The Nine Nations of China - The Atlantic (November 5, 2009)

This text is part of an interactive feature. Click the image above to explore the Nine Nations of China in the form of a clickable map.

This week, President Obama makes his first state visit to China. What kind of country will he find there? We tend to imagine China as a monolith: 1.3 billion people sharing the same language, history, and culture. The truth is far more interesting. China is a mosaic of several distinct regions, each with its own resources, dynamics, and historical character.

As a traveler, teacher, and professional investor who has been exploring China since 1986, I’ve come to think of these regions as the Nine Nations of China (inspired, in part, by Joel Garreau’s Nine Nations of North America). Taken individually, these “nations” would account for eight of the 20 most populous countries in the world.

As China’s economy becomes more integrated, these regional differences are taking on greater importance than ever before. Each of the Nine Nations faces a unique set of challenges and opportunities in carving out its own competitive niche. Anyone who wants to do business in China, make policy towards China, or simply comprehend the dramatic changes happening there should understand the Nine Nations and the role each of them is playing in shaping China’s future.

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THE YELLOW LAND
(Beijing, Tianjin, Shandong, Hebei, Henan, Shanxi, Shaanxi)
Territory: 906,243 km² (9% of total)
Population: 359 million (27% of total)
Per Capital GDP: $3,855
Exports as % of GDP: 16%

China was born on the banks of the Yellow River, where the silt-laden water, rich alluvial soil, and the harvested wheat all share the same yellow hue. This is China’s breadbasket where buns, dumplings, and noodles, rather than rice, are standard fare. But the fertile Yellow Land is vulnerable to droughts and floods, as well as jealous invaders. Since ancient times, its inhabitants have turned to a strong central government to keep them safe behind high walls and embankments. In ancient times, the emperor’s yellow robes symbolized his absolute command over the natural forces—earth, water, grain—that ensure life.

Ruling the Yellow Land is a delicate balancing act. On its own, the Yellow Land would rank as the second most populous nation on earth, with more people than the United States packed into less than one tenth the territory. Its resources, while plentiful, are stretched to the limit. The Yellow Land produces huge quantities of basic staples like wheat, cotton, and peanuts, but is rapidly running short of water. It has rich energy reserves, but over-dependence on coal accounts for some of the world’s worst air pollution.

One resource this “nation” never lacks is clout. For most of China’s history, the Yellow Land has been the center of political power. It can attract talent on a massive scale, giving it immense influence. China’s leaders hope these advantages can turn Beijing into a high-tech research hub and transform a select handful of state-sponsored companies like Lenovo and Haier into “national champions” that can dominate global markets. But the heavy hand of the government can be stifling here. Can the Yellow Land leverage its power to open up new opportunities? Or will a region that fears innovation inevitably fall behind?

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THE BACK DOOR
(Hong Kong, Macau, Guangdong, Hainan)
Territory: 231,963 km² (2% of total)
Population: 112 million (8% of total)
Per Capita GDP: $6,910
Exports as % of GDP: 82%

In Chinese, the “back door” refers to a way of doing business outside the normal, approved channels. The South Sea coast is China’s Back Door, far enough from the centers of power that nobody will notice if you bend a few rules. As locals put it, “The sky is broad and the emperor is far away.” Officials who were exiled to Yueh, as this land was once known, found it a fearful place whose inhabitants spoke strange dialects—Cantonese, mainly—and feasted on snakes, cats, and monkeys. But its clan-based villages, lush jungles, and rocky inlets offered ideal shelter for smugglers and secret societies to flourish. Unlike their staid northern cousins, these freebooters learned to take risks and profit from them. Other Chinese regard southerners as clever, sharp, and a bit slippery. But as rebels and renegades, emigrants and entrepreneurs, they infuse much needed flexibility and creativity into an otherwise rigid system.

The Back Door might be troublesome to China’s rulers, but it has also been useful. When China was closed to the outside world, enclaves like Canton, Macau, and Hong Kong offered safely removed points of contact and exchange. So when Deng Xiaoping wanted to open China’s economy to trade and investment, the Back Door offered an ideal laboratory. If reforms failed, they could be disowned and contained without contaminating the rest of China. In fact, they succeeded beyond anyone’s wildest expectations, transforming the region into an export juggernaut and a model for the rest of China.

The Back Door’s very success, however, poses a dilemma. Now that the rest of China has applied its example, is a laboratory really necessary? The region may have found a new purpose as a playground for Chinese tourists who gamble in Macau’s casinos, frolic at Hainan’s beach resorts, and ride the rides at Hong Kong’s new Disneyland. But there are others who think the experiment isn’t over, that the Back Door still has vital lessons to teach about democracy and rule of law. Perhaps China still needs a few rebels—at a safe distance, of course.

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THE METROPOLIS
(Shanghai, Jiangsu, Zhejiang)
Territory: 216,008 km² (2% of total)
Population: 147 million (11% of total)
Per Capita GDP: $6,406
Exports as % of GDP: 58%

Sleek, stylish, confident—Shanghai certainly makes an impression. Its steel skyscrapers look like rocket ships ready to blast off into the future, taking China along with it. Shanghai is a very young city by Chinese standards, but the Yangtze River delta—known in ancient times as the kingdom of Wu—has always been the most commercial and cosmopolitan part of China. Like the Low Countries at the mouth of the Rhine, it is a flat watery land crisscrossed by busy canals linking a constellation of trading cities. The Back Door may succeed in breaking the rules, but only the Metropolis has the wealth and dynamism to entirely reshape them. Its treasure fleets nearly discovered Europe a century before Columbus sailed, and of the Nine Nations, it is the only one to have displaced the Yellow Land—several times—as China’s political capital.

The Metropolis likes to see itself as China’s bright and beckoning future, but the feelings it stirs in other parts of China are decidedly mixed. While its residents see themselves as adaptable and forward-thinking, to many Chinese they come across as arrogant city-slickers—cliquish, crassly materialistic, and slavishly eager to mimic foreign ways. Shanghai had a pre-war reputation as a neon-lit version of Sodom and Gomorrah, and when China was “Red,” the Metropolis paid dearly for its “Black” capitalist past. Consigned to purgatory for over 40 years, the region bore the brunt of the Cultural Revolution and was starved for development funds—essentially frozen in time—until the early 1990s.

The rebirth of the Metropolis did not take place on its own terms. It was the result of a political decision, made in Beijing, to transform the region into a carefully designed showcase of what China could achieve. The state has poured tremendous resources into industrial parks, infrastructure, and Shanghai’s glittering new financial district, attracting huge amounts of foreign direct investment. But this subsidized, scale-driven growth model—where bigger is always better—makes for an economy dangerously prone to speculation. The best hope for the Metropolis lies not in ever-greater capacity and ever-taller buildings but in smaller, nimbler, entrepreneurial enterprises that draw on the region’s distinctive flair for marketing, design, and fashion.

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THE REFUGE
(Sichuan, Chongqing)
Territory: 569,800 km² (6% of total)
Population: 110 million (8% of total)
Per Capita GDP: $2,303
Exports as % of GDP: 5%

Tucked deep in China’s interior, Sichuan is a rich agricultural basin the size of France, surrounded on all sides by a ring of nearly impassible mountains. These bamboo-covered slopes are home to the panda, its last refuge from a rapidly encroaching world. For man as well as beast, Sichuan has always been China's place of refuge. Throughout history it has served as a secure supply base for China’s rulers, and a place to retreat and regroup in times of invasion and unrest. In World War II, when Japan occupied all of coastal China, loyalist forces relocated their capital to the Refuge to carry on the fight. During the Cold War, vital industries were purposely located in its remote valleys to protect them from the enemy.

The Refuge is able to perform such a strategic role because it is virtually self-sufficient. The ancient lands of Shu (centered on Chengdu, to the west) and Ba (to the east, around Chongqing) have been blessed with every ingredient essential to Chinese life—rice, wheat, silk, tea, salt, iron, pork. Safe like a tortoise in its shell, the population here prefers a relaxed way of life, composing poetry in teahouses or savoring the region’s famously spicy food. This splendid isolation has a downside: the region attracts little foreign trade and investment—before last year’s devastating earthquake put Sichuan in the headlines, most people outside of China were hardly aware it existed. Brain drain is another chronic problem: the region’s most talented and motivated young people tend to leave, seeking better opportunities elsewhere.

