Category: Communism

Chinese “Entrepreneurs Were Like Famished Goats Set Free from a Pen and Allowed to Flourish”

(p. 11) YULIN, China — For months, Zhao Faqi was a folk hero for entrepreneurs in China — an investor who fought the government in court and online, and against the odds, seemed poised to win. He accused officials of stealing his rights to coal-rich land, and ignited a furor by accusing China’s most powerful judge of corruption.
Now, Mr. Zhao has dropped out of sight — and the authorities want to erase his story.
. . .
The state news media has painted him as a cunning schemer. A judge who supported his case was paraded on television. A crusading former talk show host who helped bring the case to light has fallen silent.
Mr. Zhao’s arc from self-declared victim to officially designated villain has been dramatic even for China, where the party controls the courts and businesspeople can abruptly fall from grace. Mr. Zhao’s descent — and possible disappearance — is a demonstration of the hazards that entrepreneurs face in taking on powerful Chinese officials.
“I’ve faced a lot of risks and pressure because of this lawsuit,” Mr. Zhao said in an interview in Beijing a few weeks before he disappeared. Chinese entrepreneurs, he said, yearned for the rule of law to replace arbitrary power. “You can’t say someone is protected one day, and take away protection the next day.”
Mr. Zhao drew support from liberal economists and lawyers who have been unsettled by Mr. Xi’s reverence for communist tradition and support for state-owned companies, which he has urged to grow “stronger, better and bigger.”
. . .
Mr. Zhao, 52, was among the entrepreneurs who plunged into business after Deng Xiaoping, then China’s paramount leader, unleashed market overhauls. At the time, Mr. Zhao said, entrepreneurs were like famished goats set free from a pen and allowed to flourish.
“But we’re seeing this vitality steadily shrink,” he said.
. . .
. . . , Mr. Zhao’s phone has been turned off, and he appears to have gone into hiding or official custody.

For the full story, see:
Chris Buckley. “Chinese Entrepreneur Takes On the System, and Drops Out of Sight.” The New York Times, First Section (Sunday, March 10, 2019): 11.
(Note: ellipses added.)
(Note: the online version of the story has the date March 9, 2019.)

Innovative Entrepreneurs Bring Prosperity to the Poor

(p. A17) As the economist Joseph Schumpeter observed: “The capitalist process, not by coincidence but by virtue of its mechanism, progressively raises the standard of life of the masses.”
For Schumpeter, entrepreneurs and the companies they found are the engines of wealth creation. This is what distinguishes capitalism from all previous forms of economic society and turned Marxism on its head, the parasitic capitalist becoming the innovative and beneficent entrepreneur. Since the 2008 crash, Schumpeter’s lessons have been overshadowed by Keynesian macroeconomics, in which the entrepreneurial function is reduced to a ghostly presence. As Schumpeter commented on John Maynard Keynes’s “General Theory” (1936), change–the outstanding feature of capitalism–was, in Keynes’s analysis, “assumed away.”
Progressive, ameliorative change is what poor people in poor countries need most of all. In “The Prosperity Paradox: How Innovation Can Lift Nations Out of Poverty,” Harvard Business School’s Clayton Christensen and co-authors Efosa Ojomo and Karen Dillon return the entrepreneur and innovation to the center stage of economic development and prosperity. The authors overturn the current foreign-aid development paradigm of externally imposed, predominantly government funded capital- and institution-building programs and replace it with a model of entrepreneur-led innovation. “It may sound counterintuitive,” the authors write, but “enduring prosperity for many countries will not come from fixing poverty. It will come from investing in innovations that create new markets within these countries.” This is the paradox of the book’s title.
. . .
One example that the authors cite is Tolaram Group, a Singapore-based conglomerate that created the instant-noodle market in Nigeria, pushing out 4.5 billion packets annually and generating revenue of almost $1 billion a year. Sourcing, manufacturing, distributing and selling its Indomie-branded noodles required that Tolaram invest in a broad and deep logistics and distribution chain; create a retail network; develop specialized training; acquire its own electricity generation; build a water and sewage-treatment plant; and construct a deep-water port in the city of Lekki. Had Tolaram waited for the Nigerian government to address these infrastructure and institutional challenges before investing in the country, the company would still be waiting. Other examples include British businessman Mo Ibrahim’s pan-African Celtel, which built a cellphone network across 13 African countries and gained 5.2 million customers in six years, and India’s Narayana Health, which has brought the cost of open-heart surgery down to $1,000.
. . .
Instead of a book of glib answers, they present something much more powerful–a work of creative destruction for today’s failed development-policy paradigm.

