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By Elizabeth M. Lynch, September 7, 2009

Originally posted on the Huffington Post.

Health care will not be the only derisive issue on the Senate’s calendar when it returns to Congress on September 8.

Rep. Ed Markey Announces Climate Change Passage, June 26, 2009

This past June, the U.S. House of Representatives passed the American Clean Energy and Security Act of 2009 (the “Climate Change Bill”).  Far-reaching in its impact on the U.S. economy and particularly detrimental to certain energy-intensive sectors, debate in the Senate will become increasingly cantankerous as special interests and certain states lobby for protection.

And while the Bill, through a series of complicated cap-and trade equations and a plethora of subsidies to renewable energy, has the potential to completely alter the domestic market, debate thus far has been about its global impact.  With fear that countries like China will not pass legislation to cap their domestic industries’ carbon output, the House added two provisions to protect U.S. industries from companies in countries that are not similarly restrained.  Out of a 1,400 page bill, these two provisions have become the center of the debate, some calling these provisions much needed protection and others calling them tariffs.

But conspicuously absent from these discussions is an analysis of what is really going on here.  How exactly do these provisions work?  Will they have the intended effect of maintaining the competitiveness of U.S. industries or are they attempts by certain industries to protect their profits?  Will these provisions bring countries like China to the table in Copenhagen or will they ultimately produce a tariff war?  Can they withstand a challenge under global trade rules?

To answer these questions, China Law & Policy sat down with Jake Caldwell, director of Policy for Agriculture, Trade & Energy at the Center for American Progress.  Click here to listen to the interview with Jake Caldwell.

The Trade Provisions

Applicable Only to Energy-Intensive and Trade-Sensitive Industries
In our interview, Jake stressed that the two trade provisions in the Climate Change Bill will only apply to those U.S. industries that are both energy-intensive and trade-sensitive, making these provisions applicable in fact to only about five U.S. industries: ferrous metals (iron and steel), nonferrous metals (aluminum and copper), non-metal minerals (cement and glass), paper and pulp, and basic chemicals (World Resources Institute (WRI) report, p. xvi).

Under the Bill, these industries will initially be given a two-year waiver from compliance to the Bill’s cap-and-trade regulations.  However, after the two years, these industries can seek protection from foreign competition through the following two trade provisions.

Provision 1: Recovery of Some Cost of Compliance
The first of these provisions is less controversial.  Found in Title IV, Part F, subpart 1 of the Bill, it establishes an emissions allowance rebate program.  As Jake explained, this will allow companies in energy-intensive, trade-sensitive manufacturing industries to be compensated in other ways for the cost of complying with the Bill’s cap-and-trade program.  The rebate program will reduce the threat that these companies will lose business to companies from countries that do not impose equally as rigorous caps on greenhouse gas emissions. The rebate program will be phased

Click on image for a PDF of the Trade Provisions in the Climate Change Bill

out by 2035.

Provision 2: Border Adjustment Measures (a.k.a. Tariffs)
It is the second trade provision, found in Title VI, Part F, subpart 2, that is the most contentious; this is the provision that establishes unilateral border adjustment measures – a.k.a. tariffs –  on imports from countries that do not have similar emissions reduction policies.  Under this provision, if by 2018 there is no international climate change treaty in force, the President, starting in 2020, is required to impose a border adjustment measure on imports from sectors in countries that have not capped their emissions or reduced their energy-intensity to comparable levels.  The U.S. importer of the competing foreign product will have to purchase an “international reserve allowance” through a carbon market.  This in effect establishes a tariff on imports from that foreign country.

As Jake pointed out, the President can grant a waiver to certain countries if he or she deems that there is an important national economic or environmental reason that takes precedence.  But the Presidential waiver is subject to Congressional approval through a joint resolution of Congress. In effect, Congress has to “second” the President’s decision, making for a cumbersome procedure.   If either house of Congress does not agree with the President’s reasoning, the waiver is denied.  Given the already politically-sensitive as well as politically-expedient nature of the U.S.-China relationship, it is difficult to imagine that any waiver to a Chinese industry could make its way through Congress without a fight.

Effectiveness of the Trade Provisions

As Jake explained in our interview, the trade provisions were adopted for three reasons: (1) to prevent carbon leakage (the transfer of production and jobs from industries in the U.S. subject to cap-and-trade rules to companies in foreign countries that do not have such rules in place), (2) to keep U.S. manufacturing industries competitive in a potentially unequal carbon-restricted world, and (3) to be used as leverage against other countries that have yet to set emission reduction targets.  But will these provisions achieve their stated goals?  Or are they protectionist responses to pressure from a few select industries?