Today, the barriers that have insulated the Refuge are breaking down. New ports, highways, and pipelines are connecting Sichuan to a wider marketplace, giving rise to promising new industries like natural gas, snack foods, and motorcycles, but also posing new challenges to the region’s sheltered way of life. How its people adapt to these changes will determine whether the Refuge prospers or becomes, like the panda, an endangered species.

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THE CROSSROADS
(Anhui, Jiangxi, Hubei, Hunan)
Territory: 707,124 km² (7% of total)
Population: 226 million (17% of total)
Per Capita GDP: $2,402
Exports as % of GDP: 6%

All of the dynamics driving the first four nations converge in the Crossroads. The middle stretch of the Yangtze is a natural transportation and communications nexus. It is the heart of China, pumping the lifeblood of men and material to every other part along capillaries of water, road, and rail. Interrupt this heartbeat—as a freak snowstorm did last year when it hit the Crossroads during Lunar New Year—and the entire country can grind to a halt. But the region’s central strategic position has never translated into political power. Instead, it has always been a zone of competition among its stronger neighbors, a place for their rival armies to march and fight.

The wetlands along the Yangtze and its tributaries supply much of China's rice, fish and fowl, and the surrounding hills are rich in orchards above ground and minerals below. But nearly all of its resources—the electricity generated by the Three Gorge Dam, the copper mined to make electrical wiring—flow outward to fuel China’s more developed coastal provinces. The most important outflow is human. Along with the Refuge, the Crossroads supplies the vast majority of China’s migrant workers, a floating population of 150 million people.

Standing in the crosscurrents of so many comings and goings, the Crossroads functions not only as China’s physical heart but as its emotional heartland as well. When migrants return home, they bring back ideas and experiences from every part of China, which mix and recirculate through the entire body. It helps that the inhabitants of Chu—as the Crossroads was called in ancient times—have long been known for their strong passions and fierce loyalties. It is no coincidence that the popular uprisings that began both the Nationalist and Communist revolutions happened here, or that many of China’s leading reformists and revolutionaries, including Mao, rank among its native sons. But while many things begin in the Crossroads, few ever reach their fruition there.

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SHANGRI-LA
(Yunnan, Guizhou, Guangxi)
Territory: 810,690 km² (8% of total)
Population: 132 million (10% of total) * 30% non-Han minorities
Per Capita GDP: $1,770
Exports as % of GDP: 6%

The legend of Shangri-La tells of an isolated valley high in the Himalayas, where paradise exists on earth. Local tourism officials claim to have located the real Shangri-La in southwest China, and millions of visitors every year seem to agree. This land is home to some of China’s most iconic and inspiring landscapes: emerald rice terraces, the fairy mountains of Guilin, the raging rapids of Tiger Leaping Gorge. It’s also home to a kaleidoscope of ethnic minorities, usually depicted as singing and dancing in colorful tribal costumes. Throw in a clear blue sky and some banana pancakes, and Shangri-La makes for a heavenly vacation.

Behind the postcard-perfect images, however, lies a darker reality. Cut off from the outside world by jagged mountains and primitive infrastructure, Shangri-La is the poorest of the Nine Nations. Before the Revolution, the region’s main cash crop was opium. Its replacement, tobacco, turned Shangri-La into the main supplier for China’s latest deadly addiction: cigarettes. Meanwhile, Shangri-La still borders Burma’s infamous Golden Triangle, making it China’s primary gateway for illicit drugs and the accompanying spread of HIV/AIDS, which the region’s overburdened health care system is unequipped to handle. The other mainstays of the local economy—logging, strip mining, and land-intensive crops such as sugarcane and rubber—have taken a heavy toll on the environment. All in all, hardly an image of paradise.

Despite these grave problems, Shangri-La possesses untapped resources. Its forests are home to over half of China’s birds and mammals, as well as thousands of rare plant species, some of which may hold the key to new medicines. The region’s lush hills and valleys—the original birthplace of tea—offer ideal conditions for growing tropical fruits, coffee, and flowers. The great lifelines of East Asia—the Yangtze, Salween, Irrawaddy, Mekong, and Red Rivers—all originate in Shangri-La, ensuring a plentiful supply of water for consumption and hydropower. New transport links are being built to expand China’s burgeoning trade with its ASEAN neighbors. None of these opportunities comes without challenges. But for long-suffering Shangri-La, each step closer to heaven is one step farther from hell.

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THE RUST BELT
(Liaoning, Jilin, Heilongjiang)
Territory: 801,553 km² (8% of total)
Population: 109 million (8% of total)
Per Capita GDP: $3,724
Exports as % of GDP: 15%

Just over a century ago, northeast China—known to the outside world as Manchuria—was a wilderness of dark forests and frigid snow-swept plains. Its only inhabitants were a few hunting and fishing tribes. The foremost of these was the Manchu, which conquered and ruled China as its last imperial dynasty. The arrival of the Trans-Siberian Railroad in 1898 changed everything, unleashing a flood of migrants and pitting Russia against Japan in a battle to dominate the region. The Japanese prevailed, and in 1931, they made Manchuria part of their empire. They introduced industrial-scale farming and built mines, steel mills, and factories.

After the war, the Northeast (Dongbei in Chinese) was the first of the Nine Nations captured by the Communists, and the region became a bastion of state-owned heavy industry. Its workers were the socialist elite, enjoying cradle-to-grave benefits and an “iron rice bowl”—jobs guaranteed for life. But in the 1990s, market reform cut the legs out from under the planned economy. Obsolete, inefficient factories were forced to close, throwing 30 million blue-collar workers out in the cold. Once-proud Dongbei became the Chinese version of Flint, Michigan: a Rust Belt of decaying industries with no future.

The central government has launched a campaign to “Revive the Northeast,” but it will take more than ambitious blueprints to bring the Rust Belt back to life. The prospect of an implosion in neighboring North Korea is just one of many uncertainties clouding the region’s future. But the people here are survivors. Famous for their rustic manners and boisterous camaraderie—washed down with 120-proof grain alcohol—they embody the fiery spirit of the Dongbeihu, the Siberian tiger. Adapting that spirit to the 21st Century will require new ways of thinking. The port city of Dalian, for instance, is emerging as a business process outsourcing center aimed at the Japanese market. If Rust Belt residents notice the irony of inviting Japanese investors back to revive their former colony, they’re not saying it out loud.

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THE FRONTIER
(Inner Mongolia, Ningxia, Gansu, Qinghai, Xinjiang, Tibet)
Territory: 5,205,114 km² (54% of total)
Population: 86 million (6% of total) * 30% non-Han minorities
Per Capita GDP: $2,928
Exports as % of GDP: 9%

The land beyond the Great Wall has long captivated the Chinese with its aura of danger and romance. Wild Mongol horsemen, silk-laden caravans, and the inaccessible mysteries of Tibet offer a thrilling contrast to the regulated confines of Chinese life. But what really set this region apart are its vast open spaces. The Frontier comprises over half of China’s territory and just 6 percent of its population—a landmass and population density similar to the continental United States west of the Mississippi. Its desolate plateaus, scorching deserts, and snow-capped mountains resemble Nevada or Wyoming more than Beijing.

China’s frontier with Inner Asia has always had enormous strategic significance. For centuries, its overland caravan routes—the famous Silk Road—provided China’s richest trade link to the outside world, while its marauding nomads posed an ever-present threat to the Middle Kingdom. To secure control, China developed an extensive network of military colonies and prison work camps, not unlike Siberia’s gulag archipelago. The region’s trackless wastes hide many of China’s most sensitive military facilities. But the Frontier’s greatest strategic value lies in its largely untapped natural resources: oil and gas from the Tarim Basin and neighboring Central Asia; rich veins of nickel, copper, and coal; dairy and wind farms on the vast open grasslands; and vineyards that may someday produce world-class wines.

The key to unlocking these resources is the railroad. By bringing in settlers and connecting them with markets back east, the railroad is transforming China’s frontier beyond recognition. But like America’s Manifest Destiny, China’s “Go West” has a dark side. The natives of China’s frontier—the Mongols, Tibetans, and Muslim Uighurs—see their land and ways of life being swept away by a flood of Han Chinese immigrants. When their anger boils over into violence, as it did last year in Lhasa and this summer in Urumqi, the response is invariably swift and brutal. China’s West is being won, but what will be lost in the process?

