Very interesting...

Chinese Attitudes on Generosity Are Tested

By MICHAEL WINES

Published: September 23, 2010

BEIJING — Like most everything else in China’s economy, philanthropy here is in a boom period, fueled by phalanxes of newly minted billionaires and foundations, encouraged by an army of professional advisers on charity and, increasingly, sanctioned by the government.

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David Goldman/CNBC

Bill Gates, left, and Warren Buffett have invited about 50 of China's superrich to discuss philanthropy, but some may have qualms about attending.

Which makes the case of Warren Buffett and Bill Gates, who will come to Beijing next week to share their thoughts on philanthropy with some of China’s wealthiest people, all the more curious.

Mr. Buffett and Mr. Gates, the Rockefeller and Carnegie of this age, announced plans last month to invite about 50 of China’s superrich to discuss their concept of philanthropy, which includes enlisting the world’s wealthiest people to give away at least half their fortunes.

Things appeared to be going swimmingly until early September, when the Chinese news media quoted a Beijing official of the Bill and Melinda Gates Foundation as saying that “a small number of people” had declined to come, and that others had asked whether they would be pushed for donations.

Last week, Mr. Gates and Mr. Buffett issued a letter stating that they were not coming to China “to pressure people to give,” but to listen. “China’s circumstances are unique, and so its approach to philanthropy will be as well,” they wrote.

Except for denying a report from Xinhua, the state-run news agency, that only two tycoons had accepted the invitation, the organizers of the event have largely fallen silent.

But the Chinese are unlikely to stop talking soon. In a nation where explosive growth has opened a yawning gap between rich and poor, reports that Chinese billionaires might stiff-arm the invitation have spawned a sort of national Rorschach test of Chinese generosity, not to mention attitudes toward the rich.

“Are Chinese rich scared to be charitable?” asked The Global Times, the Communist Party’s English-language newspaper. Not at all; “This is the Americans’ conspiracy,” wrote one of 2,000 people who posted comments on the controversy on Sina.com, a major Internet portal. Academics grumbled about efforts to impose Western philanthropic values on Chinese tradition.

Actually, however, Chinese philanthropic tradition was being upended well before the Gates-Buffett dinner was even conceived. In barely a decade, the Chinese economy has created at least 117 billionaires, according to a Forbes magazine ranking, and hundreds of thousands of millionaires by the estimate of Hurun Report, a magazine based in Shanghai whose target audience is the rich. Only the United States has more billionaires.

While China’s reported philanthropic donations are now comparatively tiny — about $8 billion last year, the government says, compared with $308 billion in the United States in 2008 — changes in China’s economic structure and in government policies make that figure almost destined to rise quickly. And, in contrast to the past, riches are starting to flow to social and charitable causes.

“The Chinese have been very generous for a long period of time,” Rupert Hoogewerf, who publishes Hurun Report, said by telephone. “The difference has been that they do it between families, and don’t publicize it. What we’re seeing now is a new era of transparency.”

Translucency might be a better term. More than a few fortunes have been built on corruption, and their owners stay in the shadows. The China Reform Foundation, an economic research group based in Beijing, estimated last month that about $870 billion in corrupt “gray money” was being hidden by the wealthiest 10 percent of China’s population.

Huang Guangyu, who built an appliance shop into a fortune valued at $2.7 billion to $6.3 billion, was singled out by Hurun Report in 2007 as especially miserly. Today he is in prison, convicted of stock fraud and insider trading.

A Global Times article this month stated that in the last decade, 17 members of an annual list of China’s 50 richest people had been convicted of economic crimes.

Ordinary Chinese, steeped in petty government corruption, are often bitterly cynical toward the rich.

“Of course they’ll decline the invitation,” one wrote of the invited billionaires on the Sina.com postings board. “None of their money is clean!”