For the full review, see:
Rupert Darwall. “BOOKSHELF; A Better Way to Fight Poverty; The current foreign-development paradigm of government-funded programs should be replaced by an entrepreneurial model.” The Wall Street Journal (Thursday, January 31, 2019): A17.
(Note: ellipses added.)
(Note: the online version of the review has the date Jan. 30, 2019, and has the title “BOOKSHELF; ‘The Prosperity Paradox’ Review: A Better Way to Fight Poverty; The current foreign-development paradigm of government-funded programs should be replaced by an entrepreneurial model.”)

The book under review, is:
Christensen, Clayton M., Efosa Ojomo, and Karen Dillon. The Prosperity Paradox: How Innovation Can Lift Nations Out of Poverty. New York: HarperBusiness Press, 2019.

Li Rui Stood Up to Mao and Xi

(p. A8) BEIJING — While alive, Li Rui was a decades-long headache for China’s ruling Communists — a former aide to Mao Zedong who became an obdurate, sharp-tongued critic of the party. And the controversy did not stop in death, even for his funeral.
Hundreds of people gathered in Beijing on Wednesday to say goodbye to Mr. Li, four days after his death at 101. But the funeral revealed tensions between the government, which wanted a brisk Communist ceremony, and mourners who celebrated Mr. Li as a renegade — one who, even as he lay dying, railed against the authoritarian policies of Xi Jinping, the party’s leader and China’s president.
. . .
A few paid tribute to Mr. Li by holding up handwritten signs, or by making brief speeches that praised him as a freethinker who had stood up to Mao — opposing the calamitous excesses of the Great Leap Forward — and pressed Mao’s successors to take China in a more liberal direction. Police officers and officials kept watch, and tried to keep foreign reporters from talking to mourners throughout the morning.
“He was someone who had the guts to speak up for the people,” said Sheng Lianqi, a retired worker in his 70s, who said he never met Mr. Li but admired his writings.
He held up a handwritten sign that read in part: “Li Rui’s name will live in eternity. The ordinary people have sharp eyes and clear minds.”
. . .
These days, the party restricts criticism of Mao. But Mr. Li seemed determined to have the last word. He donated many of his papers — including notebooks and letters from his decades in the party, and a diary he kept for more than 80 years — to the Hoover Institution at Stanford University, where scholars will eventually be able to study them, said his daughter, Ms. Li.

For the full obituary, see:
Chris Buckley. “A Red-Banner Funeral in Beijing for a Critic of the Party From Mao to Xi.” The New York Times (Thursday, Feb. 21, 2019): A8.
(Note: ellipses added.)
(Note: the online version of the obituary has the date Feb. 20, 2019, and has the title “In Beijing, a Communist Funeral for an Inconvenient Critic.”)

