EZEKIEL 25 17
The path of the
righteous man is beset on all sides by the iniquities of the selfish and the
tyranny of evil men. Blessed is he who, in the name of charity and good will,
shepherds the weak through the valley of the darkness. For he is truly his
brother's keeper and the finder of lost children. And I will strike down upon
thee with great vengeance and furious anger those who attempt to poison and
destroy my brothers. And you will know I am the Lord when I lay my vengeance
upon you.
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FSOC CHICOM REPORT
Three
Chinese institutions were among the world's top four banks at the end of 2007
at a time when the
market capitalisation of
Western banks was suffering from a global financial crisis, a study showed
Wednesday. The number one spot in the rankings, compiled by the
Boston Consulting Group, was
occupied by the Industrial and Commercial Bank of China, with market
capitalisation of nearly 340 billion dollars (218 billion euros). In second
place was
China Construction Bank,
followed by HSBC of Britain, Bank of China, Bank of America and Citigroup of
the United States. The study found that banks in North America and
Western Europe had suffered a
loss of 695 billion dollars in market capitalisation at the end of 2007 while
their counterparts in emerging market countries Brazil, Russia, China and
India had seen their market capitalisation increase by 753 billion dollars.
Major US and European banks have suffered losses and asset writedowns stemming
from the near collapse of US subprime -- high risk -- mortgage sector, which
undermined the value of billions of dollars' worth of their mortgage-backed
securities.
This is another reason why the US
government shouldn't be spending borrowed money to finance
extra-constitutional spending. The Chinese government has begun a concerted
campaign of economic threats against the United States, hinting that it may
liquidate its vast holding of US treasuries if Washington imposes trade
sanctions to force a yuan revaluation. Two officials at leading Communist
Party bodies have given interviews in recent days warning - for the first time
- that Beijing may use its $1.33 trillion (£658bn) of foreign reserves as a
political weapon to counter pressure from the US Congress. Shifts in Chinese
policy are often announced through key think tanks and academies. Described as
China's "nuclear option" in the state media, such action could trigger a
dollar crash at a time when the US currency is already breaking down through
historic support levels. It would also cause a spike in US bond yields,
hammering the US housing market and perhaps tipping the economy into
recession. It is estimated that China holds over $900bn in a mix of US bonds.
When the federal government is asked to do things the Constitution doesn't
tell it to do, and when more and more money flows through it, and with that
more and more power, it's hard to stop spending. And with that comes
borrowing. And with that comes slavery. The same thing could happen even if
spending were kept in the context of the Constitution, but once you escape its
limits, there is then no limit. The rich rule over the poor, and the borrower
is servant to the lender. - Proverbs 22:7 (NIV)
China's oil giant Sinopec Group has signed a US$70 billion oil and natural gas
agreement with Iran, which is China's biggest energy deal with the No. 2 OPEC
producer. Under a memorandum of understanding signed Thursday, Sinopec Group
will buy 250 million tons of liquefied natural gas over 30 years from Iran and
develop the giant Yadavaran field. Iran is also committed to export 150,000
barrels per day of crude oil to China for 25 years at market prices after
commissioning of the field. Iran's oil Minister Bijan Zanganeh, who is on a
two-day visit to Beijing pursuing closer ties, said Iran is China's biggest
oil supplier and wants to be its long-term business partner. Official figures
show that China imported 226 million tons of oil in2003, about 13 percent of
which coming from Iran. Beijing expects to secure foreign energy supplies by
the deals for its economy, which has turned China into a major oil importer
but suffers severe power shortages.A former KGB officer said to be close to
President Vladimir Putin was selected at a shareholders meeting Monday to head
Transneft, the state-owned monopoly pipeline operator. Nikolai Tokarev had run
state-owned oil exporting firm Zarubezhneft since 2000, the year Putin became
president. He previously had served a brief stint at Transneft as vice
president. Tokarev will replace Semyon Vainshtok, who was picked to head the
state-run corporation overseeing construction of sports facilities and
infrastructure in Sochi for the 2012 Winter Games.
The choice of a former KGB officer to run Transneft, which is 75 percent state
owned, comes ahead of parliamentary and presidential elections in Russia and
fits a Kremlin pattern of putting trusted people in key government and
corporate positions. "This is part of the configuration around the
presidential succession," said Vladimir Pribylovsky, a political
analyst.Bulgaria and Russia signed a deal Friday to build a natural gas
pipeline that would undercut a rival project backed by the U.S. and European
Union and strengthen the Kremlin's dominance over EU energy supplies.The
agreement came after visiting Russian President Vladimir Putin pushed hard to
secure Bulgaria's crucial participation in the projected South Stream
pipeline, which would cross from Russia under the Black Sea to Bulgaria and
then branch off for delivery deeper in Europe. Putin brushed off concerns
about Russia's increasing influence, saying after the signing ceremony that
the pipeline agreement and other deals would "seriously increase the energy
security of the Balkans, Europe as a whole and, of course, Bulgaria." The deal
required last-minute negotiations, amid tough bargaining by Bulgaria and
wariness about Russia's clout. The Bulgarian Cabinet approved the agreement at
an extraordinary meeting only a few hours before it was signed.Bulgaria's
interests are fully protected, because the company which will be set up to
construct and run the pipeline on Bulgarian soil will be with 50 percent
Bulgarian and 50 percent Russian ownership," Bulgarian Prime Minister Sergei
Stanishev said. Russia's state-controlled gas monopoly, OAO Gazprom, had
previously been offering a minority stake in the part of the pipeline that
would run through Bulgaria.
"Until yesterday, the Russian side insisted on holding a 51-percent stake,"
Stanishev said. He said Putin himself deserved most of the credit for the
progress in the late-night negotiations. But despite the concession, the
imminent deal was a victory for Putin and Russia, which is already Europe's
dominant gas and oil supplier and is seeking to increase its control over
westward routes for its energy supplies from the former Soviet Union. "It's
very important that the parties have shown their ability to compromise, and
the draft that has been was prepared reflects a balance of interests," Gazprom
chairman Dmitry Medvedev, who is likely to succeed Putin after the March 2
presidential election, said after meeting with Stanishev. He said agreements
on South Stream "will work for decades and make it possible to ensure stable
conditions for future energy deliveries for Bulgaria, Russia and EU nations."
