June 26th, 2007: Alice Young, a corporate lawyer with over 30 years of experience in Asia and a partner at Kaye Scholer LLP, discusses China’s emerging legal system with Wide Angle’s anchor Daljit Dhaliwal.
DALJIT DHALIWAL: Alice Young, welcome to Wide Angle.
ALICE YOUNG: I’m delighted to be here.
DALJIT DHALIWAL: So what do you make of this film we just saw?
ALICE YOUNG: Well, I think it was fascinating to see that you were able to get access to the insides of courtrooms, to interview people afterwards. Having been involved in Asia for over 30 years as a lawyer and having been in Hong Kong in the early ’70s as a lawyer, and having gone into China fairly early on – in the old days, you could not go anywhere without people following you, restricting where you could go.
DHALIWAL: Although, I think in this film we did actually have minders.
ALICE YOUNG: Minders, there will probably always be. But to be able to have that kind of access, and to have the candidness of the people on camera about their concerns, about their situation, about the court system, about activism in China – I think goes to show that there are still a lot of problems, but there has been a tremendous amount of progress, and that people have some degree or faith that the system is going to work. That they can get some remedies through the judicial system. So, to me, that was a wonderful “wide angle” as to what’s going on in China. A wider angle than people have been able to see before. And I think the challenge is going to be to expand those rights and capabilities over a period of time where a larger and larger group in this society feel confident – and that includes foreign investors, as well as Chinese people – that it will be a transparent process, that it will be corruption-free, and that they will get some relief from the system.
DALJIT DHALIWAL: Well, let’s put what we saw into context. How far has the rule of law in China come?
ALICE YOUNG: I think that it’s important to see that there is a judicial system. Obviously, it’s not like the U.S. system. It’s not a jury system. There is a strong encouragement, as you could see, towards mediation, which is a little bit different from our system.
DALJIT DHALIWAL: The very concept of the rule of law is Western in origin. Is this an uneasy fit with China’s traditions?
ALICE YOUNG: I don’t think that the West can claim entire responsibility for rule of law. I think Chinese have always had rules and laws. So, this is not a monopoly of the Western system. The difference is that there is a Chinese flavor to all of these regulations. And in certain areas, let’s say in criminal law, they are very concerned about controlling the population, keeping the peace. And therefore, for example, we saw in the film, in 99 percent of criminal law cases the defendant is convicted. That is an area in which they feel very strongly that in order to really move forward, they have to have a great deal of stability. And they need to be sure that the criminal elements are under control.
DALJIT DHALIWAL: Our film highlights an apparent human rights violation, the secret trial and execution of an 18-year-old. Is this case exceptional?
ALICE YOUNG: Because I deal in the commercial sector, I really am less familiar with the criminal system. But there is precedent for the so-called pre-trial adjudication that’s part of their rules. I mean, one can say the rule of law means there are rules. You may not like the rules. But they’re transparent. Now, in the film, the secret aspects of that case where the lawyer isn’t even informed, that was quite shocking. I will say however, that there is a tremendous campaign against corruption. Because there is recognition, on the part of China’s leaders, that if the perception is that the system is entirely corrupt, people will not follow the system. So, for example the head of the Chinese Food and Drug Administration, which regulates the approval of drugs in China, was recently executed for having taken bribes. That clearly shows the desire of the government to set some examples so that people feel that they are not above the law, and to try to serve as a deterrence. On the other hand, locally in the various communities corruption is still quite rampant. And I think the misunderstanding oftentimes is that Beijing has control over the entire country. Witness the recent toy factory situation where a reporter from the New York Times who was investigating lead paint in toys in China suddenly found that despite pleas to the government, it took a long time to get himself out of there and that the local authorities really were in control.
DALJIT DHALIWAL: Alice, you are a corporate attorney. You have something like 30 years of experience working in Asia. What advice would you give to U.S. companies who want to set up in China and do business with the Chinese?
ALICE YOUNG: When I first started out doing work involving China – back in the early ’80s, late ’70s – it was a completely different environment. For example, when I first went in with a cosmetics company they said, “We want to create lipsticks. We want to manufacture them in China and sell them outside of China. And then we want to sell within China.” And I said, “No, no, no, no. You don’t understand. They don’t wear makeup in China. And you’re not allowed to sell in China.” This was in the early ’80s. And sure enough, when they went in, they realized that it was impossible to do what they had expected. Now, it has dramatically changed. There are very few industries. There are several that are still protected. But you are able to go into China to set up companies, to do joint ventures. And yet, it’s not always that easy. Witness the recent Dannon case, where the Dannon company suddenly discovered that they didn’t really have any control over the factories that they thought they had a joint venture with. And that, in fact, the owner had been parallel manufacturing. What I’ve said to clients over the years is, “You’ve got to be there. You’ve got to be on the ground. You’ve got to understand the culture. You have to be observant. You have to participate. You can’t do it long-distance.” And that’s a huge difference from a lot of other countries. Do your homework. Go there. Spend time. Look at the various regions. China is a huge country. There are a billion, 300 million people. To think that you can have a national distribution network is foolhardy. Every region has very separate spheres of power. I think we’re also often under the perception that China is a monolithic society, and that Beijing and the Communist government run everything.
