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Professor Park will address the changes that have occurred in the Chinese labor market over the past quarter century, focusing on the extent to which labor market reforms have successfully created a well-functioning market for labor with a high degree of labor mobility. Like other rapidly growing developing countries, China has experienced rapid structural change featuring a steady flow of labor from agriculture to industry, and from rural areas to urban areas. As a transition economy, China has shifted gradually from planned allocation of labor in state-sector jobs to a more open labor market. Although the large magnitudes of these changes are impressive, reform of the labor market has been halting, uneven, and difficult, with much additional reform still required. Prof. Park will look at several dimensions of the Chinese labor market: labor allocation, wage setting, regional differences, and ownership sectors. He will conclude by discussing the key policy challenges that lie ahead.

Albert Park is Associate Professor of Economics and Faculty Associate of the Center for Chinese Studies at the University of Michigan. He is also a research affiliate at the Population Studies Center and chairs the faculty steering committee for Michigan's China Data Center. Dr. Park has been a visiting professor and researcher at Harvard University and Peking University, as well as other research institutions in China and Taiwan, and has served as a consultant for the World Bank on several projects analyzing economic development issues in China, including the Bank's current China Poverty Assessment project. Dr. Park earned a Ph.D. in applied economics from the Food Research Institute and Department of Economics at Stanford University in 1996. His research interests include economic development, economic transition, labor, applied microeconomics, and the Chinese economy. He is involved in numerous collaborative research activities in China, including several large survey projects to study labor market developments in urban areas, and rural education, health, and labor outcomes. He has published over thirty journal articles and chapters in edited volumes, and is the coeditor of a forthcoming volume titled Education and Reform in China. At Michigan, he teaches a graduate course on the microeconomics of development and an undergraduate course on the Chinese economy.

This series is co-sponsored with the Center for East Asian Studies at Stanford University.

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Albert Park Associate Professor of Economics Speaker University of Michigan
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Based on recent work in Guangzhou, Xiamen, Taipei, and Hong Kong, this talk will address the relationship of NGO's to political transformation. It will focus in particular on three problems: the relation between state and society under various Chinese regimes, the relation between official and unoffical organizations, and problems of scaling up civil society organizations.

Taiwan/China Seminar Series

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Robert Weller Professor of Anthropology Speaker Boston University
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The arrogance of the Bush administration would be barely tolerable if it were not paired with a stunning incompetence, on display from Kabul to Katrina. That deadly combination has weakened American strength in the world, argues Pantech fellow and San Jose Mercury News foreign affairs columnist Daniel Sneider.

Despite its attempt to soften criticism of the war, there is no evidence the Bush administration is capable of self-correction.

That came home to me the other day while listening to a senior administration official deliver an off-the-record tour d'horizon of American foreign policy. He is among the best minds in this administration, counted among the ranks of the realists, rather than the neoconservatives.

The United States stands alone as the most powerful nation in the world, the official began. In no previous moment of human history has a single state enjoyed such a dominant position.

When it comes to managing its relations with other would-be powers -- Europe, China, Japan and India -- the United States has done "extraordinarily well,'' he said.

The tensions generated by the war in Iraq have eased, the senior foreign policy official confidently asserted. The Europeans are content to gaze intently inward, he observed, while America strides the globe.

Japan is embracing the United States in a very close relationship that shows no sign of unraveling. Meanwhile the Bush administration has forged a growing partnership with India.

When it comes to China, the administration has chosen the path of accommodation and integration rather than containment of the rising power. He expressed confidence that American power and the prospect of democracy in China will secure the peace.

The only remaining challenge for the United States is to combat the threat of a radical Islamist movement that seeks to acquire weapons of mass destruction. For that, there is the promotion of democracy and American values around the world. After all, the official said with not even a nod to humility, "the U.S. is the most successful country that has ever existed.''

A year or two ago, the American people embraced this vision of a confident colossus, a Gulliver among the Lilliputians. That was before they watched the giant tied down in its attempt to export those American values by force of arms in Iraq.

The arrogance of this administration would be barely tolerable if it were not paired with a stunning incompetence, on display from Kabul to Katrina. That deadly combination has weakened American strength in the world. It has emboldened far more serious challengers in Iran and North Korea, who see the United States as too bogged down in Iraq to credibly threaten them with the use of force.

