--the Premier's motorcade leaving.
So LCS is happy to present to Professor Richard Suttmeier
from the University of Oregon, who will be here
to give a brief commentary on the Premier's speech
just special for those of you in this room
and be able to answer any questions you may have
about China, Chinese technology--
which he's an expert on, China and Chinese technology.
Professor Suttmeier.
[APPLAUSE]
Thank you.
Is this working?
I thought I would just make one or two
comments about my reaction to Premier Zhu's speech.
I think it was very interesting that he started with the trade
deficit--
and, clearly, that he's picked up,
I think, some signals in the last few days
about the various kinds of US domestic politics
that are going to be playing on the WTO decision.
What I think is also interesting,
though, is the way in which he kind of turned
that question about the trade deficit really into a larger
set of issues about China's development strategy
and the importance of the US-China relationship in that.
Clearly, a good part of that strategy
is one of following a kind of export-led growth.
But, at the same time, it's clear-- and, again,
as the question from the young student from Tsinghua pointed
out--
China really is making, is redoubling its efforts,
I think, to build up its science and technology.
And so the components of that are a very significant
redoubling of effort that Premier Zhu alluded to
in the last two or three years, where this leadership-- and I
would emphasize that.
I think his team, more so than any other leaders
that China has had this century, has a keen awareness of just
how important these issues are.
China-- the last thing China wants
as it looks towards the 21st century, I think,
is to continue to be an exporter of low value-added products.
I think its objectives, its targets,
are really much more up there in more science-based
manufacturing and services.
And, so, if one looks--
and that's what I think that the student was alluding to--
at a whole series of initiatives in the last two or three years
to attack these fundamental problems that
keep China from moving in that direction in the 21st century--
A friend at the Chinese Academy of Sciences
put it to me this way last November.
He said, when we look around at the way the world is changing,
and especially in the capitalist world,
we see that the train is leaving the station--
that is, this new world, whatever we want to call it--
the knowledge economy, the new Industrial Revolution.
It's what many of you, of course,
are in the process of creating.
They see that, I think, as the train about to leave.
They missed the first Industrial Revolution.
They don't want to miss the second.
And so the question becomes, what
are the obstacles for China to be on that train?
I think Zhu Rongji has a very, very keen sense of that going
back to his experience in the '80s,
when, even before he became mayor of Shanghai,
he was a key person looking at how China can begin
to take advantage of technologies
that are available on the international market.
At the same time, while that was going on,
there has been, in course, a very significant reform
in Chinese science and technology and education.
And what I think that he is hoping to see
is that those two things come together in the near future.
I could go on and on and all that,
but rather than ask you to sing "Happy Birthday" again--
[LAUGHTER]
--I would be happy to reflect any questions
that you have or comments.
And we could have more of a discussion.
We have mikes out here, so if you'd
like to step up to the mike.
We have microphones right here.
Can I ask you a quick question?
It appeared he had spoke without notes
and without teleprompters.
Is that correct?
I think he did, yeah.
It was a very detailed and impressive talk
to be done that way.
That's one-- He's, I think, noted
for his mastery of these kinds of details.
And, again, as I look at it, I think that what you're seeing
with him-- but you can look just at the next level down in terms
of age and positions--
is an incredibly competent, or increasingly competent,
group of national leaders, many of whom, in fact, do
have engineering degrees.
This has become a very technocratic leadership now.
And, assuming that they don't get
sidetracked by one thing or another along the way,
I think you're going to find this putting
the full powers of the state behind a kind
of high technology future, if they can do it.
The minister made a reference to the prohibition on exportation
from the US, importation to China, of supercomputers.
Could you please elaborate on that a bit?
Well, export controls have been an irritant
in US-China relations since 1978.
And the-- I won't try to go into all of that,
but I think one of the things that that
tells you is that, since the normalization of relations,
China has had a very aggressive search for technology
and for science.
I mean, they've sent hundreds of thousands of students
abroad to learn science.
In recent years, and of course within the last year,
there has been these very, very high-profile export control
cases that are, in some ways, quite complicated,
one of which, of course, is the Hughes Loral satellite exports.
There have been machine tool questions, advanced machine
tool questions.
And then there have been these supercomputer issues.
And I think one in particular has gotten people's attention.
And that was the export of a system
to the Chinese Academy of Sciences, which
was supposedly--
one of the things that has happened over the years
is that, in order to make this thing work better,
is that the Chinese have agreed to having end users identified
and monitored in some sense.
