July 24, 2014: China has refused to abide by any international agreements when it comes to their claims on nearly all the South China Sea. As far as China is concerned the area is owned by China and China will seek to establish control over it all as peacefully as possible. As China deploys more military forces to the South China Sea it is clear that China is preparing to confront and scare off, or fight, any armed opposition. So far there has been opposition, but not heavily armed opposition. Thus far China’s bully and intimidate tactics are working.

Meanwhile the Chinese aggression in the South China Sea has created a widespread belief that war is not only possible but imminent. A recent opinion poll in the region found that over 60 percent of the people in nations bordering the South China Sea feared Chinese aggression and the war it might trigger. A similar percentage of Chinese agreed. China created this mindset, and the world wonders what China is going to do about it.

China and many foreign economic experts believe China has survived its recent economic crisis (although housing process continue to fall and the Chinese banking system is still suspect) and stabilized at a lower (7-8 percent a year) growth rate. For nearly three decades China grew at a rate of 10 percent a year or more. This new stability is based on China making real progress in curbing corruption. Although there are more arrests and prosecutions, there is still a lot of corruption out there. Worse, China is also prosecuting any freelance corruption investigators, especially those who report on how government anti-corruption efforts operate. It is feared that the senior leadership is simply warning the corrupt officials to be more discreet and those who do not comply will be prosecuted. This is a very Chinese way to deal with such matters and while many foreigners may not recognize it, most Chinese do.

The government has the military engaging in a number of public relations events to show off the new, modern Chinese military and build public support for the higher military spending. The military does have new uniforms, better educated and trained personnel and lots of new gear. But some things have not changed. This PR effort is up against the public perception that the military is still pretty corrupt. This ranges from recruiting officers taking bribes to let unqualified recruits or the more common incidents of troops selling military equipment on the side and procurement officers demanding bribes from firms that want military contracts. China suppresses reporting on this stuff, but because of the widespread availability of cell phones and the Internet the word gets around. Chinese efforts to censor cell phones and the Internet have only been partially successful and in terms of controlling information this is a major defeat.

China and India recently agreed to allow more economic activity between the two countries. This is unpopular with Indian firms who see the Chinese as capable and ruthless competitors. Indian diplomatic experts also point out that once China becomes a large part of a neighbor’s economy they will use that economic leverage to coerce concessions out of the neighbor. China is even doing this with mighty Japan, long a major investor in and exporter to China. Meanwhile India is spending billions of dollars to double the number of troops stationed on its borders with China.

This Chinese tactic isn’t working so well in North Korea. But China will always find a way and in the case of North Korea the Chinese have gained some leverage by providing something the North Korean leadership does want; help in halting North Koreans from escaping into China. More North Korean “defectors” are being arrested by Chinese police and sent back to North Korea. It’s unlikely North Korea will go so far as to drop their nuclear weapons program because of this, even if that’s what China really wants.

July 23, 2014: China announced a successful test of an anti-missile system that can handle ballistic missiles. No other details were given.

July 21, 2014: China agreed to increase their “strategic relationship” with Venezuela. This is largely cosmetic, an arrangement in which China says nice things about the inept leftists who are running the Venezuelan economy into the ground and not much else. China will not help out with anything that costs a lot of money, but Venezuela is happy to get whatever help it can from wherever it can. China offers the same deal to Russia, which is currently in desperate need of some major financial assistance. That’s because the Russian aggression against neighboring Ukraine has created some nasty side effects. Russian bankers and economists warn of some very real threats created by the current crises in Ukraine. The sanctions, especially those involving Russian access to credit in the West could trigger a major default and serious problems for some of the largest employers. These Russian companies, including many in the oil industry, have to refinance $112 billion in corporate debt over the next four years. While Russian leaders think they can turn to China if cut off from Western financing the Chinese have displayed a pragmatic wariness of getting too involved in the Russian economy. This is largely because of the corruption and lack of a dependable legal system to settle disputes.

July 20, 2014: In the northwest (Gansu province) 30,000 people in the city of Yumen have been quarantined after a neighbor died of bubonic plague.  Those quarantined are being checked to see if they have the plague. China is trying to avoid a repeat of what happened in 2009 when pneumonic plague broke out in the same area, with several dozen cases, and a few deaths. This is the same disease that killed over a quarter of Europe's population in the 14th century. Before that, it did similar damage across Eurasia, all the way to China and Southeast Asia.  Plague (usually the bubonic version, caught from insect bites, rather than the more rare pneumonic form, spread by sneezing) is no longer the big killer it once was. That's mainly because of better public health, and particularly because of the development of antibiotics in the 1940s. Plague, unlike most mass killers, is not caused by a virus, but by a bacteria. China used the recent plague incident to stir up more animosity against Japan. That was easy to do because during World War II the Japanese Army, in the form of Unit 731 in northern China, tried to turn plague into a weapon. This proved impossible to do. The Japanese dropped bombs filled with fleas (the normal carriers of Bubonic Plague) on Japanese villages, and the result was often no plague cases at all.  Plague still survives, in animal populations, all over the world. But in the last century, there have been only about 100-150 cases a year, usually in remote areas, and only about ten percent of them resulted in deaths. The last big outbreak in the United States was in Los Angeles in 1924, when there were 38 cases, most of them fatal. There are still periodic outbreaks in the American West, where people encounter plague infected animals in remote areas. But medical personnel in those areas know the symptoms, and quickly administer antibiotics. Thus there are few deaths. China, however, is one of the places where there are still outbreaks in densely populated areas. The pneumonic form of plague is particularly contagious, and could cause thousands of deaths, and general panic, if it ever got into a city. So these rural outbreaks are dealt with promptly, with police setting up roadblocks and isolating the area, and medical teams flooding the area to follow up on a media blitz letting everyone know what symptoms to look for, and who to call. These measures have greatly reduced plague deaths in western China over the last half century. Most incidents are over within a week or two.