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THE STRAITS
(Fujian, Taiwan)
Territory: 160,313 km² (2% of total)
Population: 59 million (4% of total)
Per Capita GDP: $9,432
Exports as % of GDP: 30%

The 110-mile strait separating Taiwan from China's mainland is one of the world's great flashpoints. So it may seem surprising that the two provinces on either side comprise a single “nation.” In fact, Fujian and Taiwan are like twins separated at birth—linked by heritage, divided by destiny. Fujian has always looked to the sea. Like the ancient Greeks, its inhabitants turned their backs on their rocky soil, venturing out to fish and trade with distant shores. They established colonies all over Southeast Asia, a far-flung network based on dialect and kinship that thrives to this day. Since such voyages were often prohibited by the emperor, the region’s mariners became skilled smugglers. Today, Fujian remains the center of a worldwide traffic in smuggled Chinese immigrants.

For centuries, Chinese seafarers largely ignored Taiwan, whose fetid rainforests seemed to harbor little more than headhunters and pirate lairs. But a major rebellion persuaded Chinese officials to annex the island in 1683. Settlers from Fujian cleared the jungle to plant rice, sugar, and tea in the fertile volcanic soil, bringing their Min dialect and their worship of Matsu, goddess of the sea. But unity with China was not to last. In 1895, a resource-hungry Japan seized Taiwan as a colony. It was returned after the World War II, only to be cut off once again by the tides of revolution.

The Cold War is over, but the Straits remain divided, perhaps more than ever before. Recent democratic reforms have awakened a new sense of identity among the Taiwanese, many of whom desire complete independence. China has made it clear that such a move would mean a war. But China’s efforts to attract Taiwanese investment, to Fujian in particular, have not gone unrewarded. The Straits may be the smallest of the Nine Nations, but this region is the richest in China, and its two economies have grown increasingly intertwined. Like magnets, Fujian and Taiwan alternately attract and repel each other, pulled together by economic opportunity, pushed apart by identity and ideology. Which of these trends will prevail remains to be seen, but the answer will have a profound impact on China’s future.

The Fall of Mexico - The Atlantic (December 2009)

Poor Mexico. So far from God and so close to the United States.
—Porfirio Díaz, dictator of Mexico from 1876 to 1880 and 1884 to 1911

Those famous words came to mind when another man named Díaz offered me an equally concise observation about the realities of life in the country today: “In Mexico it is dangerous to speak the truth. It is even dangerous to know the truth.”

His full name is Fernando Díaz Santana. He hosts two AM-radio news-and-commentary shows in the small Chihuahuan city of Nuevo Casas Grandes. A stocky, broad-faced man in late middle age, he projects an air of warmth, openness, and intelligence. As he tells me that it’s dangerous to speak or know the truth, the half-rueful, half-apologetic expression in his eyes makes it plain that he’d rather not keep his mouth shut and his mind closed.

He’s received text messages from listeners cautioning him to be careful of what he says on the air. He takes these friendly warnings seriously; failure to heed them could bring a death sentence like the one meted out to Armando Rodríguez, a crime reporter murdered by an unidentified gunman in November 2008 in Juárez, the violent border city across the Rio Grande from El Paso, Texas. The fear of suffering a similar fate is a powerful incentive for self-censorship, for training a naturally inquisitive mind to acquire ignorance.

“So now we give just the objective facts,” Díaz says as he sits facing me in a stuffy, windowless rear room of the radio station, in Nuevo Casas Grandes’s central business district. He and the co-host of his afternoon show, David Andrew (pronounced Da-veed An-dray-oo), explain that the “objective facts” are those reported by the police or city hall or some other official source. Though the accuracy of such facts is often questionable, no questions dare be asked. “We say nothing more,” Díaz adds. “As long as we don’t get too deeply into a story, we are safe.”

I am reminded of Winnie Verloc, the character in Joseph Conrad’s The Secret Agent who “felt profoundly that things do not stand much looking into.”

More than 14,000 people have been killed in the almost three years since President Felipe Calderón mobilized the army to fight Mexico’s half-dozen major drug cartels. Virtually none of those homicides has been solved, partly because witnesses suffer short-term memory loss when questioned, and partly because the police, for various reasons, also feel profoundly that things do not stand much looking into.

Rodríguez’s death is illustrative. His colleagues believe he was killed for an article he wrote linking relatives of Patricia González, the Chihuahuan state attorney general, to narcotics trafficking.

That is not idle theorizing. Jorge Luis Aguirre, a writer for LaPolaka.com, an online Juárez news service, had written extensively about corruption in the Chihuahuan state government, and did not spare González either. On the night of November 13, 2008, as he was driving to Rodríguez’s wake, he got a call on his cell phone. The male caller said, “You’re next, son of a bitch!” and hung up.

Aguirre immediately packed up his wife and sons and fled to El Paso, where he sought asylum. In March, testifying at a hearing of the U.S. Senate Judiciary Subcommittee on Crime and Drugs, he stated that he’d identified the source of the threats:

“Victor Valencia, a representative of the governor of the state of Chihuahua, had sent people to warn me to ‘tone down’ my criticisms of the prosecutor, Patricia González, because if I didn’t, he was going to kill me, using the Juárez cartel’s preferred method of kidnapping followed by execution.”

The aftermath reveals a lot about today’s Mexico. Patricia González remains in her post. Victor Valencia has been promoted to chief of public security in Juárez. The federal deputy attorney general handling the Rodríguez murder case, Jesús Martín Huerta Yedra, was shot to death in his car, along with his secretary. The investigation has since gone nowhere, to no one’s surprise. As the newspaper El Diario editorialized,

Friends of the journalist, who preferred not to give their names for security reasons, mentioned that they do not feel frustrated by the lack of advances in the case since from the beginning, they felt that the authorities had no intention of doing anything to clarify the crime.

To clarify the crime. Of the many things Mexico lacks these days, clarity is near the top of the list. It is dangerous to know the truth. Finding it is frustrating. Statements by U.S. and Mexican government officials, repeated by a news media that prefers simple story lines, have fostered the impression in the United States that the conflict in Mexico is between Calderón’s white hats and the crime syndicates’ black hats. The reality is far more complicated, as suggested by this statistic: out of those 14,000 dead, fewer than 100 have been soldiers. Presumably, army casualties would be far higher if the war were as straightforward as it’s often made out to be.

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Slideshow: Photographer Juliàan Cardona narrates a slideshow of images from the Juárez drug wars

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What, then, accounts for the carnage, the worst Mexico has suffered since the revolution, a century ago? To be sure, many of the dead have been cartel criminals. Some were killed in firefights with the army, others in battles between the cartels for control of smuggling routes, and still others in power struggles within the cartels. The toll includes more than 1,000 police officers, some of whom, according to Mexican press reports, were executed by soldiers for suspected links to drug traffickers. Conversely, a number of the fallen soldiers may have been killed by policemen moonlighting as cartel hit men, though that cannot be proved. Meanwhile, human-rights groups have accused the military of unleashing a reign of terror—carrying out forced disappearances, illegal detentions, acts of torture, and assassinations—not only to fight organized crime but also to suppress dissidents and other political troublemakers. What began as a war on drug trafficking has evolved into a low-intensity civil war with more than two sides and no white hats, only shades of black. The ordinary Mexican citizen—never sure who is on what side, or who is fighting whom and for what reason—retreats into a private world where he becomes willfully blind, deaf, and above all, dumb.

Which brings us back to Fernando Díaz and his avoidance of truth.

I have come to see him at the suggestion of Emilio Gutiérrez, who fled to the U.S. because army officers threatened him with death. During an interview at his hiding place north of the border, Gutiérrez told me about a mysterious event that occurred on February 12, 2008. Teams of gunmen, riding in SUVs and pickup trucks and described by witnesses as “dressed like soldiers,” swept through Nuevo Casas Grandes and six neighboring communities between midnight and dawn, kidnapping and executing people.

The convoys covered 170 miles altogether, rolling through military checkpoints unimpeded. In Nuevo Casas Grandes, the “armed commandos,” as they were called by the Mexican media, set fire to the house of a police subcommander and shot him to death as he ran outside. Two other people, one of them the uncle of a midlevel narcotics trafficker, were also executed. The press reported that 14 more were abducted, but the actual number was believed to be much higher. All the victims, except two who were apparently snatched by mistake and later released, vanished without a trace.

Gutiérrez, a reporter in El Diario’s Ascensión bureau, covered the operation. From what he’d seen with his own eyes and from interviews with eyewitnesses, he concluded that the perpetrators were dressed like soldiers for the simple reason that they were soldiers. An operation on that scale, he reasoned, could not have been conducted by gangs of pistoleros hastily thrown together: it required thorough planning, accurate intelligence, discipline, and coordination. Nor could pistoleros have driven through army roadblocks without being stopped. If the raid wasn’t military, it must have been conducted with the army’s cooperation.