Carbon Leakage
If a goal is to prevent carbon leakage and promote emission caps in other countries, the trade provisions, especially the border adjustment provisions, are not tailored narrowly enough to achieve these goals.  Congress was largely targeting China with the trade provisions.  However, out of the five U.S. industries that would be able to use the tariff provisions (steel, aluminum, chemicals, paper and cement), only one industry imports more than 10% of its product from China: the cement sector (WRI report, p. xviii).  For the other industries, the majority of foreign imports are from Canada and other developed nations, many of which already have emissions standards that surpass the U.S’.  While there will inevitably be some carbon leakage, it’s questionable just how dramatic it will be.  Currently, the majority of U.S. imports in these sectors come from countries with less-carbon intense production methods than China or even the U.S.  Just because U.S. companies will bare the cost of meeting more rigorous emission standards does not necessarily mean that production will be shifted to countries with less rigorous standards.  Currently, China’s production of aluminum is carbon-intensive and uses a tremendous amount of energy.  However, China’s production is more expensive than Canada’s or the U.S.’ and can barely remain competitive in the global market.  Thus, lower carbon emissions and greater energy efficiency do not always equate with higher costs.

Furthermore, if the goal is to prevent carbon leakage, the trade provisions offer no recourse to individual companies from foreign, carbon-heavy countries that are meeting their own private emission caps.  For example, Baosteel, China’s largest steel producer, is relatively energy-efficient (WRI report, p. 35).  However, under the current Climate Change Bill, even though Baosteel may voluntarily subject itself to carbon targets similar to those that will be imposed on steelmakers in the U.S., Baosteel will still be penalized.  The Bill’s trade provisions evaluate imports on a sector-wide basis and not an individual company one.  Arguably, if the goal is to prevent carbon leakage, the U.S. has a better chance of influencing a Chinese company’s behavior than an entire sector in China.  Thus, the trade provisions should establish a secondary track where certain companies, if they are able to show that they are compliant with U.S. standards, are exempted from the border provisions applied to their country and sector.

Finally, the question remains – how do you measure the carbon footprint of an imported product?  These provisions rely heavily upon the assumptions that monitoring and reporting of greenhouse gas emissions from the country of origin is (a) an easy task and (b) accurate.  While these assumptions might hold true in countries like Canada or Japan, for China, where implementation and enforcement on the local level is a perpetual struggle, any form of data collection is a challenge and results are often less than reliable.  Thus, in a world where carbon measurement is problematic, the actual ability to implement the trade provisions remains questionable.

Competitiveness
As mentioned above, imports from China in the energy-intensive, trade-sensitive industries are very small (14% of cement, 7 % of steel, 3% of aluminum, 4% of paper, and less than 1% of chemicals).  These five industries also make up a small portion of the U.S. economy, accounting for 3% of economic output and less than 2% of U.S. employment.  While these industries will inevitability be negatively affected by the Climate Change Bill, the impact on the greater U.S. economy is relatively small.  Additionally, over-protection of these industries loses sight of the broader U.S. economy and the other goal of the Climate Change Bill: to shift production and jobs to energy-efficient or renewable energy industries.

Furthermore, while the border adjustment measures protect these raw material industries, it potentially could hurt those industries that use the raw materials for production of “downstream” products.  For example, the border adjustment measures are only applicable to the importation of sheet steel, and not to products that are made out of steel, like cars or appliances (WRI report, p. 52).  U.S. car makers will still have to compete against foreign car manufacturers whose products could contain steel from countries without carbon regulations.  Without the benefit of border adjustment measures on cars, U.S. car makers would become less competitive.

Similarly, U.S. chemical manufacturing companies are fairly competitive globally.  These companies refine the carbon-intensive, raw material chemicals to make downstream, specialty concoctions (WRI report, p. 52).  However, by imposing a border adjustment measure on the raw material chemicals, any of these chemical manufacturing companies who import raw materials, would experience an increase in the cost of production, making their products less competitive abroad.  While the border adjustment measures will protect the five energy-intensive, trade-sensitive industries’ profits, they could likely hinder the competitiveness of industries that use these raw materials to manufacture downstream products.

Leverage
The jury is still out on whether border adjustment provisions do in fact bring countries to the table to discuss climate change.  The general assumption is that tariff threats rarely cause countries to act, especially countries as large as China.  However, after the U.S. backed out of the Kyoto Protocol, the European countries threatened similar types of tariffs, targeted precisely at energy-intensive U.S. industries.  Perhaps a mere coincidence, but it’s interesting to note that today, the U.S. is now close to passing climate change legislation.  Recently, South Korea voluntarily set a 2020 emissions reduction target; the South Korean government cited the fear of border tariffs as a reason to set targets.

But it is still questionable how far the threat of tariffs can go.  China has certainly taken notice of the border adjustment provisions in the U.S. Climate Change Bill, but that does not mean it will agree to carbon caps.  China’s exports to the U.S. that would likely be subject to the tariff provisions accounted for less than 0.2% of economic output in 2005, thus making the U.S.’ tariff threats of little consequence to China (WRI report, p. 57).  However, of greater consequence to the U.S. and to the rest of the world is if China, the largest emitter of greenhouse gases, walks away from climate change negotiations because it feels as though it needs to “act tough” for its domestic audience.  In looking at the current border adjustment provisions in the Bill and the tepid success they have had thus far, the Senate might want to ask itself if the risk is worth it.

Legality of the Trade Provisions

As Jake mentioned, World Trade Organization (WTO) rules require that countries pass nondiscriminatory trade provisions – that the provisions do not discriminate against foreign products in favor of domestic ones.  Arguably, the current Bill does discriminate.  As discussed earlier, individual companies that could be meeting similar carbon caps will be discriminated against if their home country has not agreed to carbon caps.  Without some sort of procedure that exempts foreign firms which individually meet carbon caps from the border tariffs, the current trade provisions may not withstand a WTO challenge.