The war rated barely a mention in the sweeping view offered by the senior administration official, except indirectly. He offered a realist defense of the administration's democracy crusade.

World War II was fought with democratic goals, the official pointed out. And the Cold War -- the model for the current struggle against Islamic extremism -- was not just about balancing the power of the Soviet Union. The wars in Korea and Vietnam were really about determining which system those countries chose, he argued.

Those are curious examples to cite as a defense of the decision to go to war in Iraq. The United States shored up authoritarian regimes in Korea and Vietnam to counter the communist threat. Vietnam was a strategic mistake that took decades to overcome. And democracy came to Korea more than 35 years later, after a long period of economic development.

President Bush cited the democratic transformation of Korea -- along with Taiwan and Japan -- in a recent speech during his trip to Asia. But these are examples of the "conventional story in which you become rich and then you become democrats,'' as the senior official put it so well.

The administration proposes however to skip this long, but necessary, path to democratic capitalism when it comes to the Middle East. The policies of security and stability have failed there and a quicker route to democratic change is called for. But there is no historical evidence to suggest that this is any more than another manifestation of a blind belief in American power.

Democratic values have always been essential to American foreign policy. In practice, however, American administrations have often made painful choices between stability and the promotion of democracy. We saw that too often during the Cold War -- in Budapest in 1956, Prague in 1968 or Tibet in 1959.

The administration might do well to recall the words of candidate Bush, uttered Oct. 11, 2000.

"It really depends on how our nation conducts itself in foreign policy. If we're an arrogant nation they'll resent us,'' Bush said. "But if we are a humble nation, they'll respect us.''

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This article examines Korea's politics of identity in the form of Asianism in the modern period, especially since Korea's incorporation into the modern world system in the late nineteenth century. Asianism, and regionalism generally, has become a salient policy strategy for the current South Korean government. However, Asianism has been a primary ideological current in modern Korea whose most recent incarnation should be understood in the larger historical context. This study traces the development of Asianism in four different periods: precolonial, colonial, Cold War, and postCold War. Initially emerging as a bulwark against Western encroachment, the Asianism narrative became irrelevant upon Japanese annexation of Korea in 1910 and only survived as a discourse about a glorified cultural past during colonial rule. Upon liberation, Asianism rescinded as the Japancentered regional order was replaced by a new Cold War alignment, capitalist (Japan, South Korea, and Taiwan) versus communist (China and North Korea). Although discussion about Asianism and a new East Asian regional order have recently resurfaced, the historical legacy of colonialism, war, and national division has added much complexity to the debate. Explicating how the Asianism narrative emerged and evolved through these various historical contexts sheds light on the complexities and difficulties inherent in the current attempt to forge an Asian regional order. By looking at Asianism from a historical perspective, we can also better appreciate the continuity and discontinuity in Korea's politics of identity. While it is still uncertain what the foundation of a new Asianism will be, it is equally obvious that regional interactions will continue to be an important part of the global world order. This study concludes with policy implications of how a historically sensitive understanding of the development of an Asian regional identity can further interaction and integration of East Asian nations.

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Inter-Asia Cultural Studies
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Gi-Wook Shin
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David Kang
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David Kang comments on the state of China-Taiwan relations in the New York Times.

What is the state of China-Taiwan relations?

President George Bush fanned the flames of the longstanding conflict between China and Taiwan during his November 16 speech in Kyoto, at the start of a week-long state visit to Asia. In urging China to expand openness and allow its people more freedoms, the president used Taiwan as a model, saying Taiwan had brought prosperity to its people by embracing freedom and creating a democratic Chinese society. China rejected Bush's comments. "Taiwan is an inseparable part ofChina, and China does not brook any interference in its internal affairs," Foreign Minister Li Zhaoxing told reporters at the Asia-Pacific Economic Cooperation (APEC) summit in South Korea. Bush meets Chinese President Hu Jintao and other Asian leaders at the summit November 19.

What is the history of the conflict?

