Starting Points

Mar 8, 2010

Educated and Fearing the Future in China - Room for Debate Blog

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March 7, 2010, 7:00 pm

Educated and Fearing the Future in China

Reuters/China Daily College graduates at a job fair in Wuhan, Hubei Province, in 2009.

As China’s economy recovers, employers are competing to hire low-skilled workers, but many of China’s best and brightest, its college graduates, are facing a long stretch of unemployment.

In 1999, the government began a push to expand college education — once considered a golden ticket — to produce more professionals to meet the demands of globalization. This year, more than 6.3 million graduates will enter the job market, up from one million in 1999. But the number of high-skilled, high-paying jobs has not kept pace.

What might be done to correct the mismatch between expectations and reality? How is this problem altering Chinese attitudes about upward mobility? If college graduates are not reaping economic rewards, how will the next generation view the value of education?

C. Cindy Fan, associate dean of social sciences, U.C.L.A.
Yasheng Huang, professor of political economy, M.I.T.
Daniel A. Bell, professor of political philosophy, Tsinghua University
Albert Park, economist, University of Oxford
Loren Brandt, economist, University of Toronto

Materialism and Social Unrest

C. Cindy Fan is associate dean of social sciences and professor of geography at the University of California, Los Angeles. She is the author of “China on the Move” and numerous articles.

Like prostitution, stocks, private cars, beauty pageants, and McDonald’s, “unemployment,” thanks to collectivization, was practically absent from Chinese life for the three decades after 1949.

The Chinese economy, no longer centrally planned, has not put enough people back to work.

Deng Xiaoping’s economic reforms paved the way for the collapse of inefficient state-owned enterprises, shattering the “iron rice bowl” of millions of workers and creating the first wave of unemployment in post-Mao China.

Unemployment among college graduates is a hot-button issue in China. A large number of young people have little other than materialism and consumerism to believe in — a general description of Chinese society today since socialist ideology lost its grip. Not having a job is a perfect recipe for social unrest.

Today, China’s official unemployment rate is about 4.3 percent, but it is a gross underestimate because of underemployment among both rural and urban Chinese — they may have a job but their skills are underutilized and they are underpaid.

What explains this situation? No doubt, the global economic crisis has contributed to job loss, but China is considered one of the first economies to recover from the recession.

Another explanation widely cited in the media is the government-directed increase in university enrollment since the late 1990s. But even with that expansion, less than 8 percent of the Chinese population are college-educated compared with more than one in four in the U.S. That suggests there is much room for growth in higher education, especially if the country is to live up to the expectation of “China’s century.”

Instead, three explanations may account for the relatively high unemployment among college graduates. First, geography matters. Young people from smaller places and rural areas, upon obtaining a university degree, are likely eager to go to or stay in big cities. This effect is crowding the labor market in cities like Beijing and Shanghai and hurting the economy of small cities and towns.

Second, globalization matters. By rough estimates, one quarter of the Chinese who have studied overseas have returned. Nicknamed “sea turtles” (haigui), these returnees are highly competitive and can easily push the domestic college graduates down the job hierarchy.

Finally, China’s economy continues to be dominated by the industrial sector, which accounts for about 49 percent of the gross domestic product. While services — the most likely sector for college graduates — account for about 40 percent of the G.D.P., high-skilled, professional jobs are still relatively few compared with low-end service jobs like those in sales.

Creating high-end jobs and increasing the incentives for young people to live in smaller cities are obvious ways to reduce their unemployment. But this is easier said than done. The Chinese economy is no longer centrally planned, and as we have observed on this side of the Pacific, relying on the market alone — even with stimulus packages — has not yet put enough people back to work.

A Terrible Education System

Yasheng Huang is professor of political economy and international management at Sloan School of Management, Massachusetts Institute of Technology. He is the author of “Capitalism with Chinese Characteristics” and will soon begin a large-scale survey of college graduates in China.

In 2007, the job openings for new graduates fell by some 22 percent compared with 2006, according China’s National Development and Reform Commission.

Although Chinese universities have pockets of excellence, they are churning out people with high expectations and low skills.

Some estimate that 30 percent of Chinese engineering students will not find jobs after graduation and that the average pay of the college graduates is now approaching that of rural migrant workers. At the same time, factories in Guangdong province cannot find enough labor. What is going on?

The idea that China is running out of unskilled labor is a myth. The news reports typically concentrate on Guangdong but this does not mean the country as a whole is short of unskilled labor. Development in rural areas in the past six years has meant that rural residents, previously denied economic opportunities close to home, now have a choice between going to Guangdong and staying in their hometowns. Many choose to stay. Any “labor shortage” in Guangdong is mostly evidence that the factories should not be located there in the first place.

But the job market is a problem for college graduates — with the opportunities created in the wrong places. Colleges educate students, but in China they also give a young person a formal right to move to an urban center.

Going Back to Mao?

Daniel A. Bell is professor of political philosophy at Tsinghua University and author of “China’s New Confucianism: Politics and Everyday Life in a Changing Society.”

“In education, there are no social classes,” Confucius said. The value of equal opportunity for education has deep roots in Chinese culture and may help to explain why most Chinese parents, regardless of social background, put so much pressure on their kids to do well in school.

Even at an elite university, students are lowering their aspirations or settling for government jobs.

It also helps to why explain the university entrance examination system — one of the least corrupt institutions in China — is designed at least partly to provide an equal opportunity for all students. Those who make the cut go on to university, regardless of social connections.

In response to societal demands for more educational opportunities, the government has boosted university enrollment by 30 percent annually over the past decade. Even in the context of a booming economy, the predictable consequence is that there are large numbers of unemployed college students. My own students — graduates of the elite Tsinghua University — are also feeling the pinch, though it usually means lowering their aspirations or changing their plans rather than coping with unemployment.

Waiting It Out

Albert Park is a reader in the economy of China at the University of Oxford. He has co-directed several surveys on China’s urban workers and is currently leading a World Bank-supported project on the impact of the global economic crisis on employment in China.

China has been confronting the challenge of employing college graduates for some years now. The number of graduates from regular institutions of higher education increased dramatically from 9.5 million in 2000 to 37.8 million in 2006.

The broader trends definitely suggest that the economy will be able to absorb more graduates.

Meanwhile, the urban unemployment rate for college graduates increased from 6.3 percent in 2000 to 11.9 percent in 2005, while declining for those with less education, according to calculations based on census data. It would be surprising if the expectations of college graduates have not begun to adjust to the new reality.

In recent years, many college graduates have been disappointed by the salaries for starting positions. Some may feel they would rather wait for a better first job, since first jobs can strongly influence future career paths. Of course, wages of college graduates tend to rise with experience once employed. Eventually, the costs of waiting will force graduates to accept available job offers.

College Educations, Needed and Desired

Loren Brandt is a professor of economics at the University of Toronto. He is a research fellow at the Institute for the Study of Labor in Bonn, Germany. He has published widely on the Chinese economy and has been involved in extensive household and enterprise survey work in China. He is the co-editor of China’s Great Economic Transformation.