But the US is not in a position--
it doesn't have the resources to fully monitor those things.
So in this case, there was an export that was made.
It went to an institute of the Chinese Academy of Sciences
for research purposes, allegedly.
And, then, allegedly, this institute
was also accessible to the military.
And that was never, supposedly, included in the original export
control licensing process.
Yeah.
Can you comment on the Sloan School
MIT and also the Tsinghua and the party elites--
the problems of the technical managers
are going to face between the--
shall we say, the relationship between the Communist Party,
the party elite, and the technocratic elite as they
try to move into the next century, some of the problems
they might face?
Well, some of the analyses that have been done on the current
leadership-- if you look at the Chinese Central Committee,
for instance--
have concluded that it is already largely technocratic.
And I think that that has some good news and some bad news.
The good news, I think, is that it really
will move China towards paying very, very serious attention
on how it gets its science and technology in order.
The bad news is that one might lose
a little bit of this kind of political flexibility
that may--
that I'm sure is going to be necessary
as China faces political changes in the near future.
That said, if I understood your question,
I think that Prime Minister Zhu is also
alluding to this very, very serious problem
of high-quality manpower and managerial manpower.
In a way, when one looks at professional manpower in China,
it's a curious kind of situation.
You have very, very large numbers of people,
both in terms of management and in terms
of research and development, who have advanced degrees and who
are--
if you look in absolute terms, it's
a very large number of people.
But, in fact, when you start looking
at age composition, experience, quality of training,
and so forth, and so on, then, indeed, China
begins to look like it has a very, very severe scarcity
of high-level manpower.
And I think that's what he was alluding to.
Now, he has been, or had been, the dean or honorary dean
of Tsinghua's school of management,
which was one of the earliest schools of management.
There are now a lot more.
But the demand is very, very large.
Please.
Yeah, we have a number of points of conflict with China
now over Formosa and Kosovo and the budget deficit
and espionage.
What are the prospects now for escalation
of this conflict between the United States and China?
In other words, what's the worst possible scenario
that you might foresee?
The worst scenario I would see is the potential
for conflict or near conflict developing perhaps over Taiwan.
But I would hope it wouldn't come to that.
I think a more likely bad scenario
would be that the two sides will stop talking intimately
to one another.
China will begin to look to Europe,
in particular, for some things that it now
looks to the United States for.
That's one of the ironies.
And I think if Zhu Rongji had had a lot more time
to talk about export controls, that would have been one
of the things he would have said,
is if you don't want to sell it to us,
we'll buy it from somewhere else.
So I think that the potential for the downward spiral
to continue is there.
Feelings in Congress, I think, at the moment, prompted
by the trade issue as well as the espionage allegations,
run quite deep.
And whether his visit on this occasion
has helped to change that a little bit remains to be seen.
But I would think that you could have
a loss of some important areas of cooperation.
The Korean problem, for instance,
is one where I think it's in our interest to maintain
a very good dialogue.
It's in our interest that the whole problem with Taiwan
is kept on a sort of steady-state balance,
rather than letting it go into a downward spiral as well.
I think what will determine all these factors is largely
the domestic politics of the two countries.
And I think you can see in this country that China,
for better or worse--
in my own view, probably worse--
has become a significant issue in US domestic politics
and kind of a political football.
And I don't think--
again, the worst case is that it may not
get any better until we have a new election
and a new administration that then has to redefine
what our interests are.
The executive has to clarify how it deals with Congress, and so
forth, and so on.
And, to follow up, how badly hurt
is the Premier by not getting a WTO agreement on this visit?
Yeah, well, that's, I think, a question everyone is asking.
And he may yet get something, if his conversation of yesterday
is any indication.
I think it will be a disappointment.
He faces a very tough challenge when he gets back.
There are still lots of people in the leadership who are not
as enthusiastic, I think, about relations with the US
as perhaps he is.
In addition, he just faces enormous challenges.
The problems of governing China I think
are often greatly underestimated in the United States
in all kinds of ways, the most important of which, I think,
is this underlying question about the state-owned
enterprises, which occupy still 70% of the industrial economy,
and all of the employment that that represents.
So when he goes out and sort of makes some gestures,
as he has done, I think, in some concessions
on WTO, that's a fairly costly thing
to do, potentially, in terms of his own domestic politics,
because it is precisely those domestic state-owned
enterprises which will begin to feel
the pressure from a liberalized WTO world or WTO membership.
