April 16, 2013: China has established a number of port relationships in the Indian Ocean that make it possible for them to support increased navy operations. All these ports are commercial operations, where Chinese firms have upgraded or built commercial ports and run them. This makes it easy for the Chinese Navy to visit (for repairs, supplies, or shore leave for the crews). So far this “string of pearls” includes Bangladesh (Chittagong), Burma (Sittwe and Coco Island), Sri Lanka (Hambantota), Pakistan (Gwadar), and Tanzania ( Bagamoyo). The Indian Ocean has become a major trade route for China and this makes the security of this route a major concern. This, however, upsets India a great deal because of active claims China has on India (especially along the Tibet border). There’s not much India can do about the String of Pearls, as China has become a major economic force in the Indian Ocean and offers all the nations hosting a “pearl” very attractive economic incentives to accept Chinese port building and management efforts.

Speaking of Tibet, China has used its economic clout in tiny Nepal (between India and China/Tibet) to put more pressure on anti-Chinese Tibetans. For decades the Nepalese government was hospitable to Tibetans fleeing Chinese rule in their homeland and even allowed Tibetan anti-China activists permission to operate in Nepal. No more. China has been increasingly generous to Nepal over the last decade and now those favors are being cashed in. As a result, anti-Chinese Tibetans are facing increasing restrictions in Nepal. The Chinese also played on the traditional Nepalese fear of India (which has long dominated Nepal but was never able to permanently conquer it and incorporate it into India).

The Chinese Navy has been increasing its training missions outside coastal waters over the last six years. In that period there were twenty of the high seas exercises in the Western Pacific, involving 90 ships. Including the ships sent to work with the anti-piracy patrol off Somalia, the ships going on high seas exercises includes about 140 vessels. The Somalia missions have been excellent training, as they last four months (versus a few weeks for the Western Pacific operations).

The increased Chinese Navy activity is largely to train sailors on how to keep other countries from exercising claims to disputed bits of land far from the Chinese coast. This issue is particularly explosive in the South China Sea. Long-term, China expects to win all these disputes and its growing (and increasingly active) navy is part of that plan.

China has been forced to admit that it is suffering another outbreak of influenza that spreads from birds to humans. This first showed up in 2003 and was called SARS (Severe Acute Respiratory Syndrome epidemic). The official designation was H1N1 and the Chinese tried to keep it secret. The news, and the disease, eventually became public knowledge and killed over 800 people worldwide. It did not, as feared, become a deadly pandemic, as some strains of influenza do. The new strain (H7N9) showed up last month and it took only a few weeks for the government to admit that SARS was back. What forced this admission was the Internet which, despite enormous efforts to control the spread of such news, was not able to contain the information.

Something like SARS is worrisome for the Chinese and the world. For thousands of years densely populated China has been the source of new epidemic diseases. Chinese public health systems are still rather primitive, and the government does not like to share health news with foreigners. But what is known is that there are epidemics in China. Some are old standbys, like Mumps are still killing on a large scale. Others are new and unknown, like SARS. In the past, many major infectious diseases got their start in Chinese swine and then leaped to humans worldwide. This is still happening.

April 15, 2013: China denied that it was sending more troops to the North Korean border. That doesn’t mean they aren’t, just that the official line is they are not. Locals are reporting increased Chinese military activity along the border. This means more patrols and some training exercises, apparently to deal with a large movement of refugees from North Korea.

April 14, 2013: Chinese leaders told visiting American senior officials that the two countries can cooperate to persuade North Korea to halt its nuclear weapons program. There was no mention of exactly what China would do, but the implication was that the Chinese would do more to get North Korea to behave and they would do some of it in cooperation with the United States. This could be a big help to American intelligence because North Korea is one of the strictest police states on the planet. Establishing an espionage network there has always been extremely difficult, and apparently the Americans are highly dependent on South Korea, and now China, for better intel on what is going on inside North Korea. China has always had the best espionage network because China came to the aid of North Korea in 1950, after the North Korean invasion of South Korea backfired. Ever since then China has been a major trading partner and some Chinese were always able to move about more freely than any other foreigners (even the Russians, who kept North Korea solvent until 1991). North Korea will occasionally crack down on Chinese inside North Korea (especially those engaged in illegal stuff) but that has never kept Chinese out of the country. To take advantage of this, Chinese intelligence officials regularly question Chinese who have been in North Korea. By doing that they have gathered an enormous quantity of data on what is going on. South Korea, by virtue of the steady stream of North Korea refugees (25,000 since 1953, most of them in the last decade) reaching South Korea, and the ability to communicate with the several hundred thousand North Korean refugees living in northeast China, has also compiled a lot of useful stuff. The U.S. has access to the South Korean network, but China has not been so accommodating. If that has changed, the Americans are now in a better position to cope with whatever new insanity the North Korean might create.

China does not like to publicly criticize an ally and has been low-key in its public comments to North Korea over the current unpleasantness. But China has other ways to send a stern public message to the North Korean leadership. China has ordered its Internet media operatives to say what they think about what is going on in North Korea. As a result, popular Chinese Internet personalities are saying what the government prefers not to say (that the North Korean leadership is acting like maniacs). Chinese Internet commentators are often local celebrities who are allowed to spout on their website or microblog (the tightly controlled Chinese version of Twitter) as long as they do not say anything the government censors do not approve of. The Chinese people understand how this works and know which blog posts are crap and which are sincere. The jabs at the Boy General are largely sincere, with the posters saying what a lot of Chinese think about North Korea.