Taiwan, an island of 23 million off China's southern coast, was occupied by Japan for fifty years, from 1895 to 1945. In 1949, after Chiang Kai-shek's Nationalist Party lost its power struggle with the Communist Party in China, Chiang and his followers fled to Taiwan. Their Kuomintang (KMT) government-in-exile in Taipei defined itself as the alternative to Communist rule and hoped one day to return to power in Beijing. The KMT governed Taiwan from 1949 to 2000; its often harsh rule included discriminatory laws against ethnic Taiwanese and nearly forty years of martial law, which was finally lifted in 1987. The KMT has historically seen Taiwan as a part of "one China" that would eventually be reunited under Nationalist rule.

Taiwan's current ruling party, the predominantly ethnic Taiwanese Democratic Progressive Party (DPP) was founded in 1986 to counter the KMT, and only became legal in 1989 after a longtime ban on opposition parties was dropped. Taiwanese President Chen Shui-Bian is a member of the DPP, which envisions Taiwan as an independent nation, separate from China. In 2000, Chen was the first DPP candidate to be elected president. Taiwanese sovereignty is the first and most prominent issue on the party's platform. This position has put the DPP severely at odds with China's leadership, which views Taiwan as a renegade province that will one day be reunited with Communist China--by force, if necessary.

What is the U.S. position?

The United States officially recognizes only one China -- including Taiwan -- and urges a peaceful resolution to the Taiwan question. However, Washington is also bound by the 1979 Taiwan Relations Act to aid in Taiwan 's defense, including selling the island the weapons it needs to defend itself against China. Experts say the United States is walking a fine line between China 's growing influence and the historical U.S. relationship with Taiwan. "Bush had to stand up for freedom and democracy and all the other values he constantly talks about, without picking a fight with China that nobody really wants," says David Kang, an Asia expert and visiting professor at Stanford University's Shorenstein APARC. Bush stressed in his speech that "there should be no unilateral attempts to change the status quo by either side."

What is the impetus behind independence for Taiwan?

After the long KMT reign, many Taiwanese are now pushing for self-determination. Independence advocates say Taiwan is a free and democratic nation with multiparty elections and a very successful economy, with a gross national product (GNP) of $328 billion in 2004, of which $174 billion was due to exports including electronics, computer parts, textiles, metals, plastic, and rubber. They say the Taiwan people should have the right to decide for themselves if they want to join China or become an independent nation. Since Chen was elected to his first term in 2000, he has steadily pushed the idea of Taiwanese independence. He provoked Beijing August 3 by supporting the idea of a referendum to ask Taiwanese citizens if the island should declare formal independence from China. China is very hostile to such talk: On August 7, the official China Daily newspaper quoted a Chinese military official saying, "Taiwan choosing independence is tantamount to choosing war."

What has China been doing?

Making both incendiary statements and conciliatory moves. In July, General Zhu Chenghu, the dean of China's National Defense University, warned that China would attack the United States with nuclear weapons if it intervened in a military dispute over Taiwan. Although he later claimed the comments were his own and did not reflect the views of the state, Zhu's words generated international concern. However, China's actions toward some Taiwanese officials have been friendlier. James Soong, head of the Taiwanese opposition party People First, has visited China several times in the last year at the invitation of Beijing. Experts say Beijing is reaching out to opposition leaders in Taiwan in an attempt to sidestep the DPP and build new bases of support on the island. Soong is taking advantage of the opening to play for domestic political support and attempt to show up the DPP, they say. His actions infuriate the ruling party in Taiwan because, despite his unofficial status, Soong is building friendly relations with China in direct contrast to DPP policy.

What are the next steps?

Bush alluded to peace talks in his November 16 speech, but experts say such talks between China and Taiwan are unlikely in the near future. "There are elements moving towards peace talks, and other elements, especially in Taiwan, that are pushing toward independence and want to stick China in the eye," David Kang says. But "it's hard to say what Taiwan wants," he adds, noting the Taiwan electorate is almost evenly split between those who favor independence and those who want to improve relations with Beijing for historical, cultural, and especially economic reasons. David Kang says that, in the last several years, as many as one million Taiwanese have moved to China to do business.

What are Taiwan's security concerns?

