Making Political Risk More Politically Relevant

Journal of Political Risk, Vol. 7, No. 12, December 2019

Alicia N. Ellis, PhD, Arizona State University

Ukraine’s Independence Square in Fall 2013, taken only months before it erupted into violent protests culminating in the overthrow of the sitting government. A busy commercial and tourist hub that day, there was no sign of the war zone it would soon resemble. Photo: Alicia Ellis.

Executive Summary

This report assesses the state of the academic literature on political risk and evaluates its contribution to understanding and mitigating risk for both business and political professionals. This assessment concludes that policy-relevant research has been in some cases limited and, in most cases, ineffectively communicated. Several major problems contribute to the persistent disconnect between policy, industry, and academia. Political scientists do not approach their research questions in a communicable way, nor do they often take the necessary step of connecting their research to an end use. Risk rating organizations have become overly reliant on cross-national aggregate models. Mixed methods research has been applied inappropriately and thus, ineffectively. Systematic biases have been introduced to models at a structural level, and conceptual difficulties plague some of the most basic questions for risk analysts.

Despite these problems, opportunities do exist for bridging the gap between research and practice, and producing policy-relevant research. This article proposes some recommendations for moving forward. Research questions must be structured in new ways to reflect the needs of end consumers that include non-academic professionals. Several research agendas in need of a practical-minded researcher are put forth, including the rise of China and what it means for global trade patterns, the ‘buy local’ movement spreading across the United States, and the problem of democratic consolidation. For each problem identified, the article makes suggestions for how we might reframe the questions in a way that produces more useful research on political risk. Continue reading

Beyond the Camps: Beijing’s Long-Term Scheme of Coercive Labor, Poverty Alleviation and Social Control in Xinjiang

Journal of Political Risk, Vol. 7, No. 12, December 2019

By Adrian Zenz, Ph.D.
Senior Fellow in China Studies
Victims of Communism Memorial Foundation

1.0 Introduction

442 rural surplus laborers from Kashgar and Hotan, Xinjiang China, are sent off to work in an industrial park in Korla in a “centralized fashion”.

After recruiting a hundred or more thousand police forces, installing massive surveillance systems, and interning vast numbers of predominantly Turkic minority population members, many have been wondering about Beijing’s next step in its so-called “war on Terror” in Xinjiang. Since the second half of 2018, limited but apparently growing numbers of detainees have been released into different forms of forced labor. In this report it is argued based on government documents that the state’s long-term stability maintenance strategy in Xinjiang is predicated upon a perverse and extremely intrusive combination of forced or at least involuntary training and labor, intergenerational separation and social control over family units. Much of this is being implemented under the heading and guise of “poverty alleviation”.

Below, the author identifies three distinct flow schemes by which the state seeks to place the vast majority of adult Uyghurs and other minority populations, both men and women, into different forms of coercive or at least involuntary, labor-intensive factory work. This is achieved through a combination of internment camp workshops, large industrial parks, and village-based satellite factories. While the parents are being herded into full-time work, their children are put into full-time (at least full day-time) education and training settings. This includes children below preschool age (infants and toddlers), so that ethnic minority women are being “liberated” and “freed” to engage in full-time wage labor. Notably, both factory and educational settings are essentially state-controlled environments that facilitate ongoing political indoctrination while barring religious practices. As a result, the dissolution of traditional, religious and family life is only a matter of time. The targeted use of village work teams and village-based satellite factories means that these “poverty alleviation” and social re-engineering projects amount to a grand scheme that penetrates every corner of ethnic minority society with unprecedented pervasiveness.

Consequently, it is argued that Beijing’s grand scheme of forced education, training and labor in Xinjiang simultaneously achieves at least five main goals in this core region of the Belt and Road Initiative (BRI): maintain the minority population in state-controlled environments, inhibit intergenerational cultural transmission, achieve national poverty reduction goals, promote economic growth along the BRI, and bring glory to the Party by achieving all of these four aims in a way that is ideologically consistent with the core tenets of Communist thought – using labor to transform religious minority groups towards a predominantly materialist worldview, akin to the Reform Through Labor (劳改) program. Government documents outline that the transformation of rural populations from farming to wage labor should involve not just the acquisition of new skills, but also a thorough identity and worldview change in line with Party ideology. In this context, labor is hailed as a strategic means to eradicate “extremist” ideologies.

The domestic and global implications of this grand scheme, where internment camps form only one component of a society-wide coercive social re-engineering strategy, are dramatic. Government documents blatantly boast about the fact that the labor supply from the vast internment camp network has been attracting many Chinese companies to set up production in Xinjiang, supporting the economic growth goals of the BRI.