DALJIT DHALIWAL: So, these are very simplistic notions and that multinationals are coming into China with?
ALICE YOUNG: Absolutely. Well, those who’ve spent a fair amount of time there, no. But the regional differences, the language differences, the eating habits – China has 56 ethnic minorities. The generational differences – if you talk about people who come from having lived through the Cultural Revolution in the ’60s and the early ’70s, their mindset is very different from the so-called “little emperors”, one-child families who have grown up quite carefree, have been under laws that permit them a great deal of freedom. They want good salaries. They want good lives. And their expectations are very different from those who grew up in the ’60s, the ’70s, and even the ’80s.
DALJIT DHALIWAL: What kind of legal reforms do you think would improve the working climate for multinational corporations investing in China or doing business with China?
ALICE YOUNG: There are so many laws that have been promulgated over the last couple of years, it makes your head spin. I have probably 100 laws, legal guidance and administrative guidance materials, every day that come into my office. These are changes that are going on in China. It’s almost impossible to keep up. They have a new bankruptcy law. They’re talking about a new antitrust law. They’ve recently promulgated a property law. I mean, this is a Communist country. The idea of private property ownership is jaw-dropping. But this is, in fact, what is happening in China. It is Communist by name. But they are trying to deal with creating an environment for the Chinese people which will maintain their power, which is economic growth. And they have a huge growth engine. For the past 20 years, they’ve been growing at the rate of eight to ten percent. Estimates are that they will grow at 11 percent in 2007. This is really unprecedented. How to keep that engine going? They need the rule of law. They need some sense on the part of the public, on the part of the business community, that there’s transparency, that there is the ability to predict what’s going to happen in the future because capital is very flighty and it can move anywhere. We now have a very global economy.
DALJIT DHALIWAL: What do you think are spurring these reforms?
ALICE YOUNG: China really wants its people to do well and they see that in order for the government to stay in power and in order to run that economic engine, they have to make sure that people feel a general sense of well-being. China realizes that in order to have lasting economic growth, there have to be rules of engagement, and that therefore they need to try to be clear about what rights are. Remember though, in the U.S., in Western democracies, the basis of law is really individual rights. In China, the emphasis is really on societal -
DALJIT DHALIWAL: The greater good.
ALICE YOUNG: Right. What’s better for the whole country? So, for example, drug prices get to be too high? They issue a law saying, “Those prices have to be cut.” Now, clearly good for the betterment of society, but not so good for the companies that are manufacturing those drugs. That’s where they tip the balance. In the meantime, they also recognize that people aren’t going to do business if they have no predictability as to whether they can make profits, whether they can take those profits out, and therefore the necessity for rules. They have now promulgated a number of rules that they are using and they’re looking at the world and saying, “What’s the best of the rules out there that we can adapt?” And also most of it I would say is not Western – certainly in the areas of securities and finance, they have taken a lot from U.S. models, from Western models. And I think that they have a long ways to go, but very recently they announced that they were going to move bond issuances to the Chinese Securities Regulatory Commission, which is a much more flexible commission than the Ministry that previously had jurisdiction over it. They realize that they have to make a lot of changes. In the ’80s, Deng Xiaoping decided that economic growth was the key to success, and so, he started that engine going. And it’s been very successful. There are issues in China. There’s labor unrest -
DALJIT DHALIWAL: Yeah, something like 87,000 protests a year.
ALICE YOUNG: Absolutely. Well, when you think about it, China has 1 billion, 300 million people. But of that, 900 million are in the rural areas. Only 400 million, which are the more prosperous, are in the urban areas. And you saw in the film that there is a great deal of local corruption. And the rural areas have not done as well. And therefore, yes, there have been protests. And I think there’s a lot of concern on the part of the government that if they don’t make sure that people consider their lives better now than they used to be, then they are in trouble as a government. There was a movie that came out in the ’90s by Zhang Yimou called To Live. It showed the ’40s through the Cultural Revolution, and the aftermath and the corruption, the difficulties of just surviving in China. Me and my American friends, when we watched the movie, thought, “My goodness. What a repressive period of time that was. And how sad what happened in China. The Cultural Revolution, people committing suicide, people being killed, the stresses on the family life.” Meanwhile, my Chinese friends saw the same movie and they said to me, “Look, they’re eating white rice. They have food on their plates. The family is together.” So, for them, this was huge progress where we only saw the suffering. So, I think we have to have a little bit of perspective on how far China has come from compared to where it was.