July 19, 2014: Vietnam is scrambling to assure Chinese tourists that they are safe in Vietnam. Nearly two million Chinese tourists visit Vietnam each year and the Chinese are the largest contingent of foreign tourists. The tourism brings in a lot of money and jobs but in the last few months the Chinese have been coming in smaller numbers. That’s because of a few incidents of Vietnamese threatening Chinese visitors over the escalating confrontation with China offshore. There Chinese and Vietnamese commercial and coast guard ships have been confronting each other for months over Chinese oil drilling activities. China admitted to having 71 vessels (including 32 from the coast guard) providing security for the two oil drilling rigs that are 278 kilometers off the Vietnam coast and 32 kilometers from Chinese occupied islands in the Paracels. China uses collisions or the threat of collisions to keep Vietnamese ships away. One Vietnamese ship has been sunk in over 1,500 collisions (mostly “bumps”) so far. Over a dozen ships of both sides have suffered significant damage. Both countries have taken the dispute to the UN. China recently moved one rig out of the area (because it had completed its exploratory drilling) and Vietnam is trying to calm down Vietnamese popular opinion and keep the Chinese tourists coming. China is discouraging Chinese from going to Vietnam, in order to pressure Vietnam to accept Chinese claims on Vietnamese coastal waters.

A Chinese AGI (Auxiliary General Intelligence, or electronic reconnaissance) ship has arrived off Hawaii to monitor a major international naval exercise that Chinese ships are participating in. This is perfectly legal and another indicator of expanding Chinese military intelligence capabilities. The new Chinese AGI ships sport several domes protecting antennae and are crammed with computers and signals processing gear. The new Dongdiao class are replacing some of the older AGI type ships that entered service in the 1970s. Those older ships have had their electronics and other information gathering gear upgraded but the hulls only last so long. China has about a dozen AGIs of varying sizes and ages. The Dongdiaos are the largest and most modern. AGI ships are mainly about electronic reconnaissance and collection. Just keeping track of the enemy's electronic devices has become a major operation, especially since no one knows exactly how everyone’s electronic equipment will interact until there is a sustained period of use. Such use does not occur in peacetime, when the EW equipment is used infrequently for training and testing. All electronic equipment has a unique electronic signature. Even equipment that is not broadcasting will appear a certain way to various sensors like radar or sonar. Thus a critical peacetime function is to determine what these signatures are. For this reason navies and air forces devote a significant amount of their time tracking other nation’s capabilities.

July 17, 2014: Japan authorized the first export of military weapons since World War II. This is a major shift in Japanese policy. This first export is Japanese made components to the United States for American Patriot missiles. Japan has been producing these parts for its own use, as it does for many American weapons. But now Japan is going to export locally (and American) designed weapons produced in Japan. This bothers China a great deal, even though Japan is simply responding to growing Chinese aggression. China is also bothered by Japanese resistance to Chinese economic threats. China has been encouraging public anger, and often violence, against Japanese firms in China as well as discouraging Chinese from buying Japanese goods. This has not weakened Japanese resolve to resist Chinese claims on Japanese territory. Japan is expanding its military and responding to Chinese threats to use nuclear weapons by implying that Japan could reply in kind.

July 14, 2014: In the south (Guangdong province) larger (up to $80,000) rewards are now being offered for information on terrorists. The rewards vary with the usefulness of the information. In May the national government increased the cash rewards for terrorist activity in the northwestern province of Xinjiang. The government is not just seeking information about Islamic terrorists but also tips on where illegal weapons and explosives might be found. The government encouraged provincial governments to offer similar rewards. Xinjiang is the most violent province when it comes to Islamic terrorism, with over 200 people killed there in the last year. Most of the Islamic terrorists are Uighurs, Turks from the northeast. More than a hundred Uighurs are currently being held and prosecuted for terrorism and most, if not all, will be executed or spend a decade or more in prison.

July 12, 2014: Recently the U.S. charged a Chinese citizen (Su Bin), based in Canada, of working with two Chinese hackers to steal technical data for American military aircraft (especially the C-17, F-22 and F-35). The thefts took place between 2009 and 2013. These three appear to be freelancers, although Su Bin had plenty of contacts with Chinese aviation firms and thus had no problem finding buyers for whatever the trio obtained. Su Bin was recently arrested in Canada and is being extradited back to the United States for trial. In the last few years more American officials have come to openly admit that a whole lot of American military and commercial technical data has been stolen via Chinese Internet (and more conventional) espionage efforts. The Americans are not providing details of exactly how they collected all the evidence, but apparently it is pretty convincing for many American politicians and senior officials who had previously been skeptical. The Chinese efforts have resulted in most major American weapons systems having tech details revealed, in addition to a lot of non-defense technology. It’s not just the United States that is being hit but most nations with anything worth stealing. Many of these nations are noticing that China is the source of most of this espionage and few are content to remain silent any longer.