Gazprom has set up a parity joint venture with Italy's ENI SpA to develop a
feasibility study for the 900-kilometer (550-mile), $10 billion pipeline. The
project is a direct rival to the Nabucco pipeline, sponsored by the United
States and the European Union, which would also come through Bulgaria. Taking
advantage of the clashing pipeline offers, Bulgaria has bargained with the
Kremlin. On Thursday, Bulgarian President Georgi Parvanov underlined his
nation's support for the EU's efforts to diversify energy supply routes -- and
for Nabucco -- in a speech at a ceremony marking the opening of a Russian
cultural festival in Bulgaria. After Parvanov had spoken, a clearly annoyed
Putin, standing next to him, said Bulgaria was free to chose its direction but
warned it to make sure it "works to its benefit." ENI CEO Paolo Scaroni played
down the rivalry between South Stream and Nabucco following meetings with
Gazprom CEO Alexei Miller, saying both would be needed because of growing
demand. But South Stream would undercut Nabucco and dash the European Union's
hopes of reducing its growing reliance on Russia, which now supplies up to 40
percent of Europe's gas and up to a third of the oil imports of some European
countries. South Stream would have an estimated annual capacity of 30 billion
cubic meters (1.15 trillion cubic feet), roughly equivalent to 60 percent of
the natural gas consumed annually in The Netherlands. The Kremlin's plans have
upset opposition parties and non-governmental organizations in Bulgaria, who
fear the former Soviet satellite's increasing dependence on Russian energy
supplies and criticize Moscow's human rights record. With Putin and Parvanov
looking on, officials also signed a $5.9 billion contract to build Bulgaria's
second nuclear plant near the northern town of Belene.
Also signed was an agreement for a joint company, also including Greece, to
build the Burgas-Alexandroupolis oil pipeline, which will channel Russian oil
from the Black Sea to the Aegean, bypassing Turkey's busy Bosporus. As part of
its energy blitz, Russia has promised to extend South Stream into Serbia and
build a huge gas storage facility there -- moves that would turn the Balkan
nation into a major hub for Russian energy supplies to Europe. Miller said
Gazprom and Serbian officials were close to a final agreement on a deal that
would envisage a South Stream branch reaching Serbia, and would also foresee
Gazprom taking a controlling stake Serbia's state oil company NIS. Belgrade
has turned increasingly away from the West and toward Russia, which has
supported Serbia in the debate over independence for Serbia's Kosovo province.
With the official launch of the Chinese Investment Corp, China's new financial
juggernaut will be both a formidable opportunity and challenge for the west.
The Chinese Investment Corp. (CIC) has been officially launched, and with an
initial endowment of US$200 billion the new state-controlled company is tasked
to invest abroad China's huge foreign reserves. In the shopping bag there will
be natural resources from developing countries as well as foreign
technologies, research and development (R&D) establishments and brand names
from developed economies. For the west, China's new financial juggernaut will
be a formidable opportunity, and a formidable challenge. After various
announcements, on 27 September, the Chinese authorities officially unveiled
the CIC. Under the direct supervision of the State Council, the nation's
cabinet, the CIC is mandated to invest abroad the huge reserves accumulated by
Beijing over the last years. China's forex topped US$1.33 trillion at the end
of June and are expected to reach US$1.5 trillion by the end of the year, the
largest in the world. Lou Jiwei, a deputy-secretary general of the State
Council and former finance minister, will be the director of the new company.
China's investment corporation has been under preparation for some time. At
the conclusion of the annual session of the National People's Congress in
March, the Chinese government announced that it would set up a State Foreign
Exchange Investment Company (SFEIC) aimed at improving the yield of the
country's foreign exchange reserves and generating the largest returns
possible. In May, the new company, while still in preparation, invested US$3
billion of its reserves in non-voting shares of the Blackstone Group, the New
York-based private equity firm that recently went public. With the
establishment of the CIC at the end of September, the contours of China's
investment strategy have become clearer. The CIC strategy
The CIC is modeled on the Singapore investment company, Temasek Holdings.
Temasek is an investment firm incorporated in 1974 and headquartered in
Singapore. Its portfolio spans various industries including telecommunications
and media, financial services, real estate, transportation and logistics,
energy and resources, infrastructure, engineering and technology as well as
bioscience and healthcare. The Chinese sovereign wealth fund will also be a
private equity vehicle, operating on a flexible investment horizon with the
option of taking concentrated risks. Lou Jiwey, the CIC's director, declared
that the new company would "invest, manage and add value to the Chinese
portfolio" as an owner of its assets and investments. Beijing currently holds
its reserves in US treasury bonds and other safe but low-yielding,
instruments. According to Chinese sources, the CIC will likely be
"equity-heavy." Analysts at Morgan Stanley also expect the Chinese company to
hold a substantial share of its assets in equities, not sovereign bonds. "The
company's principal purpose is to make profits," Li Yang, director of the
finance research institute at the Chinese Academy of Social Sciences (CASS),
told ISN Security Watch. The CIC has an initial capital of US$ 200 billion,
but presumably the amount will be increased according to the investments that
the company will support. In practice, the CIC will issue RMB-denominated
bonds and sell these bonds on the market to buy foreign exchange funds from
the central bank. It will then use the foreign exchange funds for investment.
In June, China's legislature approved a special issuance of RMB 1.55 trillion
(US$200 million) in treasury bonds for the new investment company. The CIC
will operate in both the domestic and global markets. Internally, the
investment channels of the new vehicle will include another Chinese
state-owned company founded in 2003, the Central Huijin Investment Corp.,
which has been merged into the CIC as a wholly owned subsidiary company.
