Beijing

The most important diplomatic relationship in the world is between the U.S. and China. It's souring and could get much worse.

Alas, the U.S. is mostly to blame for this. And the biggest culprit of all is the demagoguery of some Democrats in Congress.

There are plenty of legitimate reasons to be angry with China's leaders, but its trade success and exchange rate policy are not among them. The country that is distorting global capital flows and destabilizing the world economy is not China but the U.S. American fiscal recklessness is a genuine international problem, while blaming Chinese for making shoes efficiently amounts to a protectionist assault on the global trade system.

In fact, China's pegged exchange rate has brought stability to Asia, and the Chinese boom has tugged Japan out of recession and increased prosperity worldwide. In recent years, China has supplied almost one-third of the growth in the global economy (measured by purchasing power), compared with the 13 percent that came from the U.S.

Moreover, the U.S. has a history of offering Asia economic advice that proves awful. U.S. pressure helped produce Japan's disastrous bubble economy and aggravated the 1997-98 Asian financial crisis. So when American officials urge an adjustment in the yuan exchange rate, the Chinese should keep a hand on their wallets.

Over the last five years, President Bush has done an excellent job in managing relations with China - it's one of his very few successes in foreign policy - but lately he has engaged in protectionism. This month he reimposed quotas on certain Chinese textiles, and the Treasury warned China that it had better adjust its exchange rate or else.

Mr. Bush abandoned his principles because he was under attack from Democrats waving the bloody shirt of lost jobs. Sure, China's cheap yuan has cost us manufacturing jobs - but it has also led to a flood of Chinese capital to America, keeping interest rates low. If we blame China for lost American jobs in making shirts, we should credit it for new American jobs in banking and construction.

Americans are also unfair in accusing China of not stopping North Korea's nuclear program. The reality is that the North Koreans don't listen to the Chinese about anything, and many on each side look down on the other. Privately, some Chinese dismiss the North Koreans as "Gaoli bangzi" or Korean hillbillies. And fortified by a bit of liquor, North Koreans denounce Chinese as unscrupulous, money-grubbing traitors. Whenever I meet North Koreans, I tell them that the Chinese government doesn't like me - and my status soars.

China has been pushing hard in the last two years for a negotiated solution to the North Korean crisis, and it at least has a coherent policy on North Korea. That's more than you can say for the Bush administration.

One of the biggest risks for U.S.-China relations is the - very outside - chance that President Bush will order a military strike on the North Korean nuclear complex at Yongbyon. Most experts say that the resulting radiation leakage would probably not harm nearby countries, and in any case South Korea and Japan would be more at risk than China. But any hint that radiation had reached the Chinese coast would provoke anti-American fury across China.

There's a third big danger for U.S.-China relations, and this one is Beijing's fault: China's schools teach hatred of Japan, resulting in last month's street demonstrations in which Chinese protesters screamed slogans such as "Japanese must die."

The next act in the drama will unfold at sea. Japanese ships may start exploring disputed waters for oil and gas in the late summer or fall, perhaps with military escorts. China's leaders will then be under tremendous popular pressure to send China's own military vessels to block what Chinese will see as an armed Japanese incursion. And then Japan will ask the U.S. for help under the U.S.-Japan security treaty. ...

In the past, President Jiang Zemin protected the U.S.-Chinese relationship. But many Chinese scorned him as "qin Mei," or soft on the U.S. The new president, Hu Jintao, seems much less likely to go out on a limb to preserve good relations with the U.S.

So it's time for Americans to take a deep breath. Poisonous trade disputes with China will only aggravate the risks ahead, strengthen the hard- liners in Beijing and leave ordinary Chinese feeling that Americans are turning into China-bashers. Sadly, they'll have a point.

Beijing

The Chinese Communist Party survived a brutal civil war with the Nationalists, battles with American forces in Korea and massive pro-democracy demonstrations at Tiananmen Square. But now it may finally have met its match - the Internet.
The collision between the Internet and Chinese authorities is one of the grand wrestling matches of history, visible in part at www.yuluncn.com.

That's the Web site of a self-appointed journalist named Li Xinde. He made a modest fortune selling Chinese medicine around the country, and now he's started the Chinese Public Opinion Surveillance Net - one of four million blogs in China.

Mr. Li travels around China with an I.B.M. laptop and a digital camera, investigating cases of official wrongdoing. Then he writes about them on his Web site and skips town before the local authorities can arrest him.

His biggest case so far involved a deputy mayor of Jining who is accused of stealing more than $400,000 and operating like a warlord. One of the deputy mayor's victims was a businesswoman whom he allegedly harassed and tried to kidnap.

Mr. Li's Web site published an investigative report, including a series of photos showing the deputy mayor kneeling and crying, apparently begging not to be reported to the police. The photos caused a sensation, and the deputy mayor was soon arrested.

Another of Mr. Li's campaigns involved a young peasant woman who was kidnapped by family planning officials, imprisoned and forcibly fitted with an IUD. Embarrassed by the reports, the authorities sent the officials responsible to jail for a year.

When I caught up with Mr. Li, he was investigating the mysterious death of a businessman who got in a financial dispute with a policeman and ended up arrested and then dead.

All this underscores how the Internet is beginning to play the watchdog role in China that the press plays in the West. The Internet is also eroding the leadership's monopoly on information and is complicating the traditional policy of "nei jin wai song" - cracking down at home while pretending to foreigners to be wide open.