China’s urban labor market is fairly sharply divided between workers with urban residency permits (hukou) and migrants from rural areas. In general, the overlap in the job market for these two populations is relatively modest, but it has been increasing over time.

China’s emerging middle class will continue to demand expanded educational opportunities for their children.

Of the total urban workforce of 475-500 million, 60 to 65 percent have urban residency permits (hukou) with the remaining being migrants. A majority of those with residency permits (upwards of three-quarters) work in the “formal” sector in jobs that offer more security, higher wages, as well as the benefits of China’s social safety net. The migrants are more likely to be found in the “informal” urban sector, including manufacturing, construction and services.

For migrants, one huge barrier to jobs in the formal urban sector is their significantly lower levels of education. The most recent arrivals from the countryside have an average educational attainment of middle school (9 years in total), or five years less than their urban counterparts. Migrants are also willing to take the less desirable jobs that urban residents usually avoid.

Associated Press Graduates from Jinan University at a job fair in Guangzhou, Guangdong Province, 2009.

In a Reversal, Sunnis Vote, to Retain a Voice in Iraq

Image by Kurdistan KURD كوردستان كردستان ا via Flickr

By ANTHONY SHADID

FALLUJA, Iraq — In this town, nicknamed the City of Mosques, the scratchy loudspeakers of muezzins that once preached resistance to the American occupation implored Sunni Arabs to defy bombs and vote Sunday. They did, in a landmark election that demonstrated how far Iraq has come and perhaps how far it has to go.

The droves of Sunni Arab residents casting ballots in towns like Falluja — the name itself synonymous with the cradle of the insurgency, where relatively few voted in the last election five years ago — promised to redraw Iraq’s political landscape. The turnout delivered Sunnis their most articulated voice yet on the national stage, seven years after the American-led invasion ended their dominance.

Yet the act of their empowerment Sunday may make that landscape even more combustible, possibly even risking a revival of sectarian conflict. The demands of Sunni voters, from securing the presidency for a Sunni to diluting Iran’s influence, could make the already formidable task in Iraq of forming a coalition government even more difficult.

At polling stations near cratered buildings, past blast walls that still bore the pockmarks of bullets, the sentiments of voters who largely boycotted Iraq’s national elections in 2005 illustrated that divide.

Even as many cast ballots for the slate of Ayad Allawi, a secular Shiite and former prime minister, they condemned religious Shiite parties. With the invective once reserved for Americans, voters now attacked Iran, seen here as the patron of Iraq’s Shiite-led government.

“There’s no more war, it’s true, but we’re still not free,” Riyadh Khalaf, 47, a laborer, said as he stood near a polling station in the neighborhood of Andalus, where distant bombings reverberated through the morning. “We have an American occupation and an Iranian administration.”

A civil defense worker, Raad Mustafa, shouted, “We have to save our country.”

Ammar Ali, a police officer, interrupted them.

“We want someone who lives with us, someone who is from Iraq,” he said, carrying his rifle. “We don’t want the politicians who spend the night in Iran.”

In a day of remarkable images, none may have been more startling than those in Anbar Province, where just 3,375 people voted in January 2005, out of fear of insurgent threats or in protest of the occupation. People often cast the boycott then as a matter of survival, refusal to participate in an order that disenfranchised them. Similar words in another context were heard Sunday; failure to vote would amount to surrender.

“I voted for the sake of the generations to come,” said Yunus Adel, 22, a student. “My vote is going to determine my destiny. We have to have a voice.”

In another neighborhood, Mohammed Hatem walked past Martyrs School where, on April 28, 2003, American soldiers, saying they had been shot at, fired on a protest and killed 15 people, a seminal moment in unleashing an insurgency that would not end for five years. The school, on this day, was a polling station.

“The memories remain,” Mr. Hatem said. “But if you have the right, you have to exercise it.”

Voters in the Jolan neighborhood, the scene of some of the most intense fighting in 2004, barely flinched at blasts, which killed no one. Mosques that once served as refuge for insurgents blared messages imploring voters to defy the bombings.

Politics in Anbar are not for the faint-hearted. They tend toward the nasty, brutish and loud, where even nuances are conveyed as shouts. The governor lost his hand in an attack in December. A candidate near Falluja talked of the 11 attempts on his life as he might about car wrecks. Unfortunate, but they happen.

Nevertheless, in Anbar, as in predominantly Sunni regions elsewhere, politics have become far more diverse since the days when the Iraqi Islamic Party, a descendant of the venerable Muslim Brotherhood, dominated the regions. Since 2009, the province’s other currents — neo-Baathist and tribal — have rallied around lists loyal to Mr. Allawi and Interior Minister Jawad al-Bolani, another secular Shiite.

“Everyone in Anbar — no, in Iraq — knows that the Islamic Party is lying,” said Sheik Aiffan Saadoun al-Aiffan, a tribal leader and candidate on Mr. Bolani’s list. “They deal with Iran, they steal money and they’ve lost the support of the people.”

Mr. Aiffan is part of a new breed of politician here, as traditional as he is worldly, with a kinetic energy that helped him, on a recent day, hit the campaign trail in the afternoon, greet a procession of relatives wearing what amounts to Anbar chic — headdress, sunglasses and bandolier — at night, then run an hour on the treadmill until 3:40 a.m.

He speaks with the entitlement of inherited power. “I’ll win, sure,” he said, with a touch of humor. “People like me, and God is with me.” And in a province where conversation, hours and hours of it, is the favorite pastime, he understands a constituency that deems politics’ ambiguous grays as effeminate.

Mr. Aiffan called the surrender “of even an inch of territory” in the border disputes with Kurds a sacrilege. (“This is our faith,” he said.) He threatened to fight the Islamic Party with guns if there was a hint of vote stealing. (“It could happen.”) And he insisted that the presidency was the right of a Sunni Arab, not a Kurd — someone like his ally, Ahmed Abu Risha, another tribal leader here who leads Mr. Bolani’s list.

“This time, the decisions will be different,” he said. “We can vote for what’s right, who’s good. We’ll make the right choices.” He looked at his computer, next to three cellphones, one of which got 150 text messages in an hour.

“The problem is,” he asked, “who will be with us in Baghdad?”

Even before the voting ended, politicians and voters speculated about the fragility of coalitions, in particular Mr. Allawi’s, which seemed to enjoy a groundswell of support as the one force that could counter Iraq’s religious Shiite parties. Some speculated that Vice President Tariq al-Hashemi’s candidates might leave it and return to the Iraqi Islamic Party, from which they split.

Others wondered whether Mr. Allawi, with his reputation for high-handedness, could keep the loyalty of emerging Sunni figures like Saleh al-Mutlaq, a member of Parliament banned from the election for ties to the Baath Party, and Rafea al-Issawi, a deputy prime minister who hails from one of Anbar’s biggest tribes.

“We won’t have a war, but it will be a conflict,” predicted Mohammed Zaal, an engineer in Falluja. “It will be a political conflict of Sunni against Sunni and Shiite against Shiite. Once they lose power, they’ll look for other ways to keep their influence.”

“I’m still optimistic,” he added, “but even in the civil war, I was optimistic.”

