China


She was right all along!

Today I discovered a really excellent article discussing how American and Soviet scientists and intelligence operatives reported on the collapse of the Soviet Economy, at the Texas National Security Review wtf. The basic thrust of the article is to understand whether researchers in the US national security complex, and associated academics, missed the collapse of the Soviet economy that began around 1966, or whether they were actually predicting the fundamental economic challenges that would eventually bring the Soviet Union to revolution and implosion. Apparently in the 1990s there was a bit of a thing where major newspapers and some politicians accused the CIA and the academics in its orbit of having completely missed the fact that the Soviet Union’s economy was failing, and having driven the US to go into debt peonage in order to achieve massive economic growth that wasn’t actually needed. The article cites a few of these critics saying basically that if the CIA had accurately predicted the trajectory of the Soviet Economy then Reagan wouldn’t have had to build up huge deficits to finance a massive military and economic expansion. Putting aside how ludicrous this is on its face – conservatives don’t care about deficits, for starters, and Reagan was building deficits for a wide range of political reasons – the article dismisses this by showing that in fact the CIA and its fellow travelers did in fact predict the collapse of the Soviet economy, in remarkable detail, and this 1990s criticism is all just silly revisionism.

This wasn’t the part of the article that interested me though – in fact I thought the discussion about why this is important was the weakest part of the article. What I enjoyed was the detailed description of the stages of economic growth and collapse of the Soviet Union, and the description of how Soviet theorists and planners saw it coming from the 1970s onward but seemed powerless to stop it. It tells a detailed and interesting tale of an economic program that seemed so successful (to both American and Soviet observers) in the 1950s, falling into stagnation in the 1960s and then into ruin in the 1970s. It’s a detailed and well-researched description of an economic system falling apart, and it shows that actually the economic analysts of the West really had their finger on the pulse here, and their theories about how economies should work and what was wrong with the Soviet economy proved to be correct in the end. This isn’t just American triumphalism that you might expect from the Texas National Security Review wtf, because the author cites a bunch of Soviet theorists who basically saw all the same issues that the Americans saw, and were unable to come up with any solutions that could work. The story of how they failed to come up with solutions is in itself fascinating, and something I will come back to when I discuss the Chinese communist approach to the same problems these researchers identified. But first I want to ask – did Western Marxists of the 1960s to 1980s see any of these issues in the Soviet economy, and if they didn’t, what does that say about their much-vaunted economic analysis skills?

The rise and fall of the Soviet planned economy

The article divides the Soviet economy into two rough stages, the first lasting from I guess the 1930s or the end of the war up until 1959, and the second starting somewhere in the mid 1960s and running to the fall of the Berlin wall. The first period was characterized by what the author calls extensive growth[1], which appears to be the process of throwing bodies at basic problems like building roads and shit. This period was characterized by rapid growth and social engagement(?), and seems like the kind of period when central planning would be no hindrance, or possibly even beneficial to growth. This is the period of increased steel production, more coal in more burners, the kind of basic economic problems being solved by simple and robust methods. But by the 1960s the Soviet Union had solved these basic problems and had moved into a more complex economy characterized by skilled labour working on more difficult problems of distribution and production, and it could no longer function by simply investing in new plant and equipment. At this point both American and Soviet analysts of the economy noticed that it needed to move to a more mixed structure, and it required engaged and committed professionals rather than hard working industrial hands. Central planning failed at this point, and the social and cultural conditions in the Soviet Union began to hold back growth and achievement, because you can’t get skilled professionals to work for just money alone, and the other cultural and social rewards of engaging in the mixed economy just weren’t there. The economy by this point had also become much more complex and had become too complicated for proper central planners to manage, but the lack of monetarization and small scale innovation and markets prevented it from finding local and specific solutions to complex problems. Both American and Soviet theorists noticed this problem, with the Americans wondering if the Soviet leadership would make radical changes to unleash new energy and creativity, and the Soviet thinkers wondering how to do this and complaining that they weren’t able to come up with solutions to match the problems they had identified[2].

At this point the author also describes a bunch of other problems overwhelming Soviet society that were identified in the west and discussed: declining life expectancy, increasing infant mortality, rampant alcoholism, and endemic corruption. The corruption was seen as a response to the challenges of an economy that simply wasn’t working and the cultural and social barriers to progress, and the alcoholism and infant mortality were seen as signs of a deepening social malaise that simply couldn’t be solved by a planned economy. This part of the essay – which to be fair is a long way in – was powerful stuff to read. It’s a fundamental given of modern development economics that when life expectancy or infant mortality go in the wrong direction, you’re getting something very wrong. That should be a sign that you need to get off your arse now and fix whatever mess you’re facing[3].

What did Western Marxists see in all this?

To their credit it appears that Soviet theorists and planners from the 1970s onward saw the writing on the wall and were at least aware of the need for change, even if the political structures of their economy prevented them from effectively implementing them. But how did western Marxists study their model society and how did they react? While we know a lot of western Marxists went their own way – especially after Hungary and Czechoslovakia – we know that many of the western communist and socialist parties continued to support the Soviet Union for a long time. One of the few remaining claims for which the people of this time get any credit is that while its political prescriptions may have failed, Marxism provided a cogent and insightful analysis of the economic problems facing capitalism, and a definitive description of how economic crises arise and are resolved. Presumably then it would have been able to analyze the problems within the Soviet Union, and presumably at least some of these Marxists would have had better access to information and data coming out of the Soviet Union than did the CIA.

So what did they do with it? Did they see the crisis the way their Soviet colleagues did? I have dug around online and can’t find anything about Marxist critiques of Soviet economic ideas at that time except for this review of a book on Marxist critiques of Soviet economics, that suggests the book is not a comprehensive review of what was said and written in that time. I certainly can’t find any evidence of a famous critical review of the problems facing Soviet industry. One would think that at least in the post-Vietnam era, perhaps in the 1970s, some of the Marxists of the New Left would have been feeling liberated enough to consider critically whether the Soviet Union was going in the right direction. At this time left wing movements in the west had started looking to national liberationist movements in Africa and latin America for inspiration, and these movements were typically less economically and ideologically hidebound than the Soviet Union, though often still dependent on it for economic and military support, so one would think western Marxists would have been able to engage more critically with Soviet economic ideas through these movements. But I can’t see much evidence that they did. What were they doing during this time? Is there a cruel irony where Soviet theorists were applying western market economics to critique Soviet economic systems, while western Marxists were applying rigid Marxist principles and missing the entire point? Were CIA academics more closely engaged with Soviet economic data than the Soviet Union’s supposed allies in the American left? I can’t find any information about this online, and I’m wondering.

How did China learn from Soviet failure?

The article also mentions that Soviet leaders tied economic growth directly to the ideological success of their project. They figured that people would be willing to make political and cultural sacrifices to the revolution provided they saw economic progress, and could look forward to a future utopia, but from 1970 on the economy was stagnating and so they were offering the people decades of austerity and asking them to commit to a political program that offered no future. This fundamental bargain – freedom in exchange for development – seems to me to be at the heart of the Chinese political program, and to have been a huge success for them: basically, so long as everyone’s economic lot continues to improve, the Chinese communist party assumes that the population will tolerate limits on expression, political activity and assembly. It’s a deal that has worked for them so far, and it seems to be at the core of their political program. But it failed in the Soviet Union, so how did Chinese leadership respond to this?