Chernobyl Discredited Communism, Not Nuclear Power

(p. C2) In his chilling new book, “Midnight in Chernobyl,” the journalist Adam Higginbotham shows how an almost fanatical compulsion for secrecy among the Soviet Union’s governing elite was part of what made the accident not just cataclysmic but so likely in the first place. Interviewing eyewitnesses and consulting declassified archives — an official record that was frustratingly meager when it came to certain details and, Higginbotham says, couldn’t always be trusted — he reconstructs the disaster from the ground up, recounting the prelude to it as well as its aftermath. The result is superb, enthralling and necessarily terrifying.
. . .
Higginbotham describes young workers who were promoted swiftly to positions of terrific responsibility. In an especially glaring example of entrenched cronyism, the Communist Party elevated an ideologically copacetic electrical engineer to the position of deputy plant director at Chernobyl: To make up for a total lack of experience with atomic energy, he took a correspondence course in nuclear physics.
Even more egregious than some personnel decisions were the structural problems built into the plant itself. Most fateful for Chernobyl was the baffling design of a crucial safety feature: control rods that could be lowered into the reactor core to slow down the process of nuclear fission. The rods contained boron carbide, which hampered reactivity, but the Soviets decided to tip them in graphite, which facilitated reactivity; it was a bid to save energy, and therefore money, by lessening the rods’ moderating effect. Higginbotham calls it “an absurd and chilling inversion in the role of a safety device,” likening it to wiring a car so that slamming the brakes would make it accelerate.
. . .
. . . Chernobyl exposed the untenable fissures in the Soviet system and hastened its collapse; the accident also encouraged Mikhail Gorbachev to pursue drastic reforms with even more zeal.
Higginbotham observes that the plant was run like the Soviet state writ large — with individuals expected to carry out commands from on high with an automaton’s acquiescence. At the same time, when it came time to assess responsibility for the disaster, any collectivist fellow feeling evaporated, as the ensuing show trials insistently scapegoated a few individuals (some of them already dead) in a desperate attempt to keep a crumbling system intact.
The accident also decimated international confidence in nuclear power, and a number of countries halted their own programs — for a time, that is. Global warming has made the awesome potential of the atom a source of hope again and, according to some advocates, an urgent necessity; besides, as Higginbotham points out, nuclear power, from a statistical standpoint, is safer than the competing alternatives, including wind.

For the full review, see:
Jennifer Szalai. “BOOKS OF THE TIMES; Nuclear Disaster In Chilling Detail.” The New York Times (Thursday, Feb. 7, 2019): C2.
(Note: ellipses added.)
(Note: the online version of the review has the date Feb. 6, 2019, and has the title “BOOKS OF THE TIMES; An Enthralling and Terrifying History of the Nuclear Meltdown at Chernobyl.”)

The book under review, is:
Higginbotham, Adam. Midnight in Chernobyl: The Untold Story of the World’s Greatest Nuclear Disaster. New York: Simon & Schuster, 2019.

Worn Down by Growing Regulations, American Entrepreneurs Leave China

(p. A1) SHANGHAI–Fifteen years ago in California, a tall technology geek named Steve Mushero started writing a book that predicted the American dream might soon “be found only in China.” Before long, Mr. Mushero moved himself to Shanghai and launched a firm that Amazon.com Inc. and Alibaba Group Holding Ltd. certified as a partner to serve the world’s biggest internet market.
These days, the tech pioneer has hit a wall. He’s heading back to Silicon Valley where he sees deeper demand for his know-how in cloud computing. “The future’s not here,” said the 52-year-old.
For years, American entrepreneurs saw a place in which they would start tech businesses, build restaurant chains and manage factories, making potentially vast sums in an exciting, newly dynamic economy. Many mastered Mandarin, hired and trained thousands in China, bought houses, met their spouses and raised bilingual children.
Now disillusion has set in, fed by soaring costs, creeping taxation, tightening political control and capricious regulation that makes it ever tougher to maneuver the market and fend off new domestic competitors. All these signal to expat business owners their best days were in the past.
The Trump administration is making a hard-nosed challenge to China using trade tariffs, in-(p. A12)vestment controls and prosecution of technology thieves, and many in American business are cheering, if silently, having soured on the market after years of trying.
. . .
From Silicon Valley in 2003, Mr. Mushero felt China’s rumblings and started writing his book, “Off-Shoring the Middle Class.” He saw U.S. companies save money by shifting accounting, X-ray evaluations and other technical jobs overseas. China, he thought, was becoming globalization’s “one-stop-shop” for manufacturing, basic tech work and advanced research.
He predicted a broad shift to China of not only factory work, but U.S. white collar jobs, too.
. . .
At a Starbucks in mid-2008, he sketched out “a napkin business plan” for a new company called ChinaNetCloud (Shanghai) Co. with Mr. Eron. China was overtaking the U.S. as the biggest internet market, and the partners would trail-blaze into cloud services by managing the online operations of local businesses.
. . .
Tougher regulations and competition deterred foreign players. China’s reputation for technology theft kept many out of the market, which reduced the number of Mr. Mushero’s potential clients. In 2013, the American Chamber of Commerce said only 10% of its members trusted data security enough to consider cloud services in China.
Walt Disney Co. tapped ChinaNetCloud to manage the computers hosting some interactive games in 2012, including one based on its hit movie “Frozen.” Mr. Mushero looked forward to more work with the U.S. entertainment giant, but Disney scrubbed the gaming push in mid-2014. Disney declined to comment. Online gaming in China is dominated by big domestic tech companies; it is derided by regulators as chaotic and harmful and hit regularly with new rules.
. . .
On a recent drizzly afternoon, flanked by framed commendations from Amazon and Microsoft for his firm’s achievements in China, Mr. Mushero said that after New Year’s he will head back to California, where he sees burgeoning demand for corporate online services, to market the company’s cloud-management tools.

