invested millions in so-called ‘‘Confucius Institutes’’ throughout the world that provide classes in Chinese language, literature and the arts. In the United States alone, there are some 70 such Institutes, located primarily at universities and colleges. This is an opportunity for Americans who might not be able to afford overseas studies to delve into such subjects here. However, our ability to make similar outreach to the many Chinese unable to come to the U.S. to study has been sharply curtailed by China which has limited the U.S. to only five similar American Centers in China. Likewise, America’s press freedoms are available to foreign news agencies inside our borders. The Chinese government-owned Xinhua News, the official press agency of the Chinese government, will soon be allowed to open a multi-floored office in Times Square and already broadcasts from an AM transmitter in Texas. By contrast, Beijing limits the Voice of America to a single, two-person office there, blocks the opening of a VOA bureau in Shanghai. Furthermore, China forces both VOA and Radio Free Asia to beam in on Short Wave radio from distant locations well outside its borders. China also routinely jams these transmissions as well as blocks both VOA’s and RFA’s Internet sites. Meanwhile, Congress has provided tens of millions of dollars to assist in Internet freedom issues including Internet Censorship Circumvention Technology, but little of that money has been allocated by the State Department in spite of clear bipartisan support.

Since Fiscal Year 2008, Congress has given the State Department some $50 million targeted for Internet Freedom. To date, some $30 million of this money remains unobligated, with few of the spent funds dedicated to Internet Censorship Circumvention Technology (ICCT). The Broadcasting Board of Governors entities—the Voice of America, Radio Free Europe, Office of Cuba Broadcasting, Radio Free Asia and Middle East Broadcasting Network— must all work on a daily basis to ensure their radio, internet and television programs are being received by audiences in certain countries that try to block, jam or outlaw these efforts. As such, the BBG, and not the State Department, would appear to be the logical lead agency in the federal government to focus current and future ICCT funding.

Each of these facets of our Public Diplomacy with China—Educational Exchanges, Public Diplomacy Platforms and U.S. Broadcasting as well as others—is in serious need of greater focus and attention if we are to be competitive and remain ‘‘in the game’’ with China.


• China routinely jams Voice of America and Radio Free Asia transmissions in Mandarin, Cantonese, Uyghur and Tibetan. It blocks access to VOA and RFA’s websites via its ‘‘Great Firewall,’’ requiring its citizens to circumvent such censorship through Internet proxy sites and virtual private networks. China’s refusal to allow the opening of a Voice of America office in Shanghai cannot remain unchallenged given the domestic access granted Xinhua and other Chinese state media here in the United States.
• The Secretary of State’s January 2010 major speech on Internet Freedom received scant follow-up as twelve months elapsed before the State Department moved to disburse some $30 million in funds specifically appropriated for Internet freedom promotion, including the development of Internet Censorship circumvention Technology. Such technology should be given a much higher priority by the U.S. government. Recent delays in allocating pre-existing funding, and the inept handling of an untested technology, have strengthened the hands of those governments, including China’s, who seek to restrict their citizens’ access to information. The State Department is poorly placed to handle this issue due to its reliance on daily bilateral interaction with these very same governments, particularly China. The Broadcasting Board of Governors—because of its unique position in combating Internet censorship on a daily basis on behalf of Voice of America, Radio Free Asia and its other entities—is more properly poised to become a leader in the field for the U.S. government.

• China has some 70 ‘‘Confucius Institutes’’ in the United States where Chinese language, literature, culture and arts are taught and Americans made more aware of life in China. We have been unable to reciprocate these projections of soft power as the United States has been allowed to open only five American Centers in China. To help circumvent this unjustifiable restriction, the Administration has begun to assist American universities who have pre-existing programs in China in opening Centers for American Studies at Chinese universities. Pending a reversal of China’s intransigence, such partnerships will have to be the way of the future in the near term, but will also require increased funding to keep pace with Confucius Institutes.