This is another topic that is very hard to assess for a non-expert just using random internet searches. How did China respond to the Soviet Union’s stagnation? Is there a body of work, in Chinese, by Chinese planners and intellectuals, interpreting the Soviet Union’s failure in terms that could be used to improve China’s economic and social performance? Did the 100 Flowers movement or the Cultural Revolution stem from some recognition that Soviet ideological strictness was stopping economic growth and interfering with the basic bargain? I found this critical text from Mao that suggests Mao understood that economic growth cannot be about just industrial development, and that commodity exchange (i.e. free markets of some kind) are essential. But it’s very hard to read – this language is like nothing from standard public health text books! – and it obviously requires a heavy knowledge of pre-existing Maoist and Stalinist theory. For example, Mao repeatedly contrasts the Chinese communist party’s attitude towards peasants with the Soviet party’s, and finds Stalinist thought lacking on this issue that doesn’t make any sense to me.

But it seems to me that the Chinese communist party must have done something right. Under Mao they also went through a period of heavy “extensive” growth, but then under Deng Xiaoping they introduced market reforms that enabled their economy to adapt to its growing complexity, and it is now generally accepted that China runs a mixed market economy that has the flexibility to respond to new economic challenges while retaining the central planning that should, I guess, ideally be able to manage potential crises and balance competing interests. China has also not seen any period of stagnation in health markers – quite the opposite! – and seems to be much better at incorporating foreign capital and foreign ideas into its market (the original article makes the point that the Soviet Union found it very hard to import new technologies, and suffered in productivity as a result). So I wonder – was Chinese communism always more open to foreign ideas and to critical reinterpretation of basic principles? Did they see what was happening in the Soviet Union and think about alternatives earlier and more aggressively? In his Critique of Stalin’s Economic Problems of Socialism in the USSR Mao repeatedly returns to the problem of commodity production, and seems to be much more open to market ideas than the Soviets (in his own words), but then at the same time I think he was presenting Stalinism as a betrayal of Marxism for being too westernized or something. So how was China interpreting Soviet struggles? China shows no signs of economic slow down or of economic failure, though of course it is increasingly vulnerable to crashes and crises of a capitalist kind, so it’s not as if it has developed a perfect mixed economy. Did Deng Xiaoping and his successors learn from the Soviet Union, and how? And if so why was their communism open to change but Soviet communism was not? For example, the article presents corruption as a fundamental and unresolved problem of the Soviet Union, possibly connected directly to its economic and political stagnation, but we know that the Chinese government has made fighting corruption an important symbol of progress and has genuinely tried to stamp out the worst of it. Why and how did they make these decisions, and to what extent were their policy ideas driven by reaction to Soviet failure, or to western criticism?

A final note

This has been a blogpost only of questions – I don’t know anything about these issues, but I find them very interesting. I think I have said before on this blog that I think China’s future progress offers a key challenge to capitalist market democracy. Until now the only real challenge to the orthodoxy of western capitalist democracy arose from the Soviet Union, and it was a dismal failure (as is its gangster successor). But if China can make one party non-democratic Chinese communism successful, then it will offer a real alternative to capitalist democracy. In the past I have said that China needs to negotiate a series of complex challenges but that if it does it may prove its system a viable alternative to capitalist democracies. I think it’s safe to say it has shown itself to be a much better alternative development model than Russian communism, which when you’re coming from the background Chinese communism was coming from is a pretty big claim to success. But now it has moved into the intensive development phase identified in the linked article at the Texas National Security Review wtf, the question is whether it will continue to adapt in the way it needs to to show that its political model can deliver the economic boons that its fundamental contract demands. This question is further complicated by the abolition of term limits and the possibility that Xi Jinping is becoming a new Mao[4], which could undo all the gains of the past 10 or 20 years and return China to a period of madness or Soviet scleroticism[5]. I guess also the lessons of Soviet history are less important to Mr. Xi than they were to Mr. Deng, and Mr. Xi faces an environment that is in some ways much less challenging (development is complete), but also much more challenging (Trump!) Are Chinese planners moving on from the lessons of Soviet failure to the lessons of capitalist failure?

I think it’s possible that we are seeing a new era of failure in American capitalist democracy, and there are many countries in Africa that are desperate for political and economic development models at a time when China is becoming increasingly assertive about the rectitude of its own model. By looking at how previous systems have learnt from their mistakes, perhaps we can see how the Chinese government will adapt to future challenges, and also how the American government will – or won’t – learn from its own litany of errors. How will this affect development in Africa, and how will it affect the response of the big economies to the fundamental environmental and economic challenges that threaten to destroy us all? I think we need to look to China for the answers to many of these questions, and in seeing how previous regimes learnt about their own and their enemies’ weaknesses – and how they failed to adapt – perhaps we can see where our current leadership are going to take us, and worse still – how they are going to fail us.

 


fn1: It’s possible that in reporting the author’s work I will significantly dumb it down, so if any descriptions of what the author wrote seem trite or simplistic please blame me, not him

fn2: These theorists were operating in the post-Stalin era, which I guess was freer, but I hadn’t realized so much self-critical work was allowed in the Soviet Union during Khruschev and Brezhnev. But it appears that there was no translation of critical thought into action, even where it was tolerated.

fn3: Modern America is facing a challenging problem along these lines, of declining life expectancy due to middle-aged mortality, increasing maternal mortality, and growing inequality in infant mortality. Is this a sign that America’s economy is going the same way as the Soviet Union?

fn4: I think he’s not, but if he does then I think this shows a fundamental and important instability in these one party systems, that they don’t just produce occasional madmen – they return to them. The madman could be the stable attractor in these systems. But if, for example, Xi goes through three terms, China continues to develop and liberalize and then he retires, what does that tell us?

fn5: Though it’s worth remembering that even under Mao China made huge progress, probably because it was in this extensive phase of development where progress is easy if you have strong central government and central planning

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Red sky at night … nostalgia’s delight

I have long held a special fondness for China, for two reasons. The first is that it has overcome enormous obstacles to get where it is today. The last two hundred years of Chinese history are a catalogue of horrors sufficient to sink any nation: From the depradations of the Emperors in the 19th century, to the Taiping rebellion, then British meddling and the opium wars, then the civil war, the destruction of the Japanese invasion, then the cultural revolution and the great leap forward – China has had barely any time to come to terms with itself in the last 200 years, and it is only in the last 30 years that China has been free of major conflict, famine or disaster and able to focus on development and peace. Against that backdrop, China really is the Little Country that Could, and despite the various repressions and problems of the recent communist era, lifting half a billion people out of poverty in just 20 years is a huge achievement for any country, let alone a country emerging from the ravages of 150 years of war and chaos. As someone who works in public health, China’s achievements in this field are something that any country should be proud of, and for this reason I have a soft spot for the country.

The other reason I look fondly on China is that it was the first developing country I visited for an extended period of time, and my first real holiday destination as an adult. In 2002 I spent a month traveling in China with my friend Sergeant M, starting in Beijing and traipsing through Xi’An, Xiahe, Langmuir, Songpan, Chengdu, Yangshuo and Guangzhou before finishing in Hong Kong. I studied a little mandarin before I traveled and went on a small group trek with a company called Intrepid Travel, and it was an amazing trip. Back then China was definitely still a developing country, and I visited places that still had not achieved adequate sanitation or regular electricity supplies, and I met people whose life experience was a world away from mine. It was eye opening for many reasons, and I still carry many powerful memories of that trip. It also was my first real opportunity to see that the way the west reports on East Asia is extremely shallow and superficial, and that almost everything we think we know about “distant” countries (like China, Japan, Iran) from the outside is wrong or distorted. I don’t believe that traveling makes anyone a better person and I’m not a big fan of travel – I usually only travel for work and don’t make a big effort to go on holidays – but this was a really important and I guess life changing trip for me, so for that reason I view China very fondly indeed, and I am always supporting the efforts of the Chinese people (as opposed to their government) to make their situation better, against occasionally incredible odds.