There will certainly be a Senate showdown over the Climate Change Bill.  Already ten Democratic Senators have stated that the trade provisions need to be stronger.  But do they really?  If your singular goal is to protect 3% of the nation’s economic output and 2% of its jobs, then yes, the trade provisions will maintain the status quo, at least for the time being.  But if your goal is to increase innovation in new sectors like renewable energy, create clean jobs and limit global climate change, then the trade provisions, as they stand now do not achieve that goal.  There is a need to maintain U.S. competitiveness in the five effected industries, but in the current tariff provision, what is being maintained are corporate profits in a few select, and powerful, industries.  The Senate needs to take a good hard look at the current trade provisions and question if it is worth it.  Perhaps it is time to move away from defensive measures against China and begin to better engage China in agreeing to a climate change treaty.  Without China’s agreement, any legislation the Senate passes will have negligible effect in limiting climate change.

Click here to listen to the interview with Jake Caldwell

Click here to open a PDF of the transcript of the Jake Caldwell interview

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By Elizabeth M. Lynch, September 4, 2009

In this week’s Just for Fun section, guest blogger Thomas Cantwell, reviews the only authentic Uighur restaurant in all of New York.

Despite having a rich history, the Uighur (pronounced Wii-grrr) have largely flown under the radar of American consciousness until the recent violence in Urumqi which resulted in the death of nearly 200 people. The Uighur, a Turkic Muslim ethnic group living mainly in the Xinjiang Uighur Autonomous Region in the northwest of China

Cafe Kashgar

dominated the region for nearly a millennium before falling under Chinese control. Absent an arduous journey through rural China, the closest one can get to Uighur culture in New York is a visit to Cafe Kashkar, a Uighur restaurant in Brighton Beach.

Cafe Kashkar is definitely a cultural experience, though possibly more of a Brooklyn one than anything Uighur. Not having been to Xinjiang, it is difficult for this reviewer to judge whether the region is marked by unflattering florescent lighting, exact replicas of Alice Kramden’s kitchen furniture, and carpet so ugly it would embarrass a pitboss. The nonstop Uzbek music videos–think Bollywood thumping tunes sung by better-looking Borats, backed up by big-haired tramps dancing suggestively–played on the flatscreen television mounted above the cafe’s door do attest, however, to the pan-national character of the Uighur–significant populations are located throughout all of the Stans.

While not a choice for a romantic night out, one doesn’t go to Cafe Kashkar for the decor. My companions and I ordered a number of dishes that arrived as they were prepared, which seemed fun at Kashkar, with its tiny one-man kitchen, as

Salad Langsai

opposed to pretentious as it does at, say, Asia de Cuba. First was the Salad Langsai, a mix of cucumbers, peppers and another couple of unidentified vegetables in a vinegary/garlicky dressing. It was crisp and refreshing–perfect for a warm summer evening. Next came the Kashkar Soup, which contained lamb, vegetables, and noodles in a tasty lamb broth. The soup was light and satisfying. The server–probably the nicest waitperson in all of New York City–next brought out the naan which, aside from being made from grain, bears virtually no resemblance to its Indian namesake. A sort of giant, slightly-less dense bagel, the naan was bland and virtually tasteless, though it did serve as a vehicle for sopping up the remnants of the various soups and sauces.

Next up was the best dish of the night, the geiro lagman, a slightly oily noodle dish with meat (lamb, again) and vegetables. The noodles were thick and the sauce just spicy enough to be interesting without

Geiro Lagman

overpowering the taste of the meat and veg. We could have ordered another.
The manty, four giant dumplings stuffed with–you’ve got it–lamb (though mixed with beef just to shake it up a little) was so heavily laced with cumin that it tasted like cheap enchilada filling. Apparently wildly popular–you can buy frozen manty to go–you can secure a similar taste at any Taco Bell without having to haul all the way to the beach. The lamb kebobs, four fatty pieces of ribmeat that tasted of the grill, were enjoyed by my companions but I found them disappointing. Perhaps I was on lamb burnout by then.

Dessert consisted of chak chak, the only menu option available. Best described as a giant Rice Krispie treat made with honey rather than marshmallows, it was mildly sweet. American palates accustomed to sugar-laden desserts might be disappointed, though I found it a nice, light closing to the meal.

Cafe Kashkar has no liquor license, but our server specifically offered at the start of the meal the suggestion that we might secure beer from a nearby gas station. The Russian trio at the next table choose to enhance their dinner with a liter of off-brand vodka. We stuck with some pear and pomegranate/blueberry flavored soda which the server described as “Soviet” in origin and whose name I failed to note but that I’d definitely have again.
The total, before tip, was $41, a steal given the amount of food consumed. We tipped huge as the service was excellent. I’m not certain if Cafe Kashkar is worth a trip from the other boroughs–particularly in light of the upcoming suspension of B line service, which means a person could get to Philly faster than Brighton Beach from midtown Manhattan–but, if one finds oneself in Brighton Beach, Cafe Kashkar is a great alternative to New York standbys like pizza. Plus, it’s really, really fun to be able to have an excuse to use the word “Uighur”.