That wasn’t what Gutiérrez reported, however. He told me that his boss, José Martínez Valdéz, the editor of El Diario’s editions in northwest Chihuahua, instructed him to “not cause problems by writing that this was military.” Gutiérrez’s silence did not win him any points with the army. Five months later, he was warned that the military was going to kill him, and he was forced to leave the country.

But why, I asked, would soldiers maraud the countryside on a murder-and-kidnapping spree? He replied that the raid was not part of the Mexican government’s war on the drug cartels but a struggle between two powerful cartels: the Juárez organization, headed by Vicente Carillo, and the Sinaloa federation, whose boss, Joaquín “El Chapo” Guzmán, is the most-wanted man in Mexico. Gutiérrez said that in this instance the gunmen, whoever they were, had been after people they thought were working for the Juárez cartel.

“It’s an open secret in Mexico,” he said, “that the army is fighting the [Juárez] cartel to weaken them and pave the way for Guzmán.”

Open secret or no, an allegation that soldiers may have acted on behalf of a drug lord needs to be substantiated. After all, Calderón’s counter-narcotics strategy relies, with U.S. support, almost exclusively on the military.

With a short list of contacts provided by Gutiérrez, my interpreter, Molly Molloy, and I enter Mexico through the Palomas border crossing and head south into the Chihuahuan Desert. I have just been in Juárez and am relieved to not be going back to that industrialized border city—utterly charmless in the best of times, and these are far from the best of times. Juárez’s main product now is the corpse. Last year, drug-related violence there claimed more than 1,600 lives, and the toll for the first nine months of this year soared beyond 1,800, and mounts daily. That makes Juárez, population 1.5 million, the most violent city in the world. Two lines of graffiti summed up a place where not only law and order but civilization itself has broken down: Mi ciudad pide clemencia en su dementia (“My city asks for mercy in its madness”), and Mi ciudad es un negro lamento un aullido infinito (“My city is a black lament, an eternal howl”).

Nuevo Casas Grandes lies on a plateau near a fertile valley—cowboy-and-farmer country where cattle graze on the high desert ranges and apple and pecan orchards form tidy ranks on the city’s outskirts. The city itself, with some 51,000 people, is known to archaeologically minded tourists for its proximity to Paquimé, the site of ancient pueblo ruins. It looks prosperous by the standards of interior Mexico, with wide streets, a few decent hotels and restaurants, an airport, and several auto dealerships selling Fords and Jeeps and other familiar makes. If it weren’t for all the Mexican license plates, I could believe we were in a town in the southwestern United States.

Our first call is at the offices of El Diario, housed in a whitewashed villa on the main drag. Molloy and I are hoping to meet with José Martínez Valdéz, who is Gutiérrez’s former editor, and the news director, Victor Valdovinos. They can answer some of our questions and provide introductions to city officials. But repeated attempts to see Martínez are unsuccessful—he manages to dodge us all afternoon. We do get a very brief audience with Valdovinos. When we tell him what we are there for, he flinches and says, “You don’t want to talk to me,” then vanishes.

That leaves Fernando Díaz, whom we find at the radio station as he and David Andrew wrap up their afternoon show. They are willing to talk to us, and we go into the back room. Andrew, a heavyset, 30-ish man with dense carbon-black hair, shuts the door, either to muffle the noise from outside or to make sure no one overhears our conversation.

In the Mexico Mexicans have to live in, Díaz begins, life is “very hard, very bad,” a statement he underscores with a statistic: last year, 115 homicides were committed in Nuevo Casas Grandes and its surrounding communities. That works out to a murder rate more than 20 times as high as New York City’s.

It’s at this juncture that he makes his comment about the dangers of speaking or knowing the truth. I begin inquiring about the February 2008 incident, but Díaz and his younger colleague aren’t eager to discuss it.

I don’t get anywhere, though Díaz casts doubt on Gutiérrez’s assertion that the raid was a military operation. All of this talk about human-rights abuses by the army is “a myth,” Díaz insists. He is in fact cheered that an army battalion has been making rounds to bolster security in Nuevo Casas Grandes: “We are abandoned and unprotected here in northwest Chihuahua. It is a very big wish that the soldiers will bring peace. The army is the only group we can trust.” He adds by way of illustration that several sicarios, as professional assassins are called in Mexico, were arrested and confessed to killing 19 people in town.

Two of the sicarios, Andrew interjects, were his neighbors: “One guy worked in a car wash, the other guy was an army deserter.” Two others turned out to be auto salesmen—“nice guys in the day, killers by night,” Díaz says, as if he’s voicing over a trailer for Dr. Jekyll and Mr. Hyde. “You are talking to me, a radio announcer, but you can’t be sure that I’m not a sicario,” Díaz adds. “You say you’re an American reporter, but I don’t know that you’re not a sicario. You cannot trust anybody.” He doesn’t seem to notice that he’s contradicted his earlier remark that only the army can be trusted.

The question is, can the army be trusted, and if so, can it win this latest—and biggest—battle in the seemingly endless “war on drugs”? Calderón has deployed more than 45,000 troops (out of a total force of 230,000) throughout the country. Of that number, about 7,000, reinforced by 2,300 federal policemen, occupy Juárez as part of Operación Conjunta Chihuahua—the Joint Chihuahuan Operation. The army has taken over all the policing functions. The city is under undeclared martial law.

Although many ordinary Mexicans welcome the army’s intervention, certain that things would be far worse without it, approval has been far from universal. Claims of grievous abuses by the armed forces—unlawful detentions, disappearances, thefts, rapes, and murders—have increased sixfold in the past three years, according to Human Rights Watch. One hundred and seventy complaints have been filed in Chihuahua alone, says Gustavo de la Rosa, the former Chihuahua state ombudsman for Mexico’s National Human Rights Commission.

Leaving aside the question of whether militarizing the anti-narcotics campaign is the best way to go about things (a similar strategy in Colombia has been only partially successful), the fact is that, by destroying public trust in the armed forces, military misconduct undermines the entire effort, as I learned from a 50-year-old cleaning woman who now lives in Arizona and who asked to remain anonymous. She was visiting her aunt in Juárez last December when soldiers broke into a neighbor’s house, claiming that they were looking for a suspect.

“They didn’t say who,” the woman told me. “They tore her house apart, took her jewelry and her money, and said that if she complained about what they did they were going to come back and kill her. People are more afraid of the police and soldiers than they are of the narcos, because they’re very mean guys—not all, but many.”

The fear goes beyond undisciplined soldiers running amok. In an interview, de la Rosa told me that the president, elected in 2006 by a margin as thin as an ATM card, called out the army not merely to fight the cartels and eliminate a threat to national sovereignty but to consolidate his power and confer legitimacy on his presidency. “Calderón wants to show the Congress that the military is with him,” de la Rosa said. “And the military promised to support Calderón in exchange for being allowed out of the barracks, because the army wants to govern. Chihuahua is an experiment. What is happening here is in essence a military coup, a regional coup.” To support this contention, he cited a change he has had to make in his own work. Under normal circumstances, he would file complaints of abuse with the state governor, but now, he said, “the governor is ineffective, so I have to go to General Felipe de Jesús Espitia, the comandante of the 5th Military District.”

I was somewhat incredulous that the military was staging a creeping coup. To what end? I asked.

De la Rosa shrugged. “Actually, nobody really knows or understands what the military is up to,” he answered, hedging a bit. Then he asserted that the army intends not to stamp out drug trafficking but to “control” it. “So now if a drug cartel wants to move drugs into the U.S., who would they go to? To the governor? No, to the general.” (El Universal, Mexico’s largest newspaper, reported in September that de la Rosa had received death threats from the army, apparently because of his sharp criticisms; sources have told me he has taken temporary refuge in the U.S.)

As de la Rosa suggested, there is a dismal history of collusion between the armed forces and organized crime. In the late 1980s, the Mexican defense secretary was caught peddling protection to three drug organizations, which paid him a total of $10 million. In 1997, Mexico’s chief anti-narcotics officer was indicted for providing the Juárez cartel with classified drug-enforcement information in exchange for millions of dollars in bribes. In a 2001 essay in the Journal of Contemporary Criminal Justice, a University of Texas criminologist, Patrick O’Day, cited several instances of Mexican soldiers’ guarding narcotics shipments and transporting them into the United States in military vehicles or by other means. These operations were so extensive and went on for so long that O’Day concluded that the army was a cartel unto itself.