So it was with some pleasure that I had the chance last week to visit Guangzhou for work, to spend five days in a city that 15 years ago I just passed through on my way to Hong Kong, and to see how much China has changed over the past 15 years. This blog post describes some of the ways in which China has changed in the past 15 years while I was away, and also some of the many ways in which it has not.

Everyone obeys the traffic rules: Driving in China 15 years ago was a terrifying prospect, involving bouncing along decrepit roads in a barely-functioning rattling vehicle with no seatbelts or suspension, driven by a barely sane man who had a reckless disregard for lanes, speed limits or common sense, in a world where everybody shared his signature traits. The car horn was used as a means of communication – most commonly, warning – and things like lanes, traffic lights and traffic police were treated primarily as loose guidelines rather than strict rules. I spent 8 hours hurtling down a two lane road in Sichuan on the edge of a cliff, first watching in horror as our driver overtook slower cars exclusively on blind curves or hill crests, and then finally not watching at all – but looking out of the side window was not an option either, since every couple of hundred yards we would pass a section of barrier that had been torn away, and stare down into the looming abyss as our driver took another screaming turn, horn blaring, playing chicken with a massively overloaded truck. This time I hopped into a taxi at Guangzhou airport to find the familiar lack of seatbelts, but was shocked to find that my driver strictly obeyed the speed limits, drove within lanes, followed rules, and did not use his horn even once. Indeed, even when we hit the traffic crush of the city itself almost no one was blaring their horn, and the main time I saw someone use their horn was to admonish someone else for not following the road rules. I even realized that if you sit in the front seat of the taxi you get to wear a seatbelt. This is a huge change, that made me feel safer on the roads and as a pedestrian even though the traffic in Guangzhou was much more aggressive now than 15 years ago.

No one needs pachinko here

Old men still play chess on the street: In the Hutongs of Beijing 15 years ago I saw groups of middle aged men everywhere, huddled over game boards on the side of the road, playing cards or Chinese chess while other men gathered to watch, yelling advice and opinion. If I spent time watching I would even see the players arguing with the spectators over the right move. I was taught Chinese chess by a cheerful man from Xinjiang on the sleeper train to Xi’An, and after that Sergeant M and I would break out our chess set on long journeys, only to have everyone else on the train gather round to move the pieces for us and advise us. This doesn’t seem to have changed at all, and you can still see groups of men doing this now, as in the group pictured above who were enjoying a Sunday afternoon in Shamian by the water front, arguing over cards.

The portable tea jar is still a thing: Only now the jar is a hipster design. Back in 2002 everyone was carrying a jar of tea, in which the leaves or flowers just floated loose at the bottom of the jar. Often this was literally just a jar, repurposed from some other use, or a battered glass bottle that might have once held alcohol or juice. Everyone still carries that jar, but now everyone’s jar is a well-made, fancy construction, with a design emblazoned on it and a specially-made carry strap or handle. Somethings never change, even though they stay the same.

Smoking is worse: Everyone (male) smokes, and I guess now no one is so poor that they can’t afford to. China needs tobacco control badly. But it does appear that China has introduced indoor smoking laws, or at least lots of restaurants and shops have decided that is the best thing to do, and so in that regard it’s doing at least as well as Japan. Also compared to Japan women still don’t smoke much at all, which means that the tobacco companies haven’t made progress on half the population, and now that tobacco control efforts are beginning to happen, they probably never will. It’s good to see that half the world’s population still remains relatively safe from Big Tobacco’s evil schemes.

China has digitized incredibly: 15 years ago when I entered a restaurant my only concern was “did I bring cash”? But now when I enter a restaurant I have to worry “did I only bring cash?” Not because the restaurant only accepts cards, but because the entire process – from viewing the menu to ordering to paying – happens on your phone. I went to a restaurant with my collaborator where this whole process happened by scanning a QR code with your phone. This brought up the menu, from which we placed our order, and then we paid using a bank account linked to my colleague’s WeChat account (which is like the Chinese social network equivalent of Facebook). This also happened with the cafe next to the university, with a food order from my hotel, and with paying for small things everywhere. Somehow China has become a country that hasn’t yet got clean drinking water, but has skipped credit cards straight to a cashless society. Imagine if every daily transaction was handled by a QR code and a bank account attached to Facebook – including the bottled water you had to buy because the tap water is not potable. Weird!

Everyone rides a bike but no one owns one: 15 years ago the roads in Beijing had separate multi-lane bike sections, and all of life happened on bicycles. This is still the case, but no one rides their own bike anymore. Instead there is a network of QR code-operated disposable bikes, such as Mobike, which are just dumped anywhere around the city and which you access with your phone. Scanning the QR code unlocks the bike, which you can ride anywhere you want. You dump it at the destination and scan again, and the money is deducted from your account. There is no pick-up or drop-off point, like in many European bike share schemes, and no rules at all about how to use it. The bikes are simply there, everywhere, waiting to be used. This means that if you go somewhere far from public transport you can just pick up a bike at the nearest station and ride to your destination – as everyone did at the university I was visiting, which is equidistant from three railway stations. (You can see an example of one of these bikes in the picture above). This is a brilliant scheme that is really useful in a big urban conglomerate like Guangzhou, and makes perfect sense. I doubt it will ever be properly implemented in Tokyo, because the digital payment system won’t be and Tokyo is (comparatively) really strict about bike parking. It’s great to see China finding a way to make such a simple and liberating invention as the bicycle even more useful and liberating, using another uniquely liberating device (the mobile phone).

The security state is more intrusive: 15 years ago my only encounter with the security state was the (super stern) guards at Tiananmen Square, and the almost comically inept security official in Tibet who tried to interfere with our guide. This time around they were much more visible, with guards standing around every railway station scanning your bag when you entered or left, and public security police even stationed near roadway toll booths and other basic public infrastructure. It’s my understanding that there has been a lot of spontaneous local uprising in the past 10 years, not directed at central government but at local corruption and poor local decisions, and I imagine that the security state is quite scared that these spontaneous local expressions of discontent might link up and become national, so I guess this might explain it – along perhaps with fear of (or cynical use of the fear of) terrorism from Xinjiang, where there is a bit of an insurrection going on. There is also a lot more internet interference than 15 years ago, though this is probably a function of the internet being more integral to ordinary life (15 years ago press censorship in China was omnipresent, and it would have been impossible for a foreigner in the country to get access to foreign news sources that had not been approved). Interestingly no newspapers were blocked to me – the Australian ABC, the Guardian, the Washington Post, even the Daily Mail were freely available without using a VPN. It’s telling that China’s Great Firewall is directed at social media networks, not news. What does that say about the relative importance of those two forms of media?

Collect the set!

Socialist values have diversified!: 15 years ago there were big signs on public buildings announcing socialist slogans like “Postal workers united to build a revolutionary China” and stuff like that. These were huge banners in red with the slogans written in Chinese and English, presumably intended to inculcate the proper spirit of socialist fervour in this (intensely free market oriented!) society. This hasn’t changed, but it appears that the set of core values has diversified to 12, which include democracy, freedom, justice and the rule of law (see the helpful guide above). Who knew! Strangely I couldn’t find anyone who had recently voted … I’m a little sketchy about the equality value, since it’s pretty obvious that inequality has grown over the past 15 years, but I can certainly believe prosperity and patriotism, and Chinese people remain as civil as they ever were. There are a lot of building sites in Guangzhou, and their outer walls are all covered in this propaganda. I have to say the font is pretty cool, and the propaganda is quite swish (further along the wall I photographed they have a detailed exposition of each value, with pictures – patriotism has a picture of a bunch of children doing kung fu, with (of course) a QR Code in case you need more information.