For the full story, see:
James T. Areddy. “American Entrepreneurs in China Are Heading Home, Disillusioned.” The Wall Street Journal (Saturday, Dec. 8, 2018): A1 & A12.
(Note: ellipses added.)
(Note: the online version of the story has the date Dec. 7, 2018, and has the title “American Entrepreneurs Who Flocked to China Are Heading Home, Disillusioned.”)

“The Key Is Freedom”

(p. A17) . . . Ronald Reagan, in the last year of his presidency, delivered one of his most magnificent speeches . . . before a packed auditorium of students at Moscow State University.
. . .
Reagan’s ultimate aim was to plant the seed of freedom in the newly receptive furrows of a cracking totalitarianism.
. . .
Reagan delivered his Moscow speech standing before a gigantic scowling bust of Lenin and a mural of the Russian Revolution. He incorporated them as props in his address. “Standing here before a mural of your revolution,” he said, “I want to talk about a very different revolution,” a technological and “information revolution” that was transforming the world. How much progress had already been realized! But progress was not foreordained. “The key,” Reagan said, “is freedom–freedom of thought, freedom of information, freedom of communication.”

For the full commentary, see:
Roger Kimball. “‘When Reagan Met Lenin.” The Wall Street Journal (Thursday, May 31, 2018): A17.
(Note: ellipses added.)
(Note: the online version of the commentary has the date May 30, 2018.)

Tracking the Rosenbergs Was About Catching Spies, Not About Suppressing Dissent

(p. 18) In writing about the events and the back story surrounding the espionage case of Julius and Ethel Rosenberg, Howard Blum, a contributing editor at Vanity Fair, seems at first glance to be going over well-trod territory. But “In the Enemy’s House” is not a mere rehash. Instead, it is an account of the two men who were principally responsible for tracking down the Rosenbergs: Robert Lamphere, an F.B.I. counterintelligence agent, and Meredith Gardner, the most experienced and able code-breaker working for the United States government.
. . .
Blum’s book is especially valuable in rebutting the dwindling few who still believe the Rosenberg case was about the government seeking to curb the civil liberties of dissenters. Suppression of dissent, Blum demonstrates, was the furthest thing from the two men’s minds.

For the full review, see:
Ronald Radosh. “Catching the Rosenbergs.” The New York Times Book Review (Sunday, April 15, 2018): 18.
(Note: ellipsis added.)
(Note: the online version of the review has the date April 10, 2018, and has the title “In This True-Life Spy Story, It’s America vs. Russia, the Early Years.”)

The book under review, is:
Blum, Howard. In the Enemy’s House: The Secret Saga of the FBI Agent and the Code Breaker Who Caught the Russian Spies. New York: Harper, 2018.