Death Toll From Nigeria Violence Hits 500

Image by missbax via Flickr

By ADAM NOSSITER

DAKAR, Senegal — Officials and human rights groups in Nigeria sharply increased the count of the dead after a weekend of savage ethnic violence, saying Monday that as many as 500 people — many of them women and children — may have been killed near the central city of Jos, long a flashpoint for tensions between Christians and Muslims.

The dead were Christians and members of an ethnic group that has been feuding with the Hausa Fulani, Muslim herders who witnesses and police officials identified as the attackers. Officials said the attack was a reprisal for violence in January, when dozens of Muslims were slaughtered in and around Jos, including more than 150 in a single village.

Early Sunday, the attackers set upon the villagers with machetes, killing women and children in their homes and ensnaring the men who tried to flee in fishnets and animal traps, then massacring them, according to a Nigerian rights group whose investigators went to the area. Some homes were set on fire.

The latest attacks were “a sort of vengeance from the Hausa Fulani,” said the Rev. Emmanuel Joel, of the Christian Association of Nigeria in Jos.

After the January attacks, “the military watched over the city, and neglected the villages,” he said. The attackers, said Mr. Joel, “began to massacre as early as 4 a.m. They began to slaughter the people like animals.”

The police said Monday that they had made 95 arrests, including a number of Hausa Fulani. The clothes of many of the suspects were blood-stained, said Mohammed Larema, a police spokesman in Plateau State.

Image by MikeBlyth via Flickr

The mood in Jos was tense Monday, as troops were deployed in the streets, shops closed early, and residents remained indoor. A few miles south of the city nearly 400 of the victims were buried in a mass grave in Dogon Na Hauwa, the village that was the site of the worst violence. Some of the bodies had been mutilated.

There, women cried unconsolably amid crowds of mourners, and the thick smell of burnt and decomposing flesh hung in the air. Officials meanwhile combed a large area around the village, continuing to find bodies of victims during the day.

Shehu Sani of the Nigerian Civil Rights Congress said in a telephone interview on Monday that members of his organization had counted 492 bodies, mainly in Dogon Na Hauwa. He said that security forces had not been much in evidence in the “vulnerable areas” south of Jos. Mr. Sani said that the attackers were motivated at least in part by a large-scale theft of cattle by members of the same Christian ethnic group as the victims.

“We were at the scene of the violence,” Mr. Sani said, suggesting that the local government figure of 500 was not an exaggeration. “We have counted as many bodies as that,” he said. “There are not enough functional mortuaries to take them. It’s possibly even more than that because many were buried without documentation.”

Mr. Sani said the latest violence strongly resembled the killings in January. One predominantly Muslim village of several hundred, Kuru Karama, was virtually wiped out, and bodies were thrown into pits and latrines.

Mr. Sani said he was not optimistic about an early end to the deadly cycle of violence. “Most likely there will be continuous acts of reprisal,” he said.

Jude Owuamanam contributed reporting from Dogon Na Hauwa and Jos, Nigeria.

Jackson Diehl - Where are Obama's foreign confidants?

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By Jackson Diehl
Monday, March 8, 2010; A13

I recently asked several senior administration officials, separately, to name a foreign leader with whom Barack Obama has forged a strong personal relationship during his first year in office. A lot of hemming and hawing ensued.

One official mentioned French president Nicolas Sarkozy, who is scheduled to bring his glamorous wife to the White House residence this month for a couples dinner with Barack and Michelle Obama. But in France, Sarkozy's bitterness toward Obama, the product of several perceived snubs, is an open secret, reported widely in the French press. In a speech at the U.N. General Assembly in September Sarkozy appeared to mock Obama's signature disarmament initiative, saying "we are living in a real world, not a virtual world."

Angela Merkel's name also came up: Obama and the German chancellor, I was told, share a down-to-business pragmatism. But Merkel, too, has been conspicuously cool toward Obama ever since he made Berlin a stop on his 2008 election campaign. She stopped him then from appearing at the Brandenburg Gate and was said to be miffed last November when Obama didn't show for ceremonies celebrating the 20th anniversary of the fall of the Berlin wall. Anyway, diplomats say that Merkel has a much warmer relationship with Secretary of State Hillary Rodham Clinton.

No one named Gordon Brown. That's fairly remarkable: The relationship between the sitting British prime minister and U.S. president has been consistently close over the past 30 years. Think Reagan and Thatcher, Clinton and Blair, Bush and Blair. But Obama has been portrayed as dissing Brown ever since he presented him with a set of DVDs as a gift during their first meeting in Washington a year ago. Last fall the British press reported that the White House had turned down five requests for Obama to meet Brown one-on-one at the United Nations or the G-20 summit.

Image via Wikipedia

Finally, I was offered a name I didn't expect: Dmitry Medvedev. Obama, I was assured, has built a solid relationship with the Russian president during their several bilateral meetings, which have focused in part on a new nuclear arms control agreement that both could count as a distinctive achievement. But the deal hasn't been clinched -- maybe because Vladimir Putin, whom Obama has held at arm's length, doesn't like it. And could it really be that an American president has found his closest foreign partner in the Kremlin?

The paradox here is that Obama remains hugely popular abroad -- from Germany and France to countries where anti-Americanism has recently been a problem, such as Turkey and Indonesia. His following means that, in democratic countries at least, leaders have a strong incentive to befriend him. And yet this president appears, so far, to have no genuine foreign friends. In this he is the opposite of George W. Bush, who was reviled among the foreign masses but who forged close ties with a host of leaders -- Aznar of Spain, Uribe of Colombia, Sharon and Olmert of Israel, Koizumi of Japan.

Jealousy or political rivalry may play a part -- Sarkozy is one of several Europeans who have wanted to assume the role of Obama's closest ally and reacted poorly when he didn't respond. But another big cause seems to be lack of interest on Obama's part. Focused intently on his domestic agenda, the president is said to be reluctant to take time to build relationships with foreign leaders. If something has needed to be done or decided, he has readily picked up the phone. If not, he generally hasn't been available.

Obama also hasn't hesitated to publicly express displeasure with U.S. allies. He sparred all last year with Israel's Binyamin Netanyahu; he expressed impatience when Japan's Yukio Hatoyama balked at implementing a military base agreement. He has repeatedly criticized Afghanistan's Hamid Karzai, and he gave up the videoconferences Bush used to have with Iraq's Nouri al-Maliki.

An argument can be made that none of this matters. Bush, after all, was often criticized for depending too heavily on personal relationships -- remember how he looked into Putin's soul? -- and his pals didn't save his administration from being universally condemned as "unilateralist." The Obama administration, in contrast, can argue that it has done pretty well in lining up European support on key matters such as Afghanistan and Iran. And Obama's personal popularity continues to provide leverage with leaders around the world, whether they hit it off with him or not.

Still, it's worth wondering: Would Sarkozy have fought French public opinion and sent more troops to Afghanistan (he has refused) if he had been cultivated more by Obama? Would Israel's Netanyahu be willing to take more risks in the (moribund) Middle East peace process if he believed he could count on this U.S. president? Would Karzai cooperate more closely with U.S. commanders in the field if Obama had embraced him?