Yet a growing number of China’s corporate titans are open both about their wealth and about giving it away. The leading example is Yu Pengnian, an 88-year-old real estate baron who gave the last of his $1.3 billion fortune in April to a foundation he created to fund scholarships for poor Chinese students. The latest is Chen Guangbiao, 42, a Jiangsu Province recycling-company owner who has taken the Gates-Buffett pledge to give away his $440 million fortune when he dies.

“Wealth is not something that comes to you when you are born,” he said in an interview last week. “It’s like water. If you have only a cup, you keep it to yourself. If you have a barrel, you share it with your family. And if you have a river, you share it with everyone.”

This is a new phenomenon, and not only because the money is new. China’s Communist Party claims to represent the downtrodden, and has been reluctant to turn to the private sector to address problems of poverty and disease.

But since the outpouring of support for victims of the Sichuan earthquake in 2008, the government now seems to be edging toward a more accommodating attitude about private philanthropy. It offers corporations a tax break of up to 12 percent for charitable gifts, rising to 30 percent for individuals.

This year, a reregistration drive has certified more than 1,000 nonprofit groups as able to accept tax-deductible donations. Government officials have also said that they plan to enact the nation’s first charity law, with rules that clearly define what a charity is and how it must operate, by late 2011.

But whether revised rules on charities and nonprofit groups generally will broaden or restrict philanthropic work is unclear, said Jia Xijin, who directs the Nongovernmental Organization Research Center at Tsinghua University in Beijing. While the government has slowly given new leeway to some charitable groups, especially those that provide social services, it keeps a tighter rein on groups that advocate policy changes or raise money on their own.

The government’s concern is that “most public fund-raising organizations need some social cause, and if you organize people,” she said, “that means the organization represents some social force.”

For Mr. Chen, the recycling magnate, the best way to encourage philanthropy by the group invited to dine with Mr. Buffett and Mr. Gates is to publicize the names of people who decline to attend.

“I’ll help you bash them in the media,” he said. “We can’t be misers.”

The Day After Tomorrow

Op-Ed Columnist

By DAVID BROOKS

Published: September 13, 2010

Every political movement has a story. The surging Republican Party has a story, too. It is a story of virtue betrayed and innocence threatened.

Through most of its history, the narrative begins, the United States was a limited government nation, with restrained central power and an independent citizenry. But over the years, forces have arisen that seek to change America’s essential nature. These forces would replace America’s traditional free enterprise system with a European-style cradle-to-grave social democracy.

These statist forces are more powerful than ever in the age of Obama. So it is the duty for those who believe in the traditional American system to stand up and defend the Constitution. There is no middle ground. Every small new government program puts us on the slippery slope toward a smothering nanny state.

As Paul Ryan and Arthur Brooks put it in The Wall Street Journal on Monday, “The road to serfdom in America does not involve a knock in the night or a jack-booted thug. It starts with smooth-talking politicians offering seemingly innocuous compromises, and an opportunistic leadership that chooses not to stand up for America’s enduring principles of freedom and entrepreneurship.”

Ryan and Brooks are two of the most important conservative thinkers today. Ryan is the leading Republican policy entrepreneur in the House. Brooks is president of the highly influential American Enterprise Institute and a much-cited author. My admiration for both is unbounded.

Yet the story Republicans are telling each other, which Ryan and Brooks have reinforced, is an oversimplified version of American history, with dangerous implications.

The fact is, the American story is not just the story of limited governments; it is the story of limited but energetic governments that used aggressive federal power to promote growth and social mobility. George Washington used industrial policy, trade policy and federal research dollars to build a manufacturing economy alongside the agricultural one. The Whig Party used federal dollars to promote a development project called the American System.

Abraham Lincoln supported state-sponsored banks to encourage development, lavish infrastructure projects, increased spending on public education. Franklin Roosevelt provided basic security so people were freer to move and dare. The Republican sponsors of welfare reform increased regulations and government spending — demanding work in exchange for dollars.