China, located just 100 miles away across the Taiwan Strait, has hundreds of ballistic missiles aimed at Taiwan, and is targeting much of its recent militarization campaign specifically at the island, including building amphibious tanks that can be used to storm Taiwan's shores. China's military buildup has put Taiwan at a strategic disadvantage: Taiwan's military spending has dropped 25 percent over the last five years, to only 2.4 percent of gross domestic product (GDP). The United States has been pressuring the island to buy a specially designed $18 billion package of U.S. arms to improve its military capabilities. But some Taiwanese politicians are reluctant to devote resources to military buildup given the presumed U.S. protection, and opposition leaders have blocked the sale over what experts call domestic political squabbling. But, David Kang points out, a military invasion of Taiwan by China is highly improbable. "That's the least likely scenario," he says. "You can have a military dispute that's far short of all-out war."

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Mr. Schriver will address China's military modernization program, its growing economic clout, and its increased willingness to exercise pro-active diplomacy to further its interests. He will examine how this widening "tool box" of capabilities impacts China's approach to security challenges in Asia including its long-standing differences with Taiwan, more recent renewed tensions withJapan, the Korean nuclear challenge, and energy security. And he will assess what all these developments mean for the security interests of the United States and what policy options are under consideration in Washington in response to the China challenge.

Mr. Schriver is Partner with Armitage International, is the former Deputy

Assistant Secretary of State for East Asia with specific responsibilities for China, and the former Senior Director for China in the Office of the Secretary of Defense.

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Randall Schriver former Deputy Assistant Secretary of State for East Asian Affairs Speaker
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Many people in China and the US assume that the new Taiwanese national identity is a political ploy which originated with Taiwan's government. Based on ethnographic research in both Taiwan and China, Melissa Brown argues that Taiwanese identity -- in both its ethnic and national forms -- are based on social experience. Because the people of Taiwan and China have had such different social experiences since 1895, Taiwanese identity as distinct from Chinese identity is real. The reality of Taiwanese identity poses challenges for resolving the debate over Taiwan's future relations with China, particularly in nationalistic responses due to lack of Chinese experience with Taiwanese society.

Melissa J. Brown is Assistant Professor of Anthropological Sciences and Research Affiliate at Asia-Pacific Research Center at Stanford University. She has been researching changing identities in Taiwan and China since 1991. Her books include Negotiating Ethnicities in China and Taiwan (University of California, Institute for East Asian Studies, 1996) and Is Taiwan Chinese? The Impact of Culture, Power, and Migration on Changing Identities (University of California Press, 2004).

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Melissa J. Brown Speaker Stanford University
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In today's global economy, access to resources around the world has never been easier. The high tech industry has always been in the forefront of globalization in lowering costs, acquiring talent as well as serving markets. For instance, Asian countries have long been known for their vast manufacturing bases for western high tech industry.

In recent years, thanks to Y2K, India has become the leader in software outsourcing. China, given its expanding economy as well as its open market direction, has rapidly become the emerging location for multi-national semiconductor companies to outsource their product development amidst China's own burgeoning integrated circuit (IC) industry. Mr. Lee has first-hand experience in building and managing an IC product development center in Shanghai, China. He will discuss the challenges of operating a R&D organization in an environment of different languages and cultures. He will also share his vision of the future of the IC industry in China.

Mr. Lee is Group Vice President and general manager of Timing Solutions Products at Integrated Device Technology, Inc.(IDT), a public semiconductor company of $650 million annual sales, focusing on valued-added solutions for communication, consumer and computing markets. He has been with IDT for the last 22 years and has served various management roles. In 2001, he architected the acquisition of Newave Semiconductor Corporation in China and established the Shanghai Product Development Center for IDT. Before joining IDT in 1984, Mr. Lee spent 5 years at Intel Corporation as a technologist for the early development of flash memory technology. Mr. Lee earned his B.S. degree in Electrical Engineering from National Taiwan University in 1975 and M.S. degree from Case Western Reserve University in 1979.

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Jimmy Lee Group Vice President & General Manager of Timing Solutions Products Speaker Integrated Device Technology, Inc.
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For years policymakers in China have advocated creating "Silicon Valleys" in China, but only recently has China's semiconductor industry taken off. Rather than the state leading the way, economic globalization has created the large flow of capital and knowledge to the developing world that has spurred China's technological development in recent years.