• China’s moves toward a greater market-oriented economy should not be mistaken for the Communist Party’s willingness to tolerate organized political opposition—an iPhone does not equal democracy! Nonetheless, these new technologies are symbols to millions of Chinese that there is much new information available to the rest of the world—information that their government denies them. Determining how to enable reformers to use this technology to safely communicate with like-minded activists should remain a constant goal of the U.S. government.

• China continues to harass, prosecute and imprison bloggers and journalists on a routine basis. Those who dare raise topics related to Tibet, Taiwan and Tiananmen Square—the so-called ‘‘Three Ts’’—as well as HIV/AIDS in China and issues related to the Xinjiang province (with its Muslim Uyghur population) are often ‘‘invited for tea’’ at the local police station, resulting in a stern verbal warning for a first offense. Those who continue discussing these topics on-line risk being fired or imprisoned for ‘‘disturbing the social order.’’ In 2010, China was tied for first with Iran in the number of imprisoned journalists; additionally, there are over 1,400 political prisoners in China as of the date of this report.

• Nobel prizes have been awarded eleven times to Chinese recipients; 326 to Americans. Of the 11 Nobel Prizes awarded to Chinese citizens, only one was living in China at the time—the 2010 Nobel Peace Prize to imprisoned human rights activist Liu Xiaobo. China views this as an example of Western ‘‘hegemonic lecturing’’ and in 2010 created its own ‘‘Confucius Peace Prize,’’ the winner of which declined to accept the award.

• The Chinese lifting of the annual cap of twenty foreign (mostly American) films allowed into China would give the average Chinese viewer a broader exposure to the United States and do much to offset the millions of dollars in lost revenue due to illegal copying in China.

• Currently, 690,000 international students are enrolled in the United States, generating over $19 billion in tuition and living expenses. Of these, 130,000, roughly 19%, are from China—making it the number one ‘‘sending nation.’’ In comparison, there are some 14,000 Americans students in China. Increasing the number of Americans studying in China is in our nation’s vital interest if we are to have the needed commercial, academic and policy experts to address the challenges a rising China will pose to our nation. The State Department’s recently announced ‘‘100,000 Strong’’ four-year goal is laudable but was accompanied by no U.S. government funding and will, therefore, need significant financial support from the private sector which has much to gain in terms of competitiveness with a bilingual American workforce. The Chinese government, however, has already agreed to fund 2,500 scholarships each year for the four years of the program.

• The current U.S. Peace Corps program in China of some 140 ‘‘Chinese-American Friendship Volunteers’’ primarily engaged in English-language instruction provides invaluable, long-term interaction with American citizens and should be expanded but amounts to only one American volunteer for every 10 million Chinese.

• Beijing’s ‘‘Peaceful Rise of China’’ Public Diplomacy campaign is also being carried out by an ever-increasing number of Chinese military personnel in United Nations peacekeeping operations. To reinforce the nature of the campaign, none of these troops have come from combat units, but rather engineering, medical and police divisions.

• Many Americans now view World Expos as antiquated affairs. The rest of the globe does not, and U.S. ambivalence towards participation unduly offends the host nations. Given that more than 7,000,000 Chinese visited the U.S. Pavilion at the Shanghai Expo in 2010, the lack of effort caused by unnecessary hesitation and delays on the part of the Obama Administration only squandered an unprecedented opportunity to put our best foot forward to an audience over 10 times the size of the number of Chinese who visit the United States in a single year. Although large crowds streamed in, many were disappointed by the low-tech and rather ordinary exhibits inside which failed to demonstrate American technological, scientific and commercial expertise. Those same mistakes should not be repeated in the lead up to the 2012 Expo in Korea. Given recent interest by Texas and California in hosting the 2020 Expo, the U.S. should seek immediately to re-join the Bureau of International Expositions in order to bid for the 2020 Expo. Consideration should be given to repealing legislation limiting U.S. government involvement in Expos, an action that would give the private sector greater confidence in our efforts and lead to more coherent funding.

Click |here| for the full report.