US-China Commission Report - Fatal System Error

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372 Witnesses: Allen R. Carlson, Ph.D., Cornell University; June Teufel Dreyer, Ph.D., University of Miami School of Business Administration; Peter A. Dutton, U.S. Naval War College; Roy D. Kamphausen, National Bureau of Asian Research; James A. Lewis, Ph.D., Center for Strategic and International Studies; Phillip A. Meek, U.S. Air Force; Robert G. Sutter, Ph.D., Georgetown University. March 18, 2008: Public Hearing on ‘‘China’s Expanding Global Influence: Foreign Policy Goals, Practices, and Tools,’’ Washington, DC 1 Commissioners present: Larry M. Wortzel, Ph.D., Chairman; Carolyn Bartholomew, Vice Chairman (Hearing Co-Chair); Daniel A. Blumenthal (Hearing Co-Chair); Peter T.R. Brookes; Mark T. Esper, Ph.D.; Jeffrey L. Fiedler; Hon. Patrick A. Mulloy; Hon. William A. Reinsch; Hon. Dennis C. Shea; Daniel M. Slane; Peter Videnieks; Michael R. Wessel. Witnesses: Thomas J. Christensen, Ph.D., Bureau of East Asian and Pacific Affairs; Lisa Curtis, The Heritage Foundation; Mauro De Lorenzo, American Enterprise Institute; Edward Friedman, Ph.D., University of Wisconsin; Lawrence E. Grinter, Ph.D., Air War College, Maxwell Air Force Base; Joshua Kurlantzick, Carnegie Endowment for International Peace; Mohan Malik, Ph.D., Asia-Pacific Center for Security Studies; Philippe Rogers, U.S. Marine Corps; Andrew Scobell, Ph.D., George H. Bush School of Government and Public Services; David S. Sedney, East Asian Security Affairs; Andrew Small, German Marshall Fund of the United States; Cynthia A. Watson, Ph.D., The National War College. April 24–25, 2008: Public Hearing on ‘‘Chinese Seafood: Safety and Trade Issues,’’ New Orleans, LA Commissioners present: Carolyn Bartholomew, Vice Chairman (Hearing Co-Chair); Jeffrey L. Fiedler; Hon. Patrick A. Mulloy; Daniel M. Slane (Hearing Co-Chair); Peter Videnieks; Michael R. Wessel. Congressional Perspectives: Hon. David Vitter, U.S. Senator from the state of Louisiana. Witnesses: Kim Chauvin, Mariah Jade Shrimp Company; Carole R. Engle, Ph.D., University of Arkansas at Pine Bluff; Matthew Fass, Maritime Projects International; E. Spencer Garrett, National Oceanic and Atmospheric Administration; Jean M. Halloran, Consumer’s Union; Walter R. Keithly, Jr., Ph.D., Louisiana State University; Donald W. Kraemer, U.S. Food and Drug Administration; Stephen Minvielle, Louisiana Crawfish Farmers Association; Harlon H. Pearce, Jr., Louisiana Seafood Promotion and Marketing Board; Schuyler Richard Porche, Louisiana State University; John Williams, Southern Shrimp Alliance; Patrick Woodall, Food & Water Watch. 1 Additional Material Supplied for the Record, Statement by Ellen Frost, National Defense University.
373 May 20, 2008: Public Hearing on ‘‘China’s Proliferation Practices, and the Development of its Cyber and Space Warfare Capabilities,’’ Washington, DC Commissioners present: Daniel A. Blumenthal; Peter T.R. Brookes (Hearing Co-Chair); Mark T. Esper, Ph.D.; Jeffrey L. Fiedler; Hon. Patrick A. Mulloy; Hon. William A. Reinsch (Hearing Co- Chair); Hon. Dennis C. Shea; Daniel M. Slane; Peter Videnieks; Michael R. Wessel. Congressional Perspectives: Hon. Zoe Lofgren, U.S. Congresswoman from the state of California. Witnesses: Jeffrey C. Horne, United States Strategic Command; Gary D. McAlum, United States Strategic Command; Patricia McNerney, Principal deputy assistant secretary of State for International Security and Nonproliferation; James C. Mulvenon, Ph.D., Center for Intelligence Research and Analysis, Defense Group, Inc.; Hon. Stephen G. Rademaker, BGR Holding, LLC; William B. Scott, Aviation Week & Space; Henry D. Sokolski, The Nonproliferation Policy Education Center; Ashley J. Tellis, Ph.D., Carnegie Endowment for International Peace; Timothy L. Thomas, Foreign Military Studies Office. June 18, 2008: Public Hearing on ‘‘Access to Information and Media Control in the People’s Republic of China,’’ Washington, DC Commissioners present: Larry M. Wortzel, Ph.D., Chairman (Hearing Co-Chair); Carolyn Bartholomew, Vice Chairman; Daniel A. Blumenthal; Peter T.R. Brookes; Mark T. Esper, Ph.D.; Jeffrey L. Fiedler (Hearing Co-Chair); Hon. Patrick A. Mulloy; Hon. William A. Reinsch; Hon. Dennis C. Shea; Peter Videnieks. Witnesses: Ronald J. Deibert, Ph.D., Open Net Initiative; Peter Hayes Gries, Ph.D., University of Oklahoma; Gilbert Kaplan, King & Spalding LLP; Randolph Kluver, Ph.D., Texas A&M University; Perry Link, Ph.D., Princeton University; Lucie Morillon, Reporters Without Borders; Susan Puska, Defense Group, Inc.; Dan Southerland, Radio Free Asia; Xiao Qiang, University of California, Berkeley. June 19, 2008: Public Hearing on The Memoranda of Understanding between the U.S. and China Regarding Prison Labor Products,’’ Washington, DC Commissioners present: Larry M. Wortzel, Ph.D., Chairman (Hearing Co-Chair); Carolyn Bartholomew, Vice Chairman; Daniel A. Blumenthal; Peter T.R. Brookes; Mark T. Esper, Ph.D.; Jeffrey L. Fiedler; Hon. Patrick A. Mulloy; Hon. William A. Reinsch; Hon. Dennis C. Shea; Daniel M. Slane; Peter Videnieks (Hearing Co- Chair); Michael R. Wessel. Witnesses: Daniel T. Ellis, Lydy & Moan, Ltd.; James Ink, Immigration and Customs Enforcement; Gary G. Marck, G.G. Marck & Associates; Harry Wu, The Laogai Foundation.
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USCC 2008 ANNUAL REPORT
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1 2008 REPORT TO CONGRESS of the U.
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U.S.-CHINA ECONOMIC AND SECURITY RE
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CONTENTS Page TRANSMITTAL LETTER TO
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INDEX OF TABLES AND FIGURES 2008 RE
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2 economic, security, diplomatic, a