Central Huijin holds shares in China's four leading commercial banks and in
2005 injected US$60 billion into three of them. While Central Huijin will be
one of the financial vehicles adopted as the central bank's investment arm to
improve the balance sheets of Chinese state-owned banks, the CIC will be more
of a strategic investment fund focused on industry and private equity.
Internationally, the CIC will be Beijing's investment arm in a range of
sectors and countries. Its initial endowment and future prospects make it one
of the biggest in the world.
According to a report by Chatham House published in September, the CIC soon
will be the number two in the world, behind the Adia, the sovereign wealth
fund of the United Arab Emirates, but ahead of both the Gic, the Singaporean
fund, and the Norwegian Government Pension Fund. The central question is
therefore where and in which sectors the CIC will invest its capital.
According to sources, China's international investment strategy will take two
directions. One the one hand, it will invest in natural resources in
developing countries. On the other hand, it will concentrate on the
acquisition of foreign technologies, R&D establishments and brand names in
advanced economies. According to Li Rongrong, director of the China State
Asset Management Commission (the agency that oversees government assets), the
CIC may also help major state-owned companies expand overseas.
Taking the world by investment
Since the mid-1990s, the search for natural resources has continued to gain
momentum as a result of China's high economic growth, with increasing emphasis
on oil and industrial raw materials. In its 2006 World Investment Report, the
United Nations Conference on Trade and Development (UNCTAD) indicated that
China's outward foreign direct investment had more than quintupled in the
first half of this decade, to reach US$11.3 billion in 2005. South-East Asia,
Latin America and Africa have become the prime targets. For instance, in 2002,
the China National Offshore Oil Corporation became the largest foreign oil
producer in Indonesia after its takeover (for US$585 million) of Repsol
Indonesia. In Africa, China's investment strategy has been directed mainly at
sourcing natural resources, including oil. Moreover, increasing numbers of
Chinese companies have recently established production bases to supply local
markets with cheap products highly compatible with local demand and purchasing
power. As a result, total trade between China and Africa nearly quadrupled in
six years, from US$10.8 billion in 2000 to nearly US$40 billion in 2006. China
is today Africa's biggest trading partner and the second most important
investor. China's new investment company will further boost these trends. At
the same time, China will invest more and more in developed countries, where
its presence is often welcomed for the jobs, cash and infrastructure that it
brings. In Australia, for example, China has become the biggest foreign
investor in the mining sector. The CIC will place more emphasis on the
acqui¬sition of advanced technologies, R&D establishments, managerial
know-how, distribution networks and brand names. China's investment strategy
will likely take the form of profitable participation in private equity funds
as well as strategic participation in foreign investment companies running
businesses considered of importance for China. While normally in the first
case, the CIC would hold a minority stake or give up voting rights for the
entitlement of a higher return (as in the Blackstone investment fund), in the
event of acquisitions of strategic assets, China's investment company would
presumably detain the majority of shares or in any case full control of the
company. It is in this scenario that questions of corporate governance,
transparency and strategic considerations will be unavoidable.
Eye on Europe: challenge and opportunity
While in the US protectionist tendencies may create difficulties for China
investing in key strategic sectors, Europe is emerging as the most attractive
place for China's technology-seeking shopping spree. China is eyeing Europe's
IT, aerospace and defense sectors as investment opportunities, both in terms
of profitable returns on its foreign reserves and in terms of acquisition of
advanced technologies needed for China's industrial (and military)
modernization. Chinese investments in European companies would be helped by
the fact that EU-China relations are characterized by the conspicuous absence
of issues that could provoke a confrontation between the two sides - such as
the Taiwan question. Unlike the US and Japan, Europeans look at China almost
exclusively in terms of business opportunities and not as a possible military
competitor. Some EU policy makers - such as the Italian minister for the
economy, Tommaso Padoa-Schioppa - have openly invited the CIC to invest in
Europe. At the same time, French President Nicolas Sarkozy and German
Chancellor Angela Merkel have called for a European "golden share" to protect
industrial strategic assets from unwanted takeovers from sovereign wealth
funds (SWFs). EU Economy Commissioner Joaquin Almunia added that "the EU might
restrict investments by government funds unless they disclose more about what
they invest in and why." The CIC will thus be, on the one hand, a great
opportunity for some industrial sectors, as it will offer fresh money into
tight markets after the sub-prime mortgage crisis. On the other hand, the
Chinese investment vehicle could well succeed in gaining control of western
assets and advanced technology that could be turned into military might in a
situation where there could be future tensions in US-China relations,
especially over Taiwan. In sum, for the west, the new Chinese investment
corporation will be a great economic opportunity, but also a formidable
strategic challenge to watch.
Extracting oil from sand is still a laborious, time-consuming task although
improved technology has significantly lowered costs. From his perch behind the
wheel of a heavy-hauler truck in Fort McMurray, Alberta, Lucas Crisby peers
out over a seemingly limitless moonscape of black, sticky sand. Oil has been
good to Crisby. With his US$62,000 (HK$483,600) annual salary, he has bought a
US$338,000, four-bedroom house a few doors from where he grew up. That's a
significant achievement for a 20-year-old without a college degree and only a
few years of work experience.Now, with Chinese companies pouring hundreds of
millions of dollars into the vast northern Alberta oil sand deposits, Crisby
and others at Fort McMurray - a former Hudson Bay trading post - believe the
good days have just begun.
Crisby says he doesn't care who harvests the oil sands, as
long as the paychecks keep rolling in.''It's a free market,'' said Crisby, who
rocks out to country tunes while hauling 400-tonne truckloads of unprocessed
sand for Syncrude, a giant Canadian oil producer.To power its factories and
fleets of new cars, China has intensified its search for oil in Asia and
Africa. But Beijing's expansion into the United States' back yard demonstrates
the risks the Asian economic giant is taking to secure energy supplies.China's
venture into Canada has triggered unease in Washington, where some fear it
could threaten US energy security and set the stage for clashes.Under the 1994
North American Free Trade Agreement, Canada ensured its role as the dominant
supplier for the United States by guaranteeing it would send a portion of its
energy south of the border.