Rating:

Cafe Kashkar
1141 Brighton Beach Ave
Brooklyn, NY 11235-5903
(718) 743-3832‎

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By Elizabeth M. Lynch, August 25, 2009

A day after Ambassador Huntsman’s arrival in Beijing, Chinese authorities released three prominent activists on

Ambassador to China Jon Huntsman

Sunday: Xu Zhiyong, founder of Gongmeng, a public interest law organization, Xu’s assistant Zhang Lu, and economics professor and Uighur Online founder, Ilham Tohti.

Both Xu and Zhang were released on bail, a very rare occurrence under Chinese law, signifying that higher authorities likely gave approval to release the two.  Although bail is theoretically available, in the vast majority of criminal cases, the suspect remains in custody until trial.

The circumstances surrounding Tohti’s release are much less clear, but it appears that charges against him are no longer pending.

Was it U.S. pressure on the Chinese government that secured the release of these three activists?  While it likely played a role, there are other important factors that influenced the Chinese government.  First, there was significant domestic pressure, especially for the release of Xu and Zhang.  Through small donations, some as little as five or one yuan, Gongmeng was able to raise over 800,000 yuan (over $115,000) to pay the fine imposed by the tax courts.   Additionally, a group of well-regarded academics and professionals issued an open letter to the Chinese government requesting the release of Xu and Zhang.

In addition to the domestic support for Xu and Zhang’s release, a second factor that likely played a part is that their actions are viewed as less threatening to the Chinese government.  Xu’s organization, Gongmeng, worked within the

Activist, Gao Zhisheng

legal system, using the very laws passed by the National People’s Congress to protect the rights of vulnerable individuals.  Other activists who have taken a more strident approach to the Chinese government have not been released.  Gao Zhisheng, an attorney who has ardently represented members of the religious organization Falun Gong and who also openly called on western nations to boycott the 2008 Beijing Olympics, was taken into custody in February 2009 and has not been heard from since.

Although Gao Zhisheng and Liu Xiaobo and many others remain in Chinese police custody, the release of Xu, Zhang and Tohti should still be viewed with guarded optimism.  Evidently, for those activists who do not go too far, the Chinese government does respond to domestic and international pressure.  However, what it means to “go too far” is still unclear and detention of activist attorneys will likely continue.

But Ambassador Huntsman and President Obama should see the release of these three activists as a positive sign, and should continue with the dialogue they have evidently already started with the Chinese government.

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By Elizabeth M. Lynch, August 25, 2009

China Continues to Blame Outside Forces for Riots

This morning, the China Daily reported that over 200 people will go on trial, likely this week, for various crimes

Photo of Chinese protestors in Urumqi, Xinjiang on July 5, 2009

relating to the July 5 riots in Xinjiang.  Surprisingly, the China Daily also reported that all trials will be public aside from those involving charges of “splitting the State” and “instigating to split the State.”  Because the number of cases involving these charges has not been announced, it is unclear how many of the trials will in fact be public.

Additionally, officials have yet to announce how many of the defendants are Han Chinese and how many are Uighur; at least some will be Han since the China Daily last week reported that trials of the Han defendants will occur before the Uighur defendants’ trials.

The announcement that over 200 people were arrested and face trial in the coming week was a departure from the “small number” originally anticipated.  At the beginning of August, the Chinese police stated that out of the 1,600 people detained, only 83 had been arrested.  Under the Chinese Criminal Procedure Law, a suspect can be detained for days, and in politically sensitive cases for a good month, without being formally arrested.

As with most of the articles concerning the Xinjiang riots, China Daily’s recent report again blamed foreign forces for instigating the riots.  Both the Chinese press and Chinese officials have repeatedly assigned blame for the riots to Rebiya Kadeer, a Uighur woman who was granted political asylum in the United States in 2005.  Once viewed as a model minority by the Chinese government because of her successful businesses in Xinjiang, Ms. Kadeer soon fell out of favor when she began to support Uighur causes.   Jailed in 1999 for allegedly passing state secrets, Ms. Kadeer was freed to U.S. custody in 2005.  Since then, she has become president of the Uighur American Association and the World Uighur Congress.

Because the Chinese government is intent on presenting an appearance of a “harmonious society,” it is essential that it seeks to blame outside forces when discontent is presented by some of its minority groups, regardless of the claim’s validity.  After the March 2008 protests and riots in Tibetan areas of China, the Chinese government vilified the Dalai Lama, accusing him of being the mastermind behind the riots.  However, the government never provided any evidence to support the claim that the Dalai Lama was involved (see Premier Wen Jiabao’s statements here).

Similarly, with Ms. Kadeer, the Chinese government has accused her of organizing the riots from her home in Washington, DC (for a scathing critique of Ms. Kadeer in the Chinese press, click here).  While the Chinese government claims to have a recording of a phone call to her brother allegedly evidencing her role, this recording has never been made public.