On this point it’s worth noting that British newspapers often talk about “British values”, the British government is planning to (or has?) included “British values” in its citizenship test (do potential citizens of Mao-Mao descent have to answer questions on the British value of “Colonialism”?) Australian politicians also ramble on about “Aussie values”, including the reprehensible focus of a past conservative government on “mateship”, so I guess it’s worth noting that identifying core values and blasting them into the minds of your citizens is not a uniquely Chinese trait. But I will contend that it comes in a better font.

Under stranger skies

The sky bleeds: And it is cool. I follow a woman called Marilyn Mugot on Instagram whose shtick is pictures of China’s vivid purple-red urban night skies, and in Guangzhou I really understood the fascination that led her to run that account. The sky really is red at night, I guess through the pollution and also the Chinese fondness for vivid red and yellow light. Guangzhou is constantly misty and rainy too, which I guess helps to give the evenings a real Bladerunner feeling. Fifteen years ago it didn’t feel like that all, partly because the cities I visited were not yet megalopolises, and partly because the air was cleaner. It’s a pretty striking phenomenon and I have never seen it in Tokyo. Bright lights and strange skies – that’s modern China.

Chinese service is still ditzy, chaotic and effective: In my experience of getting any service in China it happens, it happens reasonably quickly, but it doesn’t happen always in the way that you expected, and often during every stage of the process everyone is confused about what they’re doing, and happily expresses their confusion while they find a workaround or a new way to do what they should, one assumes, have been doing forever. It’s also very cheerful, if not always very friendly, which makes it an almost perfect contrast with Japanese service, which is often cold or not friendly but always formal, polite, efficient, and organized. This aspect of China doesn’t seem to have changed at all – and neither does the inordinately large number of people required to provide service anywhere. The cafe near the university had 10 seats and five staff, so at any time three staff were standing around doing nothing. In Europe that would be one person, in Japan two. In terms of social cohesion and engagement I can’t say I think the European or Japanese way is better, but I guess I should kick up a stink because my coffee cost 240 yen, and if they employed half as many people maybe it would only cost 200 yen? That’s surely worth sacking three humans, right? In any case, it seems like this is a social contract – companies hire extra people, and there’s no unemployment, and everyone’s happy. I guess … I’ll be interested to see whether the productivity gains implicit in reducing those staff loads happen in anything like the time frame in which China has digitized, since it seems like the excess staff thing hasn’t changed at all in 15 years, while in every other way China has changed radically. Interesting, that … but I hope in any case that the ditzy chaotic service style doesn’t change, because I like it.

So that is my China after 15 years. My work fate is now entangled with China’s, as I am involved in an ongoing project here and hope to become further involved in working on public health in this amazing, growing, booming and innovative country, and some of my best students have come from there and now returned there to pursue their own futures. So I’ll be continuing to cheer China as its people negotiate the complexities of development and growth under communism, in an increasingly uncertain world. I hope they can do as well in the next 15 years as they have in the last 15!

Today the Guardian reported on a new study that claims a large sale of legal ivory in 2008 actually led to an increase in illegal elephant poaching. Basically in 2008 China and Japan were allowed to pay for a large stockpile of legally-obtained ivory, in the hopes that this would crash the market and drive ivory traders out of business. Instead, the study claims, the sale led to a big increase in poaching – approximately a 66% increase in elephants killed, according to the study. This is interesting because it appears to put a big dent in a common libertarian idea for preserving endangered species – that allowing a regulated trade in them would lead to their preservation. It is also one of those cute findings that puts a hole in the standard just-so story of “Economics 101” that everything is driven by supply and demand. We all know that in reality there are many factors which moderate the effect of supply and demand on crucial markets, and on the surface this study appears to suggest a quite contradictory supply and demand relationship in illegal poaching markets, in which increasing supply boosts poaching. But is it true?

The Guardian report links to the original study, which is held at the National Bureau of Economic Research behind a paywall, but which I managed to get a copy of through my work. I thought I would check the statistical methods and see if the study really did support this conclusion. My judgment is that this study is quite poor, and that the data doesn’t support that conclusion at all, due primarily to three causes:

  • A poor choice of measure for illegal poaching that doesn’t clearly measure illegal poaching
  • The wrong choice of statistical method to analyze this measure
  • The wrong experimental design

I will go through each of these reasons in turn. Where equations are needed, I have used screenshots from the original paper because I’m terrible at writing equations in html. Let’s get started.

The PIKE is a terrible measure of illegal poaching

The study is based around analysis of a data set of “legal” and “illegal” carcasses observed at search sites in 40 countries. Basically a “legal” carcass is an elephant that died on its own, while an illegal one is one that was shot and looted. Apparently poachers don’t bother to clean up the corpse, they just cut off the ivory and run, so it’s easy to see when an elephant has been poached. However, because no one knows the full details of elephant populations, the authors study an outcome variable called the PIKE, which is defined as the ratio of illegal carcasses to total carcasses. In their words (screenshot):

PIKE equation

They say that this enables them to remove the unknown population from the outcome by “normalizing” it out in top and bottom of the ratio. They justify this with a little proof that I am not convinced by, since the proof assumes that probability of discovering carcasses is independent of the number of carcasses, and that legal mortality and illegal mortality are not related in any way. But even if it factors out population, this PIKE measure doesn’t tell you anything about illegal poaching. Consider the following hypothetical scenario, for example:

Imagine a population of elephants in which all the older elephants have been killed by poachers, so only the pre-adult elephants remain. Every time an elephant becomes mature enough to have decent tusks a poacher kills it and the corpse is found. Further, suppose that the population is not subject to predation or other causes of legal mortality – it is young, and the environment is in good shape so there are large stocks of easier prey animals for lions to target. This population is at high risk of collapse due to adults being killed as they mature; indeed, let’s suppose no babies are born because adults are poached as soon as they reach sexual maturity. Thus every time an elephant is killed, the population drops by one towards its inevitable crash.

In this case, at every time point the PIKE would be 1, because there are no legal carcasses. The PIKE will remain 1 until there are no elephants left to die, at which point it will jump to infinity. It doesn’t tell us anything about the impending population collapse.

Consider now a situation where there are a great many more legal deaths than illegal deaths. Denoting illegal carcasses by y and legal carcasses by x, we have y/(y+x) where y<<x. In this case we can approximate the PIKE by y/x, and if e.g. the number of illegal carcasses suddenly doubles we will see an approximate doubling in the PIKE. But suppose y is approximately the same as x. Then we have that the PIKE is approximately 1/2. Now suppose that the number of illegal carcasses doubles; then the PIKE increases to 2/3, i.e. it nowhere near doubles. If the number of illegal carcasses again doubles, it increases to 4/5. But if all deaths drop to 0 it then increases to infinity … So the magnitude of the increase in PIKE is not a direct reflection of the size of the change in poaching, and in at least one case even the direction is not meaningful. That is not a well-designed measure of poaching. It is also scale free, which in this case is a bad thing because it means we cannot tell whether a value of 1 indicates a single illegal carcass or 10 illegal carcasses. Similarly we don’t know if a value of 1/2 corresponds to 1 or a million illegal carcasses; only that however many there are, they are half of the total.

The authors say that this variable is constrained between 0 and 1, but this is not strictly true; it actually has an additional non-zero probability mass at infinity. This strange distribution of the variable has implications for model choice, which leads us to the second problem with their data.

All the models in this study were poorly chosen

The authors choose to model the PIKE using an ordinary least squares (OLS) model with fixed effects for country and a (separate) fixed effect for each year. An OLS model is only valid if the residuals of the model are normally distributed, which is a very strong assumption to make about a variable that has lots of values of 0 or 1. The authors claim their residuals are normally distributed, but only by pooling them across years – when you look at residuals within individual years you can see that many years have much more normally distributed residuals. They also don’t show us the crucial plot of residuals against predicted values, which is where you get a real idea of whether the residuals are well-behaved.

