China: Incentives


October 14,2008:  China has lost two more trademark infringement cases. The World Trade Organization made the ruling, and this continued a trend that is making it more difficult for China to get away with stealing civilian and military technology. China's increased military power is largely propelled by stealing military technology (largely from Russia and the United States).

China continues to cope with the anti-Chinese riots in Tibet over the last year. The secret police quietly arrest and prosecute Buddhist clergy who served as informal leaders of the popular opposition to growing Chinese immigration and cultural domination in Tibet. Some of the unrest occurred just across the border, in thinly populated areas largely occupied by half a million nomadic Tibetans. The government is spending $700 million to build housing and villages for many of these Tibetans, which the police see as a long range threat.

In a major legal and economic change, the Chinese government has given over a hundred million farmers legal title to the land they work. Technically, the farmers will not own their land, but in practical terms they can mortgage, rent or sell it. This change, in nation that still pretends it is a communist state, is an attempt to get the rural population (over half of all Chinese) out of poverty, and forestall potential rebellion. Chinese leaders are very conscious  of the their history, and the frequency with which the Chinese government has been brought down, or severely weakened, by rural unrest and rebellions.

European police have found several hundred credit card readers (as found in stores and restaurants) that were built in China, but had a small component added that allowed hackers to obtain all credit card information put through the card swipe devices. It's long been feared that Chinese manufacturers would do this sort of thing, for components potentially headed for military equipment. It's been pointed out that keeping something like this secret is difficult, given the amount of scrutiny data and equipment get. Such was the case with the modified card readers. The modification was discovered over the past nine months. It's not yet known if the readers were modified at the Chinese factory, or after (as in Pakistan, which some of the equipment passed through on their way to Europe.) Many Information War operations tend to be carried out first by criminals, not government intelligence operations. The crooks are more efficient and more motivated, something the civil service operators don't like to contemplate.

The former (he retired three months ago) of the Taiwan's Bureau of Investigation (a national intelligence and investigative agency) was arrested for aiding and participating in corrupt practices (money laundering). While not as corrupt as China, Taiwan has its problems. This makes it easier for Chinese spies to operate, what with so much potentially for sale.

October 4, 2008: The U.S. announced a long delayed (by Chinese and Taiwanese politics) $6.5 billion sale of American weapons to Taiwan. China protested, by cancelling or delaying some feel-good meetings with American military officials. China is upset with Taiwan improving its anti-missile systems, which can diminish the impact of the 1,300 ballistic missiles China has aimed at Taiwan.  China wants the U.S. to stop defending Taiwan. Meanwhile, China does little to interfere with Taiwanese investing in China. After all, it's business.

October 2, 2008: It was revealed that one of the VOIP (cheap phone calls via the Internet) software companies (Skype) operating in China had special software installed so that the government could search all text messages sent via Skype networks. The government was interested in searching to words  or phrases indicating interests or behavior the government does not approve of. China is believed to force all foreign communications companies operating in China to assist in the national electronic eavesdropping system. China likes to keep this secret, so they can pretend they are not running a heavy handed police state.

September 28, 2008: Chinese police have arrested nearly thirty people for causing the recent contaminated milk scandal. Prosecution and public executions may follow, in an attempt to placate an enraged public. Basically, rural businessmen had an illegal manufacturing operation that produced melamine, an industrial chemical not meant for human consumption. But it could be used to improve the protein content of milk. People running companies that brought milk from farmers would knowingly spike the milk with melamine, making it appear to be of higher quality, and sell the tainted milk for a higher price. It was a typical scam, and China had no government department testing milk quality that could catch it. This causes growing public anger, since China is a police state and the government pretends to be in charge of everything. But the growing number of corruption cases show that the people running this police state are more interested in making money for themselves, than in running the government well. The government is trying to restrict details on how many children were killed or made ill by consuming melamine tainted milk. A larger problem is dealing with foreign governments who are very angry with tainted food products coming out of China.

September 26, 2008: Israel provided counter-terrorist training for Chinese police assigned to working last Summer's Olympic Games. At least twenty Chinese police officers went to Israel for the training in dealing with certain emergency situations that could best be taken care of by a small group of well trained operators. China requested that this bit of cooperation with Israel be kept secret, but word got out.




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