DALJIT DHALIWAL: Just within a generation, by the sounds of what you’re saying.
ALICE YOUNG: Just within one generation, within 20 years. And therefore, we need to be a little bit more patient. It doesn’t mean that we stop being concerned about human rights issues, about rule of law and equal justice. We ourselves have some of those problems in the United States. But I think that it is really important to bring China into the global economy as a stakeholder. And the only way to do that is to treat them with respect and to try to bring them into the global economy, and to point out things out in a helpful, multilateral way, rather than antagonistically.
DALJIT DHALIWAL: And what about your own personal experiences of doing business and your legal dealings in China? Have you run into problems yourself?
ALICE YOUNG: Well, what’s fascinating to me is, for example, the area of intellectual property rights. This is something that we’re quite concerned about.
DALJIT DHALIWAL: Piracy.
ALICE YOUNG: Piracy, and also just infringement of trademark rights. One of my clients – we were doing a joint venture in China. It’s a very well known retail chain – and in the process of negotiating I discovered that the other side of the transaction, the potential joint venture partner, had gone in and tried to register the trademark of my client. And because in China, first to register wins, not first to use, they could have possibly gotten away with it. Now, we’re very concerned about counterfeiting and I think there’s certainly a lot of pressure on the Chinese to do something about it. But, the interesting thing about what’s happening in trademark law is that last year, the majority of the trademark infringement cases were brought by Chinese against other Chinese. So, I think it’s a good example of the Chinese themselves saying, “This isn’t just for Western, foreign companies coming in. This is to protect us as well.” And the Chinese are using the court system.
DALJIT DHALIWAL: What kind of advice would you give to American companies who are running into these kinds of problems? I mean, you spoke earlier on about the need to do their homework. But there is also a big difference between what’s on paper and what actually gets enforced.
ALICE YOUNG: Absolutely. And that’s exactly why I say you have to be there. You have to send people in. You have to get to know your partners – if you have local partners – to see them in a lot of different settings, to talk with the local authorities, to hopefully have people on the ground who speak the language fluently, to really investigate who your partners are, and to decide that you’re going to be there for a long time. China has a 5,000-year history. It has only been Communist for 50 years. It does have a very strong basis of, I wouldn’t say capitalism, but it has been involved in trade for a very, very long time. But there’s much that’s very new. If you go to China and two weeks later you go to the same location, you’ll see new buildings, new stores. The pace of change is extraordinary. So, you really have to spend the time and soak it all up. And you have to have staying power.
DALJIT DHALIWAL: Do you think though that the legal reforms are robust enough? Especially when it comes to the question of individual rights over the greater good, and ensuring that justice is seen to be done.
ALICE YOUNG: I think that it is an evolving process. I think the film showed that there is some small degree of trust that is just beginning. Trust in the legal process, that individuals are starting to assert their rights. But I think it has a long ways to go. And I think that there is a growing have, have-not problem in China where, through television media, cell phones, the internet, the Chinese public can see the wealth, the benefit, the disparities. And so China’s going to have a big problem on its hands trying to balance that. To make sure that everyone feels that they are getting a piece of that economy and the benefits of that.
DALJIT DHALIWAL: Do you think that the economic boom has benefited the ordinary Chinese worker who has left the countryside and migrated into the cities?
ALICE YOUNG: Well, not too long in the past China tried very hard to control the rural population. You had to show your registration card if you weren’t from the city. You couldn’t get a job. There’s been a loosening up of that system because of a recognition that the rural economy is not supporting its people. So I think there is growing unrest and the government is very concerned about that. They’re trying to figure out how deal with -
DALJIT DHALIWAL: Well, on average, something like 200 protests everyday.
ALICE YOUNG: And that is what we hear about. But that’s not every protest. It’s a big country, and also a closed country, so we don’t hear about all of the protests. Certainly there are tremendous environmental problems. China is trying to take the water from the south and move it upstream to the north where it’s gradually becoming more and more desert. And in order to try to provide electricity, to provide energy, to provide water, they are moving people. People are being displaced from farms, the only life that they’ve known. It’s been a very, very difficult problem in China. And something that China is going to have to cope with.
DALJIT DHALIWAL: Do you think that if the unrest continues, it could derail the whole idea of the market economy experiment and also the Communist Party itself at some point?