An additional consequence of using an OLS model is that it is possible to predict values of the PIKE that are unphysical – values bigger than 1 or less than 0 – and indeed the authors report this in 5.6% of their data points. This is indicative of another problem – the PIKE shows a non-linear response to increased illegal kills (see my example from 1/2 to 2/3 to 4/5 above), so that for a fixed number of legal kills each additional illegal kill has a diminishing effect on the value of PIKE, but a linear OLS model assumes that the PIKE changes by a uniform amount across its range. Given that the goal here is to identify increases in the PIKE over time, this runs the risk of the model over- or under-estimating the true effect of the 2008 ivory sale, because it is not properly modeling the response of the PIKE score.

The authors try to test this by fitting a new model that regresses ln(illegal carcasses+1) against a function that includes ln(legal carcasses+1) like so:

PIKE alternative model

This introduces a new set of problems. The “+1” has been added to both variables here because there are many zero-valued observations, and ln(0) doesn’t exist. But if there are lots of zero-valued observations, adding one to them is introducing a big bias – it’s effectively saying there was an illegal carcass where previously there wasn’t one. This distorts low numbers and changes the patterns in the data. The authors claim, furthermore, that “The coefficient on legal carcasses φ will be equal to unity if the ratio of illegal carcasses to legal carcasses is fixed”, but this is both nonsensical and obscures the fact that this model is no longer testing PIKE. It’s nonsensical because that is not how we interpret φ. If φ=1, then we can rewrite their equation (8) so that the left hand side becomes the natural logarithm of (illegal carcasses+1)/(legal carcasses+1). Then we are fitting a linear model of a new variable that is not the PIKE. We are not, however, assuming the ratio of illegal carcasses to legal carcasses is fixed. If φ is not 1, we are modeling the natural logarithm of (illegal carcasses+1)/(legal carcasses+1)^φ. The ratio here is still fixed, but the denominator has been raised to the power φ. What does “fixed” even mean in such a context, and why would we want to model this particular strange construction?

The authors do, finally, propose one sensible model, which is similar to equation (8) (they say) but uses a Poisson distribution for the illegal carcasses, and still fits the same right hand side. This is better but it still distorts the relationship between illegal and legal carcasses by adding a 1 to all the legal (but not the illegal) carcasses. It also doesn’t properly account for elephant populations, which is really what the legal carcasses serve as a proxy for. There is a much better way to use the legal carcass data and this is not it.

Finally there are two other big problems with the model: It uses fixed rather than random effects for country and site, which reduces its power, and also it doesn’t include any covariates. The authors instead chose to model these covariates separately and look for similar spikes in specific possible predictors of ivory usage, such as Chinese affluence. The problem with this is that you might not see a strong spike in any single covariate, but multiple covariates could move together at the same time to cause a jump in poaching. It’s better to include them in the model and report adjusted poaching numbers.

The wrong experimental design

An expert cited in the original article noted this interesting fact:

The Cites spokesman also noted that there had never been a one-off sale of rhino horn: “However, the spike in the number of rhinos poached for horn largely mirrors what has been seen with ivory. The illegal killing of rhino for its horn in South Africa alone increased from 13 in 2007 to close to 1,200 last year.”

This suggests that there has been an upsurge in illegal poaching across Africa that is independent of the ivory sale, and could reflect changing economic conditions in Africa (though it could also reflect different markets for ivory and rhino horn). It’s possible to test this using a difference-in-difference approach, in which rhino poaching data is also modeled, but is treated as not having been exposed to an intervention. The correct model specification then enables the analyst to use the rhino data to estimate a general cross-species increase in poaching; the elephant data identifies an additional, elephant-specific increase that could be said to be due to the ivory sale. The authors chose not to do this, which means that they haven’t rigorously ruled out a common change in poaching practice across Africa. If the CITES spokesman’s point is correct, then I think it likely that we would conclude the opposite to what this study found: that compared to rhinos, elephant poaching did not increase nearly as much, and in fact the ivory sale protected them from the kind of increased poaching observed with rhinos.

Indeed, it’s possible that there were poachers flooding into the market at around that time for other reasons (probably connected to development and increasing demand in Asia), but after the ivory sale most of them switched to killing rhinos. That would suggest the sale was successful, provided you aren’t judging that success from the standpoint of a rhino.

A better model: Bayesian population estimation followed by Poisson regression

It’s possible to build a better model using this data, by putting the legal carcass data to proper use and then using a correctly-specified Poisson regression model on the illegal carcass data. To see how different the results might then look, consider Figure 1, taken from the Appendix of the paper, which shows the actual numbers of illegal carcasses in each year.

Figure 1

Figure 1: Distribution of illegal elephant kills, 2002 – 2013 (year is above its corresponding histogram)

Does it look to you like the number of elephants killed has increased? It certainly doesn’t to me. Note that between 20 and 50% of observed data are 0 kills in all years except 2002 (which the authors say was the start year of the data, and exclude from their analysis). Can you strongly conclude any change from these figures? I haven’t shown the legal kill data but it is broadly similar in scale. Certainly, if there is any upward step in illegal kills in 2008, it could potentially be explained simply by changes in populations of elephants – if even a small change in elephant density leads to an extra 1 or 2 extra kills per site per year, it would lead to distributions like those in Figure 1. To me it seems likely that the single biggest determinant of elephant kills will be the number of elephants and the number of poachers. If we assume the number of poachers (or the pace of their activity) changed after 2008, then surely we need to consider what happened to the population of elephants overall in 2008. If it declined, then poachers might catch the same number as 2007; if it increased, they would catch more.

The best way to analyze this data is to directly adjust for the population of elephants. We can use the legal kill data to do this, assuming that it is mostly reflective of elephant population dynamics. It’s not easy, but if from published sources one can obtain some estimate of the mortality rate of wild elephants (or their life expectancy), a Bayesian model could be built to estimate total population of elephants from carcasses. This would give a credible interval for the population that could then be used as what is called an offset in a Poisson regression model that simply modeled counts of illegal kills directly against time. The advantage of this is that it uses all 0 count events, because a Poisson model allows for zeros, but it adjusts for the estimated population. I think the whole thing could be done in a single modeling process, but if not one could obtain first a distribution of the elephant population, then use this to simulate many different possible regression model coefficients for the effect of the ivory sale. In this model, the effect of the ivory sale would simply represent a direct estimate of the relative increase in mortality of elephants due to poaching.

Then, to complete the process, one would add in the rhino data and use a difference-in-difference approach to estimate the additional effect of the ivory sale on elephant mortality compared to rhinos. In this case one would find that the sale was protective for elephants, but potentially catastrophic for rhinos.

Conclusion

Based on looking at this data and my critical review of the model, I cannot conclude that the ivory sale led to an increase in poaching. I think CITES should continue to consider ivory sales as a tool to reduce elephant poaching, though with caution and further ongoing evaluation. In addition, based on the cited unnamed CITES spokesman, evidence from rhino culling at the time suggests the sale may even have been protective of elephants during a period of increased poaching; if so, a further big sale might actually crush the business, although there would be little benefit to this if it simply drove poachers to kill more rhinos.

With regard to the poor model design here, it shows a lot of what I have come to expect from economics research: poor definition of an outcome variable that seems intuitive but is mathematically useless (in health economics, the incremental cost effectiveness ratio shows a similar set of problems); over-reliance on OLS models when they are clearly inappropriate; poor model specification and covariate adjustment; and unwillingness to use Poisson or survival models when they are clearly most suited to the data.