The answers seem obvious. In foreign as well as domestic affairs, coolness has its cost.

Bo Xilai's charm offensive is paying off politically in China

Image by Getty Images via Daylife

By Ariana Eunjung Cha
Washington Post Foreign Service
Monday, March 8, 2010; A07

BEIJING -- Of the nearly 3,000 members of China's ruling elite in the country's capital this weekend to kick off the biggest political gathering of the year, only one has the state media and online commentators abuzz: Bo Xilai.

Named "Man of the Year" by a People's Daily online poll, the subject of an adoring home video being circulated on the Internet and revered in countless blogs, Bo is in contention to be named to one of the top jobs in China in 2012, when many of the country's current leaders are expected to retire.

In the three years he has served as the top Communist Party official in Chongqing, the country's largest municipality, Bo has shaken up Chinese politics by becoming a wildly popular politician in a country where politicians in the Western sense are frowned upon.

"Bo Xilai is a selfless person and a fearless one. In these times, we need government officials like Bo . . . He chases justice for ordinary people," said Li Lei, a 48-year-old entrepreneur. Li created the video tribute after reading about Bo's crackdown on Chongqing's mafia, a crusade that not only targeted corrupt businessmen but -- in a departure from previous efforts -- the senior-level government officials who colluded with them.

The official purpose of the meeting of the National People's Congress from March 5 to 14 in Beijing is to review and pass new legislation. But given that there's no separation of powers in China and that some of those who will vote on the laws were also involved in drafting them, the gathering is largely symbolic.

The more interesting discussions are happening behind the scenes, because this year's people's congress is the unofficial start of mid-term jockeying for the 2012 Communist Party Congress where the next generation of leaders will take the reins from Hu Jintao and Wen Jiabao.

All eyes are focused on which of the "fifth generation leaders" like Bo are up and which are down -- what that says about the direction of the country.

In two years, more than half the members of the ruling Politburo are expected to retire or step aside because of age. This would set the stage for newcomers to emerge as the principal figures responsible for the country's political and ideological affairs, economic and financial administration, foreign policy and military operations, according to Cheng Li, a China researcher at the Brookings Institution.

Among them, Li Keqiang, 55, a former farmer who got his doctorate in economics at one of China's top universities and is now vice premier, is widely seen as being groomed to be the next premier. Xi Jinping, 57, the son of a powerful Communist Party elder and who currently serves as the vice president, is considered to be the most likely heir to the position of president.

However, Li, the China researcher, wrote in a recent policy paper that "a dark horse can emerge in Chinese politics, just as in American politics." He wrote it would be wise to "pay greater attention to a broader group of potential contenders for power, especially the rising stars in provincial leadership." Of those regional leaders, Bo -- a former minister of commerce, provincial governor and mayor -- is the standout.

While other senior-level officials tend to be shy and awkward in dealing with the public and the media, Bo has managed to charm nearly everyone. He has led crowds of thousands in singalongs of "red culture" songs, sat down for TV chats with protesting workers and communicated with students via mass text messages.

At 60, Bo is too old and controversial to be regarded as a candidate to become premier. But Chinese scholars say he's likely to be named to the Communist Party's nine-member standing committee -- China's most powerful decision-making group.

Charismatic, handsome and majestically tall by Chinese standards at 6-foot-1, Bo has become the poster child for a group of emerging Chinese leaders known as the "princelings."

His candidacy reflects how far China's Communist Party has evolved from its origins. Today the party's constituency is increasingly middle class and more concerned with things like business and finance than Marxist ideology.

Like other "princelings" -- descendants of high-ranking party officials -- Bo grew up mostly in China's wealthier coastal regions, came of age during the Cultural Revolution, is fluent in English, has a graduate degree, and began his career in the government after it began market-based economic reforms in the late 1970s.

In contrast, many of China's current leaders were raised mostly in the inland by ordinary working-class families and they worked their way up the ranks of the government bureaucracy through postings in far-flung provinces. Known as "tuanpai" -- a reference to the China Communist Youth League that they were members of and that was once considered the place to groom future leaders -- these men are considered technocrats who have helped China carry out the goals set forth by previous generations but stopped short of reinventing them.

In policy decisions, the princelings tend to believe the future lies with advancing the interests of the middle class; the tuanpai tend to pay more attention than the princelings to vulnerable groups such as farmers, migrant workers and the urban poor.

Bo "is perceived by the public as a modern, honest and upright official," said Zhang Hongliang, an economics professor at the Minzu University in Beijing. On the other hand, Zhang said, "The high praise of Bo equals criticism of other officials," which has created enemies.

The second eldest son of the seven children of Bo Yibo, one of a group of Communist Party officials known as the "Eight Immortals" who were purged during the Cultural Revolution for supporting open trade with the West and other capitalist-style reforms, Bo and the rest of his family were jailed and his mother was beaten to death in custody. But when Deng Xiaoping rose to power in 1978, he returned Bo Yibo to his position of vice premier. Bo Xilai thrived during his father's tenure in Beijing, graduating from Peking University with a degree in history and then working at the Chinese Academy of Social Sciences, a prestigious government-affiliated think tank, for his master's degree.

Today Bo is in charge of running Chongqing, a region of more than more than 31,000 square miles and 32 million people along the Yangtze River that is the largest of China's four provincial-level municipalities. In the fall of 2008, Bo gained national praise for the way he managed strikes by teachers, police and taxi drivers in the city as China's economy began to contract. While other regional leaders around the country faced with similar problems treated striking workers as criminals, arresting leaders and sending in police, Bo made what was considered a radical move in China: He invited taxi driver representatives to meet with him in a forum broadcast on state television and negotiated terms for ending the strike.

And in 2009, Bo took another political gamble. He launched what he called a "Red Culture Campaign" to get people to get together and read, study and even sing about Mao Zedong's work again. While a few scholars ridiculed the efforts, it was a hit with the masses, with hundreds of thousands showing up at the events.

Researcher Wang Juan contributed to this report.

Second Life's virtual money can become real-life cash

Image via CrunchBase

By Michael S. Rosenwald
Washington Post Staff Writer
Monday, March 8, 2010; A01

Dana Moore sells rain. He sells a lot of it, for about a buck per reusable storm.

"I don't know why people love buying rainstorms," he said, watching his product drizzle last week, "but they do seem to like them a lot."

The attraction isn't rain, per se, but Moore's rain, which can deluge swaths of land on command. The rain falls not in Bowie, where he lives with his wife of 37 years, but in the virtual world of Second Life, the Web portal where he also markets snow, clocks, University of Maryland basketball T-shirts, Duke basketball T-shirts (grudgingly), two-story Tudor-style homes, pinup posters from the 1930s and the sounds of barking dogs.

In the physical world, Moore, 62, writes software for a subsidiary of defense contractor Raytheon. In the virtual world, he is one of thousands of entrepreneurs selling products -- for genuine American dollars -- that add a remarkably profitable dose of reality to Second Life's fantasy world.