Thank you.
I want to follow up on this WTO issue,
because it seems, at least to someone
reading the Washington Post, that this sort of came out
of nowhere within the last month or so,
whereas my impression is that over the last year or two,
trade relations with the US have deteriorated,
becoming much more mercantilistic--
the restrictions on foreign participation
in communication systems and hardware,
stopping the smuggling gray market,
which was a significant part of US exports,
and other things like this.
So I guess it's two questions.
One is, what was the motivation for the sudden movement on WTO
by the Chinese?
And, two, do you really think it represents a fundamental shift,
or is this just one more change in the direction of the winds?
Yeah, I think you're right that the investment
environment and the trade investment environment
have deteriorated a little bit in China.
Well, my sense is that the two sides have seen this
as the right moment to try to do something and conclude a deal
and that the Chinese seem to be willing to make
considerable concessions in order to make that happen.
Now, what anybody who studies Chinese politics
and Chinese government knows is that one
of the enormous problems in China is implementing policy,
and that when you have agreements reached,
or when you have national policies enunciated,
getting them enforced all the way through is often easier
said than done.
So, to address the second part of your question,
I think that there would undoubtedly be a period--
assuming China does accede and is accepted and accedes
to WTO--
there will undoubtedly be a period
of conflict over the actual implementation
of its obligations as a member.
Thank you.
The Premier had made several references-- or several ways
of trying to describe what exactly is the trade
deficit between US and China, describing a black market,
describing low-cost consumer goods.
But isn't that the way we measure all trade deficits
with all other countries?
So what exactly is the real number,
or does he have a valid argument there?
I'm probably the wrong person to ask what
the real number is on this.
I think he laid out what the positions are on that.
The main problem has been whether or not
you count the transhipment through Hong Kong.
And that's what leads to the gross disparities
between the two.
But I think that it is interesting, and sometimes
overlooked, that when you consider
the nature of the products coming
from China, in comparison, say, with the deficit with Japan,
it is sort of a somewhat different kind of phenomenon.
That is, unlike Japan, which really had not
adopted a very open foreign investment policy,
China has been, in relative terms, more open.
So there's much more foreign investment
and foreign manufacturing and processing
activities going on there.
And as a result, the products that are coming in oftentimes
produce, as he was pointing out, profits--
and, in some cases, considerable profits--
to American firms.
Not surprisingly, the domestic politics
of trade in the United States on China
is quite different from what it has
been on Japan, where corporate America has been much more
active in much more of a lead role
in attacking the Japanese trade deficit problem,
whereas in the Chinese case, it has
been more labor, rather than capital, that has been active.
Yes?
I don't really know much about China at all.
But if I believe what I read in the press,
I think, for most of my life, my basic understanding
about the differences between what we have here
and what things are like there is
that we have all sorts of freedoms in the United States.
And perhaps one of the most important ones
is the freedom to dissent, both in the politics
of the government, but we also have the freedom
to dissent in the marketplace.
You don't have to run Microsoft software
if you don't want to, and--
[LAUGHTER]
I use all sorts of other operating systems.
But anyway.
But now to get to my question--
I was wondering.
You commented earlier on there are many advanced degrees,
but, somehow, if you look at the experience and the quality
of the training--
I was wondering, what is the real difference in the quality
of the training, because pretty much what you can
study and learn from books--
And I thought back on my own education and thought,
actually, the majority of the important education I got
was outside of any formal academic curriculum
but was in sort of a sense being--
the time I was able to spend at MIT
with the other students and the arguments
I would have with them and stuff.
And I was wondering, what is academic life
for these people who have the advanced degrees in China?
I assume that most of them got them in China.
And what is it like in academia, both for the students
and for the faculty and for the people who have relationships
with the universities?
I know that somebody commented yesterday
that you can spend a lot of time--
you spend four years plus at MIT.
It's kind of a relationship you have as an alum.
Anyway, so my question is, what is academic life in China?
And, in particular, do you have, in academia,
freedom to dissent against prevailing
thought in academia, something that I think we do enjoy here?
Well, there are a couple of ways of getting at that.
I think the first thing I would say
is, one has to recognize generational differences.
So you had a group of people in Zhu's generation,
for instance, who had some of their education
actually before the Communists.
Then you have another group that sort of came in and had
education during the '50s.
And that was an education that was already changing.
The influence of the Soviet Union was part of that.