I think there is lots of evidence that legal markets don’t necessary protect animals from over-exploitation (exhibit A, the fishing industry), but it is also obviously possible that economic levers of supply and demand could be used to kill an illegal industry. I suspect that more effective, sustainable solutions to the poaching problem will involve proper enforcement of sales bans in China and Japan, development in the regions where poaching happens, and better monitoring and implementation of anti-poaching measures. If market-crushing strategies like the 2008 ivory sale are going to be deployed, development is needed to offer affected communities an opportunity to move into other industries. But I certainly don’t think on the evidence presented here that such market-crushing strategies would have the exact opposite of the intended effect, and I hope this poor quality, non-peer-reviewed article in the NBER doesn’t discourage CITES from deploying a potentially effective strategy to stop an industry that is destroying a majestic and beautiful wild animal.

epocholis_by_jonasdero-d4ca97z

[Faustusnotes note: This post is guest content by my GM, Eddie, which he has given me permission to upload from the background document he provided to us all. Over the next few weeks I’ll be uploading more of this material in concert with Cyberpunk game reports and other background information]

The City

You live in New Horizon, a massive city that sprawls towards the southeast coast of the Hong Kong conglomerate. The major business area was slowly pushed out of the main land, the city growing further and further into the sea. Now, it’s centre lies on the coast and half of the biggest city in the world floats in the east china sea. All the buildings in New Horizon are massive, each with hundreds of floors and divided into decks. The city itself is then divided by districts, blocks of buildings that are “miniature” cities by themselves. The buildings are so tall that looking down the bottom becomes a dark, misty area, were only utility pipes, transport trains and water can be found. The taller you live the richer you are, the top of the buildings becoming little gardens of Eden, with synth nature, clean air and direct sunlight. The dregs of society are pushed ever downwards, some even living close enough to the bottom that their lives depend on scavenging what falls from the top. Downwards there is only shadow and eternal night, the shade of buildings upon buildings blocking the light of the sun and creating a world of darkness in which shadows and desperation only rule.

The verticality of the city has forced transport to depend on super fast automated elevators and personal hovercrafts, making the city alive with hundreds of thousands of flying vehicles swarming and flying in the spaces between city blocks. Travel inside the decks is a combination of trains, half-automated cars and personal hovercrafts.

In all this mess, you live in district 68, “a place so run down its one number short of a dirty joke.” It is located 6 districts south of central, and is one district short of being in the sea line (where the buildings end and a huge tsunami barrier starts). District 68 is controlled by BioTechnica Incorporated, a company that deals in pharmaceuticals and health technology. Its HQ is located in a beautiful synth nature Arcology on the very top of the district.

Horizontally District 68 its composed of 9 building blocks, south-facing blocks being the poorest and the central block reserved mostly for BioTechnica business and residential areas. Vertically each block is divided into 5 decks of around 50 floors each. The decks are divided in: Deck 1, Corporate headquarters and residents only; Deck 2, Midway residentials, commercial zone; Deck 3, Mid-low residential, light manufacturing, red light businesses; Deck 4, industrial, low-class residential, heavy manufacturing; Deck 5, structural, transportation, illegal residential and chemical manufacturing. Both Decks and floors are counted top side first. (D2F04 is higher than D2F28) Then each floor is divided into residential, commercial and industrial zones (usually from 01 to 99), and finally a residential number. So an address would be:

D01F20Z01 Apt203, Bldg 8, District 68, New Horizon, Hong Kong, XX Province, East Chinese State, Asian Federation.

MFC: Quantum energy and the end of the Oil Age

A long way from here to there ...

A long way from here to there …

It is indisputable now, that the Asian Federation and its Megacity project are the pinnacle of human technological, structural and social advancement. The sprawling, self-feeding, self-organizing “city” is in some aspects as alive as Billy next door (actually far more than Billy, he is quite lazy). It (the city) has a brain, the massive quantum computer ExAlta, capable of organizing and planning everything single aspect of life and structure in the city, apparently obsessed with its constant and perfectly designed growth. It also has a nervous system, an infinite self-replicating information network that spreads through every single utility, structure and even human brain, connecting everything in a network that is more than just “free, public wifi” but rather an alternate world that overlaps with the physical one, creating for all a sort of (pardon my romanticism) spiritual link with everything and everyone around you.

And it never, never runs out of energy.

It grows, it evolves, it is completely connected and finally it feeds itself. This is all made possible through one single amazing (and terrifying) technology: Space Folded Fusion Cells, or (wrongly, but warmly nicknamed) MFC’s (micro fusion cells). A tiny, infinitely complicated and revolutionary quantum technology.

This “battery”, (if you are the kind of person that would call a fusion reactor a fireplace), joins all future technology into an object capable of using nanometric folds in space, allowing nearly infinite amounts of energy to be stored in a finite space, and accessed rapidly and easily. Today, MFCs can be found everywhere, they power our vehicles, our implants and cybernetics, whole buildings, and of course even the Russian spacecraft, used to travel around the solar system, run on massive versions of the MFCs. MFCs don’t generate energy themselves, but they can charge up so quick and hold so much energy that a person could live inside a road hovercraft, travelling through the wasteland, full AC on and music banging only powered with one fully charged 1x1m sized MFC, and never, for their whole life, need a recharge.

The invention of MFCs completely changed the world; the oil super powers, along with their western partners cried in unison as they saw their power base burned from under them. It also allowed the rise of the biggest most advanced city-state ever in human history, who will carry the legacy of the greatest minds and ideas gathered from around the globe. The MegaCity plan which eventually would lead to the open border policy, the Chinese legacy of super tech that would allow it to expand in complexity without depending on any other country for energy.

The change was also quick, MCFs and Fusion Energy were implanted with ferocity and no concern for the effects on the global economy or the Oil Age holdout states that were left floundering in the wake of this super-powered change. In a matter of ten years the Asian Federation and its sphere of influence completely restructured itself to accommodate the new super technology.

The world shook, as the oil empires started to crack in the edges, as Asia rose, the rest of the world descended into war and desperation. US military saw itself being called back to avoid a new civil war, only so that the country would fall to disease a few years later. The Arab nations saw themselves first being consumed by the eastern menace, yet, miraculously, later united to ensure its survival. The European Union crumbled and receded to its old feuds to never rise properly again, and the Russian Federation closed its borders and ignored the chaos, to resurface years later with its master plan: escape earth forever.

Years passed, the western worlds stopped screaming in rage and evolved to pleading in desperation. Russia came alive blooming and sending its colony ships into the vastness of space. AFed, guided by its master minds and pushed forward by its new MegaCity AI, ExAlta, stood tall and proud as the leader of the new world. And then the Crash came, and brought it all down in ruins …

Our adventures are set in the city of New Horizon after the mysterious catastrophe called the Crash, which killed ExAlta and brought New Horizon to the edge of ruin. No utopia now, this crash and subsequent political events, coupled with the environmental pressures wrought by climate change and the slow-burning collapse of the global economy have reduced New Horizon to a teeming, hard-scrabble version of its former self. Ruled by corrupt oligarchs and corporate power-mongers, it has been reduced through chaos and the cruel logic of environmental collapse to the classic case study of Cyberpunk lore. Here, in the oily rain and wave-wracked wilds of the lower decks of District 68, we fight to survive, to get ahead … and maybe, if we’re lucky, to get out …

 

China and Japan are in a dispute over the Senkaku islands. China has pulled out of UN negotiations over a territorial dispute with the Philippines.

Both of these disputes (and a few others) are about possession of the oil and gas resources under the South China Sea.

If the world is to avoid warming beyond 2C, all of the oil and gas under the South China Sea needs to stay buried there forever. If China and Japan resolve their disputes in any way that grants either side actual exploitation rights, the world will take one more small step towards being fucked. Some scientists are now arguing that even 2C is going to cause catastrophe; we need to get even tougher. This means that the best thing for the world is for China and its allies to continue locking horns over these islands for … about 1000 more years.