Through the mutual pairing assistance program, 19 cities and provinces from the nation’s most developed regions are pouring billions of Chinese Yuan (RMB) into the establishment of factories in minority regions. Some of them directly involve the use of internment camp labor, while others use Uyghur women who must then leave their children in educational or day care facilities in order to engage in full time factory labor. Another aspect of Beijing’s labor schemes in the region involve the essentially mandatory relocation of large numbers of minority workers from Xinjiang to participating companies in eastern China.

Soon, many or most products made in China that rely at least in part on low-skilled, labor-intensive manufacturing, may contain elements of involuntary ethnic minority labor from Xinjiang.

The findings presented below call for nothing less than a global investigation of supply chains involving Chinese products or product components, and for a greatly increased scrutiny of trade flows along China’s Belt and Road. They also warrant a strong response from not only the international community in regards to China’s intrusive coerced social re-engineering practices among its northwestern Turkic minorities, but from China’s own civil society that should not want to see such totalitarian labor and family systems extended to all of China. Continue reading

China and the War of Shipyards and Factories

Journal of Political Risk, Vol. 7, No. 10, October 2019

By William R. Hawkins

Chinese aircraft carrier group, including J-15 fighters and helicopters, trains in the South China Sea in late December, 2016. Visual China Group via Getty Images.

Satellite images show that China is making rapid progress in building its new Type 02 aircraft carrier at the Jiangnan Shipyard in Shanghai. The Type 02 is a larger design than Beijing’s first two carriers which were based on Soviet-era light carriers of about 67,000 tons and which lacked catapults for launching first-rate fighters. They used “ski jumps” to put planes into the air, limiting them to the small, short-range J-15 “Flying Shark” fighter-bombers. The Russian-built/China modified Type 01 can only carry 24 of these warbirds, though the China-built 01A, which is about to deploy, may be able to carry a few more. The Type 02 is a much larger design more in line with American carriers. At an estimated 80,000+ tons, it will be able to carry 40+ fighters as well as supporting aircraft such as early warning and control planes. In comparison, the typical U.S. Navy carrier has 60+ fighters along with other support aircraft. They are also nuclear-powered which the Chinese carriers are not. This does not mean, however, that American naval-air superiority is assured. Continue reading

An Oligarch, A Think Tank And The Rise Of American Kleptocracy?

Journal of Political Risk, Vol. 7, No. 10, October 2019

By Bertie Harrison-Broninski

Industrialist Len Blavatnik, left, and former U.S. President Bill Clinton speak at the Film Society of Lincoln Center 40th Anniversary Chaplin Award Gala at Lincoln Center in New York, U.S., on Monday, April 22, 2013. Clinton presented Barbra Streisand with the award honoring her work in film. Photographer: Amanda Gordon/Bloomberg via Getty Images

Ukrainian-born billionaire Lenonard Blavatnik has ignited controversy once again with his lavish donations to British and American institutions. This time, it is by giving $12 million to the Council of Foreign Relations (CFR), an influential thinktank with close ties to senior business, government, intelligence and foreign-policy communities in the US.

The move has prompted a series of open letters signed by “U.S., European and Russian foreign policy experts and anti-corruption activists”, who fear that such donations are “a means by which Blavatnik exports Russian kleptocratic practices to the West”. Many of them are CFR members themselves, and their letters are rounded off with footnotes demonstrating Blavatnik’s links to Putin’s inner circle and questioning the sources of his wealth. Their second letter states that the impact of the donation “extends far beyond the potential value of the money…beyond even CFR. That impact will touch upon the health of American democracy.”

None of this will come as any surprise to those who have followed Blavatnik’s spending over the past 15 years. While his philanthropy has seen him knighted by the Queen in the UK and hailed by some as one of the world’s most generous benefactors, his donations within political and educational spheres have repeatedly led to scrutiny and protest.

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Geopolitics and the Western Pacific: An Interview with Leszek Buszynski

The book cover of Geopolitics and the Western Pacific: China, Japan and the US, by Dr. Leszek Buszynski. Routledge, 2019.

Journal of Political Risk, Vol. 7, No. 6, June 2019

This interview with Dr. Leszek Buszynski, author of Geopolitics and the Western Pacific: China, Japan and the U.S. (Routledge, 2019), took place by email with Dr. Anders Corr between May 31 and June 12.

Anders: What are some of your recommendations in the book?

Leszek: The recommendations are in the final chapter and have been written from the perspective of Australia as a a middle power and ally of the US.  Basically, the U.S. relies excessively on military power to counter China but this is creating the fear of a US-China clash in the region from which China benefits, particularly within ASEAN.  Scuttling the Trans-Pacific Partnership (TPP) was a mistake because it is a way of bringing together the states of the region into cooperation with the U.S., Japan and Australia in a way which would offset Chinese influence.

Anders: Don’t you think that China is also creating fear with its military buildup? Wouldn’t countries like Japan and South Korea be even more fearful if they did not have the U.S. military there to protect them?