Newbies show up in Second Life without so much as 40 acres and a mule, so their avatars need hair, and fancy shoes for a concert or suits for business meetings, and a house, and art for the house, and maybe a waterfall for the living room -- virtual goods that cost real money.

Last year, as the physical economy withered, Second Life's economy blossomed, with user-to-user transactions topping $567 million in actual U.S. currency, a 65 percent jump over 2008. About 770,000 unique users made repeat visits to Second Life in December, and the users, known as residents, cashed out $55 million of their Second Life earnings last year, transferring that money to PayPal accounts.

The big purchases in Second Life are land and the material goods residents put on that land. It isn't real land, obviously, but digital space that looks like land. Users control the intellectual property rights to whatever they build, giving them economic incentive to create things. And create they do.

"The barriers to entry are really, really low for an enterprise to get started in Second Life," said Tom Boellstorff, an anthropologist with the University of California at Irvine who studies virtual worlds, in an interview at one of his Second Life residences -- a lovely modern space with a water view. "You don't need a factory. You don't have a lot of expenses."

Boellstorff, through his avatar, was sitting on a couch. To make his point, the professor arranged for a box to appear suddenly in his living room, not far from a reporter's virtual face. "You can make it hollow," he said, making the box hollow. "Or you can make it a circle," he said, making the box a circle. "You can't do that in the physical world. It's just not that easy. Here you can make anything." His voice came through a computer's speaker with the clarity of a land-line telephone call.

Second Life's economy looks remarkably like that of the physical world. At one end, where most users are, small-business owners such as Moore keep their physical-world day jobs but make a few hundred dollars a year selling niche products such as rain and T-shirts. But as Second World has grown, some users have built much bigger, full-time businesses: Stiletto Moody sells thousands of high-end shoes for about $8 a pair, and Curious Kitties is a Japanese maker of somewhat risqué clothing.

More than 50 businesses in the virtual world made more than $100,000 each last year.

Second Life's owner, Linden Lab, makes money by selling land plots and islands. An island runs about $1,000, a high barrier of entry for most Second Life users. But to open a strip mall, dance club or office tower, or to build a home, avatars need land. Some Second Life users have taken on Donald Trump-like personas, buying land from Second Life and then leasing plots to small-business owners or would-be homeowners, or flipping their properties as speculators.

As in physical reality, these land barons are few in number but generate a big chunk of the world's gross domestic product. The top 25 Second Life earners are mostly land barons, making a combined $12 million.

"The Second Life economy really starts with the idea that people want to socialize," said Robert Bloomfield, a Cornell University management professor who hosts a popular financial talk show in Second Life called Metanomics. "People need a place to do that. So the foundation of the economy is land." Sound familiar?

Ray Williams, who lives near Richmond, is a Second Life land baron. In 2006, on his lunch break as a computer technician at Circuit City, Williams stumbled on a CNN.com news item about an avatar named Anshe Chung, Second Life's first physical-world millionaire. Chung, whose real name is Ailin Graef, is a former schoolteacher who became known as the Rockefeller of Second Life by buying and selling land. That night, Williams logged on to Second Life for the first time. Two and a half years ago, after he was laid off by Circuit City, Williams made Second Life his full-time career.

The other day, standing on the beach of a private island he shares with his real-world girlfriend, Williams -- through his avatar, named Ray Burdeyna -- told a story that sounded very much like Trump's: He started off small, buying land plots here and there. He saved enough money to buy his first island. Then he started leasing out spaces. That led to more island purchases, and now he owns 100 islands. Each of his holdings generates about $85 a week in rent. He pays for his health insurance and runs his business from a room in his Chesterfield, Va., apartment -- two computers tuned in to Second Life, a third to his music.

"I make a lot more money doing this than working at Circuit City, that's for sure," said Burdeyna, strolling on his island near a yacht his girlfriend bought him for Christmas. He looked out of place on his beach; after all, he was wearing a shirt and tie. Burdeyna said he put it on for his interview with The Washington Post, and then he invited one of his tenants, who runs a virtual club from his physical home in the Netherlands, to drop by.

Foxx Bode proclaimed Burdeyna a great landlord. "He's a lot cheaper than other landlords," said Bode, who declined to give his real name. "I've got no problems with him."

Every week, Williams's tenants drop by his office, where signs on the wall show how much each resident owes and the date the money is due. Tenants click on boxes to pay their bills.

Nobody in Second Life pays for anything with actual currency. They pay in Linden dollars, which, like real-world currency, is traded on an exchange. Linden Lab, like the Federal Reserve, controls the exchange and money supply to maintain a steady value for Linden dollars. That value has historically hovered around 250 Linden dollars for every U.S. dollar.

People entering virtual worlds for the first time are often surprised to learn that virtual dollars have actual value. They should not be surprised, economists say, because whether the world is physical or electronic, all value is virtual.

"I think it's fair to say that the car I am in or the clothes people wear, a good chunk of their value is virtual," said Ed Castronova, an Indiana University economist who studies and creates virtual worlds. "A coat is not entirely about keeping the cold off -- there's a look, a signal, a message, and that's virtual. There's always been this virtual part of the economy, but by stripping out the physical part, you go, 'Oh my gosh, a lot of our motivations are intangible.' "

To that end, one of the more popular posts last week on the virtual worlds blog Terra Nova was by Castronova, linking to a story in the satirical newspaper the Onion that opened: "The U.S. economy ceased to function this week after unexpected existential remarks by Federal Reserve chairman Ben Bernanke shocked Americans into realizing that money is, in fact, just a meaningless and intangible social construct."

In Second Life, that money buys weather.

Web Searches Preview Hiring Trends

Image by Getty Images via Daylife

By JENNIFER MERRITT

Payroll and unemployment data released Friday offered a snapshot of the labor market's health last month. But some researchers say they can get a read on such trends days or weeks ahead of the official numbers by studying Google searches, tweets and even queries at an online phone directory.

Economists painted a mostly positive picture of the latest government data, which showed the economy shed fewer jobs than expected in February and the jobless rate held steady. For people who look at early-warning indicators, the figures were no surprise. The Web-based data have been telling a similar story for at least a month: The job market is getting better—very slowly.

Development of the new techniques is still in its early stages, but researchers say the data could become a part of the traditional forecasting models—or replace some outdated predictive surveys and statistics.

Economists who analyze the job market using more conventional techniques are already paying attention. "The great benefit is that these [data] show people actually doing something," said Ed Leamer, director of Anderson Forecast, an independent economic-forecasting group at the University of California, Los Angeles.

Still, Mr. Leamer and others don't yet use such indicators in their official forecasts because the tools haven't been around long enough to prove their worth.

Beyond that, the habits and makeup of people who use the Internet are in flux, which can make it difficult to isolate the economic message sent by searches and comments.

A study of daily Twitter activity conducted for The Wall Street Journal by Crimson Hexagon, a firm that builds algorithms to look for key phrases that are indicative of consumer mood, shows a gradual decline in the number of people tweeting about being unemployed and looking for work over the six months ending Feb. 16. The study picked up tweets with phrases like "still looking for a new job" or "I just had an interview." The company also sees a gradual decline in those worried about losing their job in the past two months.