Yet China is unwilling, or unable, to actually replace the current North Korean government. That attitude may be changing. Since the Cold War (and Russian subsidies that kept the economy afloat) ended in 1991 China has picked up some of the slack. China has since become unhappy with the incompetent leadership in North Korea as the Kim dynasty refuses to undergo the kind of economic reform that has kept the Chinese Communists comfortably in power. Staging a coup in North Korea has always been a possibility but the paranoid (for good reason in this case) North Korean leadership has made it difficult for China to recruit enough North Korean officials to make this feasible. That said, the potential is still there and China could still go this route.

Many North Koreans believe that the Chinese will take over if it appears that the North Korean government is about to fall apart or otherwise become dangerous to China. The Chinese plan apparently includes installing pro-Chinese North Koreans as head of a new "North Korean" government and instituting the kind of economic reforms they have been urging the North Korean to undertake for over a decade. The Chinese do not want North Korea to merge with South Korea, nor do they want North Korea to collapse (and send millions of starving refugees into northern China) into chaos. China and South Korea both want North Korea to stay independent and harmless. Thus China is willing to unofficially annex North Korea, knowing that the South Koreans would go along with this as long as the fiction of North Korean independence was maintained. South Korea won't admit this but most South Koreans know that absorbing North Korea would put a big dent in South Korean living standards. That is more unpopular than any other outcome. While all Koreans would like a united Korea, far fewer are willing to pay the price.

April 9, 2013: The former head of the state owned Chinese railroad, Liu Zhijun, was indicted for corruption. This misbehavior was long suspected, especially after some embarrassing accidents (especially one involving the high profile “bullet train”) and the public demand for answers soon led to discoveries of corruption, lots of corruption. While the government is officially behind anti-corruption efforts, it is no secret that many powerful officials are able to be obviously corrupt (living far beyond their official compensation) and are not touched by investigations. This is becoming a widespread popular issue that the government refuses to acknowledge. Those Chinese that press this issue publicly are arrested. The government is willing to go after lower ranking officials but senior people only get prosecuted if their illegal activities become widely known. This attitude is very unpopular with most Chinese and the government is slowly being forced to deal with it. Another issue creating growing public unrest is the air pollution in urban areas. This is believed to cause over a million premature deaths a year and the censors are not able to keep Chinese from knowing this or discussing it. Senior officials can buy expensive air filtration systems for their homes and offices but they and their families cannot completely escape the dirty air. Solutions would be expensive and politically unpopular and public pressure is making avoidance of the issue untenable.   

April 7, 2013: China made its first public criticism of North Korea regarding the extreme bellicosity the North Koreans (threats of war against South Korea and the United States) have been indulging in lately. China tried letting North Korea know of their displeasure quietly but that had no noticeable effect.

April 4, 2013: Responding to increasing incidents of luxury cars carrying military license plates getting involved in accidents or criminal acts, China has made it illegal for anyone to put military plates on most civilian cars. This is yet another effort to crack down on the manufacture and use of fake (or real) military ID by civilians. The new rules are meant to halt incidents where the kin of corrupt military officers drive around family luxury cars equipped with military plates.

Two years ago China increased the penalties for civilians caught using military uniforms or forged military documents (including license plates). Penalties were increased to ten years in jail for this sort of thing. Previous penalties (often aided by a bribe or two) amounted to a slap on the wrist. The problem, especially the use of forged license plates, is believed to cost the government over $150 million a year in lost taxes and fees. These rules were aimed mostly at criminals but there are more embarrassing incidents involving the children of generals and admirals.

It was seven years ago that China first made a major effort to deal with this problem (gangsters pretending to be soldiers). In China the military is something of a state-within-a-state. Civil officials, including police, are discouraged from interfering with military personnel, unless they are very obviously doing something illegal. This extends to off-duty military personnel driving military vehicles. Actually, any vehicle with military license plates qualifies. Several gangs discovered that stolen, or counterfeit, military license plates conferred a bit of immunity on whoever was driving a vehicle with such plates. Eventually, the police caught on. So, back in 2006, the government mobilized 20,000 personnel from the army and police to man checkpoints and check for counterfeit or stolen military plates. In two months this effort seized over a thousand stolen or counterfeit plates. In addition, 775 vehicles were seized and 123 people were arrested.

The gangs often supplied the names of the officers who owned the stolen plates, to better enable the new owners to get past military or police security while using the stolen plates. As a result of all this, new procedures were enacted, to make it more difficult to use counterfeit or stolen military plates. The gangsters and corrupt officers found ways around this and the fakes continued to flourish. Despite passing new laws and orders to "crack down" on the use of fake military ID, the problem continues. The fact that public exhortations to enforce the old laws, and the new punishments, was ignored, tells you something about the resilience of corruption in China. This is another reminder to the Chinese people that their government is not very good at fighting corruption. The average Chinese gets reminded of this in a very personal way on a regular basis.

April 3, 2013:  Last year, for the first time since 1998, world military spending declined (by about half a percent to $1.75 trillion). Even the U.S. cut spending by six percent. But Chinese spending increased, as it has for two decades, and is now north of $100 billion.