Leszek: This is not the issue, the answer is of course. But without a broader US presence in the region, one that is not just military based, regional countries such as those in ASEAN would feel the pressure to gravitate to China.  China has a way of undermining the U.S. presence and its alliance system by playing on regional fears of conflict and instability, the Philippines under Rodrigo Duterte is a case in point. America has to counteract that. Continue reading

President Trump Has Authority to Rebuild American Industry: Use the Defense Production Act of 1950

Journal of Political Risk, Vol. 7, No. 3, March 2019

By William R. Hawkins

The USS Eisenhower at a dock to complete it’s overhaul, Newport News, Virginia. Ira Block/National Geographic/Getty Images

President Donald Trump’s trade reform campaign is not meant only to redress the massive deficit with the People’s Republic of China ($419 billion in goods last year, a net figure of how much American money is supporting jobs and production in China rather than at home). His policies have been rooted in national security concerns with a focus on the dangerous transfer of capital and technology that has empowered Beijing’s military buildup and aggressive behavior along the Pacific Rim and beyond. There is concern that the momentum of his efforts is slowing. He delayed elevating tariffs on Chinese goods from 10% to 25% on March 1st to give negotiations more time to reach a deal. But the PRC regime will never curb its pursuit of the wealth and capabilities it needs to replace the U.S. as the world’s preeminent power. It is a long-term economic contest between rivals for the highest of stakes imaginable.

President Trump and close advisors such as Peter Navarro, Director of the National Trade Council in the White House know this, but need to operate from a strong base. Congress cannot, however, add much to the campaign at present. It is so crippled by factions and sophistries as to have taken itself out of the game. But Congress has left a legacy from earlier, less anarchic times: the Defense Production Act. This core legislation, based on preserving the “Arsenal of Democracy” which won World War II, gives the President broad authority to revive, expand and maintain our domestic industrial base. The DPA was first enacted in 1950, but it is still alive and well, being reauthorized twice by President George W. Bush, amended in 2009 on a bipartisan basis, supported by a 2012 Executive Order issued by President Obama and reauthorized again in 2014.

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Wall Street Elites Against Democracy? A Case Study in Pro-China Media Bias

Press Reaction to the November 2018 speech by Dr. Peter Navarro, Director of the White House Office of Trade and Manufacturing Policy, was biased in a negative direction.

Journal of Political Risk, Vol. 7, No. 12, December 2018 

By Anders Corr, Ph.D.

U.S. President Donald Trump delivers remarks before signing ‘Section 232 Proclamations’ on steel and aluminum imports with (2nd L-R) Treasury Secretary Steven Mnuchin, Commerce Secretary Wilbur Ross, U.S. Trade Representative Robert Lighthizer and White House National Trade Council Director Peter Navarro in the Roosevelt Room of the White House on March 8, 2018 in Washington, DC. Trump signed proclamations that imposed a 25-percent tarriff on imported steel and a 10-percent tarriff on imported alumninum. (Photo by Chip Somodevilla/Getty Images)

Dr. Peter Navarro, Director of the White House Office of Trade and Manufacturing Policy, gave a speech on November 9 at the Center for Strategic and International Studies (CSIS) in Washington, D.C. The title of the speech was “Economic Security as National Security”, which Dr. Navarro, a Harvard-educated economist, argues is the maxim of the Trump Administration. After the speech, Dr. Navarro was attacked in the media, but not about his main points. The negative, and one might argue biased, coverage came from the Wall Street Journal, CNBC, the Atlantic, and Director of the National Economic Council, Larry Kudlow, among others. The negative response centered on Dr. Navarro’s controversial claim that Wall Street elites have undue influence on U.S. policy having to do with China.  Tempers were likely frayed at the time due to planning, negotiations and internal maneuvering in advance of a high stakes late November meeting then being planned between Presidents Trump and Xi Jinping at the G-20 meeting in Argentina. Worries were high that lack of progress on at least the outline of an agreement at the meeting could lead to deepening tariffs between the countries, and fears in the financial sector of falling stock markets or even a recession. But the bias and infighting of the attacks were unbecoming of these media outlets, and of Mr. Kudlow, the Director of the National Economic Council.

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Protectionism Won’t Work: Four Alternatives to Canceling Trade Agreements

Journal of Political Risk, Vol. 5, No. 12, December 2017

By Bhakti Mirchandani

It’s time to create jobs for displaced manufacturing workers and bolster American competitiveness in four ways: (i) invest in growing fields and tradable economies that draw upon a region’s endemic old industrial skills; (ii) fight the opioid epidemic to avoid further declines in labor force participation; (iii) align universities and local manufacturers to ensure that workers are sufficiently skilled to participate in the local tradable economy; and (iv) encourage–and protect–R&D and entrepreneurship in manufacturing.

Embed from Getty Images

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