Hal Varian, who left a teaching post at the University of California, Berkeley, to become chief economist at Google Inc., conducted an analysis of searches using a Google tracking function called Insights that pointed to the trend in initial claims for unemployment benefits seven days before the government released them.

The same tool showed more Web searches were conducted over the past two months for "job interview questions" and "what to wear to an interview," phrases that likely mark the beginning of the hiring process. And Google can pinpoint the geographic areas producing the most searches. People typing in Minnesota, for instance, increased searches for job interview questions and answers more than any other state between late October and mid-February.

"I think of it as taking the pulse of the economy," said Mr. Varian, whose team is exploring whether Google wants to get further into forecasting. "We think [the data] definitely have predictive power."

Yellowbook.com, an online phone directory, has devised an indicator based on the types of businesses consumers search for the most. Yellowbook.com says an upturn in searches related to home improvement and remodeling began in October, presaging a fourth-quarter rise in such sales. In late January, Home Depot and Lowe's reported increased fourth-quarter sales.

Researchers also are looking to search patterns for clues to other aspects of the economy. Erik Brynjolfsson, of Massachusetts Institute of Technology's Sloan School of Management, has used Google search volume to forecast home sales. Mr. Brynjolfsson predicted two months in advance that National Association of Realtors' reading of home-sales volume would rise 6.4% in the third quarter, compared with a forecast of 8% by the NAR. The actual rise: 6.1%.

Write to Jennifer Merritt at jennifer.merritt@wsj.com

Mar 7, 2010

Op-Ed Columnist - The Up-or-Down Vote on Obama’s Presidency

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By FRANK RICH

WEDNESDAY’S health care rally was one of President Obama’s finest hours. It was so fine it couldn’t be blighted even by his preposterous backdrop, a cohort of white-jacketed medical workers large enough to staff a hospital in one of the daytime soaps that refused to be pre-empted by the White House show.

Obama’s urgent script didn’t need such cheesy theatrics. At last he took ownership of what he called “my proposal,” stating concisely three concrete ways the bill would improve America’s broken health care system. At last he pushed for a majority-rule, up-or-down vote in Congress. At last he conceded that bipartisan agreement between two parties with “honest and substantial differences” on fundamental principles wasn’t happening. At last he mobilized his rhetoric against a villain everyone could hiss — insurance companies. In a brief address, he mentioned these malefactors of great greed 13 times.

There was only one problem. This finest hour arrived hastily and tardily. At 1:45 p.m. Eastern time, who was watching? Of those who did watch or caught up later, how many bought the president’s vow to finish the job “in the next few weeks”? We’ve heard this too many times before. Last May Obama said he would have a bill by late July. In July he said he wanted it “done by the fall.” The White House’s new date for final House action — specified as March 18 by Robert Gibbs, the press secretary — is already in jeopardy.

“They are waiting for us to act,” Obama said on Wednesday of the American people. “They are waiting for us to lead.” Actually, they have given up waiting. Some 80 percent of the country believes that “nothing can be accomplished” in Washington, according to an Ipsos/McClatchy poll conducted a week ago. The percentage is just as high among Democrats, many of whom admire the president but have a sinking sense of disillusionment about his ability to exercise power.

Image via Wikipedia

Now that we have finally arrived at the do-or-die moment for Obama’s signature issue, we face the alarming prospect that his presidency could be toast if he doesn’t make good on a year’s worth of false starts. And it won’t even be the opposition’s fault. If too many Democrats in the House defect, health care will be dead. The G.O.P. would be able to argue this fall, not without reason, that the party holding the White House and both houses of Congress cannot govern.

For the sake of argument, let’s say that Obama does eke out his victory. Republicans claim that if he does so by “ramming through” the bill with the Congressional reconciliation process, they will have another winning issue for November. On this, they are wrong. Their problem is not just their own hypocritical record on reconciliation, which they embraced gladly to ram through the budget-busting Bush tax cuts. They’d also have to contend with this country’s congenitally short attention span. Once the health care fight is over and out of sight, it will be out of mind to most Americans. We’ve already forgotten about Afghanistan — until the next bloodbath.

The 2010 election will instead be fought about the economy, as most elections are, especially in a recession whose fallout remains severe. But that battle may be even tougher for this president and his party — and not just because of the unemployment numbers. The leadership shortfall we’ve witnessed during Obama’s yearlong health care march — typified by the missed deadlines, the foggy identification of his priorities, the sometimes abrupt shifts in political tone and strategy — won’t go away once the bill does. This weakness will remain unless and until the president himself corrects it.

Those who are unsympathetic or outright hostile to Obama frame his failures as an attempt to impose “socialism” on a conservative nation. The truth is that the Fox News right would believe this about any Democratic president no matter who he was and what his policies were. Obama, who has expanded the war in Afghanistan and proved reluctant to reverse extra-constitutional Bush-Cheney jurisprudence, is a radical mainly to those who believe a conservative Republican senator like Kay Bailey Hutchison of Texas is a closet commie.

The more serious debate about Obama is being conducted by neutral or sympathetic observers. There are many hypotheses. In Newsweek, Jon Meacham has written about an “inspiration gap.” He sees the professorial president as “sometimes seeming to be running the Brookings Institution, not the country.” In The New Yorker, Ken Auletta has raised the perils of Obama’s overexposure in our fractionalized media. (As if to prove the point, the president was scheduled to appear on Fox’s “America’s Most Wanted” to celebrate its 1,000th episode this weekend.) In the Beltway, the hottest conversations center on the competence of Obama’s team. Washington Post columnists are now dueling over whether Rahm Emanuel is an underutilized genius whose political savvy the president has foolishly ignored — or a bull in the capital china shop who should be replaced before he brings Obama down.

But the buck stops with the president, not his chief of staff. And if there’s one note that runs through many of the theories as to why Obama has disappointed in Year One, it cuts to the heart of what had been his major strength: his ability to communicate a compelling narrative. In the campaign, that narrative, of change and hope, was powerful — both about his own youth, biography and talent, and about a country that had gone wildly off track during the failed presidency of his predecessor. In governing, Obama has yet to find a theme that is remotely as arresting to the majority of Americans who still like him and are desperate for him to succeed.

The problem is not necessarily that Obama is trying to do too much, but that there is no consistent, clear message to unite all that he is trying to do. He has variously argued that health care reform is a moral imperative to protect the uninsured, a long-term fiscal fix for the American economy and an attempt to curb insurers’ abuses. It may be all of these, but between the multitude of motives and the blurriness (until now) of Obama’s own specific must-have provisions, the bill became a mash-up that baffled or defeated those Americans on his side and was easily caricatured as a big-government catastrophe by his adversaries.

Obama prides himself on not being ideological or partisan — of following, as he put it in his first prime-time presidential press conference, a “pragmatic agenda.” But pragmatism is about process, not principle. Pragmatism is hardly a rallying cry for a nation in this much distress, and it’s not a credible or attainable goal in a Washington as dysfunctional as the one Americans watch in real time on cable. Yes, the Bush administration was incompetent, but we need more than a brilliant mediator, manager or technocrat to move us beyond the wreckage it left behind. To galvanize the nation, Obama needs to articulate a substantive belief system that’s built from his bedrock convictions. His presidency cannot be about the cool equanimity and intellectual command of his management style.