The best thing China, Japan and the Philippines can agree on is that exploiting these islands is against everyone’s interest. The whole region should be set aside as a marine park, and the military forces of every side of the dispute put to the task of sinking any oil research vessel, fishing boat or seismic survey ship that comes within a sniff of the place.

But that’s not going to happen, is it?

Chongching after necessary urban renewal, 1952

Chongching after necessary urban renewal, 1952

Since I began reading Antony Beevor’s The Second World War I have returned to my old Hearts of Iron 2 campaign. When last I played I had just defeat the perfidious USA, establishing am empire stretching from the east coast of the USA to Yemen, stretching as far North as the Canadian arctic and as far south as New Zealand. The only major powers still outside my control were the UK, Germany, the USSR and Nationalist China. The USSR has been largely ignoring me, but very soon after I had annexed the USA – in fact, before I had had a chance to repatriate my troops – that devious Generalissimo, Chiang Kai-Shek, declared war on me! I made several failed attempts to win that war, but gave up sometime in 1950 with a large portion of my army stuck on the eastern seaboard of mainland China, and being pushed back from my previous holdings in India and Burma. Many of my troops were still moving around the USA, and no matter what I did I couldn’t seem to defeat the Chinese. So, like all good gamers everywhere, I gave up and moved on to something else.

Having had my interest in the war reignited by Beevor’s book I thought I’d give it another go. I decided to use a new strategy, at least for the short term: consolidate my holdings so that there was no risk of losing the parts of China I had gained, and then build a huge fleet of missiles that would destroy China’s industry, rendering them incapable of fighting, while I shifted my armies around and built new ones. I realized I was woefully short of land-based aircraft, tanks, mountain troops or for that matter unit attachments – a consequence of fighting the war in the Pacific. So, I would rebalance my army by building it up, while laying waste to Chinese industry and reorganizing my forces.

China’s defense in depth and the role of strategic bombardment

China’s armed forces basically consist of three types of unit: infantry, mountain infantry, and militia. It has vast numbers of all three, but limited industry with which to support them. To give a sense of contrast, when the war started China had perhaps 3-5 tank divisions, maybe 150 divisions of various forms of infantry, one obsolete air arm (soon eliminated) and total industrial capacity (IC) of 100. I had perhaps 80 divisions including marines, tanks, cavalry and mountain troops, three or four land-based air arms (also soon depreciated) and a total industrial capacity near 300 (I think). I could run a large productive enterprise, maintain an excess of supplies, and fully reinforce all those troops while upgrading them and fighting an aggressive war. China at 100 IC was already incapable of balancing all those tasks. When it started the war it was largely neglecting upgrades, but even a small drop in IC would force it to choose between income, supplies and reinforcements. Low income means growing dissent; low commitment to supplies can lead to complete social collapse very rapidly if not addressed; and low reinforcements means the slow attrition of forces, especially those in mountainous or jungle areas with poor supply – like a lot of the Nationalist Chinese troops who had waged an unjustifiable war of aggression on my peace-loving troops in Thailand and Burma.

The Chinese strategy for deploying these soldiers appeared to be one of defense in depth: multiple layers of large armies all mutually reinforcing one another. This makes encirclement and destruction close to impossible, because although you can win against an army in a province, by the time you have moved troops there another army attacks from the rear and cleans you up. Fighting wars of encirclement and destruction is the only way to make headway against your enemy in the start of a war, but is extremely difficult to do if you don’t have the troop numbers, since you need to be able to advance, protect your flanks, and have reserves to smash the encircled army.  This is particularly difficult when you have poor infrastructure and tough terrain, so movement forward is slow – never a problem for defenders with reserves in depth. With my troops spread out from Rangoon in the south to Beijing in the north, and under attack along the entire front, it just wasn’t possible to make headway. I think around Beijing I tried encirclements of the province of Datong perhaps five times in one year, and every time I was beaten back before I could complete the snare. This is dangerous when you’re up against numerically superior but inferior troops, because if you destroy your own troops’ morale you can suffer highly effective counter-attacks, and when you are defending a strip of land only three provinces wide with the sea at your back, you don’t have much space to retreat.

So, the simple solution in the short term was to hold what I had gained while I built up and reorganized forces; and simultaneously to destroy industry so that Nationalist China suffered growth in dissent, reduction in supplies, and the inability to reinforce troops. Even if in the short term I couldn’t gain ground from this, it would force the enemy to pay dearly for each province they recaptured, and prevent them from growing their forces while I grew mine. Then I could run a couple of counter-attacks once my forces were bigger.

1950: reorganization, entrapment and strategic bombardment

During the first year of the war I had to move troops from the far coast of the USA to China, then deploy them inland. I also needed to build specialist troops (mountaineers) and tanks to help me through the tough terrain of inland China. Later in the year I realized that China had no air force but that I lacked the planes to take advantage of it, so I established a large aircraft construction program, and I also needed to modernize and update much of my equipment. This is because for Japan the first stage of the war is naval and not land-based, and infantry power tends to be neglected compared to having an advanced (and huge) fleet.

While I engaged in all this reorganization I tried to lay a few traps to whittle away my enemy. This involved withdrawing from attacks and letting my enemy penetrate inward by multiple provinces, then smashing into their rear lines to encircle the invader. This is a risky move because they can recapture key strategic areas, and I had to play this game near Nanjing or Beijing, both places I didn’t want to lose. The game never worked in the Beijing area – they would attack across too wide a front and I would have to repulse the entire front before I could do encirclements. But it worked just south of Nanjing, where I lured maybe 5 or 6 divisions into such a trap and manged to destroy them, though it took time and lost me a front line area in the process of relocating troops. Unfortunately, against an army the size of Nationalist China, five divisions isn’t worth the expenditure of reinforcements. By the time mid-1951 came around I was down to 400 manpower and losing 1 more a day in reinforcements, and it was looking like I wouldn’t actually be able to enlarge my army suffiiciently if I also had to bleed my population to reinforce brave divisions.

Simultaneously with this tactic I also tried strategic bombardment. I built ICBMs 10 at a time and launched them at all China’s major industrial centres, usually managing to knock its base IC down by 40 in one night. There’s a lesson here for war planners in long wars: distribute your industry. One ICBM can do 10-12 points of IC damage, but if you only have 3 or 4 IC in a province you limit their effectiveness. Amongst China’s 80 points of base IC, 10-12 were in Chongqing, 6 in Chengdu and 6 in Urumqi, so three missiles could knock off a quarter of its value easily. This didn’t cause the collapse I hoped for, and Chinese IC seems to grow back ridiculously fast, but it is satisfying nonetheless to restart the game as China after one of these attacks and to see the lines of red in their production tab: no production of new soldiers at all, no reinforcements, no upgrades, and all industrial output committed to supplies and money. I compounded this by nuking Chonqing twice in two years (destroying 10 IC each time and slowing down its rate of regrowth) and also Xinyuang once. Nuking Xinyuang destroyed 3 points of IC but also wiped out 10 divisions of soldiers who were inconveniently perched there. By this time China could not replace lost units, so that was 10 divisions I would never have to face again. Nukes also cause an automatic 10% of dissent, which is extremely useful because it puts a further dent on IC and reduces the effectiveness of soldiers.

Nonetheless, for this whole year I made no progress. Just gathered an enormous army in eastern and northern China, and watched as the Chinese army slowly recaptured parts of southeast Asia that I thought would be mine for eternity.