Chinese Entrepreneurs Anxious Over Growing Government Control of Private Enterprise

(p. A15) HONG KONG — The comments were couched in careful language, but the warning about China’s direction was clear.
China grew to prosperity in part by embracing market forces, said Wu Jinglian, the 88-year-old dean of pro-market Chinese economists, at a forum last month. Then he turned to the top politician in the room, Liu He, China’s economic czar, and said “unharmonious voices” were now condemning private enterprise.
“The phenomenon,” Mr. Wu said, “is worth noting.”
Mr. Wu gave rare official voice to a growing worry among Chinese entrepreneurs, economists and even some government officials: China may be stepping back from the free-market, pro-business policies that transformed it into the world’s No. 2 economy. For 40 years, China has swung between authoritarian Communist control and a freewheeling capitalism where almost anything could happen — and some see the pendulum swinging back toward the government.
. . .
China’s leadership turned to entrepreneurs in the late 1970s, after the government had led the economy to the brink of collapse. Officials gave them special economic zones where they could open factories with fewer government rules and attract foreign investors. The experiment was an unparalleled success. When extended to the rest of the country, it created a growth machine that helped make China second only to the United States in terms of economic heft.
Today, the private sector contributes nearly two-thirds of the country’s growth and nine-tenths of new jobs, according to the All-China Federation of Industry and Commerce, an official business group. So pressures on private businesses could create serious ripples.
“The private sector is experiencing great difficulties right now,” wrote Mr. Hu, the retired minister, who as the son of a former top Communist Party leader is often a voice for reform in China, in an essay posted online last Thursday. “We should try our best not to replicate the nationalization of private enterprise in the 1950s and the state capitalism.”
. . .
Private entrepreneurs are loath to speak out for fear of attracting official condemnation. But signs of distress aren’t hard to find.
Last month, Chen Shouhong, the founder of an investment research firm, asked a group of executive M.B.A. students — many of whom already owned publicly listed companies — to choose between panic and anxiety to describe how they feel about the economy. An overwhelming majority chose panic, according to a transcript. Mr. Chen declined to be interviewed.
. . .
Xiao Han, an associate law professor in Beijing, cited one of Aesop’s fables, of a man trying and failing to stop a donkey from going over a cliff.
“Before long,” Mr. Xiao said, “we’ll probably find a body of a China donkey under the cliff.”

For the full story, see:
Li Yuan. “China Muscles In on Its Free-Market Prosperity.”The New York Times (Thursday, Oct. 4, 2018): A1 & A12.
(Note: ellipses added.)
(Note: the online version of the story has the date Oct. 3, 2018, and has the title “Private Businesses Built Modern China. Now the Government Is Pushing Back.”)

As Chinese Government Control of Economy Grows, Entrepreneur Jack Ma Joins Communist Party

(p. B3) HONG KONG — Jack Ma, China’s richest man and the guiding force behind its biggest e-commerce company, belongs to an elite club of power brokers, 89 million strong: the Chinese Communist Party.
. . .
The disclosure of Mr. Ma’s membership reflects the thinking that the party controls the economy and society, said Guo Yuhua, a sociology professor at Tsinghua University in Beijing and a critic of the party.
“It’s going backward from the Deng Xiaoping era, when the party advocated the separation of the party and the government,” she said, referring to the party leader who ultimately governed China during its early years of reform in the 1970s and ’80s.
The disclosure also drew attention because Mr. Ma had in the past tried to keep his distance from the government. When asked at public appearances how he managed government relations, he often said, “Fall in love with the government, but don’t get married.”
But as Mr. Xi tightens ideological controls and the power of the state grows, many successful entrepreneurs have made a point of showing their party loyalty.

For the full story, see:
Li Yuan. “In China, Billionaires Sidle Up to the Party.”The New York Times (Wednesday, Nov. 28, 2018): B3.
(Note: ellipsis added.)
(Note: the online version of the story has the date Nov. 27, 2018, and has the title “Jack Ma, China’s Richest Man, Belongs to the Communist Party. Of Course.”)