Today, Canada provides 17 percent of US oil imports, 16
percent of its natural gas and nearly all its imported hydroelectric
power.Karen Harbert, assistant secretary for policy and international affairs
at the US Energy Department, said Washington didn't believe it should tell
other countries where - or with whom - they could do business.``Is China's
investment into Canada's energy sector good for the North American energy
market? Ultimately, it will be up to the Canadians to figure out which way
they want to go and what's in their best interest economically and
security-wise,'' she said.In the past two months, China's three largest oil
firms have struck major deals in Canada, including a 40 percent stake in a
US$3.6 billion pipeline project.The promise of a big new player in Alberta's
oil sands has intensified a boom in the province. Since 2002, Fort McMurray's
population has expanded by 20 percent to 56,000, mostly young Canadian men
seeking their fortunes.
Oil companies are beginning to import labor from as far away
as Venezuela and China, which has sparked job-loss concerns among labor unions
and indigenous leaders. But many Canadians, including Crisby, simply view
China as another major player in an industry that has long been a global
game.Although the Canadian government owns the vast majority of the country's
energy resources, more than half of Alberta's oil deposits are being developed
by US companies, including Chevron, Exxon Mobil and Oklahoma City-based Devon
Energy. The French, Dutch and Japanese have also invested in the oil
sands.Thanks in part to aggressive marketing by its political leaders, Canada
has also been a big beneficiary of China's economic growth.
China is now Canada's second-largest trading partner, and
Chinese is the third-most widely spoken language in Canada, after English and
French. More than a million people of Chinese descent have immigrated to
Canada in the last century.The latest influx of Chinese funds into energy and
mining has prompted the Canadian government to look more closely at the
national-security effects of foreign investment. Canada is closely watching
the debate in Washington over competing bids for Unocal by Chevron and China's
CNOOC, a majority of whose stock is held by government-owned China National
Offshore Oil Corp. US critics say a Chinese buyout of the California company
would put scarce energy resources in the hands of a potentially hostile
government.
Wenran Jiang, a China expert at the University of Alberta,
said a US rejection of the CNOOC bid would make Canadians more cautious about
striking energy deals with the Chinese.Energy analysts say Canada must balance
its desire for investments from China with the need to satisfy its best
customer, the United States, which buys 80 percent of Canada's total exports.
When Alberta Energy Minister Greg Melchin visited Capitol Hill recently, he
was questioned repeatedly about China's new role in Canada.Melchin said he
reassured US officials and others that Canada's oil sands were a ``sunrise
industry'' with lots of room for development, and that the United States would
remain his province's ``best customer, friend and neighbor.''But many
Canadians also view the issue as a way of reminding their powerful neighbor
not to take them for granted.
``Our message is it would be in the best interest of the US
to pay attention to your largest and best opportunity for long-term energy
supply,'' Melchin said. ``You shouldn't take for granted that it will
automatically happen.''Oil-industry executives and analysts differ on what
China's entry into the Canadian market will mean for the United States. Some
say it will have little effect on the price Americans pay for Canadian energy
because oil supplies can be acquired elsewhere.But Wilfred Gobert, vice
president of Peters & Co, a Calgary investment firm, thinks greater
competition for Canada's oil could push up prices, especially if the Chinese
are willing to pay more to secure a stable supply.Analysts say an infusion of
Chinese funds would speed up development of Canada's oil sands, allowing the
extraction of more oil for the United States, as well as China.Although
improved technology has significantly lowered costs, extracting the oil from
sand is still a laborious, time-consuming task, requiring two tonnes of sand
to produce a barrel of oil.
Critics say the process is one of the most environmentally
destructive ways to squeeze oil from the earth, in part because it emits large
amounts of greenhouse gases.To reach the oil, giant pits as deep as 250 feet
are being carved out of the northern Alberta forests. The sticky sands are fed
through a series of machines that crush and separate out bitumen, which is
processed into crude oil.If Canada's output more than doubles by 2010, as
projected, the oil sand producers will need new pipelines to get the crude to
their customers. That's why China is a key factor in the competition between
Calgary-based Enbridge and another Calgary firm, Terasen Pipelines, to develop
a pipeline from northern Alberta to the coast of British Columbia in the
west.Whichever company secures a Chinese commitment for long-term contracts
will have the edge in financing its pipeline, said Steven Paget, a research
analyst for FirstEnergy Capital, a Calgary-based investment bank.
But getting there won't be easy, said Richard Bird, group
vice president of Enbridge. He said China's big energy firms aren't ``willing
to buy long-term supply without more direct investment into the oil sands,''
meaning they want to help produce oil and share in profits.Canadian executives
said Chinese firms were more willing than Western companies to invest
``patient capital'' in projects that might not reap immediate profits, to gain
a foothold in promising markets.With the surge in oil prices, the biggest
Canadian oil sand producers are being courted heavily and can afford to be
choosy about their partners.Thomas d'Aquino, chief executive of the Canadian
Council of Chief Executives, a group of Canada's leading firms, said he
opposed any efforts to restrict China's participation in the North American
energy market, as long as its acquisitions are legal and transparent.But he
said Washington and Ottawa should think about what they would do if there was
a global energy shortage and Beijing controlled a large share of Canada's
oil.``What would it mean if China owns those resources and said, `No, we need
them for us, we can't send them to you'?''
China says nine countries have offered it financial
incentives to invest in oil and gas projects as it continues its global hunt
for energy resources. Government officials said Kuwait, Qatar, Oman, Morocco,
Libya, Niger, Norway, Ecuador and Bolivia would offer China tax breaks and
other sweeteners. China already has a similar arrangement with 20 other
countries. China is increasingly dependent on imported oil and gas as it tries
to sustain its rapid economic growth.