But let us make the risky assumption that today’s army is no longer involved in drug trafficking. The belief that it is exploiting a weak government to advance agendas beyond its declared mission is widespread, and not without reason. While many of the crimes alleged to have been committed by the armed forces appear to be the random acts of rogue troops, others may be part of a directed campaign with three possible objectives.

One objective is laudable—to get information about drug trafficking. The problem is that, in de la Rosa’s words, “the army’s investigative techniques are kidnapping and torture.” But according to Cipriana Jurado, a veteran labor organizer and women’s-rights activist, the military has another purpose: trying to stifle dissent, she said, citing numerous arrests of political troublemakers. And, as Gutiérrez’s case indicates, the generals also may be seeking to clamp down on Mexico’s freewheeling press.

In seeking, much less speaking, the truth about what the army is up to, one often runs into the paradox of the Mexican reality: something dreadful happens and is then treated as if it hadn’t happened. Facts, like people, simply disappear.

I experience this myself as I tour the ruins of a Juárez drug-rehabilitation center with my friend Julián Cardona, a photographer and Reuters correspondent. The rehab clinic is in a shabby two-story building on an unpaved street lined with cinder-block hovels, old cars, and derelict buses. A wind-whipped urban grit that feels dirtier than desert dust pelts our faces as we enter the rectangular patio strewn with rubble, its walls gouged by bullet holes. Small rooms lead off the patio, each with a hand-painted phrase above its door—Cocina for kitchen, Sala de Juntas for meeting room, D-Tox, which needs no translation.

We enter the meeting room. Votive candles gutter in glass jars arranged around an image of Jesus Christ propped up in one corner. The walls are peppered with bullet holes and spattered with dried blood. Cardona tells me what happened here on a Wednesday evening, August 13, 2008, as an Assembly of God pastor named Socorro García and her deacon, Joel Valle, conducted a service for the patients. After they and about 20 addicts gathered in the meeting room to sing hymns and hold a prayer service, García took the podium for altar call. “Is there anyone here who was a Christian in the past,” she asked, “but who fell away into drugs and who would like to reconcile with God?” Several patients raised their hands. García summoned them.

Outside, a Ford pickup carrying a detachment of Mexican paratroopers was parked at an intersection no more than 50 yards away. Two other trucks pulled up in front of the rehab center. Eight men armed with assault rifles and 9-millimeter pistols and wearing bulletproof vests and ski masks piled out of the vehicles and rushed inside.

The shooting started in the patio, just as the patients were walking up to the podium in answer to García’s call. Some flung themselves to the floor, others ran for their lives or huddled against a wall. García stood at the podium, crying out, “Muchachos! Ask God for another chance to live!” At that moment, four gunmen burst inside and, in her words, started “shooting in all directions.”

García raised her hands and hollered above the gunshots, “Lord, send your angels to protect us!” A gunman looked at her through the eyeholes of his ski mask and she looked back. He stopped shooting. “I was right there in front of him,” García told Cardona. “He had already shot a lot of people, and one more life would have meant nothing to him, but he didn’t shoot. Why? Maybe God did not allow it.”

Neighbors called the Emergency Response Center, the equivalent of 911, but got no response. Accounts of the actions taken by the soldiers parked at the street corner differ. According to one, the soldiers stood by passively as the assassins jumped in their trucks and fled. According to another, they drove past the rehab center at high speed while the massacre was going on. People shouted to them to put a stop to it, but the soldiers kept going. This led one of the neighbors to conclude that they “were guarding the killers or came with them so that the police would not intervene.”

In all, nine people were killed and five wounded. Among the dead was Joel Valle, the deacon. It was the worst mass murder in Juárez in years, Cardona says as I gaze at the flickering votives, the bloodstains and bullet holes framing the picture of Christ.

Of course, I have questions: Were any of the killers identified or captured? No. Was their motive determined? No, although there were rumors that they were after members of a street gang, the Aztecas, said to be hiding in the facility. Were the soldiers involved in the massacre? That’s what eyewitnesses claimed, Cardona replies. I keep grasping for facts, but realize it’s futile. Cardona says, “This is the black hole of Mexico. You cannot see inside of it, and nothing gets out.”

Despite the heavy military and police presence, six rehabilitation clinics have been attacked in Juárez over the past two years. The deadliest incident occurred on September 2, when 18 people were executed. Government authorities claimed the massacres were part of a war of extermination between the Sinaloa and Juárez cartels.

The conduct of the Mexican military goes to the heart of U.S. counter-narcotics policy. In the past year, experts like General Barry McCaffrey (the drug czar in the Clinton administration) and political figures have warned that if the cartels are not contained, Mexico could become a failed state and the U.S. could find itself with an Afghanistan or a Pakistan on its southern border. Such forecasts are hyperbole, but the fact is that drug trafficking and its attendant corruption are a malignancy that has spread into Mexico’s lymph system. To extend the metaphor, Calderón is attempting to perform radical surgery with the only instrument at his disposal—the army. It may be a tainted instrument, so the reasoning goes, but it is less tainted than the law-enforcement agencies.

Washington supports, indeed encourages, this approach through the Mérida Initiative, a security-cooperation agreement between the two countries that Congress passed and George W. Bush signed into law. Its aim is to provide $1.4 billion in funding, spread over several years, for military and law-enforcement training, equipment such as helicopters and surveillance aircraft, and judicial reforms. The aid package also includes conditions for improvements to Mexico’s less-than-enviable record on human-rights issues. Fifteen percent of the funds can be withheld if Mexico fails to show progress on matters such as prosecuting human-rights violators and prohibiting the use of torture to obtain evidence and testimony.

And that is where U.S. policy becomes contradictory. It calls for a military solution to the trafficking problem. But there are very few, if any, civil safeguards on the actions of the Mexican military. Its soldiers are subject only to military law, even when deployed in their current crime-fighting capacity, and the country’s military-justice system is, to understate things, opaque.

A good example is the case of Javier Rosales, a medical technician who died after he and a friend were captured and tortured by soldiers. Members of his family went to the state justice office and the federal attorney general’s office to file a complaint against the soldiers and demand an investigation. They were turned away because, the officials said, charges of army misconduct fall under military jurisdiction. However, Enrique Torres, a spokesman for the Joint Chihuahuan Operation, told me that the army looks into such allegations only through internal investigations or when formal charges have been filed by state or federal prosecutors. It’s pure catch-22: state or federal authorities will not receive complaints against soldiers, and the army will not investigate unless charges have been filed by state or federal authorities.

That is among the reasons why, out of the more than 2,000 complaints brought before Mexico’s National Human Rights Commission, not one has resulted in the prosecution of a single soldier.

The provisions of the Mérida Initiative would appear to give the U.S. considerable leverage in compelling the Mexican army to act with more restraint and greater respect for the civil rights of the country’s citizens. Financial leverage, that is. The moral authority of the U.S. has been eroded by accusations that it has employed torture and illegal detentions in the “war on terror,” as well as by its status as the drug cartels’ biggest market and its singularly unsuccessful efforts to dry up demand.

Every year, under the Foreign Assistance Act, the State Department is required to certify that its southern neighbor is fully cooperating in efforts to stem the export of illegal narcotics into the United States. Without certification, Mexico would be ineligible to receive the vast majority of American aid. But the U.S. government often soft-pedals criticisms of Mexico on matters such as corruption and human-rights offenses, for two reasons. One is U.S. sensitivity to the Mexican elite, which can be thin-skinned about what it regards as infringements from the north on its national sovereignty. The second is money. In the highly unlikely event that Mexico were decertified, the cutoff in U.S. aid would strain bilateral relations, trade agreements would be imperiled, and American businessmen would find it harder to operate south of the border. Also, of all the countries that export oil to the United States, Mexico, at 985,000 barrels a day, ranks third, behind Canada and Saudi Arabia.

That makes speaking the truth about Mexico politically and economically dangerous in official U.S. circles.

But a larger question arises. Even if tomorrow the Mexican military began waging its anti-narcotics campaign with the probity of, say, the Swiss Guard, could it overcome the power of cartels? The drug bosses and their organizations have become integrated into Mexican society, corrupting every aspect of the nation’s life.