Interestingly though, China’s denunciation of the Ms. Kadeer might have the unintended consequences of designating a leader of a movement that up to this point was without one.  Tibetans easily rally around the Dalai Lama since he is their spiritual leader.  But for Uighurs, there have been few that have reached the level of the Dalai Lama and symbolize their culture and religion quite the same way.  However, by continuously pointing to Ms. Kadeer and accusing her of masterminding the riots, the Chinese government may have inevitably provided the Uighur people and the Uighur movement with a much needed leader.

Rebiya Kadeer, President of the Uighur American Association

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By Elizabeth M. Lynch, August 20, 2009

When one studies Chinese or anything China, the question inevitable arises from others: what’s the best Chinese restaurant?  Like all things China, it’s complicated and like the Chinese Communist Party, Chinese food is not

Best Steamed Shrimp Dumplings Ever - Corner 28

monolithic.  Today in “Just for Fun,” we review Corner 28 in Flushing, Queens.

Corner 28 is not easy to find and that’s a good thing.  This gem of a Cantonese restaurant lists an address on Main Street but in reality, the entrance is around the corner on 40^th Rd.; you will have to walk around the flower vendor to enter and then up to the second floor.  But once in, the effort is worth it.

The menu offers a wide variety of Hong Kong delights, from congee and noodle soups, to various dim sum standards.  This is a great place to go for dim sum if you are looking to avoid the crowds and carts of the traditional dim sum places.  All of the dishes use fresh ingredients with lots of flavor, but the best dish was by far the steamed shrimp

dumplings.  It’s hard to find steamed shrimp dumplings with the proper ratio of wrapping to shrimp; most times the dumpling wrapping overpowers the shrimp and leaves a stickiness in the mouth.  But at Corner 28, the chef has evidently perfected the proper balance between shrimp to wrapping by providing a huge serving of meat that has been marinated in a sweet and light sauce.  With the first bite, the flavors of the shrimp cannot be denied.

Also of note was the Thousand Year Egg congee.  While rice gruel often does not appeal to non-Chinese, this is unfortunate, especially when it is the Hong Kong version – congee.  Congee offers a meal in and of itself and Corner 28 serves a strong one.  With the congee are thick and soft breadsticks, known in Mandarin as youtiao (oil sticks).  These are some of the best youtiao out there.

Prices are also extremely reasonable.  With dim sum dishes averaging around $2.50, Corner 28 will not break the bank.

Housed in a relaxing and modern atmosphere, above the hubbub of Flushing, Corner 28 not only offers fresh and yummy Cantonese food, but also provides a great break before getting back on the subway.

Rating:

Corner 28
718-886-6628
40-28 Main Street, Flushing NY
(entrance around the corner on 40^th Road)
Take the 7 train to the last stop, Main Street, Flushing

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By Elizabeth M. Lynch, August 19, 2009

Chinese Human Rights Defenders reported yesterday that Xu Zhiyong was formally arrested on August 18, 2009 at 11:50 AM.

Holding a person in detention for many days prior to arrest is not uncommon.  While the norm is three days before a request for an arrest, in political cases it is not uncommon to hold an individual for up to 30 days before a formal arrest.  For a great summary on the multiple ways that a person can be held by the police without an arrest in China, see this post on China Law Prof Blog.

The charge against Xu Zhiyong – tax evasion.

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By Elizabeth M. Lynch, August 17, 2009

Originally posted on the Huffington Post

Just before dawn on July 29, 2009, the Beijing police apprehended leading Chinese public interest lawyer, Xu Zhiyong, allegedly to question him about possible tax evasion.  He has not been heard from since.  In an increasingly conservative political environment in China, Mr. Xu’s detention is far from an anomaly.  Many speculate that the Chinese government’s recent crackdown on public interest lawyers is merely a part of the preparations for the 60^th

Xu Zhiyong; Photo by Shizhao

Anniversary of the founding of the People’s Republic of China this fall.  But in looking beneath the surface of the government’s recent actions, a different narrative emerges.

The apprehension of Mr. Xu, the forced closure of his legal assistance organization, Gongmeng (in English the Open Constitution Initiative), the investigation of Yi Ren Ping, a non-profit law center that assists AIDS and hepatitis patients with anti-discrimination actions, the recent disbarment of over 20 public interest lawyers, the professional “exile” of a leading legal scholar and outspoken critic to a remote region of China, all of these actions paint the picture of a government that has become increasingly more alarmed by a more vocal and organized group of lawyers.  The government, and the Chinese Communist Party (CCP) which ultimately controls all governmental bodies, has begun to view the development of these non-profit lawyers and legal reform as a threat to its authority and to the one-party rule of the CCP.  Recent governmental assaults on the public interest law field are not just a one-off affair.  Rather, they show a CCP not looking to embrace the “rule of law,” but instead seeking to contain it.

Development of Rule of Law in China from the US & Chinese Perspectives

Both China and the U.S. agree that greater rule of law in China is needed and can benefit China.  Virtually every conference between the two nations mentions the need for rule of law development. But what is never articulated is what each means by “rule of law.”  Many Western scholars claim that rule of law is value-neutral; it is merely a system where laws are enforced in a transparent manner by an independent judiciary and that rule of law can exist regardless of the political system of the country.