Chernobyl Was Due to “Bureaucratic Incompetence,” Not Due to Technology

(p. C6) Dr. Medvedev’s study of Lysenko was not approved for official publication in the Soviet Union, but samizdat, or clandestine, copies circulated among the intelligentsia. In 1969, the book was translated into English and published as “The Rise and Fall of T.D. Lysenko.”
Dr. Medvedev was fired from his job at an agricultural research laboratory, and within a few months was summoned to a meeting with a psychiatrist, on the pretext of discussing the behavior of his teenage son. Instead, Dr. Medvedev was taken to a holding cell, where he managed to pick the lock and walk away.
Soon afterward, on May 29, 1970, as Dr. Medvedev recounted in his book “A Question of Madness,” he was confronted at his home by two psychiatrists accompanied by several police officers.
“‘If you refuse to talk to us,’ one of the psychiatrists told Dr. Medvedev, ‘then we will be obliged to draw the appropriate conclusions . . . And how do you feel yourself, Zhores Aleksandrovich?’
“I answered that I felt marvelous.
“‘But if you feel so marvelous, then why do you think we have turned up here today?’
“‘Obviously, you must answer that question yourself,’ I replied. “A police major arrived. “‘ And who on earth might you be?’ Dr. Medvedev asked. ‘I didn’t invite you here.’ ”
“He protested, to no avail, that the homes of Soviet citizens were considered private and inviolable to the forces of the state.
“‘Get to your feet!” the police major ordered Dr. Medvedev. ‘I order you to get to your feet!’ ”
Two lower-ranking officers, twisted Dr. Medvedev’s arms behind his back, forced him out of his house and into an ambulance. He was driven to a psychiatric hospital.
The preliminary diagnosis was “severe mental illness dangerous to the public,” and Dr. Medvedev was repeatedly warned to stop his “publicist activities.”
Meanwhile, his brother, Sakharov and other activists for greater openness in the Soviet system sent telegrams and published open letters calling for Dr. Medvedev’s release. One of his friends, the novelist Alexander Solzhenitsyn, then still living in the Soviet Union, condemned Dr. Medvedev’s detention with a bold and blistering statement.
“The incarceration of freethinking healthy people in madhouses is spiritual murder,” he said. “It is a fiendish and prolonged torture . . . These crimes will never be forgotten, and all those who take part in them will be condemned endlessly, while they live and after they’re dead.
“It is shortsighted to think that you can live constantly relying on force alone, constantly scorning the objections of conscience.”
Solzhenitsyn received the Nobel Prize for Literature later that year.
. . .
In 1990, Dr. Medvedev wrote an account of the 1986 nuclear disaster at Chernobyl, which he considered inevitable, with the Soviet Union’s history of scientific and bureaucratic incompetence.
“In the end, I was surprised at how poorly designed the reactor actually was,” he told the New York Times in 1990. “I wanted to write this book not only to show the real scale of this particular catastrophe, but also to demolish a few more secrets and deliberate misconceptions.”

For the full obituary, see:
SCHUDEL, Matt. “‘Scientist exposed agricultural fraud and Soviet incompetence.” The Washington Post (Sunday, Sept. 6, 2018): C6.
(Note: ellipses between paragraphs, added; ellipses internal to paragraphs, in original.)
(Note: the online version of the obituary has the date Sept. 4, 2018, and has the title “‘James Mirrlees, Whose Tax Model Earned a Nobel, Dies at 82.”)

The books by Zhores Medvedev that were mentioned above, are:
Medvedev, Zhores A. The Rise and Fall of T. D. Lysenko. New York: Columbia University Press, 1969.
Medvedev, Zhores A., and Roy A. Medvedev. A Question of Madness: Repression by Psychiatry in the Soviet Union. London: Mcmillan London Ltd., 1971.
Medvedev, Zhores A. The Legacy of Chernobyl. New York: W. W. Norton & Company, 1990.