The U.S. government estimates that the cultivation and trafficking of illegal drugs directly employs 450,000 people in Mexico. Unknown numbers of people, possibly in the millions, are indirectly linked to the drug industry, which has revenues estimated to be as high as $25 billion a year, exceeded only by Mexico’s annual income from manufacturing and oil exports. Dr. Edgardo Buscaglia, a law professor at the Autonomous Technological Institute in Mexico City and a senior legal and economic adviser to the UN and the World Bank, concluded in a recent report that 17 of Mexico’s 31 states have become virtual narco-republics, where organized crime has infiltrated government, the courts, and the police so extensively that there is almost no way they can be cleaned up. The drug gangs have acquired a “military capacity” that enables them to confront the army on an almost equal footing.

“This in itself does not prove that we are in a situation of a failed state today,” Buscaglia wrote. He seemed to be suggesting that the situation could change tomorrow—and not for the better.

The Tijuana of the Caspian - The Atlantic (December 2009)

Image by myxabyxe via Flickr

At 8:45 a.m., the Azerbaijani cabbies were clustered in the courtyard next to the customs terminal, waiting for the Iranians to walk through a narrow, rusted door. They do this every morning in the town of Astara, which dates back 6,000 years and today sits on the border between the post-Soviet Republic of Azerbaijan and the Islamic Republic of Iran. It can be hard for the uninitiated to distinguish Azerbaijani Azeris from Iranian Azeris, but the drivers know their clientele.

“The Iranian girls are fairer, and they always have their heads down and their head scarves on,” said Misha Mamedli, a tall, slouching man with a gold front tooth and a stash of self-rolled cigarettes in his breast pocket. But the Iranian men, who have the cash and do the negotiating, drew the most attention from the cabbies. Decked in tight jeans and T-shirts with Italian print, they emitted a cool, confident brusqueness as they marched through the rusted door: their gateway to pork products, alcohol, and easy sex. - Peter Savodnik

“Here, it’s open,” Misha said. “No one cares what you do.”

This makes the mullahs in Tehran very nervous. Books, DVDs, fashions, and—most important—ideas that are inaccessible in Iran are ubiquitous in Azerbaijan. Iranians line up daily to cross the Astara River to buy and sell jeans, chickens, bras, laptops—and often sex and schnapps and heroin. This commerce, combined with cultural curiosity and shared Azeri bloodlines, has transformed Astara into the Tijuana of the Caspian.

Astara doesn’t scream so much as strongly hint at the possibility of sin. Next to the customs terminal’s courtyard and above the row of babushkas selling tea and beef kebabs, there’s a convenient motel (“Ideal for bringing the girls back to,” one Iranian told me). The fluorescent-lit cafés on Aliyarbeyov Street are stocked with Russian vodka and French cognac, and the Turkish Salon, on Fountain Square, offers, among other things, tattoos, piercings, astrological forecasts, and “full-body massage.”

All of this is made possible by the Azerbaijanis’ somewhat attenuated relationship with God, the product of seven decades of Communist rule and a steady influx of Westerners after oil was discovered in the mid-1800s. Iranians find the Azerbaijanis’ mildly ironic attitude toward Islam a welcome relief from the stern theocracy of the ayatollahs. During Ramadan many Azerbaijanis do not fast, and the cafés in Astara do a bustling lunch business, serving lamb shashlik, or barbecue, to visiting Iranians. Manana Shafieva, a stylist at the Turkish Salon, said many Iranian men bring in their wives to be spruced up. “They say, ‘I know she can be beautiful. Can you make her beautiful?’ They know we know about hair and what it means to have a modern image.”

But the Iranian mullahs are not merely concerned about the affectations of modernity. Mamedli, the cab driver, said that the crowds lining up for entry to Astara have surged since June, when hundreds of thousands of Iranians protested the allegedly rigged reelection of President Mahmoud Ahmadinejad. This has worrisome implications: the potential for political upheaval is acute in Iran’s north, where the bulk of the country’s university students live, along with most of its 15 million to 30 million ethnic Azeris (out of a total population of about 73 million). Prominent ethnic Azeris in Iran include Ahmadinejad’s presidential rival, Mir-Hossein Moussavi, the poet Mohammad Hossein Shahriar, and the filmmaker Kamal Tabrizi. Even the supreme leader of Iran, Ayatollah Ali Khamenei, is part Azeri. Many Azeris are so swollen with ethnic pride that Iranian officials suspect them of dual loyalty.

As a result, an Azerbaijani Ministry of Foreign Affairs official told me, “it’s common knowledge that the Iranians want the border shut down.”

At night, the courtyard next to the customs terminal was empty except for a few malnourished cats. On the Iranian side of the border, an imam and his flock were praying. Their voices drifted across the river and through the mesh of walls and fences. On Fountain Square, kids blasted Israeli pop music. A guard stopped me as I navigated the darkened market stalls, redolent of tea and rotting nectarines.

“The border is closed until morning,” he said. Then he nodded at the motel. “You want a room? It’s very nice, with a television and a girl.”

I said I was staying near the square and just taking a stroll.

“Only 10 manats,” he persisted. “I can get you this. Anything you want.” I laughed, and he lit a cigarette. “Come on,” he said, “don’t be a Muslim.”

Letter From China - Going Green in China, Case by Case - NYTimes.com

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By MICHAEL FORSYTHE

ORDOS REGION, CHINA — This region of Inner Mongolia, home to one of the biggest deserts in China, is being transformed into the site of a pine forest that will stretch across its low hills as far as the eye can see.

The local government’s tree-planting program is part of a plan to “assume our green responsibilities and build a civilized way of life,” Du Zi, the local Communist Party secretary, told energy executives at a conference last month in Beijing.

Also on tap: the world’s biggest plant to convert sunlight to electricity, built by First Solar of Tempe, Arizona, part of a 12-gigawatt wind, solar and biomass power-generating zone. And General Electric is helping the land of Genghis Khan cut wastewater emissions into the Yellow River, which borders the region.

“This shows what local leadership can do in China these days,” said Kenneth Lieberthal, head of the Brookings Institution’s China Center in Washington, which played host to Mr. Du and other provincial officials at the Oct. 21-23 conference. “They’ve gone flat-out.”

Regions are vying to outdo one another in a race to develop alternative-energy sources and reduce pollution. Gansu Province in western China is building a wind farm equivalent to about 20 nuclear power facilities. In the east, Zhejiang Province is installing solar panels on roofs. Beijing bans motorcycles from the city center in favor of electric bikes.

Their efforts demonstrate that China, the world’s largest producer of the emissions blamed for global warming, will continue to accelerate development of energy from renewable sources, even as it resists binding targets for reducing carbon emissions ahead of a U.N. summit meeting in Copenhagen next month aimed at forging a new treaty to curb greenhouse gases.

Some regional officials now see environmental projects as a way to bolster their economies after decades when companies were allowed to poison the air and water without penalties while expanding output.

And First Solar surged $12.94, or 11 percent, to close at $134.41 on Nasdaq on Sept. 8, the day Wu Bangguo, China’s highest-ranking leader after President Hu Jintao, visited the company’s Tempe headquarters. The next day the company made the Ordos agreement public.

Mr. Du, 54, cites a list of achievements in Ordos: increasing the portion covered by vegetation to 81 percent last year from 20 percent in 2000, closing 1,200 polluting factories and installing 100 megawatts of wind capacity.

The 20-gigawatt, 120 billion yuan, or $17.6 billion, Gansu project, set for completion in 2020, would be the biggest wind farm in the world. The Roscoe Wind Complex in Texas, currently the largest, generates less than one gigawatt — a billion watts — of electricity.

China is under pressure from the international community to accelerate its push toward alternative energy. It has refused to accept binding restrictions on carbon pollution, saying controls will crimp economic growth. Instead, China has pledged to cut emissions voluntarily in proportion to gross domestic product, without committing to include the policy in a global agreement.

Mr. Hu called climate change “a grave challenge to mankind” and pledged to work for “positive outcomes” in Copenhagen during a speech Sunday at the Asia Pacific Economic Cooperation forum in Singapore.

Collaboration between the United States and China on alternative energy was on the agenda for the talks this week in Beijing between Mr. Hu and President Barack Obama. Such projects are already under way in Ordos, Mr. Du says.

General Electric, based in Connecticut, is working with Elion Chemical Industry of Ordos City to cut its wastewater discharge into the Yellow River. The project is slated to be completed next year, said G.E., the biggest maker of power-plant equipment in the world.

First Solar, the largest U.S. producer of solar modules, is looking for more business following the planned groundbreaking next year for the new photovoltaic facility.

