The Collapse of China’s Credibility

Translation first appeared in the Epoch Times.

By He Qinglian on August 17, 2012.

Recently, the international community has been voicing its distrust of China from a variety of perspectives, both political and economic. Even dirty deals between Western businessmen and the Chinese government are being exposed for the first time since the mid-1990s. China’s credibility appears to be collapsing.

Political mistrust can be seen from the international community’s reaction to the Gu Kailai murder trial. Since this was a high-profile case involving the wife of disgraced Chongqing Communist party boss Bo Xilai, the world watched closely.

The performance of China’s judicial system was measured and judged by how the Chinese regime handled the complex and major case—from its treatment of the defendants to the level of information disclosed.

What people saw was a managed show trial with a predetermined outcome. Contradictory statements involving the third party’s involvement in the murder, the chemicals used to kill British businessman Neil Heywood, and the defendants’ motive for the murder, have raised suspicions and left many unanswered questions.

An Aug. 12 article in The Telegraph titled “Neil Heywood murder trial: Did China’s ‘Red Queen’ fall on her sword to save her family?” raised more serious questions.

“The staging of the trial—closed to foreign media but open to some selected members of the public—was rehearsed repeatedly, according to one source. Two Chinese officials even donned suits like British Consulate officials who were to be invited to attend the hearing, allowing Gu to practice how to react and behave while under scrutiny,” stated the article.

Skeptics have suggested that the poisoning of Heywood is a serious warning to foreign investors who do business with China. Good relationships with Chinese representatives, once regarded as the key to successful business dealings in China, are now subject to heightened mistrust as a result of this case.

Greater Scrutiny

A New York Times, Aug. 14, report suggests that China investors may find themselves under greater scrutiny from both Chinese and American authorities. A series of investigations raises questions about the shady and intertwined intersection between politics and business in China.

The article reported that the Federal Bureau of Investigation, the U.S. Department of Justice, and the Securities and Exchange Commission are investigating possible bribery involving casino tycoon Sheldon Adelson’s Las Vegas Sands Corporation.

China’s State Administration of Foreign Exchange has also begun an investigation of some of Sands’s subsidiaries, which are alleged to be involved in the use of funds for business purposes other than what had been reported to the authorities.

In fact, this situation is very common. Chinese officials normally turn a blind eye to ill dealings when they have good relationships with a foreign investor. Documents obtained by the paper show that China’s Ministry of Commerce and Chinese courts have frozen the bank accounts and Company Registrars of some of Sands’ subsidiaries.

At the London Olympics, Chinese athletes were subject to great suspicion by British media. Britain’s Daily Telegraph published a commentary by Brendan O’Neill, “Why do we Brits look upon Chinese athletes as cheats, freaks, and robots?”

It discussed the widely reported aspersions on swimmer Ye Shiwen’s superhuman achievements, and how Chinese badminton players were disqualified after they purposefully tried to lose the game. The author raised questions as to just why Britons view the Chinese as sneaks and cheats, who unlike Britons, understand nothing of fair play.

Economic Data

The most revealing indicator of China’s national loss of credibility is the recent widespread doubt about China’s economic data. Although there were doubts in the past, they had not reached a consensus among economists.

In 2010, a secret telegram from the U.S. Embassy in Beijing published by WikiLeaks disclosed that on March 12, 2007, when Li Keqiang, the Party secretary of Liaoning Province, was having dinner at the U.S. ambassador’s residence, Li revealed that China’s GDP figures are made up, and not reliable.

He also told U.S. officials that to evaluate the Liaoning Province economy he focuses on three numbers: power consumption, railway cargo volume, and the volume of loans made. Despite such a revealing statement, many overseas economists chose to ignore this message. Now the suspicions have become more mainstream.

On June 22, The New York Times reported that local Chinese governments required that local power plants report fake power consumption numbers, so as not to report the full extent of the slowdown to Beijing.

A widely spread July 25 article on Also Sprach Analyst, a Hong Kong based financial and economics website, said, “We do have a few reasons on why you should just stop believing in the Chinese leadership when it comes to running the economy.” 

Whole Word Questions

The documentary Death by China, which premiered in Los Angeles Aug. 15, highlights the intensity of the threat some Americans are feeling about China.

Produced by Peter Navarro, a professor at University of California at Irvine’s Department of Economics, the 80-minute-long film features interviews with American politicians and other voices from across the political spectrum highlighting the effect of the destructive U.S.-China trade relationship on U.S. jobs.

The film exposes Chinese authorities’ disregard for human rights, China’s forced labor system, and the dangers to U.S. consumers from the toxic food and merchandize imported from China. The film is now showing in New York City through Aug. 30, before moving to a series of screenings in Ohio.

Over the years, popular slogans about China have changed from “China Fever” in 2001 to the highly touted “Peaceful Rise” in 2005, along with Joshua Ramo’s prediction that the “Beijing consensus will replace Washington consensus.”

Today, China’s national credibility is suspected by outside observers in the fields of politics, economics, and ethics. Who is at fault for bringing China’s national credibility to such a low point?

I believe one should blame the Chinese regime, including those politicians and business people, representing China, who deal with foreign countries.

From the late 1990s until 2009, Western countries’ mainstream attitude was a willingness to trust China; many countries, including France, were willing to believe in and hope for a strong China in order to contain the United States.

During that time, only a few observers expressed their suspicion of China. The first time appears to be in February 2001, in a report published in the Far Eastern Economic Review. The article, “People’s Republic of Cheats,” describes how China descended into what it calls the People’s Republic of Cheats.

Professor Carsten A. Holz of Hong Kong University of Science and Technology published an article, “Have China Scholars All Been Bought?” in the Far Eastern Economic Review in 2007. The article reviewed the situation with China scholars, and discussed how many of them obtained research opportunities and access to information as a result of pleasing the Chinese government.

“Academics who study China, which includes the author, habitually please the Chinese Communist Party, sometimes consciously, and often unconsciously,” Holz said. “Our incentives are to conform, and we do so in numerous ways: through the research questions we ask or don’t ask, through the facts we report or ignore, through our use of language, and through what and how we teach.” Holz cited a long list of facts, which touched the sore spots of his peers, leading to a cold reception for the article.

A famous quote attributed to U.S. President Abraham Lincoln said, “You can fool some of the people all the time, and all of the people some of the time, but you cannot fool all of the people all the time.”

Beijing’s credibility is now questioned by the whole world. The situation proves that the widespread use of lies and rumors will lead to political demise.