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4 China’s Capital Investment Vehi
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6 • Antidumping penalties imposed
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8 rities of other nations and cause
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10 Conclusions China’s Current En
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12 other countries that rely on Chi
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14 vein, there appears to be a stro
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16 lator of all financial services
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18 • Identifying substandard ship
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20 During the year, China continued
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22 U.S. inspections of prisons to e
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24 to the uncertainty during the su
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26 U.S. exports to China were 20 pe
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28 currency for RMB to obtain forei
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30 of supply and demand in the fore
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32 troversial is whether the treaty
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34 erty (IP) rights holders from en
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36 New Currency Rules China’s und
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38 brought in 2006 by the United St
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40 sectoral talks on farm trade. In
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42 tinue buying foreign exchange, t
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44 difference between temporary, th
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46 The Administrative Structure and
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48 U.S. dollar and has appreciated
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50 Development Committee and other
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52 drawn some fairly conventional l
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54 demonstrates the great length to
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56 cent revelations of the activiti
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58 of China by way of the investmen
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60 Ltd. attempted to acquire the U.
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62 not be applied necessarily in th
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64 economy—from ports and telecom
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66 asset allocations, benchmarks, a
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68 the investments, viewing them as
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70 and printed circuits in order to
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72 2006, R&D spending in China from
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74 tios—two of Asia’s technolog
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76 The last time the United States
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78 pendent players. However, this m
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80 aviation industry and has a role
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SECTION 4: A CASE STUDY OF THE LOCA
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85 The rise of industrial fish farm
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87 According to the Southern Shrimp
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89 the increasing import base. The
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91 nated fish are discovered after
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93 At the time this Report was comp
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95 port with the hope it will be ad
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97 Restaurants also are exempted by
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99 entire dusted product is from Ch
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101 written and approved, which is
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RECOMMENDATIONS The U.S.-China Trad
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105 gress could enable consumers to
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107 26. ‘‘China Central Bank to
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109 82. USTR, ‘‘2008 National T
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111 121. U.S.-China Economic and Se
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113 173. ‘‘China’s Stake in B
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117 282. International Working Grou
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121 361. Food & Water Watch, ‘‘
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123 Louisiana and the U.S. Gulf Coa
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126 While witnesses concluded that
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128 China’s Nonproliferation Comm
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130 State during the interdiction o
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132 Northwest National Laboratory
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134 UN Security Council resolutions
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136 ployment, this change would inf
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138 ing Iran’s missile program on
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SECTION 2: CHINA’S VIEWS OF SOVER
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142 ficing the principle behind it.