1951: regaining the initiative

From mid-1951 my armies from America and my newly-produced planes and tanks began to flood the eastern areas. I deployed them in the south near Sichuan, in the middle to protect my possessions around Nanjing (a very important area) and somewhat further north to try and trap large numbers of soldiers around Beijing. I also deployed tactical bombers and later close air support fighter-bombers into these campaign areas, and by the end of 1952 I had enough of these planes to be able to rotate them out when their strength began to wane. It’s a testament to the obstinacy and ferocity of the Chinese army that even though they had no functioning anti-aircraft guns and no air force, I still had to rotate my airplanes out or lose them (in fact I did lose a couple of divisions over the year). During this time I also continued my strategic bombardment. This was to prove useful for an unexpected but important subsidiary reason: with all its available IC constantly diverted to supplies and reducing dissent, the Chinese government could not build anti-tank or anti-aircraft attachments for its units, even though they are cheap and quick. With functioning industry it would have been able to flood its units with these counter-measures, which would have led to the very rapid destruction of my (still quite small) tactical support air wings. Unfortunately my strategic bombardment had forced the Chinese to put all military production of any kind on hold for a year.

Once my forces were in place I began the long, slow process of encircling and destroying armies while gaining ground. This didn’t work so well in the south on the road to Chongching, with continual set backs and frustrations, but I had some success sealing off peninsulas and advancing down one side of a great river to the north. In each encirclement I would tend to liquidate 3-5 divisions. During this year I lost maybe 10 divisions of my own, who were trapped and destroyed before I realized (multi-tasking all this stuff can lead to slip ups). Progress was slow, grinding and frustrating, but the lack of Chinese reinforcements meant that over this year their armies weakened and became increasingly disorganized. They also began to spread more thinly as I chewed off smaller armies, and the defense in depth tactic began to weaken.

1952: the big push

By the beginning of 1952 I had managed to reorganize and assemble a spare army, which I used to recapture Rangoon in an amphibious assault. From there I pushed out north through the jungle with the Irawaddy River on my right, stomping Chinese units as I went. In the mountains of Burma and India isolated units of Chinese mountain troops were being destroyed by a combination of exposure, lack of supply and constant aerial attack. In mid-1952 I landed a second expeditionary force in western India, using new motorized units with rocket artillery to push rapidly across the sub-continent and completely separate the Indian armies from supply lines over the Himalayas. I soon ruthlessly put them down and moved to attack towards Calcutta, while simultaneously redeploying a huge army of marines to capture Chittagong and cut off more troops between my Irawaddy armies and the marine invasion. Within two months a horrific jungle war that had tied up 20 or 30 divisions for 2 years – including the complete annihilation of 5-10 – became a rout, with whole Nationalist armies being torn apart in the high mountains. Meanwhile the defensive line around Chongching collapsed and in one month I managed to surround 20 divisions in the capital area, eliminating all of them while capturing most of China’s industrial heartland. In the north, the Beijing front finally got encircled with a huge pincer movement into the Mongolian desert, and the Chinese army was finished as a fighting force. My newest nuke didn’t have to be deployed, and in three months the war had changed from a stalemate to complete destruction. With the simultaneous collapse of Indian, Burmese, Manchukuo and Sichuan fronts the Chinese lost their will to go on, and offered unconditional surrender.

Of course I took it. I now possess an Empire of unparalleled size: from the Azores in the Atlantic through America and Asia to Oman, including all of India and China, Canada, every piece of land in the Pacific and all of Oceania. All that remains of foreign possessions in this Greater Co-prosperity Sphere is a ragtag group of starving British soldiers in Hong Kong. Only two allies stand between me and the complete destruction of the colonial powers: Britain and France. I have already destroyed half the British navy – can I conquer them before Germany does? And do I dare to take on the Soviet Union?

Where next for the Empire of the Eternal Sun?

Image credit: that picture is actually PLA soldiers entering North Korea at Yalu, but it looks like I imagine much of China looked after this 3 year war was over…

The Yellow Dragon can use Stinking Cloud at will

The Yellow Dragon can use Stinking Cloud at will

Today it was 26C in Tokyo, and we had our first taste of this year’s yellow dust, the strange and nasty pollution that tends to drift over Japan from China during spring and summer. Today’s was the worst I have ever seen in 5 years in Japan – the above photograph, taken from my ground floor balcony, shows the sky at about 3pm today, just after the cloud reached us. Apparently in Matsue, in Western Japan, visibility was down to 5 km. In case this seems like a strange thing to care about, let me assure you this “weather” is not pleasant: it causes sneezing, eye irritation, headaches and drowsiness in many people when it is at its worst, and I think some towns in Kyushu issued alerts that would cause some people to stay inside (especially those with respiratory problems). The US army monitors this phenomenon in Korea and issues regular warnings. Of particular recent concern is the increasing concentration of what the Japanese call “PM2.5,” very small particles of pollutants of size less than 2.5 microns, which seem to arise from industrial pollution and smog, and have specific associated health concerns. According to the Global Burden of Disease 2010, Ambient PM Pollution is the 4th biggest cause of lost disability-adjusted life years in China, and ranks much higher as a cause of years of life lost than of years of disability. By way of comparison it is ranked 16 in Australia and 10 in the USA.

Some part of the yellow dust problem is natural, due to sandstorms in the interior of China, but in the past 10 years the problem has become worse and its health effects more significant. No doubt part of the concern about its health effects arises from greater awareness, but there is also a confluence of factors at work in China that create the problem: desertification, soil erosion and pollution, and industrial pollution due primarily to coal power and transport. It’s becoming increasingly clear that as China develops, it needs to make a shift away from coal power and personal transportation, and it needs to do it soon. No matter how bad the yellow dust is in Japan, it has become very bad in China, and concern is growing about the seriousness of its health and economic effects.

This puts China on the horns of a dilemma. Development is essential to the improvement of human health, but the path China has taken to development, and the rapidity of its industrial and economic growth, are seriously affecting environmental quality. It’s possible that China is the canary in the coalmine of western development, and may be the first country to find its economic goals running up against its environmental constraints – and this despite a rapid slowing in population growth. China is going to have to start finding ways to reverse desertification, soil erosion, and particulate pollution, because it cannot afford to continue losing marginal farmland, degrading the quality of its farmland, and basing its industrial and urban growth on highly-polluting fossil fuels.

This raises the possibility that China needs to introduce a carbon tax (or better still, a carbon-pricing system) for reasons largely unrelated to global warming. A carbon pricing system with options for purchasing offsets, linked into the EU market, would potentially encourage reforestation and reductions/reversals in the rate of desertification; it would also provide economic incentives for investments in non-fossil fuel-based energy sources, probably nuclear for the long term and renewables for the short term. The government, by selling off permits, would be able to raise money to help manage the infrastructure and health needs of the poorest rural areas most in need of immediate development. These effects are important even without considering the potential huge benefits for the world from China slowing its CO2 emissions. I notice I’m not alone in this idea; Rabett Run has a post outlining the same environmental issues, and suggesting that there are many direct economic and social benefits of such a system.

This is not just of practical importance to China, but it’s rhetorically a very useful thing to note: that a lot of carbon sources (and most especially coal) have huge negative health and social consequences in their own right; raising the cost of using them and finding financial incentives to prevent or reverse deforestation is of huge benefit for a lot more reasons than just preventing runaway climate change. It would be cute indeed if China’s immediate economic and environmental problems became the cause of strong action to prevent climate change; on the other hand, it would be very sad if the focus on the AGW aspects of carbon pricing – which are a shared international burden rather than a national responsibility – led China’s decision makers to miss the other vital environmental problems it can address. Especially if failure to address those other environmental problems caused China’s economic growth and social liberalization to stall or fall backwards.

If any country is going to run up against environmental limits to growth, it is China; and if China can avoid that challenge, and the social and health problems it will cause, then there is great hope for the future of the planet. So let’s hope the Chinese can come to terms with their growing environmental challenges as adroitly as they have dealt with some of their others … and if their efforts to tackle those problems will benefit the rest of the world too.

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