“We hope this will be the first of many projects in China,” said Brandon Mitchener, a company spokesman based in Brussels. “China has the potential to become one of, if not the, largest solar market in the world.”

The Bloomberg World Energy-Alternate Sources Index has risen 21 percent in the last year as of Nov. 16, compared with a 27 percent rise in the Standard and Poor’s 500 Index.

Ordos, among the nation’s wealthiest areas, has the means to push big, government-backed projects. It claims one-sixth of China’s proven coal reserves and one-third of its natural gas, giving the region of 1.6 million people a per capita income of 102,128 yuan, the third highest of any Chinese municipality.

Mr. Hu is signaling that he is serious about changing China’s energy mix. The goal is to produce 15 percent from renewable sources by 2020, according to a 2006 energy law.

China will see an even greater push by provinces and cities if the Communist Party begins to reward and promote officials on the basis of their ability to promote alternative energy, says John Thornton, a former co-president of Goldman Sachs who is now chairman of Brookings and was co-host of the October conference in Beijing.

“China is really quite an impressive, well-oiled machine in its ability to do large-scale things decisively,” Mr. Thornton said.

Michael Forsythe is a columnist with Bloomberg News.

For Bread or Soccer, Egypt Is Ready for a Riot - NYTimes.com

Image by madmonk via Flickr

By MICHAEL SLACKMAN

CAIRO — History has proven there are two subjects that will move Egyptians to pour into the streets in riotous numbers, crashing windows, burning cars, battling each other and defying an army of club-wielding riot police.

One is the price of bread. Another is soccer, as was proven again this week after Egypt’s national team was defeated by its bitter rival Algeria, losing a berth in the World Cup tournament next year and sparking a riot outside the Algerian embassy in Cairo late Thursday night.

But there was a pronounced difference between the bread riots of 1977 and 2008 and the soccer riot: the government quieted those earlier outbreaks by quickly lowering the price of bread, while this week it stoked outrage against Algeria.

Egypt had beaten Algeria 2-0 in Cairo on Saturday to set up Wednesday’s climactic playoff in the Sudanese capital, Khartoum. After Egypt lost the second match, the government withdrew its ambassador from Algiers and accused Algerians of menacing Egyptian fans after the game. President Hosni Mubarak’s eldest son, Alaa, a wealthy businessman, sounded as if he were calling his nation to war.

“We were being humiliated and we can’t be silent about what happened there,” he said in a telephone call to Egypt’s most popular television talk show. “We have to take a stand. This is enough. That’s it, this is enough. Egypt should be respected. We are Egyptian and we hold our head high and whoever insults us should be smacked on his head.”

Despite the Egyptian complaints, which include accusations of stoning and machete attacks, there is no documented evidence of any Egyptians being seriously injured in the aftermath of the game on Wednesday, won by the Algerians, 1-0.

Dignity did seem to be a subtext, however, as hundreds of young men rushed the Algerian embassy, trashing cars and stores, burning Algerian flags and injuring police 35 police — a rare occurrence in a police state that has made gatherings of seven or more people illegal.

Soccer is a national passion. The only time Egyptians take to the streets in flag waving celebration is when their team wins. And in soccer terms the North African neighbor, Algeria, has for years been enemy No. 1. Both nations have waited a long time to get a spot in the World Cup, 24 years for Algeria, 20 for Egypt. The last time Egypt made it was in 1989, when it defeated Algeria.

From the start, the Egyptian government sought to exploit the games with Algeria for political reasons, political analysts said. State radio broadcast nationalist songs. Streets were filled with young men selling Egyptian flags. The president’s son, Gamal Mubarak, who is often talked about as a possible successor to his 81-year-old father, attended the two games with other high ranking party members.

“They charged people thinking that this would keep them busy from other problems, but in the end it backfired,” said Osama Anwar Okasha, an Egyptian television writer and columnist who blamed leaders in both countries. “It made people here and there explode.”

Critics charged that the government — and specifically the president’s political organization, the National Democratic Party — was hoping that a win on the field could bolster its credibility in the face of grinding poverty and political stagnation. By the time the Algerian team bus pulled into Cairo on Saturday, people were so riled up they pelted it with hunks of concrete and its players were bloodied — though Egyptians insisted the Algerians did that to themselves in an attempt to win a change of venue.

When Egypt lost the playoff, the government still tried to ride those emotions, leading with calls of outrage and indignation.

“It is strange that the regime was charging people with all these emotions from the beginning, as though this victory or loss will resolve all their problems,” said Salama Ahmed Salama, head of the editorial board of El Shorouk, an independent newspaper in Cairo. “What you see happening is that the problems, and the social and political oppression people face, pushes them to behave this way.”

The Algerians were not entirely innocent victims in all this. They goaded the Egyptians, claiming falsely that Algerian fans were killed in Cairo. A music video circulating on the Internet showed a picture of President Mubarak with a pig’s face as a rapper called Egyptians “beggars, beggars thieves, crooks, known pick pocketers.” (And much worse.)

Tensions ran high before Wednesday’s game, in which Egypt was favored, and the Sudanese dispatched thousands of soldiers and police to the stadium to maintain calm. Yet, after the Algerians won the crowd filed calmly out of the stadium without any sign of violence, witnesses reported.

But that was not the message sent back home, where Egyptians were overwhelmed with news coverage and amateur videos of injured fans and Algerians waving knives and insulting Egypt.

“What you don’t know is that the Algerian fans have been in the streets of Khartoum for the past three days purchasing daggers and knives,” said the minister of information, Anas el-Feqqy, Thursday night on one of Egypt’s most popular television talk shows. “These are not people going to cheer for soccer, these are people going to take revenge and exercise violence.”

That same night, young men rampaged in the streets. But on Friday, the government sent out a signal that it was time to stop, that perhaps things had gone too far. The Foreign Ministry said the government would not “tolerate violations against Algerian interests” in Egypt.

Reporting contributed by Mona el Naggar

U.S. Fears Iraq Development Projects May Go to Waste - NYTimes.com

Image by Getty Images via Daylife

By TIMOTHY WILLIAMS

BAGHDAD — In its largest reconstruction effort since the Marshall Plan, the United States government has spent $53 billion for relief and reconstruction in Iraq since the 2003 invasion, building tens of thousands of hospitals, water treatment plants, electricity substations, schools and bridges.

But there are growing concerns among American officials that Iraq will not be able to adequately maintain the facilities once the Americans have left, potentially wasting hundreds of millions of dollars and jeopardizing Iraq’s ability to provide basic services to its people.

The projects run the gamut — from a cutting-edge, $270 million water treatment plant in Nasiriya that works at a fraction of its intended capacity because it is too sophisticated for Iraqi workers to operate, to a farmers’ market that farmers have not been able to decide how to divvy up space for, to a large American hospital closed immediately after it was handed over to Iraq because the government was unable to supply it with equipment, a medical staff or electricity.

The concern about the sustainability of the projects comes as Iraq is preparing for pivotal national elections in January and as rebuilding has emerged as a political imperative in Iraq, eclipsing security in some parts of the country as the main anxiety of an electorate frustrated with the lack of social, economic and political progress. American forces are scheduled to begin withdrawing in large numbers next year.

In hundreds of cases during the past two years, the Iraqi government has refused or delayed the transfer of American-built projects because they can not staff or maintain them, Iraqi and American government officials say.

Other facilities, including hospitals, schools and prisons built with American funds, have remained empty long after they were completed because there were not enough Iraqis trained to operate them.

“As large-scale construction projects — power plants, water-treatment systems and oil facilities — have been completed, there has been concern regarding the ability of Iraqis to maintain and fund their operations once they are handed over to the Iraqi authorities,” said a recent analysis prepared for Congress by the Congressional Research Service.

The Government Accountability Office and the special inspector general for Iraq reconstruction have also issued reports during the past several months about the potential failure of American-financed projects once they are transferred to Iraq.

Stuart W. Bowen Jr., inspector general for Iraq reconstruction, said his watchdog agency had “regularly raised concerns about the potential waste of U.S. taxpayer money resulting from reconstruction projects that were poorly planned, badly transferred, or insufficiently sustained by the Iraqi government.”

The blame is shared, officials said. While Iraq has often been guilty of poor management, American authorities have repeatedly failed to ask Iraqis what sort of projects they needed and have not followed up with adequate training. And whether or not the American-built health centers and power plants are ever used as intended, the American companies that won the lion’s share of rebuilding contracts from the federal government have been paid.