So, for instance, at that time, in a place like Tsinghua,
which had been defined as kind of a comprehensive university
before 1949, Tsinghua and lots of other places
all began to be--
all were reorganized.
And their curriculum were changed in order
to make them highly specialized technical institutes,
for the most part.
That was part of the influence of the Soviet Union.
So that marked the educational experiences of a generation
or two of people.
Then you had, in the 1960s, all of the disruptions associated
with the Cultural Revolution.
And that really-- that closed down the educational system
for five, six, seven years.
And it was only in the late '70s, then--
mid-'70s, I guess-- '76--
that you began to have universities
being reestablished.
And, initially, they were reestablished
along the lines of the Soviet system of the 1950s.
A couple of things, though, began to happen at that point.
First of all, China was, at the same time,
beginning to get a sense or reacquire a sense of what
happens outside of China, and in particular
in the capitalist world.
That was the great breakthrough, from the educational point
of view, of Nixon's trip.
So you began to then have people going out and seeing
that, in fact, this much more innovative, exciting
world in the capitalist world that they were discovering
had an educational system, had higher education
institutions, research institutions, that
were markedly different.
And so that, then, began to produce a period--
some thinking about reforms in education
that began to kick in in the 1980s and are continuing today.
The Chinese were doing a lot of reforms from the beginning
of the 1980s until 1996.
They weren't putting too much money into them.
Now-- and that's what he was alluding to-- in the last two
or three years, expenditures on science and education
are finally beginning to go up.
They're still way below where they should be.
So you have-- it depends a lot on generations.
Another thing I would just say that turns back
to your question about the freedoms--
I think he is quite right in saying that, in some ways,
you can look in China and say there's more rights now
than there have been perhaps ever before.
If you go back and you look at what
happened to graduates of places like Tsinghua
or any other higher educational institution
under the old system, the Soviet-inspired system,
they in fact had no rights of employment.
They were assigned.
They all got sucked up into the great central planning system.
And they were assigned to that job, this job, that ministry,
this university, this research institute, and so forth.
In short, there was no labor market--
free labor market-- for a graduate.
That has now changed.
And it's that kind of change from no freedoms for choices
about careers, for choices about housing,
for choices about all kinds of things, that
has changed so dramatically.
That's why there's no question.
If you look over the past 20 years,
China has become an infinitely more liberal society
than it was.
Does it extend to dissent?
No.
And that's the big interesting question.
Can China become the sort of dynamic, innovative society
it wants and still maintain this tight political control?
We would probably guess no.
So it's a kind of contradiction.
[? David. ?]
I have a question.
And it's also about a big cultural difference
between the countries that you might help us with.
When we hear the Premier talking about education, and change
there, and getting on this information revolution train
that you're talking about, it seems,
to a Western, European mind, that a great block
is the Chinese language system itself,
the character-based system and so forth.
And can you tell us anything about efforts--
We'd heard Mao was once interested
in an alphabetical sort of reform.
Is anything like that going on in China today?
Not really.
I don't think that.
What is happening is that there has
been a very significant growth of the software
industry designed to make PCs more
user-friendly in a Chinese-language environment.
This, again, is I think one of the very interesting things
that ties back to the question that, again, that MIT
student was asking.
In the last 15 years, roughly, now,
there has been the growth of a whole series of spin-off
companies in China--
and they really refer to them as that--
coming out of the academy, institutes,
out of the universities.
Tsinghua, for instance, runs a whole series of companies.
And these companies-- it's a long story,
but they really do represent a significant, and I think one
would argue probably the most hopeful sign,
for China's future industrialization
or future industrial trajectory.
They still, for the most part, are fairly small.
But if you then look and say, well, what fields are they in?
And the answer is they're in a whole range
of high-tech fields.
But one of them is, in fact, in software.
And a lot of the emphasis that has
gone into that has been to try to make Chinese,
written Chinese, interact with information technology.
So it's beginning to happen.
The whole-- Romanization is used,
but I think that there is no serious thought of giving up
Chinese characters.
They're culturally too important.
You think that the average Chinese access
out into the internet will be impaired
by this very big difference between us and them,
or will machines and translation and tools
make it as easy for them to see the internet
as the rest of the world will see it?
I think that's the question that is on the mind of people
even that at the Zhu Rongji level.
I should just add, just on that point,
Zhu Rongji does share a very high-level science, technology,
and education group.
So he's got a kind of hands-on group
that involves the ministry of science, ministry
of education, a few others.
But they're quite conscious of all of this.