That he hasn’t done so can be attributed to his ingrained distrust of appearing partisan or, worse, a knee-jerk “liberal.” That is admirable in intellectual theory, but without a powerful vision to knit together his vision of America’s future, he comes off as a doctrinaire Democrat anyway. His domestic policies, whether on climate change or health care or regulatory reform, are reduced to items on a standard liberal wish list. If F.D.R. or Reagan could distill, coin and convey a credo “nonideological” enough to serve as an umbrella for all their goals and to attract lasting majority coalitions of disparate American constituencies, so can this gifted president.

He cannot wait much longer. The rise in credit-card rates, as well as the drop in consumer confidence, home sales and bank lending, all foretell more suffering ahead for those who don’t work on Wall Street. But on these issues the president, too timid to confront the financial industry backers of his own campaign (or their tribunes in his own administration) and too fearful of sounding like a vulgar partisan populist, has taken to repeating his health care performance.

And so leadership on financial reform, as with health care, has been delegated to bipartisan Congressional negotiators poised to neuter it. The protracted debate that now seems imminent — over whether a consumer protection agency will be in the Fed or outside it — is again about the arcana of process and bureaucratic machinery, not substance. Since Obama offers no overarching narrative of what financial reform might really mean to Americans in their daily lives, Americans understandably assume the reforms will be too compromised or marginal to alter a system that leaves their incomes stagnant (at best) while bailed-out bankers return to partying like it’s 2007. Even an unimpeachable capitalist titan like Warren Buffett, venting in his annual letter to investors last month, sounds more fired up about unregulated derivatives and more outraged about unpunished finance-industry executives than the president does.

This time Obama doesn’t have a year to arrive at his finest hour. Not to put too fine a point on it, but the clock runs out on Nov. 2.

Facebook Is Getting Older Without Getting Old

Image via Wikipedia

By RANDALL STROSS

FACEBOOK now has more than 400 million active users, up from only 50 million as recently as 2007. If social networking still resembled a young, hip downtown nightclub scene — one day a site is hot, the next it’s not — we might expect the crowds to decamp soon. Facebook would become another Friendster, still around but ghostly, forgotten by most.

Facebook, however, isn’t likely to have such a fate. For one thing, it has attracted many “olds,” and they tend to stay put. (Consider AOL.) More than 50 percent of Facebook’s members in the United States are 35 or older, and only 26.8 percent are 24 or under, according to an analysis of December visitors by comScore Media Metrix.

More than demographic stability favors Facebook. The site has shrewdly emulated the “network effects” strategy used by another brand that has long held a dominant position in the computer industry: Microsoft Windows.

Economists use the term network effects to refer to the way the value of a product or service increases in tandem with the number of people who use it. If you’re one of only 10 people in the world with an e-mail account, its usefulness is limited; add a billion more, and the practical value of yours increases apace.

A Facebook member enjoys immediate benefits when each friend joins — these are direct network effects. But the average user already has 130 friends, so unless the user is unusually gregarious, the direct effects won’t increase drastically beyond a certain point.

For an individual member, the most powerful network effects may be indirect ones that come from the huge number of unknown other people in the Facebook world. Their mass attracts, in turn, suppliers of complementary products and services.

For Windows, the enormous installed base attracted third-party software developers, which in turn drew more users. Apple’s iPhone has had a similar virtuous cycle. So, too, on Facebook, developers of applications like FamilyLink, Marketplace and iLike’s Music create a software universe with seemingly infinite choices. And that attracts more users — and still more developers.

Facebook’s decision to open its site to outside developers in May 2007 was a “transformative moment,” said Charlene Li,founder of the Altimeter Group, a strategy consulting firm.

“Because Facebook allows developers on their site, the people who would have developed the next social networking site are now working with Facebook,” she said.

Nick O’Neill, founder of AllFacebook.com, a site with Facebook-related news and statistics, said, “Games are the killer app for Facebook.” Because of their social nature, popular Facebook games produce direct network effects. The dedicated farmers of the FarmVille game — it attracts 83 million users a month — nudge friends to play and become virtual neighbors, enhancing their own game experience. (That pull gives Facebook an advantage Windows lacked; its signature game was Solitaire.)

Businesses, nonprofits, government offices and celebrities use Facebook pages to disseminate information, thus forming an ever-growing simulacrum of the Web within Facebook’s walls. Network effects are at work here, too: users attract well-known names, which, in turn, draw more users to Facebook.

The White House, for example, has its own Facebook page, one of three million active pages that have an aggregate of 5.3 billion fans, the company says.

Facebook members in the United States, on average, spent more than seven hours on the site in January, according to the Nielsen Company. That is more than three times the average time spent on Google’s Web sites. Facebook’s average number of minutes per visitor grew almost 10 percent from the previous month, while the average at sites for every other company in the top 10 fell — Google, by 14.3 percent; Yahoo, 27 percent; and Microsoft, 26.9 percent.

Google does not reap the benefits of significant network effects because its search algorithms are centered on the analysis of links, and operate essentially the same way whether one person or six billion are using it. Google has tried to add new services as quickly as it can — or more quickly than it is ready to, as shown by the less-than-smooth introduction last month of Buzz, which gives Gmail some social network features.

Network effects, if powerful enough, can push a platform past the tipping point, accelerating its growth. “As the Windows example shows, once a market with network effects tips to one dominant platform, then it is very hard to tip back,” said Andrei Hagiu, an assistant professor at Harvard Business School.

But network effects alone don’t necessarily produce tipping, he cautioned. Users must also perceive a high switching cost —in this case, in time and inconvenience — if they were to move to another social networking site.

Facebook increasingly makes it easy for its members to remain loyal. Outside sites can become Facebook Connect partners, offering visitors the ability to log on with their Facebook username and continue to interact with their Facebook friends even when they aren’t at the Facebook site. More than 60 million Facebook members use Facebook Connect each month, the company says.

YET Facebook Connect introduces a strategic risk for the company. As its adoption spreads, Facebook members may spend less time at the home site, with possibly negative implications for Facebook’s business model. The company says that more than half its users now log on to Facebook daily. But that share might drop significantly as more outside sites incorporate Facebook Connect.

“It could turn out that taking your network with you is more powerful than having all of the activity around your network happening in a central place,” said Noah Brier, head of strategic planning at the Barbarian Group, a digital marketing firm.

Industry watchers constantly scan the horizon for a challenger that could displace Facebook, and Mr. Brier thinks he has a sighting: “Who will be the next Facebook?” he asks. “Facebook Connect.”

Randall Stross is an author based in Silicon Valley and a professor of business at San Jose State University. E-mail: stross@nytimes.com.