The Iraqi government, prodded by American officials here, has pledged to begin spending more of its own money on reconstruction, but the country is facing a substantial budget deficit because of declines in international oil prices.

Prime Minister Nuri Kamal al-Maliki has insisted that reconstruction is the next task. What is not clear is where the $400 billion the government says it needs will come from.

“We will use the revenue we have from oil, but the government feels it has to do more than that to rebuild,” said Ali al-Alak, an adviser to Mr. Maliki.

In the meantime, the Americans — military and civilian reconstruction specialists alike — continue to depart in large numbers, taking with them their money, equipment and expertise.

Despite the $53 billion spent by the United States, many Iraqis have criticized the rebuilding effort as wasteful. Ali Ghalib Baban, Iraq’s minister of planning, said it had had no discernable impact. “Maybe they spent it,” he said, “but Iraq doesn’t feel it.”

Iraqis, for whom bombed-out buildings are an unremarkable part of urban existence, also say they have seen little evidence of rebuilding.

“Where is the reconstruction?” asked Sahar Kadhum, a resident of Kut, about 100 miles southeast of Baghdad. “The city is sleeping on hills of garbage.”

Indeed, despite the billions in American funds, more than 40 percent of Iraqis still lack access to clean water, according to the Iraqi government. Ninety percent of Iraq’s 180 hospitals do not have basic medical and surgical supplies, according to the aid organization Oxfam. Iraqis also have from disproportionately high rates of infant mortality, cerebral palsy and cancer.

Exacerbating the problem, Iraqi and American officials say that hundreds of thousands of Iraq’s professional class have fled or been killed during the war, leaving behind a population with too few doctors, nurses, engineers, scientists and others.

In Hilla, 60 miles south of Baghdad, a recently completed $4 million maternity hospital built by the Americans is open, but the staff members are unable to operate much of its equipment.

“The building is fairly good and the Americans have provided the hospital with a variety of high-tech medical devices, but they did not pay attention to the training of doctors in how to use them,” said Jawad al-Jubouri, a district officer.

In Falluja, west of Baghdad, a $98 million waste water treatment plant built by the United States serves only one-third of the homes it was intended to because the Iraqi government has not supplied it with sufficient fuel “raising the possibility that the U.S. effort has been wasted,” according to a special inspector general’s report.

At Ibn Sina Hospital in Baghdad, which had been the American military’s largest medical center in the country, Iraqi security forces took up guard positions even before the conclusion of a ceremonial transfer to the Iraqi government last month. The hospital, however, has been closed because the Health Ministry lacks the staff and equipment to reopen it, even though the American military said it left $7.9 million in equipment behind.

Iraq’s most notorious reconstruction project might be the $165 million Basra Children’s Hospital in southern Iraq. Championed by Laura Bush when she was the first lady, its completion has been delayed by more than four years, and the project is $115 million over budget.

Once the hospital opens — perhaps next year — there will be too few doctors and other medical staff members to take advantage of much of its modern equipment.

“It was supposed to open in March, but I don’t think it will be ready,” said Ahmed Qassim, the hospital’s director. He added: “Maybe July, but we don’t know. Maybe not July.”

Duraid Adnan contributed reporting from Basra, John Leland from Baghdad and Iraqi employees of The New York Times from Basra, Hilla and Kut.

In New Orleans, Elation Over Katrina Liability Ruling - NYTimes.com

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By CAMPBELL ROBERTSON

NEW ORLEANS — Since the first days after Hurricane Katrina, when the streets were still under water, many residents of New Orleans and its surroundings have maintained that the flood that wrecked their lives was the government’s fault, and that the government should pay for it.

On Wednesday night came news that many had hoped for but few had believed would ever actually happen: a federal judge agreed.

“My head is spinning,” said Pam Dashiell, a co-director of the Lower Ninth Ward Sustainability Project and a 20-year resident of the neighborhood. “Maybe things are really breaking for the people.”

The sense of vindication was widespread, but the practical implications were less clear. The morning after Judge Stanwood R. Duval Jr.’s decision that the Army Corps of Engineers’ negligent maintenance of a major navigation channel led to major flooding in the Lower Ninth Ward and the adjacent St. Bernard Parish, a pleasantly startled New Orleans was still trying to decipher what it meant.

Was it an opening for tens of thousands of lawsuits, or a big class-action lawsuit, that could add up to billions of dollars in compensation for residents? Or was it leverage for negotiating a broader, regionwide settlement with the government? Some experts suggested that it was a welcome but ultimately symbolic ruling that could be overturned on appeal.

Charles S. Miller, a spokesman for the Department of Justice, said that the government was still reviewing the decision.

“We have made no decision as to what the government’s next step will be in this matter,” he said in a statement.

But given the potential of liability, legal experts are expecting the government to appeal.

The United States Court of Appeals for the Fifth Circuit in New Orleans, where the case would go, has a record of hostility to plaintiffs in environmental cases, said Oliver Houck, a law professor at Tulane University. But, he said, Judge Duval’s decision is so technical and packed with details — it came with a 33-page appendix of graphs, charts and maps — that there are only a few areas where it would be exposed to a reversal.

“For an appellate court to reverse him on the facts is unthinkable,” Professor Houck said.

In 2008, Judge Duval dismissed a lawsuit arising from drainage canal breaches that flooded much of the city, ruling that a 1928 act gave the corps immunity for damages that came from a flood protection project. But his decision was scathing nonetheless, and he insisted that the government should not be free “from posterity’s judgment concerning its failure to accomplish what was its task.”

Wednesday’s decision was about a different corps project, the Mississippi River-Gulf Outlet, a navigation channel known as MR-GO (pronounced Mister Go). In the 156-page decision, the judge wrote nearly as much about complicated immunity issues as he did in determining that the corps’s negligent maintenance of the channel actually caused the flooding in two areas, including the Lower Ninth Ward.

Lawyers for the corps had raised a variety of immunity shields in addition to the Flood Control Act, and the judge knocked these down one by one. With every one, though, he created a potential opportunity for higher judges to overturn the decision on appeal.

The judge ruled that the corps was liable for damages because, he said, it should have been filing environmental impact statements as the landscape around the channel significantly changed: wetlands had disappeared, levee banks had eroded, and the channel had more than doubled in width.

This is a conclusion of law rather than of fact, experts said, and thus is open territory for appeals judges. When legal opinion is at issue, said Howard J. Bashman, a Pennsylvania lawyer specializing in appellate practice, “the court gets to make up its own mind, without any deference paid to the trial judge in how the law was applied.”

At a Thursday morning news conference, the plaintiffs’ lawyers painted the decision in superlative terms, even comparing it to the victory over the British in the Battle of New Orleans.

The lawyers said they hoped the decision, and the possibility of thousands more cases following, would compel Congress and the Obama administration to agree to some kind of larger settlement for the entire city, like the one for victims of the Sept. 11 attacks.

“It’s time that we stopped litigating and started negotiating,” said Pierce O’Donnell, one of the lead lawyers.

Mr. O’Donnell said that he and the other lawyers had scheduled meetings on Capitol Hill in the coming weeks at which they would push for damage compensation for property owners, billions of dollars to rebuild infrastructure projects, and restoration of the area’s coastal wetlands. They will also demand a widespread overhaul of the Army Corps.

For now, however, much of the city was just enjoying a rare sense of triumph. Friends who were watching the news Wednesday night grabbed for their cellphones. At a coastal planning meeting in St. Bernard Parish, people broke into applause.

Mark Madary, who was on the St. Bernard Parish Council at the time of Hurricane Katrina, had campaigned against MR-GO ever since he heard the forecasts of catastrophe at a sportsmen’s league meeting in 1978. He said he never thought the case would even make it to court, but now expects a regionwide settlement.

“Now that the corps has been thrown over and exposed, it’s their duty,” Mr. Madary said.

Others in New Orleans, a city that has become accustomed to disappointment over four long years, were not as elated.

“It is an answer to something that was obvious from the beginning, and we’re glad we finally got a federal judge to agree with us,” said Robert Green Sr., a resident of the Lower Ninth Ward, who lost his mother and granddaughter in the flooding.

But it was clear that Mr. Green was more interested in talking about a grocery store that could be coming to the neighborhood.

“The lawyers are happy and the people are happy,” Mr. Green said of the decision. “But at the same time, we waited four years. So you deal with the important issues that are right in front of you.”

John Schwartz contributed reporting.