And while this is likely true, the U.S. government still largely views rule of law within the rubric of democracy; as the rule of law develops so does democracy and greater protection for human rights.  Of the $27 million the government appropriated to rule of law projects in China in 2008, $15 million were administered by the Department of State’s Bureau of Democracy, Human Rights and Labor and another $2 million was designated for non-State Department rule of law projects (see CSR report, p. 2).

China, however, takes a different perspective.  While seeing the benefits of rule of law in terms of economic development, international acceptance and respect, and the ability for the central government to have greater control over the provinces, China has largely limited rule of law to the economic sphere and at times, a few other select areas.  If a case involves a politically sensitive issue, involves an organized group of plaintiffs, or could unmask government malfeasance, the government will either not allow a case to proceed or will determine the ultimate outcome.

Even with this limited development toward legal reform, many U.S. policymakers believe that rule of law will continue to spread and permeate lawyers’, judges’ and society’s consciousness.  This Trojan horse strategy assumes that legal reform in the economic sphere will inevitably spread to all areas of the law and to Chinese civil society.  Government will be held more accountable to the people, laws will be administered transparently and all rights, political, economic and social, will be able to be vindicated.  But proponents of this theory offer little to no evidence as to why.  Why is this inevitable? Why can’t China succeed in limiting legal reform to the economic sphere?  Why can’t rule of law be contained?

In other words, what if China is the black swan in the whole rule of law theory?

Emergence of a More Conservative Legal Ideology in China

Theory of the Three Supremes

The detention of Xu Zhiyong comes amid an increasing conservative political environment in China, at least in terms of legal reform.  In December 2007, President Hu Jintao attempted to reassert the importance of the CCP in legal interpretation and reform by announcing his theory of  “The Three Supremes:” judges and prosecutors should “always regard as supreme the Party’s cause, the people’s interest, and the Constitution and laws.”   Although initially unclear if the Three Supremes were listed in hierarchical order, a recent announcement in July 2009 by a justice minister confirmed the hierarchical nature of the Three Supremes and the preeminence of the CCP when he called upon lawyers to “above all obey the Communist Party and help foster a harmonious society.”

Wang Shengjun, President of the Supreme People's Court

The Three Supremes is not just rhetoric.  In March 2008, the National People’s Congress named Wang Shengjun, a Party insider without any legal training, as head of the Supreme People’s Court (SPC), replacing reform-minded and trained lawyer Xiao Yang.  Upon taking his position Wang has worked ardently to have the courts conform to the Three Supremes.

A More Organized Public Interest Law Movement

While the government expounds the Three Supremes and imposes this conservative ideology on the legal system, public interest lawyers have become increasingly organized and vocal.  In August 2008, a group of 35 public interest lawyers in Beijing issued an internet appeal that requested that the government-controlled Beijing Lawyers’ Association (BLA) to conduct free and direct elections of governing officials of the BLA.  In December 2008, human rights activists, many of whom are lawyers, signed Charter 08, a petition to the Chinese government calling for greater human rights, the end of one-party rule and an independent legal system.  In addition, many of the non-profit lawyers, including Xu Zhiyong, have represented plaintiffs in politically sensitive cases, including cases pertaining to the Sichuan earthquake and the melamine milk scandal.  Last year, Xu’s organization issued a report blaming Chinese policies in Tibet for the 2008 uprising in that region.

China’s Recent Response

Under the doctrine of the Three Supremes, China has not responded kindly to these public interest lawyers.  Although the BLA slightly altered its voting rules by allowing for the direct election of representatives who then in-turn elected the governing officials, in February 2009, the local Judicial Bureau sought its revenge.  After withholding a license from Li Subin, one of the advocates of the new voting procedures at the BLA, the Bureau issued an order for Yitong Law Firm, which employed Li, to shut down for six months for permitting a non-licensed attorney to practice law.

Liu Xiaobo, a leading human rights activist in China and signatory to Charter 08 was detained by police just hours before the publication of Charter 08.  He remains in police custody.  He Weifang, a well-known law scholar at the prestigious Peking University has been sent into professional exile and now teaches law in China’s most western region, Xinjiang.

Xu Zhiyong has faced a similar fate.  In May 2009, tax authorities began to investigate Xu’s non-profit legal center, Gongmeng.  On July 14, the Beijing office of the National Tax Bureau and the Beijing Local Tax Bureau each issued a notice to Gongmeng for non-payment of taxes on funds donated by Yale University and levied the maximum penalty of five-times the amount owed, or $208,000.  On July 17, twenty officials from the Beijing Office of Civil Affairs barged into the Gongmeng offices, confiscating all materials including computers, case files, and furniture, and shut down Gongmeng.  On July 29, Xu was apprehended by police for suspicion of tax evasion; he remains in custody.

In a Kafkaesque turn of events, on August 5, after raising at least some funds to pay its fine, the Beijing Public Security Bureau froze all of Gongmeng’s accounts.  On August 10, in an attempt to discuss this matter with tax officials at the Beijing Local Tax Bureau and the National Tax Bureau, Gongmeng officials were escorted out.   Authorities have informed Gongmeng that their recently filed paperwork is invalid because it does not contain the signature of Gongmeng’s legal representative, Xu Zhiyong. As this back-and-forth continues, Xu Zhiyong remains in police custody and the fine of $208,000 accrues daily compounded interest of 3%.