Attack on Timorese President Unsolved

Image by Getty Images via Daylife

by Lindsay Murdoch

The Age, DILI: Who shot the President and the rebel leader? Three Dili District Court judges have sentenced 24 rebels to jail terms of up to 16 years but their verdicts have raised more questions than they answered about the attacks on East Timor's top two political leaders on February 11, 2008.

The judges said after hearing five months of evidence that Marcelo Caetano, the rebel accused of shooting the President, Jose Ramos-Horta, twice in the back, did not do it.

They accepted the evidence of Australian Federal Police officers who examined bullet fragments were taken from Mr Ramos-Horta during surgery in Darwin that they did not come from Caetano's automatic weapon.

Only hours before the judges delivered their verdicts to a packed court on Wednesday, Mr Ramos-Horta said there was no doubt Caetano was the shooter, although he had earlier insisted he was not.

Mr Ramos-Horta said he had subsequently had a ''flashback'' to that day. He said Caetano had made a tearful confession to him and had apologised, saying he did not intend to kill him. But the judges accepted Caetano's protestation of innocence.

The judges said that all nine of the rebels who went to the President's house, including Caetano, ''acted in concert and collaboration'' to kill Mr Ramos-Horta, for which Caetano was jailed for 16 years. But they said it was not known which one fired the shots that almost killed him.

Buried in a long judgement are the judges' findings that the official version of how the rebel leader, Alfredo Reinado, and one of his men, Leopoldino Eposto, were killed at the President's house did not happen.

They said that based on the evidence, Francisco Marcal, a security guard at Mr Ramos-Horta's house, did not kill the two men from a distance, as he had claimed.

Government ministers still insist that that is what happened. But the court had heard that AFP ballistics tests showed Reinado and Esposto were shot dead by two different weapons.

Forensic analysis pointed to the shots being fired at close range, which suggests execution. Neither of the weapons used was the one that Mr Marcal testified he was carrying.

The judges condemned the rebels who went to the President's home fully armed. All were sentenced to 16 years' jail. They also condemned a second group of 11 rebels that ambushed the Prime Minister, Xanana Gusmao, the same day. They received an average of 10 years' jail.

Lawyers for the rebels intend to appeal against the verdicts and sentences.

THE UNKNOWNS

Who shot Jose Ramos-Horta twice in the back?

Court found Marcelo Caetano, the rebel accused of firing the shots, did not do it.

Who shot Alfredo Reinado and Leopoldino Esposto?

Court found the guard Francisco Marcal did not fire fatal shots at rebels, as he claimed. The rebels were killed with different weapons, neither of which was Marcal's.

Posted by : Voice of East Timor on 06 March 2010

Democratic activists channel anger into Arkansas Senate race

Image by tsweden via Flickr

By Perry Bacon Jr.
Sunday, March 7, 2010; A03

Democratic activists flooding money into a primary challenge against Sen. Blanche Lincoln (D-Ark.) say the race isn't simply about defeating the incumbent. It is also about rebuking a Democratic-controlled Congress that they say isn't pursuing an aggressive, populist agenda.

After Arkansas Lt. Gov. Bill Halter announced Monday that he would challenge Lincoln, liberal donors from groups such as MoveOn.org poured more than $1 million into his campaign, an unusually high sum for the first two days of campaigning. Liberals blasted Lincoln with anti-Washington rhetoric that sounded more like the conservative tea party movement. The groups are particularly critical of her opposition to the public option, as it is known, in the health-care bill and her support in 2008 for a Wall Street bailout.

The primary contest illustrates the challenge Democrats face in trying to please activists who worked hard to elect President Obama and congressional Democrats and now want to see results. They also want to lure independent voters who helped the party win the 2006 and 2008 elections but now express wariness about the Democratic agenda.

"As Bill Halter says, Washington is broken. It's really remarkable when you have a strong Democratic majority in both the House and the Senate and a Democratic president and still not get a lot of things passed," said Charles Chamberlain, political director for the activist group Democracy for America, which has encouraged its members to donate to Halter. "Some of that blame rests on Republicans, but the Democratic Party is not standing up to lead."

Support in high places

The White House and congressional Democratic leaders are lining up behind Lincoln, who they say has the strongest chance of winning in Arkansas. And Lincoln, who was first elected to the Senate in 1998, is trying to turn the fury among liberal activists into an asset.

In a commercial that began airing just after Halter announced his candidacy, Lincoln touts her opposition to the public option and the climate-change bill, issues popular among Democratic activists. "I don't answer to my party, I answer to Arkansas," she says.

"She's pretty much fighting for the freedom to be a moderate Democrat," said Steve Patterson, her campaign manager.

That strategy could be risky in the two-month blitz to the May 18 primary, for which more partisan Democratic activists are likely to turn out. Lincoln, who received 56 percent of the vote in 2004, has seen her approval ratings plunge in the past several months. Liberals attribute the decline to her changed position on the public option, which she supported last summer then distanced herself from a few months later. Conservatives say her numbers reflect dissatisfaction over her support for a health-care bill that is unpopular in the state.

Halter's approach

Seeking to keep the buzz among online activists, Halter appealed to liberals after launching his candidacy and touted his support for the public option and other liberal causes.

At the same time, his campaign commercials sound the kind of anti-Washington themes that could unite liberal activists outside of Arkansas and voters in his state. He criticizes Lincoln for her bailout vote, saying, "Washington is not working for Arkansas families."

"He's not a liberal, he's not a conservative, he's an Arkansan," said Bud Jackson, an adviser to Halter, illustrating the campaign's attempt to make sure he is not simply cast as the spokesman of liberal groups and their causes.

The GOP could have as many as eight contenders in its primary, but party officials are confident the winner will be the favorite in the general election. Two House Democrats in the state already have decided to retire rather than face potentially difficult races in a state where Obama won just 39 percent of the vote in 2008.

In some ways, Halter's candidacy is a perfect marriage of activists and candidate. Once the head of the Social Security Administration, Halter had been exploring how to run for higher office. Labor unions in Arkansas and nationally have pledged to put $3 million into his effort, largely because they are furious over Lincoln's opposition to the Employee Free Choice Act, which would make it easier for unions to organize workers.

Tension in the party

Party activists, both in unions and on liberal blogs, have been angry for months that Democrats haven't pushed on some progressive causes, such as for the public option and climate-change legislation.

Some activists have publicly suggested that Obama do more to promote these policies, but they have generally targeted their anger at centrist politicians such as Lincoln.

"When you have a country with 10 percent unemployment and you see all of that money going to banks, that discontent will manifest itself in different ways," said Jane Hamsher, founder of the liberal blog Firedoglake. She hosted an event for Halter at her Washington home in December, where liberal activists encouraged him to run.

That intraparty tension could turn the Lincoln-Halter race into the Democratic version of the Florida GOP Senate race between conservative insurgent Marco Rubio and Gov. Charlie Crist that has become a proxy for larger questions about the direction of the Republican Party.

"The larger message being sent to the administration and Congress is: You are with us or you are against us," said Patterson, Lincoln's campaign manager. "The left feels frustrated after eight years [of President George W. Bush] their agenda should be at the forefront and should be passed in its entirety in the first year. That didn't happen and that anger, some of that is being magnified in our race."