Throughout American history, in other words, there have been leaders who regarded government like fire — a useful tool when used judiciously and a dangerous menace when it gets out of control. They didn’t build their political philosophy on whether government was big or not. Government is a means, not an end. They built their philosophy on making America virtuous, dynamic and great. They supported government action when it furthered those ends and opposed it when it didn’t.

If the current Republican Party regards every new bit of government action as a step on the road to serfdom, then the party will be taking this long, mainstream American tradition and exiling it from the G.O.P.

That will be a political tragedy. There are millions of voters who, while alarmed by the Democrats’ lavish spending, still look to government to play some positive role. They fled the G.O.P. after the government shutdown of 1995, and they would do so again.

It would be a fiscal tragedy. Over the next decade there will have to be spending cuts and tax increases. If Republicans decide that even the smallest tax increases put us on the road to serfdom, then there will never be a deal, and the country will careen toward bankruptcy.

It would also be a policy tragedy. Republicans are right to oppose the current concentration of power in Washington. But once that is halted, America faces a series of problems that can’t be addressed simply by getting government out of the way.

The social fabric is fraying. Human capital is being squandered. Society is segmenting. The labor markets are ill. Wages are lagging. Inequality is increasing. The nation is overconsuming and underinnovating. China and India are surging. Not all of these challenges can be addressed by the spontaneous healing powers of the market.

Most important, it would be an intellectual tragedy. Conservatism is supposed to be nonideological and context-driven. If all government action is automatically dismissed as quasi socialist, then there is no need to think. A pall of dogmatism will settle over the right.

Republicans are riding a wave of revulsion about what is happening in Washington. But it is also time to start talking about the day after tomorrow, after the centralizing forces are thwarted. I hope that as Arthur Brooks and Paul Ryan lead a resurgent conservatism, they’ll think about the limited-but-energetic government tradition, which stands between Barry Goldwater and François Mitterrand, but at the heart of the American experience.

In Israel, Settling for Less

By GADI TAUB

Published: August 29, 2010

WILL Israel remain a Zionist state? If so, what kind? These are the important questions in Israeli politics today, and will be looming over the direct talks between Israel and the Palestinian Authority scheduled to begin Thursday in Washington.

The secular Zionist dream was fundamentally democratic. Its proponents, from Theodor Herzl to David Ben-Gurion, sought to apply the universal right of self-determination to the Jews, to set them free individually and collectively as a nation within a democratic state. (In fact, the Zionist movement had a functioning democratic parliament even before it had a state.)

This dream is now seriously threatened by the religious settlers’ movement, Orthodox Jews whose theological version of Zionism is radically different. Although these religious settlers are relatively few — around 130,000 of the total half-a-million settlers — their actions could spell the end of the Israel we have known.

The roots of the problem have been there from the birth of modern Zionism. The relations between Herzl’s movement and Jewish Orthodoxy were uneasy from the start. After all, the Zionist movement sought to achieve by human means what Jews for two millenniums considered to be God’s work alone: the gathering of the diaspora in the land of Israel. Most rabbis therefore shunned Herzl, but not all. Some joined the movement, even formed a party within it, based on a separation of religion and politics. For them, secular Zionism was primarily a solution to the earthly predicament of the Jews; it was not so theologically laden.

But over the following decades another form of religious Zionism came to precedence, inspired by the quasi-mystical writings of Abraham Isaac Kook, who was the chief rabbi of Palestine under the British Mandate in the 1920s and ’30s. Kook saw secular Zionists as the unwitting agents of God’s providence, advancing redemption by returning Jews to their homeland.

His son, Rabbi Zvi Yehuda Kook, later focused his father’s theological ideas around a single commandment: to settle all the land promised to the ancient Hebrews in the Bible. His disciples, energized by a burning messianic fervor, took Israel’s victory in the Six-Day War of 1967 as confirmation of this theology and set out to fulfill its commandment. Religious enthusiasm made the movement subversive in a deep sense — adherents believed they had a divine obligation to build settlements and considered the authority of Israel’s democratic government conditional on its acceptance of what they declared to be God’s politics.