Also on July 29, officials from Beijing Cultural Market Administrative Enforcement Unit inspected the offices of Yi Ren

Click on image to open a PDF version of the Timeline of Events

Ping, a non-profit organization that files anti-discrimination lawsuits on behalf of people AIDS or hepatitis.  Claiming that their search was being conducted under the Measures to Manage Internal Material Publications, a law that was repealed in 2001, the officials seized 90 copies of Yi Ren Ping’s newsletter.

China’s Containment of Rule of Law

The Chinese Communist Party is unified by one principle – to remain in power.  Any organized effort, even if within the confines of the law, will be viewed as a threat to the CCP’s authority.  In recent months, Chinese public interest lawyers have been effectively organizing themselves, especially through the internet, to challenge the current system.  However, these lawyers are far from what the rest of the world would deem radical.  They are merely using the laws passed by the National People’s Congress to protect people, especially those in disadvantaged groups like rural parents in Sichuan or people with AIDS.  They are not looking to overturn underlying constitutional principles; they just want to enforce the law as written.

Even though these lawyers work within the system to improve Chinese society in a way that the law permits, as soon as they amass sufficient numbers, in the minds of the CCP, they are no longer operating within the legal system, but within the political one.  In these situations, the CCP will abandon the legal system in favor of the political one.

But this is not to say that rule of law has not taken hold in China.  Today, foreign corporations usually receive a fair hearing before arbitration commissions and the majority of cases handled by the courts are ordinary cases that involve little to no Party interference.  There has been a marked increase in the professionalism of many judges and lawyers, and there is a sincere effort by many in the profession to develop greater rule of law.

However, those few cases that involve large groups of people or involve issues sensitive to the CCP, often do not receive the same transparent and independent judgment.  In these situations, the outcome is ultimately determined by the CCP.

Thus far, China has been successful at confining rule of law development to non-political cases.  The actions that have been taken against public interest lawyers in the past two years show China’s commitment to maintaining this separation.  The government’s harassment and detention of public interest lawyers is intended to have a chilling effect on the profession.  The low numbers of lawyers who seek a career in the public interest can be seen as a reflection of this impact.

But can China succeed in containing rule of law to certain areas?  Many look to Taiwan and South Korea as an example of the inevitability of legal reform and democracy in an East Asian society.  Both were under authoritarian regimes but eventually developed vibrant legal systems.  However, China is in a very different place.  Taiwan and South Korea were still dependent on the U.S. for trade and for military protection, and thus heavily influenced by the U.S.  China, on the other hand, has become an economic and military powerhouse, beholden to few other nations.  One of those countries is, of course, the United States, but China has gained significant leverage in this bilateral relationship by stocking up over $700 billion in US treasury bonds. All the while, it has been able to develop its economy while limiting legal development in the political and human rights spheres.  Its continued rise only solidifies the need for this separation in the minds of the CCP leadership.

China’s future remains uncertain and only time will tell if rule of law does in fact permeate other areas of Chinese society.  However, at this juncture, where China has become an important global power, it is important for U.S. policymakers to re-evaluate their assumptions of the rule of law landscape in China; and to ask themselves, what if China is successful in containing rule of law to certain segments?  Can the U.S. live with that reality?  Will it have a choice?

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By Elizabeth M. Lynch, August 14, 2009

Last week, Taliesin Thomas, in her review of Song Dong’s current exhibit at the MoMA, observed that “[f]or all that we can posses in this life, in the end we leave the entire corporeal world behind, entrusting someone else to manage the

Trash in the Yangtze River

articles of our former existence.”

But where does all this “stuff” go?  For Song Dong’s mother, it sits in a museum.  For the billions of other Chinese people, their “stuff” and trash ends up in landfills; and China is becoming overwhelmed by the amount of trash that its population increasingly produces.

China’s Legal Daily, in an article published yesterday, provided some sobering numbers.  Every year, China’s cities produce 150 million tons of trash, with a litter growth rate of over 10% per year.  The Legal Times estimates that the amount of trash sitting in Chinese cities’ landfills has reached 7 billion tons.

Beijing alone produces 18,400 tons of trash per day, 6.7 million tons per year, quickly filling Beijing’s 23 landfills.  By 2010, the Legal Daily estimates that 10 of these landfills will be filled to capacity and closed.  Experts hypothesize that with the increasing growth in Beijing, all of its landfills will reach capacity within five years.

For China, this is more than just a space problem; it is also a health hazard.  As the NY Times reported this week in an interesting article about trash in China, as trash decays, it emits large amounts of methane, a greenhouse gas that is more effective in trapping heat in the atmosphere than even carbon dioxide.

As a result of this trash problem, China has begun to look to incineration of trash as a solution, creating a global hazard if strict limits on emissions are not enforced.  As the NY Times points out, such limits differ widely from city to city in China, and even within cities.  In general, communities of the affluent and well educated impose stricter limits similar to those in Europe and the U.S. while across town,  incinerators barely meet the loose requirements imposed by the national government.