Beijing has agreed a host of energy deals with other
countries in the past year, including Venezuela and Malaysia, and is
currently negotiating with Iran over gas imports. China has been particular
active in Africa, prompting criticism that it is exploiting the continent's
resources for its own benefit and setting aside concerns about poverty
reduction and human rights abuses. Chinese oil companies already have
interests in Niger, while Libya is looking for external partners as it opens
up its energy sector to foreign investment. China imported 47% of its oil
supplies last year as its domestic supplies dwindled. New supplies are
regarded as vital if the country is to continue its swift economic
expansion. Separately, a government official said China would continue to
rely on domestic coal production for most of its energy needs but was also
looking to step up investment in renewable industries. Zhao Xiaoping, head
of the National Development and Reform Commission's energy bureau, told
Money China magazine its goal was to source 10% of energy from renewable
sources by 2010. Beijing is under pressure to embrace more
environmentally-friendly energy supplies to reduce pollution levels across
the country and set a lead in the global fight against climate change.
They operate from a bare apartment on a Chinese island. They are intelligent
20-somethings who seem harmless. But they are hard-core hackers who claim to
have gained access to the world's most sensitive sites, including the
Pentagon.
In fact, they say they
are sometimes paid secretly by the Chinese government -- a claim the
Beijing government denies."No Web site is one hundred percent safe. There are
Web sites with high-level security, but there is always a weakness," says Xiao
Chen, the leader of this group."Xiao Chen" is his online name. Along with his
two colleagues, he does not want to reveal his true identity. The three belong
to what some Western experts say is a civilian cyber militia in China,
launching attacks on government and private Web sites around the world.If
there is a profile of a CHICOM HACKER, these three are straight from central
casting -- young and thin, with skin pale from spending too many long nights
in front of a computer.
One hacker says he is a former computer operator in the PLA
another is a marketing graduate; and Xiao Chen says he is a self-taught
programmer."First, you must know about the Web site you want to attack. You
must know what program it is written with," says Xiao Chen. "There is a
saying, 'Know about both yourself and the enemy, and you will be
invincible.'"WE decided to withhold the address of these hackers' Web site,
but Xiao Chen says it has been operating for more than three years, with
10,000 registered users. The site offers tools, articles, news and flash
tutorials about hacking.Private computer experts in the United States from
iDefense Security Intelligence, which provides cybersecurity advice to
governments and Fortune 500 companies, say the group's site "appears to be an
important site in the broader Chinese hacking community."Arranging a meeting
with the hackers took weeks of on-again, off-again e-mail exchanges. When they
finally agreed, SOMEONE was told to meet them on the island of Zhoushan, just
south of Shanghai and a major port for China's navy.The apartment has cement
floors and almost no furniture. What they do have are three of the latest
computers. They are cautious when it comes to naming the Web sites they have
hacked.
But eventually Xiao Chen claims two of his colleagues -- not
the ones with him in the room -- have hacked into the Pentagon and downloaded
information, although he wouldn't specify what was gleaned. "They would not
publicize this," he says of someone who hacks the U.S. Defense Department. "It
is very sensitive."This week, the Pentagon said ULTRA TOP SECRET PENTIGON
COMPUTERS in the United States, Germany, Britain and France were hit last year
by what they call "multiple intrusions," many of them originating from
China.At a congressional hearing in Washington last week, administration
officials testified that the government's cyber initiative has fallen far
short of what is required. Most alarming, the officials said, there has never
been a full damage assessment of federal agency networks."We are here today
because we must do more," said Robert Jamison, a top official in the U.S.
Department of Homeland Security. "Defending the federal system in its current
configuration is a significant challenge."U.S. officials have been cautious
not to directly accuse the Chinese military or its government of hacking into
its network.
But David Sedney, the deputy assistant secretary of defense
for East Asia, says, "The way these intrusions are conducted are certainly
consistent with what you would need if you were going to actually carry out
cyber warfare."Beijing hit back at that, denying such an allegation and
calling on the United States to provide proof. "If they have any evidence, I
hope they would provide it. Then, we can cooperate on this issue," Qin Gang, a
spokesman for the Chinese Foreign Ministry, said during a regular press
briefing this week.But Xiao Chen says after the alleged Pentagon attack, his
colleagues were paid by the Chinese government. Again, CNN has no way to
independently confirm if that is true.His allegations brought strenuous
denials from Beijing. "I am telling you honestly, the Chinese government does
not do such a thing," Qin said.But if Xiao Chen is telling the truth, it
appears his colleagues launched a freelance attack -- not initiated by
Beijing, but paid for after the fact. "These hacker groups in my opinion are
not agents of the Chinese state," says James Mulvenon from the Center for
Intelligence Research and Analysis, which works with the U.S. intelligence
community."They are sort of useful idiots for the Beijing regime."
He adds, "These young hackers are tolerated by the regime
provided that they do not conduct attacks inside of China."One of the biggest
problems experts say is trying to prove where a cyber attack originates from,
and that they say allows hackers like Xiao Chen to operate in a virtual world
of deniability.And across China, there could be thousands just like him, all
trying to prove themselves against some of the most secure Web sites in the
world.
Taiwan's President Chen Shui-bian warned in a national address Wednesday that
China's military build-up was threatening world peace, and urged it to halt
military exercising targeting the island.
In a National Day
speech ahead of a parade aimed at underscoring Taiwan's defence capabilities,
he also called on China to withdraw
ballistic missiles
that are aimed at the island. "With China's rapid rise and relentless military
build-up, the 'China threat' is no longer confined to confrontation across the
Taiwan Strait.
In fact, it has already seriously impacted world peace," he said. Chen called
on urged the international community to "strongly demand that China
immediately withdraw missiles deployed along its southeastern coast targeted
at Taiwan, stop
military exercises
simulating attacks on Taiwan."
The
independence-leaning Chen accused Beijing of ignoring peace overtures and
using "ever more belligerent rhetoric and military intimidation." He said the
tactics were "aimed at denigrating our nation, marginalizing it in the world,
cultivating the perception that Taiwan is a local region of China,
delegitimizing its government, and undermining its sovereignty." "Only the
people of Taiwan have the right to decide their nation's future," he added.