Although religious settlers often describe themselves as heirs of the early Zionist pioneers, they are anything but. Herzl’s vision was about liberating people, while theirs is about achieving a mystical reunion between the people of Israel and the land of Israel. Herzl’s view stemmed from the ideals of the Enlightenment and the tradition of democratic national liberation movements, dating back to the American and French Revolutions; religious settlers are steeped in blood-and-soil nationalism. Herzl never doubted that Israeli Arabs should have full and equal rights. For religious settlers, Arabs are an alien element in the organic unity of Jews and their land.

The consequences of these differences are huge. If the settlers achieve their manifest goal — making Israel’s hold on the territories permanent — it will mean the de facto annexation of a huge Arab population and will force a decision about their status. In Israel proper, the Arab minority represents about a fifth of its 7.2 million citizens, and they have full legal equality. But between the Mediterranean and the Jordan River, there are roughly equal numbers of Arabs and Jews today.

Even if Israel annexed only the West Bank, it would more than double its Arab population. With birthrates in the territories far exceeding those of Arabs and Jews within Israel, Jews would soon enough be a minority. This would void the very idea of a Jewish democratic state.

Israel would have to choose between remaining democratic but not Jewish, or remaining Jewish by becoming non-democratic. Israel’s enemies have long maintained that Zionism is racism and that Israel is an apartheid state. If the settlers succeed, they will turn this lie into truth.

In fact, the former Prime Minister Ariel Sharon, once the great patron of the settlers, was one of the first politicians on the right to accept that the settlers’ dream is hopeless. That is why he led Israel out of Gaza in 2005. But not all have followed him. The secular Israeli right has abandoned the idea of annexation but still favors settlement on short-term (and short-sighted) security grounds.

Preserving military rule over the territories, they believe, is necessary to keep terrorism in check, and the settlements demonstrate Israel’s resolve. Although the occupation and the suspension of Palestinian rights are officially temporary, the right wing aspires to keep Arabs indefinitely in quasi-colonial status. Given the Palestinians’ refusal to sign a peace deal with Prime Minister Benjamin Netanyahu’s predecessors, many Israelis who oppose the settlements and occupation in principle have thrown up their hands and accepted this situation, too.

But the status quo cannot last — and Israelis and their supporters need to confront this fact. The most pressing problem with the settlements is not that they are obstacles to a final peace accord, which is how settlement critics have often framed the issue. The danger is that they will doom Zionism itself.

If the road to partition is blocked, Israel will be forced to choose between two terrible options: Jewish-dominated apartheid or non-Jewish democracy. If Israel opts for apartheid, as the settlers wish, Israel will betray the beliefs it was founded on, become a pariah state and provoke the Arab population to an understandable rebellion. If a non-Jewish democracy is formally established, it is sure to be dysfunctional. Fatah and Hamas haven’t been able to reconcile their differences peacefully and rule the territories — throwing a large Jewish population into the mix is surely not going to produce a healthy liberal democracy. Think Lebanon, not Switzerland.

In truth, both options — and indeed all “one-state solutions” — lead to the same end: civil war. That is why the settlement problem should be at the top of everyone’s agenda, beginning with Israel’s. The religious settlement movement is not just secular Zionism’s ideological adversary, it is a danger to its very existence. Terrorism is a hazard, but it cannot destroy Herzl’s Zionist vision. More settlements and continued occupation can.

Gadi Taub, an assistant professor of communications and public policy at Hebrew University in Jerusalem, is the author of “The Settlers.”

Cleaning the Henhouse

Op-Ed Columnist

By NICHOLAS D. KRISTOF

Published: September 1, 2010

The latest salmonella outbreak, underscoring the failures of industrial farming, reminds me of the small chicken flock that I tended while growing up on a family farm.