China’s national government has allowed slack restrictions imposed years ago on incineration emissions to remain in place due to a power play amongst the various agencies that have overlapping jurisdiction on the matter.  Currently, national emission standards allow for 10 times the level of emissions allowed in Europe or the U.S.

China’s trash is not merely a domestic problem but impacts the world.  Pollutants from trash incinerators in China, like mercury and dioxide, have made their way to the Pacific coast of North America.  As China seeks to increase the number of incinerators, with the currently slack limit on emissions, the U.S. will suffer.  But China has made progress.  Its growing middle class will no longer tolerate such environmental hazards, as evidenced by the incinerators in these neighborhoods that emit almost zero pollutants.

U.S. policymakers need to see this as progress and instead of walking away from the table in Copenhagen, look to continue this progress and work with China to develop the capacity to institute limits that benefit not just the wealthy in China, but even the poor.  China is a big country and this will take time.  But if ever there was a more dire sign that the U.S. needs to reach an agreement with China in Copenhagen, their trash is it.

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By Elizabeth M. Lynch, August 9, 2009

On Friday, the day before breaking for a month-long recess, the Senate finally confirmed Gov. Jon Huntsman as U.S.

Our New Ambassador to China!

Ambassador to China.  In the coming weeks, Ambassador Huntsman, his wife and two youngest daughters will move to Beijing.  In addition to managing the U.S.-China relationship and working with Chinese officials on North Korea, climate change and other difficult issues, Ambassador Huntsman will also be helping to arrange President Obama’s first trip to China, scheduled for this fall.

For more information from the Salt Lake Tribune, click here.

For an analysis on the Huntsman confirmation from the China Daily’s English edition, click here.

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By Elizabeth M. Lynch, August 6, 2009

For those of us in NYC without a home in the Hamptons for the summer, every Friday, the question inevitably arises – what to do this weekend.  If you are sticking around the city, China Law & Policy recommends that you check out Song Dong’s new exhibit at the Museum of Modern Art (Friday nights are free, FYI).

In this inaugural post of the “Just for Fun” series, Taliesin Thomas reviews Song Dong’s exhibit “Waste Not.”

Taliesin Thomas is the Director of AW Asia, a private organization in New York that promotes the field of Chinese contemporary art through institutional loans and museum acquisitions, curatorial projects, publishing, and educational programs (www.awasiany.com). Ms. Thomas is also currently an MA candidate in East Asian Studies at Columbia University and a specialist in the field of Chinese contemporary art. She lived in rural Hubei Province , Central China from 1999-2001.

Cross posted on the Chinese art blog RedBox

Song Dong’s “Waste Not”

By Taliesin Thomas

Right now New Yorkers have the opportunity to step inside a genuine chapter of twentieth century Chinese history at the Museum of Modern Art (MoMA). An installation by Song Dong, titled “Waste Not”, is both a portrait of Chinese culture and a homage to the artists’ late mother. The exhibit is more than just a nostalgic presentation of personal effects; it is a devoted work of art by one of China’s most talented and conscientious contemporary artists.

For more than 50 years, Song Dong’s mother accumulated and held on to everyday items in an effort to “waste not” (wu jin qi yong). Empty toothpaste tubes, dry water bottles, tattered shoes, battered boxes, bowls, plates, cups, pens, buttons, styrofoam, plastic, ceramic, glass, cloth, wood; some 50,000 miscellaneous objects of every shape and color as tallied by Song Dong himself.

In 2002 Song Dong’s father died, and his mother became isolated and withdrawn. She amassed more and more belongings in an effort to console her grief. The result was a home filled with emptiness. Song Dong approached his mother about turning her possessions into an art piece that would bring renewed meaning to these old objects. After her initial protest, she gradually assisted him in organizing the contents of her house. This process pulled her out of her sadness, and re-engaged her with the stationary material life that she had built up around herself.

A veritable Chinese treasure chest turned upside down, the dense display of numerous weathered household items arranged in MoMA’s atrium is an intimate portrait of one woman’s world. That woman died unexpectedly early this year while trying to save a wounded bird high up in a tree. Song Dong’s careful placement of his mothers physical reality reflects a lovingly organized memoir, with individual items appearing like stanzas of an epic poem. In this particular verse, one can almost hear the bittersweet song of the bird.

I had the opportunity to hear Song Dong speak about his “Waste Not” project at a lecture that he gave at Pace Wildenstein gallery several days after his MoMA debut. Hosted as an evening art salon in conjunction with the China Institute, the talk was a beautiful addendum to his installation. Song Dong eloquently described the impetus for this project, revealing personal family stories that increased my appreciation for the energy, consideration, and effort that went into creating “Waste Not”.

Standing there in the middle of his poignant art piece, I could not help but recall the basic premise of Buddhism: impermanence. For all that we can posses in this life, in the end we leave the entire corporeal world behind, entrusting someone else to manage the articles of our former existence. Song Dong’s filial piety brings Chinese contemporary art to a sincerely sacred place, one that is filled with reflection and hope.

Show runs now through Sept. 7.  Click here for details.