"Taiwan and the
People's Republic of
China are two sovereign, independent nations, and neither exercises
jurisdiction over the other. This is a historical fact. This is the
status quo across the
Taiwan Strait."
Taiwan and China
split in 1949 after the end of a civil war, but Beijing still regards Taiwan
as part of its territory awaiting reunification, by force if necessary.
"A
geostrategic issue of crucial importance is posed by China's emergence as a
major power. The most appealing outcome would be to co-opt a democratizing and
flee-marketing China into a larger Asian regional framework of cooperation.
But suppose China does not democratize but continues to grow in economic and
military power? A "Greater China" may be emerging, whatever the desires and
calculations of its neighbors, and any effort to prevent that from happening
could entail an intensifying conflict with China. Such a conflict could strain
American-Japanese relations -- for it is far from certain that Japan would
want to follow America's lead in containing China -- and could therefore have
potentially revolutionary consequences for Tokyo's definition of Japan's
regional role, perhaps even resulting in the termination of the American
presence in the Far East.
However, accommodation with China will also exact its own price. To accept
China as a regional power is not a matter of simply endorsing a mere slogan.
There will have to be substance to any such regional preeminence. To put it
very directly, how large a Chinese sphere of influence, and where, should
America be prepared to accept as part of a policy of successfully co-opting
China into world affairs? What areas now outside of China's political radius
might have to be conceded to the realm of the reemerging Celestial Empire?" -
Zbigneiw Brzezinski
In 1997,
Zbigneiw Brzezinski, wrote "The Grand Chessboard - American Primacy and it's
Geostrategic Imperatives", which called for the American Dominance over
Eurasia. As it is believed, "Those who control Eurasia control the Planet",
and to accomplish this, the US would have to Prevent China from Acquiring
Supremacy in Eurasia...... which means War......
In
1998, Two senior PLA Air Force colonels, Qiao Liang and Wang Xiangsui, wrote "Unrestricted
Warfare" in Direct response to The Grand
Chessboard. Throughout this book, it is described how it would be feasible
for Low Tech to Overcome High Tech, which could be used to Destroy America.
.... and Unrestricted Warfare, goes as far as mentioning Bin laden and the
World Trade Center in the same Sentence. After 9-11-01, Qiao Liang and Wang
Xiangsui were
hailed as Hero's in
China. On the Anniversary of 9-11, this book was given new cover art...... a
Snapshot of 9-11
(on a little
side note,
Chinese Premier Zhu Rongji jokes publicly about the
September 11 attacks)
I know that
many of you are already thinking that "just because it's in a book, doesn't
make it true"..... which is why I ask that you try reading them before
dismissing this whole theory I'm about to type.... I also Tried to reference
everything I could with Documents from the most Reliable Sources I could Find
It is Inevitable that the US
and China would fight each other
Within these 2 books, is a basic format of how to acquire the goal of being
the
Hegemonic
Country that carries the Planet through the 21st Century....... and it seems
these books are being followed quite closely.
The Grand
Chessboard, states that the only way America would be able to be the Dominant
Power in Eurasia, would require a "Pearl Harbor Styled Attack" to give the US
Government the ability to change it's Foreign Policy towards Dominance......
which is Exactly what happened with George Bush's
National Security Strategy for the United States
it states that "as a matter of common sense and self-defense, America will act
against such emerging threats before they are fully formed' and `to forestall
or prevent such hostile acts by our adversaries, the United States will, if
necessary, act preemptively"
and
according to the CHINA SECURITY REVIEW COMMISSION -
REPORT TO CONGRESS OF THE U.S.
- JULY 2002, in -Chapter
7 - Proliferation and Chinese Relations with Terrorist-Sponsoring States.........
(China, is Considered a Threat)
....... The
Axis of Evil......
Using
September 11th,
the United States began their conquest of the Middle East, starting with
Afghanistan, Iraq, and soon to be Iran...... as these three countries are
necessary for holding a Geostrategic Influence over the Middle East. (which,
if you read the link to "the Grand Chessboard" you'll understand)
Each of
these, Important to China..... will China let America threaten it's National
Interests? Such as..... Iraq being the Biggest Supplier of Oil to China (refer
to
1997 China-Iraq Oil deal)
In comes North
Korea
N. Korea is a
Chinese Wild Card...... a country that's nuclear capable, ICBM's that can
potentially reach Chicago, and has a leader that's threatened to Nuke
America. China uses N. Korea to Launch Nukes at America....or American
Interests, like Japan, S. Korea, Taiwan, Guam...... Who would America
retaliate against...... N. Korea or China?
Then
there's the "List
of 60+ other countries" that the President
Bush considers as "Terrorist Harboring or Sponsoring States" (though the full
list has never been disclosed)
but it would almost be safe to say that Within the "List of 60", America has
created a Half Circle around China........ leaving the Russian Border
Open......
Russia will be the
deciding factor, and I believe whoever allows a blind eye to be turned to the
expansion into some of their old Satellite Countries, will be who Russia sides
with...... and as it stands, Russia is against this War in Iraq.... to the
point, they were giving Iraq Military Equipment after America had already been
in Iraq for Days. So, it's not looking good, if America wants Russia as an
Ally, for a War against China....... read the Russia page if you want to know
more..... now back to China
China, more then any other country since 9-11-01, has remained fairly silent
in the World of Politics, they've just been sitting back watching what America
does......even after the US has repeatedly tried "Provoking" China..... the
EP-3 Spy Plane Incident, the Bombing of the Chinese Embassy, the "Spy
Bugs" on President Zemin's Boeing..... and
now PreEmptiveness against many of China's Economic Partners?
China's response to each incident?...... China
disassembled the EP-3 Plane
and shipped it back to America...... China, though did nothing through action,
they refuse to believe
any excuse we have to
offer, for the Bombing of their Embassy....... and Silence upon the Bugged
Plane incident (which almost prevented the Bush-Zemin meeting in February of
2002)......... China asked the United States to Halt the War against Iraq
Immediately.