Our chickens wandered freely, and one dawn we were awakened by frantic squawking. We looked out the window to see a fox rushing off with a hen in its mouth.

My father grabbed his .308 rifle and blasted out the window twice in the general direction of the fox. Frightened, it dropped the hen. Yet the hen, astonishingly, was still alive. She picked herself up, spun around dizzily a couple of times, and staggered back to the barn.

A month later, my aunt visited our farm with her Irish setter, Toby, who was always eager to please but a bit dimwitted. We chatted and forgot about Toby — until he bounded up proudly to show a chicken he had retrieved for us.

It was the very same hen that had survived the fox. We shouted, and Toby sadly dropped the bird. She ruffled her feathers, glared at the dog, and then stalked off while clucking indignantly.

Perhaps that hen might have been ready to choose a cage over the perils of canines on the range, and, obviously, my family’s model of chicken-farming was horrendously inefficient and no model for the future. But the other extreme of jamming chickens into small cages is a nightmare for the animals — and the salmonella outbreak underscores that it can be a health hazard to humans as well.

Inspections of Iowa poultry farms linked to the salmonella outbreak have prompted headlines about infestations with maggots and rodents. But the larger truth is: industrial agriculture is itself unhealthy.

Repeated studies have found that cramming hens into small cages results in more eggs with salmonella than in cage-free operations. As a trade journal, World Poultry, acknowledged in May: “salmonella thrives in cage housing.”

Industrial operations — essentially factories of meat and eggs — excel at manufacturing cheap food for the supermarket. But there is evidence that this model is economically viable only because it passes on health costs to the public — in the form of occasional salmonella, antibiotic-resistant diseases, polluted waters, food poisoning and possibly certain cancers. That’s why the president’s cancer panel this year recommended that consumers turn to organic food if possible — a stunning condemnation of our food system.

The Centers for Disease Control and Prevention published a study in 2005 suggesting that in 2000 there were about 182,000 cases of egg-caused salmonella in the United States, including 70 deaths. That means that even without an outbreak in the news, eggs with salmonella kill more than one American a week.

“We keep finding excuses to keep this rickety industrial system together when the threat is very clear,” said Robert P. Martin, the executive director of the Pew Commission on Industrial Farm Animal Production. “It’s really a matter of when, not if, these serious outbreaks occur.”

About 95 percent of American egg-laying hens are still raised in small battery cages, which are bacterial breeding grounds and notoriously difficult to disinfect. Hens are crammed together, each getting less space than a letter-size sheet of paper. The tips of their beaks are often sheared off so they won’t peck each other to death.

They are sometimes fed bits of “spent hen meal” — ground up chickens. That’s right. We encourage them to be cannibals.

Industrial farms also routinely feed animals low doses of antimicrobials because growers think these help animals gain weight. One study found that 70 percent of antibiotics in the United States are used in this way — even though this can lead to antibiotic-resistant infections in humans.

“Food safety has received very little attention since Upton Sinclair,” notes Ellen Silbergeld, an expert on environmental health at the Johns Hopkins Bloomberg School of Public Health who is deeply concerned about antibiotic overuse. “The massive economic reorganization of agriculture has proceeded with little recognition of its potential impacts on these aspects of food. Cheapness is all.”

But as Professor Silbergeld notes, unsafe foods are cheap only in a shortsighted way. The Pew commission found that industrial production produces hogs that at first sight are cheaper by six cents per pound. Add in pollution and health costs and that industrial pork becomes more expensive by 12 cents per pound.

Largely for humanitarian reasons, Europe already is moving toward a ban on battery cages. In 2008, California approved a similar ban, and other states are expected to follow.

So let’s hope this salmonella outbreak is a wake-up call. Commercial farming can’t return to a time when chickens wandered unfenced and were prey to foxes (and Irish setters). But we can overhaul our agriculture system so that it is both safer and more humane — starting with a move toward cage-free eggs.