And, so, if you look at the internet computerization
expansion in China, which is now occurring very,
very rapidly, you see that one of the objectives of government
policy is to ensure that there's more Chinese-language content.
And, for some people, that's part--
some observers have suggested that that's
part of an elaborate strategy to kind of build
firewalls against the influence of the West.
But there's also, I think, a genuine consideration of,
how do you disseminate this technology in a country
with that kind of a population?
It would have been very interesting
if we had had-- if we can bring Bill Gates back again
to talk about China.
I sometimes think Bill Gates is probably
more important to the leadership of China than Bill Clinton.
But one of the fascinating things that Microsoft is
doing-- and maybe there's someone from Microsoft still
here--
is that they have now made a pretty big commitment
to the China market.
And I think they call the project the Venus Project.
And the idea is to basically provide
a web computer that will then be very low cost
and will be very user friendly to Chinese households.
So there's a lot going on in that area.
And I'm sure at MIT there are probably
a lot of people who know much more about it than I do.
[INAUDIBLE]
Sure.
How would you contrast the fundamental interest
of the United States towards China versus Russia's
fundamental interest involving China?
Are we kind of moving into a tripartite world,
or is it a superpower-- a two-party world yet?
Well, again, maybe that goes back
to the question about worst-case cases.
There is an interesting relationship
that the Chinese and the Russians have.
The Chinese are getting a lot of military hardware
from the Russians.
They're getting a lot of scientists, actually,
from Russia as well.
And when you look at something like the Kosovo issue,
there apparently one sees a kind of commonality of interest
between the two of them.
But on the other hand, if you really look at--
you think a little bit about what Zhu Rongji was saying,
Russia simply is not in the position
to do what the United States does for China.
It is not that enormous, mass, highly affluent market
to suck up Chinese manufactures and goods.
It really isn't the source of most of the technologies
that are most interesting to the Chinese.
They go to the Soviets because they sometimes
can't-- or the Russians-- [? because ?] they can't get it
from other places.
And, of course, again, going back to the training question,
there is a generation of Chinese leaders
and professionals and scientists who
had their training in the Soviet Union
and have maintained close ties.
But I think that if you had a significant souring
of relations with the United States,
one of the things that would happen
is that that relationship with Russia
would increase and become more important.
But it doesn't, ultimately, I don't think,
serve China's interests as well.
And there are, of course, historic frictions and problems
as well, that you can look to.
I guess one more question.
This is a cultural question, too.
Mary Potter asked what the situation of women
was in China.
And he answered it in the specific
that, here I have a woman vice premier with me,
so everything's great.
But how would you compare, culturally,
the freedom and power and education of women
in China vis-a-vis the US?
Well, the Confucian tradition was probably much more
patriarchal than anything one knows in the West,
to begin with.
But the Communist Party, when they seized power in '49,
did in fact embrace principles of gender equality
and set about trying to change things a bit.
And they did, I think, in many ways.
You see women in--
opportunities for women in a whole variety
of activities and professions.
But I think that what's interesting about--
and I think a lot of people who have studied this more than I
have would suggest that, in spite of Madame Wu Yi
and a few people like that, in general,
women still have not reached the upper echelons of whatever
it is that they're doing.
He made reference to the Women's Federation,
a mass organization.
That is really basically controlled
by the Communist Party.
And there are those who say that, however
much that advances causes of women, in fact, ultimately,
it doesn't, because it is just simply
an instrument of control.
There's an interesting question about whether or not
the reform period, the marketization,
has improved or hurt the chances of women.
Some people, I think, would argue that, as marketization--
especially in the countryside-- has occurred,
the status of women has gotten worse in the countryside.
On the other hand, I think in the urban, more modernized
sectors you see maybe more opportunities coming along.
But, again, I think it is true that there
seems to be a kind of glass ceiling at work.
And some work that I've done--
I just recently finished a paper on China's system
of academicians.
They have a new system--
a new academy of engineering and a Chinese Academy of Sciences--
where they're trying to establish an honorific system
for scientists and engineers.
And if you look at the membership of that,
you can see pretty definitely that women
are somewhat disadvantaged.
If you then go back and look a little bit more
at women leading important national R&D programs,
they do much better there.
So there seems to be a disjunction
between opportunities up to a point
where you can have very significant responsibilities
and opportunities as a woman professional,
but then, beyond that, there seems
to be something of a block.
Thank you.
One more?
Thank you very much.
[APPLAUSE]