So far,
China has shown that they are taking a Passive Route, but that could very
easily change
.... and we think that their
efforts will bear no fruit, if they attempt anything......
"Since the 7
May 1999 bombing of China’s embassy in Belgrade, China’s leaders reportedly
have been discussing ways to offset US power, to include accelerating military
modernization, pursing strategic cooperation with Russia, and increasing
China’s proliferation activities abroad. However, none of these options is
likely to improve fundamentally Beijing’s position." -
China Report to Congress
- Pursuant to the FY2000 National Defense Authorization Act
China's
Offensive Move against the United States would be Taiwan and the N. Korean
Wild Card, but Taiwan, would be a Last Resort, as "Unrestricted Warfare"
offers a Variety of ways to Destroy America without a Serious Military Match
Up, but does not leave that subject undiscussed. Which
China has been Preparing for,
within the past 5 years, according to their "Stated Budget Reports"
China is already a significant
regional power and is likely to entertain wider aspirations, given its history
as a major power and its view of the Chinese state as the global center.
The choices China makes are
already beginning to affect the geopolitical distribution of power in Asia,
while its economic momentum is bound to give it both greater physical power
and increasing ambitions. The rise of a "Greater China" will not leave the
Taiwan issue dormant, and that will inevitably impact on the American position
in the Far East.
"The exercise
of American global primacy must be sensitive to the fact that political
geography remains a critical consideration in international affairs. Napoleon
reportedly once said that to know a nation's geography was to know its foreign
policy. Our understanding of the importance of political geography, however,
must adapt to the new realities of power.
For most of the history of international affairs, territorial control was the
focus of political conflict. Either national self-gratification over the
acquisition of larger territory or the sense of national deprivation over the
loss of "sacred" land has been the cause of most of the bloody wars fought
since the rise of nationalism. It is no exaggeration to say that the
territorial imperative has been the main impulse driving the aggressive
behavior of nation-states. Empires were also built through the careful seizure
and retention of vital geographic assets, such as Gibraltar or the Suez Canal
or Singapore, which served as key choke points or linchpins in a system of
imperial control"
-
Zbigneiw Brzezinski
China, knowing
that attacking Taiwan prematurely, will bring a repercussion of massive US
Military Force, they will watch America for awhile.....
"The Blind Man and the Elephant"
Bush
Administration already pledged to do "whatever
it takes" to defend Taiwan, in accordance to
the
Taiwan Relations Act
With the US
Military Occupied in the Middle East, Trying to Protect Taiwan, and Dealing
with the N. Korean Wild Card, China has a variety of options that open for
them.
Try to
use Diplomatic Processes to halt the US War...... Assist (Arms
& Finances) those that the US is Attacking (Proxy Wars)....... Take Taiwan,
and go to War with America.
Through the Diplomatic Process,
China could use a Call for Peace, as a way to unite the world to pressure the
United States to Stop their Conquest, which could have extremely positive
effects for China, if they play their cards right.
Assisting those that the US are
Fighting, could allow China to increase their Military Industrial Complex on
an Exponential Factor, which would obviously hinder the US War Plans and
create a US vs China style Vietnam, that many are expecting this war to
eventually come to........
While,
"Unrestricted Warfare" Supports the creation of a Vietnam Styled Conflict, it
is questionable if it would be the best route to take, unless China is wanting
a Mass Population Reduction.....which, could be very possible, as they have a
population of 1.4 Billion people..... and we already know America's up for
Population Reduction...... (or at least some in Congress want "H.
CON. RES. 70" passed)
Which brings us to the Option
of actually Confronting the US War machine, via Taiwan..... which in all
essence would be World War Three.
Now, as I stated earlier,
Russia is going to be the deciding Factor in who is the winner for the
position of "the Lone Hyper-Power"..... yea, there's some who claim the US is
a Lone Super Power, but it is impossible to claim that 1/5th of the World's
Population is Not a Super Power. The Difference between a Super Power and a
Hyper Power, is the Super Power has a relatively close Rival to some aspect of
the Sphere of Influence of a Nation, be it Military, Economic, Social, or
Political....... the Hyper Power has no Rival.
George Bush's
National Security Strategy, calls for the US to have No Rivals
Since the Rise
of Communism in the bitterness of the Cold War, one of America's Greatest Fear
was a Russian-Chinese total peace agreement, and them attacking America......
after the Fall of Soviet Russia, this fear has been close to forgotten, yet is
closer then it has ever been. (High-Level
Political/Military Visits Between Beijing and Moscow Strengthen "Strategic
Alliance" Against U.S./NATO
-----
United States Security Strategy for Europe and NATO)
With the US on the path of
Conquest, it is Imperative in the National Security interests of China and
Russia to have the Presence of the US removed from their Sphere of Influence
....... the question is, as I asked earlier.... what Path to take.
Any Option that is Chosen,
means an inevitable end to the US quest for the Status of Hyper Power.
........ The
Peace Process.......
If the
Diplomatic process is used, this could grant the UN the ability to become
effective in their Role as "Peace Keepers" and Strengthen their ability to
uphold their Resolutions and position as International Body of Law...... which
could in all essence, be the creation of a World Governing Body.
There are many who claim that
the UN has shown their Irrelevance and Inefficiencies, which will lead to
their demise within the next 10 years, but this could easily not be the
case...... This is just the belief that the UN is no longer Relevant to the
USA, towards their quest towards Hyper Power Status.
If this were to happen, it
would be very possible that the US could lose their position on the Security
Council, which I see the US attempting to pull out of the UN if the UN tries
to stop it's Quest........ This would obviously cause some havoc in the UN
which could destroy the UN, but China, Russia, and the EU could easily make up
for the loss of the US and it's Obligations towards the UN.
For the US to
block the UN Peace Process and continue the Road to Hyper Power, would require
the destruction of the UN, but in a show of Good Faith, the US will wait till
the UN acts against them.
Back to the
Peace process......