My old friends in the Chinese news media and the Communist Party are mostly aghast at President Hu Jintao's revival of ideological slogans, praise for North Korea's political system and crackdown on the media. The former leaders Jiang Zemin and Zhu Rongji are also said to be appalled.

Yet China, fortunately, is bigger than its emperor. Some 100 million Chinese now surf the Web, and e-mail and Web chat rooms are ubiquitous.

The authorities have arrested a growing number of Web dissidents. But there just aren't enough police to control the Internet, and when sites are banned, Chinese get around them with proxy servers.

One of the leaders of the Tiananmen democracy movement, Chen Ziming, is now out of prison and regularly posts essays on an Internet site. Jiao Guobiao, a scholar, is officially blacklisted but writes scathing essays that circulate by e-mail all around China. One senior government official told me that he doesn't bother to read Communist Party documents any more, but he never misses a Jiao Guobiao essay.

I tried my own experiment, posting comments on Internet chat rooms. In a Chinese-language chat room on Sohu.com, I called for multiparty elections and said, "If Chinese on the other side of the Taiwan Strait can choose their leaders, why can't we choose our leaders?" That went on the site automatically, like all other messages. But after 10 minutes, the censor spotted it and removed it.

Then I toned it down: "Under the Communist Party's great leadership, China has changed tremendously. I wonder if in 20 years the party will introduce competing parties, because that could benefit us greatly." That stayed up for all to see, even though any Chinese would read it as an implicit call for a multiparty system.

So where is China going? I think the Internet is hastening China along the same path that South Korea, Chile and especially Taiwan pioneered. In each place, a booming economy nurtured a middle class, rising education, increased international contact and a growing squeamishness about torturing dissidents.

President Hu has fulminated in private speeches that foreign "hostile forces" are trying to change China. Yup, count me in - anybody who loves China as I do would be hostile to an empty Mao suit like Mr. Hu. But it's the Chinese leadership itself that is digging the Communist Party's grave, by giving the Chinese people broadband.

As this millennium dawns, New York City is the most important city in the world, the unofficial capital of planet Earth. But before we New Yorkers become too full of ourselves, it might be worthwhile to glance at dilapidated Kaifeng in central China.

Kaifeng, an ancient city along the mud-clogged Yellow River, was by far the most important place in the world in 1000. And if you've never heard of it, that's a useful warning for Americans - as the Chinese headline above puts it, in a language of the future that many more Americans should start learning, "glory is as ephemeral as smoke and clouds."

As the world's only superpower, America may look today as if global domination is an entitlement. But if you look back at the sweep of history, it's striking how fleeting supremacy is, particularly for individual cities.

My vote for most important city in the world in the period leading up to 2000 B.C. would be Ur, Iraq. In 1500 B.C., perhaps Thebes, Egypt. There was no dominant player in 1000 B.C., though one could make a case for Sidon, Lebanon. In 500 B.C., it would be Persepolis, Persia; in the year 1, Rome; around A.D. 500, maybe Changan, China; in 1000, Kaifeng, China; in 1500, probably Florence, Italy; in 2000, New York City; and in 2500, probably none of the above.

Today Kaifeng is grimy and poor, not even the provincial capital and so minor it lacks even an airport. Its sad state only underscores how fortunes change. In the 11th century, when it was the capital of Song Dynasty China, its population was more than one million. In contrast, London's population then was about 15,000.

An ancient 17-foot painted scroll, now in the Palace Museum in Beijing, shows the bustle and prosperity of ancient Kaifeng. Hundreds of pedestrians jostle each other on the streets, camels carry merchandise in from the Silk Road, and teahouses and restaurants do a thriving business.

Kaifeng's stature attracted people from all over the world, including hundreds of Jews. Even today, there are some people in Kaifeng who look like other Chinese but who consider themselves Jewish and do not eat pork.

As I roamed the Kaifeng area, asking local people why such an international center had sunk so low, I encountered plenty of envy of New York. One man said he was arranging to be smuggled into the U.S. illegally, by paying a gang $25,000, but many local people insisted that China is on course to bounce back and recover its historic role as world leader.

"China is booming now," said Wang Ruina, a young peasant woman on the outskirts of town. "Give us a few decades and we'll catch up with the U.S., even pass it."

She's right. The U.S. has had the biggest economy in the world for more than a century, but most projections show that China will surpass us in about 15 years, as measured by purchasing power parity.

So what can New York learn from a city like Kaifeng?

One lesson is the importance of sustaining a technological edge and sound economic policies. Ancient China flourished partly because of pro-growth, pro-trade policies and technological innovations like curved iron plows, printing and paper money. But then China came to scorn trade and commerce, and per capita income stagnated for 600 years.

A second lesson is the danger of hubris, for China concluded it had nothing to learn from the rest of the world - and that was the beginning of the end.

I worry about the U.S. in both regards. Our economic management is so lax that we can't confront farm subsidies or long-term budget deficits. Our technology is strong, but American public schools are second-rate in math and science. And Americans' lack of interest in the world contrasts with the restlessness, drive and determination that are again pushing China to the forefront.

Beside the Yellow River I met a 70-year-old peasant named Hao Wang, who had never gone to a day of school. He couldn't even write his name - and yet his progeny were different.

"Two of my grandsons are now in university," he boasted, and then he started talking about the computer in his home.

Thinking of Kaifeng should stimulate us to struggle to improve our high-tech edge, educational strengths and pro-growth policies. For if we rest on our laurels, even a city as great as New York may end up as Kaifeng-on-the-Hudson.