However, not all firms in China benefit equally from these inflows of financial and human capital. Presenting both industry-wide data and case studies of individual firms, Dr. Fuller will explain how the politics of finance in China shape which Chinese chip firms become fast learners able to compete in world markets and which ones remain technological laggards.

Douglas Fuller has spent over ten years researching technological development in East Asia. Most recently, he completed a doctorate at MIT in political economy. The topic of his thesis was technological development in China's IT industry. For this and previous research, he has interviewed IT firms in Malaysia, Japan, Korea, Taiwan, the People's Republic of China and the US. He has published articles in Industry and Innovation and other peer-reviewed journals.

Part of SPRIE's Greater China and the Globalization of R&D seminar series.

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Doug Fuller SPRIE Postdoctoral Fellow Speaker
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George Krompacky
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Dr. Liu first offered his view on the current state of the software industry's development and in particular software outsourcing to China. Software prices and margins continue to drop. Coupled with this reality is Liu's view that "only 10-15% of software development is truly innovative and therefore suitable to be developed in Silicon Valley". As software development platforms and communication technologies, especially the Internet, become ubiquitous and affordable, distributed software development is becoming the rule.

China's challenges and advantages in software outsourcing

Compared to India, the leader in software outsourcing, China has its own distinct challenges. Chinese software companies have almost no U.S. customers for a number of reasons: language barriers, different working styles, customers' concern for software piracy, and the lack of experienced programmers and technical managers in China. Yet, China also has its advantages. Not only does it have a rapidly expanding domestic software market, but it also has a large pool of fresh engineering talent. "The key, therefore," asserted Dr. Liu, "lies in someone creating the right environment to train and build a local team to be able to develop and deliver world-class software products."

Augmentum's software development goals

This is what Augmentum has set out to accomplish. "...[W]e want to build a world-class, distributed development team for software product development... like the ODM model in the PC world..." declared Dr. Liu. Based on this vision, Augmentum's strategy hinges on its insistence to develop software for top US customers, such as Motorola, Business Objects, and PalmSource--and to rely primarily on local Chinese engineers. Explained Liu: "We want to make sure that the center of most of the people of that team is going to be in China, even though the locomotive, the teachers, is in the U.S., because that's where the leadership is in the software product development world."

Drawing on decades of experience developing top software teams at IBM and other companies, Dr. Liu detailed his company's efforts to attract the brightest local engineers and train them to be even better. He explained, "Culture and team is the true differentiation of Augmentum.... The real...challenge is to build the right culture with the right core team." The company insists on having no expatriates in their China operations but promoting close interaction between experienced mentors in the U.S. and the young teams in China, sometimes using some creative approaches for recruitment and training. For example, Augmentum puts all of its new hires under "a stress test" after hiring and proactively maintains an "upfront churn of at least 30%" in the first three-month period." Their end goal: "a world-class software development team that can bridge the East and the West but still has a cost structure comparable to local companies."

Liu's focus for the future

Despite experienced leadership, ties to leading U.S. companies, and strong young software teams, Augmentum faces real challenges. Liu acknowledged skeptics who question the ability to build a world-class team through working on the "crumbs of companies" of "projects they don't want to work on themselves." Nevertheless, he is confident in the trajectory of Augmentum's future growth, as the company is expecting to double its employees every year for the coming few years. In addition, Dr. Liu's vision includes a landscape beyond Augmentum. "I have a very simple focus. I want to train a lot of world-class software developers in China to serve the world. Many of them will not be working for Augmentum. It is fine...I want to bring my experience to there to make it happen. And the best vehicle to do that at this moment and time, the wave [that] I want to jump on is outsourcing, because it is growing the fastest."

Biography of Leonard Liu

Leonard Liu has spent 30 years in the systems industry, with a track record of developing innovative computing technologies into successful businesses. Most recently, he served as president of ASE Group, a leading provider of IC test and packaging services, having held roles as Chairman and CEO of Walker Interactive Systems, COO of Cadence Design Systems, and President of Acer Group. He was an early champion of outsourcing to India and China at Cadence and Walker. Dr. Liu began his career at IBM where he was responsible for the creation and implementation of SQL and the management of CICS, SNA and AIX, eventually overseeing the worldwide Database and Language lines-of-business. He received his undergraduate degree from Taiwan University and his Ph.D. from Princeton University.

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