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144 baseline. Other states enjoy ov
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146 India, Vietnam, Taiwan, and oth
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148 as, ‘‘What constitutes a sp
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150 The proposed PAROS treaty itsel
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152 enhance China’s assertions of
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154 Media and Public Opinion Warfar
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SECTION 3: THE NATURE AND EXTENT OF
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158 Today, China’s space program
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160 The Management Structure for Ch
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162 • Launching geostationary orb
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164 bility to conduct cyber operati
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166 tions between the NIPRNet and t
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RECOMMENDATIONS China’s Prolifera
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170 ENDNOTES FOR CHAPTER 2 1. U.S.-
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172 41. U.S.-China Economic and Sec
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174 80. Janice E. Thomson, ‘‘St
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176 112. Reinhard Drifte, ‘‘Jap
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CHAPTER 3 CHINA’S ENERGY AND ENVI
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185 A growing share of energy deman
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187 pleted. Without the discovery a
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189 A Survey of China’s Interests
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191 projects that imports of natura
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193 and design of the units. 71 Chi
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195 dioxide, nitrous oxide, mercury
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197 sions are realized and producti
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199 ferent interests that motivate
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201 the oil, gas, coal, and power i
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203 fluential figures in business a
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205 The Terminology Used to Describ
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207 velop international and domesti
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209 that growth must occur in an en
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211 servation. Officials highlighte
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213 grated Gasification Combined Cy
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215 Obtaining sufficient movement f
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217 nology and finding ways to make
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219 • As the negotiations for a p
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223 tent.aspxdata=EmergingMktlconte
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225 13, 2008. These tools include s
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229 ergy Group, Environmental Energ
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CHAPTER 4 CHINA’S FOREIGN ACTIVIT
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233 China will seek to displace the
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235 China to help resolve them. 22
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237 presenting itself as an accepta
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239 China’s infrastructure invest
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241 IMF. The Angolan government exp
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243 China’s Conventional Arms Sal
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245 Kurlantzick testified that Chin
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247 pendent of their legislatures a
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249 diplomacy and in the internatio
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SECTION 2: CHINA’S RELATIONSHIPS
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PART 1: TAIWAN The Significance of
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255 PRC pressure directed against T
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257 this end. 150 (Additional infor
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259 Discussions Regarding Arms Sale
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261 ernment is committed to set ann
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263 • Arms purchases from the Uni
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265 China, appreciation of the RMB,
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267 Days later, although they did n
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Introduction PART 3: THE REPUBLIC O
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271 South Korean officials emphasiz
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273 mount among the ROK’s diploma
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275 Even after approving these grad
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277 exercising undue influence—be
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RECOMMENDATIONS China’s Expanding
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283 42. UN Conference on Trade and
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287 134. Calculation performed by C
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289 184. ‘‘Factbox: Key facts o
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CHAPTER 5 CHINA’S MEDIA AND INFOR
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293 The central role of the Propaga
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295 thoritarian post-Soviet governm
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297 Some of the measures taken by C
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299 Images of ‘‘Jing-Jing’’
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301 Legislation was introduced duri
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303 In addition to promoting a powe
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305 Chinese Government Restrictions
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307 search engine and the servers s
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309 media, the Internet, popular en
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311 ENDNOTES FOR CHAPTER 5 1. David
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313 image-of-internet-police-jingji
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318 China’s prison labor system,
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320 most literal sense, the term la
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Page 338 and 339: 328 Mr. Marck, who is the partial o
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Page 342 and 343: RECOMMENDATIONS • The Commission
Page 344 and 345: 334 28. U.S. Department of Homeland
Page 347 and 348: COMPREHENSIVE LIST OF THE COMMISSIO
Page 349 and 350: 339 gram. By expanding this volunta
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Page 353 and 354: 343 43. The Commission recommends t
Page 355 and 356: 345 ADDITIONAL VIEWS OF COMMISSIONE
Page 357 and 358: 347 ADDITIONAL VIEWS OF COMMISSIONE
Page 359 and 360: APPENDIX I UNITED STATES-CHINA ECON
Page 361 and 362: 351 (iii) make all subsequent appoi
Page 363 and 364: 353 (2) Information. The Commission
Page 365 and 366: 355 In each Section and Subsection
Page 367: 357 ecutive Schedule under section
Page 370 and 371: 360 member of the Academic Advisory
Page 372 and 373: 362 nomic, defense, and foreign pol
Page 374 and 375: 364 formulated by the Committee suc
Page 376 and 377: 366 Commissioner Shea is an attorne
Page 378 and 379: 368 than twenty years, leaving his
Page 381: APPENDIX III PUBLIC HEARINGS OF THE
Page 385 and 386: APPENDIX IIIA LIST OF WITNESSES TES
Page 387 and 388: 377 Alphabetical Listing of Panelis
Page 389: 379 Alphabetical Listing of Panelis
Page 392 and 393: 382 REPUBLIC OF KOREA, JAPAN AND TA
Page 395 and 396: APPENDIX V LIST OF U.S. SANCTIONS I
Page 397: 387 Date Imposed Entity/Person Cont
Page 401 and 402: APPENDIX VII ABBREVIATIONS AND ACRO
Page 403: 393 UNGA UN PKO USD USDA USITC USTR
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