There's close
to 200 Countries on this Planet, and in the "Coalition of the Willing" (there
has never been a straight and definite number given) is made up of somewhere
between 30-45 Countries, which leaves 140+ that don't seem to be "Willing" to
assist America's War ( I use 140, since some countries are probably helping
the US behind the scenes)
So, these
140 countries that are left, Pressure the US to stop their War and Quest for
Hyper Power Status, the US can not survive in it's current state, if it's cut
off from the world......... and the US falls like the Soviet Union... but the
National Security Strategy will not allow for that...... for us, it's either
World Domination or Total Destruction......"We will not tire, we will not
falter, and we will not fail" -
George Bush Jr.
Already,
a few countries have started boycotting American Goods..... Germany, Russia,
France...... what if this were to catch on?....... What would happen if the US
was cut off from the rest of the world, outside of
Pax Americana?
...... The
American-Chinese "Vietnam".........
With the Peace
Process, seemingly Failed, every possible scenario I could think of, Leads me
to wonder what China would do, if they didn't want to Fight the US at first,
but instead let them wear out their resources, fatigue their military, and
strain their nation (with assistance from potential world wide sanctions from
an attempted peace process)
This could
cause the Chinese Military Industrial Complex a chance to catch up to the US
technologically, as they could just sit back and support guerillas in Iraq,
Iran, Afghanistan, Syria, N. Korea ........ which of course, is going to
increase their Economy and their
"Middle Eastern" Sphere of Influence
If this were to
happen, "Terrorism" would increase a thousand fold, throughout the Middle East
and the Coalition Countries, pulling the Coalition Countries into a long drawn
out War.
During the
drawn out war, inevitably the Arabic World would unite, as they will see the
Coalition as Occupiers and not Liberators
This war, if it
were to happen, it would most likely follow the Unrestricted Warfare's Words,
as it has already done before.
Varity of Department of Defense Articles and Documents
on US-China Relations, and perceived threats from China
300 short range missiles face Taiwan
DongFeng-31 Missile
China controls the Panama Canal
Chinese Military Power page
General Info on China
Secretary Rumsfeld Outlines Space Initiatives
Annual Report to the President and the Congress, from
the Dept. of Defense
The United States Security Strategy for the East Asia -
Pacific Region 1998
East Asia Strategy Report 1995
United States Security Strategy for Europe and NATO
A geostrategy for Eurasia by Zbigniew Brzezinski
CHINA - A Country Study (Library of Congress)
King Khan - Alternate Futures for 2025
Defense Issues: Volume 10, Number 109-- U.S. Strategy:
Engage China, Not Contain It
State Department - China Page
Russia-China Deal Makes NASA Uneasy
United States Security Strategy for the Middle East -
1995
China expands ties "in all fields" with Iran, Lybia,
Syria - Pakistan prepares to buy warships from Beijing
Pentagon warns of China threat - July 17, 2002 - CNN
PRC to quadruple nuke missiles aimed at US by 2015;
China helped Pakistan develop nuclear weapons
Chinese military White Paper calls for an "Electronic
Pearl Harbor"
Iran-Russia-China axis seeks to limit US power
New China-Iran Pact Enhances Military Cooperation;
Chinese Navy Modernizes, US Pacific Fleet Cut 40 Percent
Chinese Military Prepares for War Using Mock US Military
Base Built with Knowledge from US-China Military Exchanges
Taipei: PLA air superiority over Strait in 3 to 5 years;
Former CIA director warns of Clinton "appeasement"
Beijing Threatens to Attack US Pacific Fleet, Launch
Nuke Strikes on US Policy
Pentagon Assessment Warns of China-Dominated Asia in
2025
Beijing describes how to defeat U.S, in high-tech war;
Russia-China military technology agreement detailed
China's "Western" Sphere of Influence
PLA Electromagnetic Pulse Bombs Can Destroy US Fleets;
PLA Telecommunications Corporations Described
Pentagon Study: PRC Preparing for War vs US
(DoD Report from defenselink.mil coming soon)
Chinese Defense Minister in Moscow Forges Anti-US
Alliance
China's new ICBM carries decoys to defeat future U.S.
missile defense
Defense Minister: PLA preparing for war with U.S
Lax Security Enabled China to Build Neutron Bomb with
U.S. Data
China Receives Advanced Kilo-Class Submarine from Russia
China restructures military industries
Jiang Tells PLA of U.S. "Hegemonists" Threat
China plans long-range missile test in late July; PLA
commissions "stealth" warship
Moscow Sells 72 Advanced Sukhoi-30 Fighter-Bombers to
Beijing
China to Build New Communications Spy Base in Cuba
China sells WMD's to Iran and Pakistan
Pentagon: elite U.S. Special Forces seek to train
Chinese commando
China readies for future U.S. fight
(CNN - Tuesday, March 25, 2003 )
CHINA'S MILITARY STRATEGY TOWARD THE US
Budget boost for China's military
China's Military Strategy and Security in the Taiwan
Strait
PRC Air Force
CHINA'S MILITARY POTENTIAL: Foreword and Summary
China: Military Imports From the United States and the
European Union
China's military starts war games near Taiwan -- The
Washington Times
Senator Kyl Remarks on China's Military Policy
Halt Encryption Software Sales To China's Military
US Dept. of State - IIP: The United States and China
CHINA: AIRPOWER DEVELOPMENT
Pravda.RU Beijing waiting for US-Iraq war?
Selected Military Capabilities of the People's Republic
of China
China and the United States: From Hostility to
Engagement
Is China a Military Threat? Video
MILITARY CAPABILITIES OF THE PEOPLE'S REPUBLIC OF CHINA
Military Laws of the People's Republic of China
IV. Military Exchanges Between China and the US
US Military Technology That China Is Believed to Have
Acquired
China Condemns US Congressional Acts on Military
Cooperation With Taiwan
China Reaffirms Military Ties with DPRK
Ten Obstacles to China Becoming A Strong Military Power
The House Policy Committee - China Report