ALICE YOUNG: Well, certainly if the Communist Party can’t alleviate the situation, its power would be more questioned. But I have to say that, generally speaking the succession of power in China from Mao Zedong to Deng Xiaoping to Jiang Zemin to Hu Jintao has been a relatively smooth one. And Hu Jintao seems to be trying very hard to maintain this bureaucratic sense of the government trying to benefit the people. So long as they can keep the economic engine going I think they’re relatively safe. The Chinese people on the street that I talk to generally are content with where they’re going. They have aspirations and hopes that life will be even better for them. And I think that the people who are on the farms want to have that feeling too. If this is tackled, and if there is a sense of overall well-being, China will be able to keep moving forward. But there’s a lot of potential for hiccups and crises.
DALJIT DHALIWAL: And the party really does have its work cut out for it. Because they have to create something like 50,000 jobs a day.
ALICE YOUNG: And it’s even worse than that, in the sense that China’s one of the first countries that’s going to be an aging population before it’s a rich country. Predictions are that by 2030 there will be over 200 million in the aging population. This is as much as the entire population of the United States. And, yet, to support that is going to have to be one child per family, because of the one child policy. So they’ve got a lot of social and economic issues ahead of them that are not going to be that easy. I don’t think we can be so confident that this boom is going to continue unless there are some real attempts to fix the healthcare system, the under-funded pension system. So they do have a lot of work cut out for them.
DALJIT DHALIWAL: And to make the judiciary transparent and, at some point, independent?
ALICE YOUNG: Hard to say whether the judiciary is going to be independent anytime soon. But having watched your film, I feel that the judges – their hearts are in the right place. They were trying to create a fair system. They were trying to mediate. The big problem in creating a judicial system in China is that they’re understaffed. They have very few judges. They’re training, they’re working very hard to create a knowledgeable group of judges. But it wasn’t that long ago that judges were all ex-People’s Liberation Army soldiers. That’s where they recruited the judges. And in fact, during the Cultural Revolution, schools were disrupted. There were no law schools. There was no training. So the lawyers that you’re seeing now, the judges you’re seeing now, all of them are post-Cultural Revolution. It’s after 1976 and after the 1982 constitution. So this is a whole new era. And it’s going to take a long time to get enough judges who can even do a terrific job of judging.
DALJIT DHALIWAL: Well, one of the things that is new in China is this whole idea of private property. I mean earlier this year there were loud protests from leftists within China’s parliament who basically saw this as a bit of a sellout of Communist ideology. Is private property an oxymoron in China?
ALICE YOUNG: This is not what I learned in fifth grade textbooks about what Communism is – the idea that you could have private ownership. So I think that what we’re now seeing is that China is not your ordinary Communist state. It is creating a different kind of system or government which has authoritarianism, has socialistic aspects, but also has a capitalistic market economy to it. And certainly private property is key in that. So this, to me, is a very interesting development. And what was equally interesting was the fact that, in trying to develop its private property laws, I understand that they talked with government officials in Hong Kong. As you know, it’s now the tenth anniversary of the hand-over of Hong Kong to China. They actually discussed with Hong Kong authorities, since Hong Kong has a private property system, how best to promulgate laws, and got ideas from them. So, again, I think that there is a certain level of flexibility and understanding that in order for it to survive, as a government, it really has to make certain adjustments. Hopefully for the benefit of the people.
DALJIT DHALIWAL: Talk about your thoughts when it comes to U.S.-China relations. Do you think our leaders really understand how to engage China?
ALICE YOUNG: Boy, is this a topic I could talk for days about. We’ve always had a very difficult relationship with China. It is curious to me, particularly as a Chinese-American, but born in Washington DC, raised in DC and Maryland, and having gone to school in the U.S. – gone to Yale, gone to Harvard law. I mean I consider myself very American. And, yet, as I see the history of U.S.-China relations, the Wen Ho Lee case, the McCarthy era, I begin to see that that there are certain aspects of being Chinese-American that can be a little bit uncomfortable. There is this sense of fear and competition. Certainly now as a result of the economic challenges. I mean certainly this happened in the ’80s with Japan, the trade friction. And now there’s a $262 billion trade imbalance with China. So, we in the United States have a connection with China in the global economy that is economic, that is political, that is in a changing world. This is an opportunity, as I see it, for us to really involve China, engage China. If we treat China like an enemy, it’s quite possible that they’ll become one.
DALJIT DHALIWAL: What do you think is at the root of this fear?
ALICE YOUNG: One can start out by saying it is a Communist country. We are a democratic society. There is an ideological difference, without a doubt. I think that now that China is beginning to emerge economically – many say that, by 2020, they’ll be the second largest economy in the world after the United States – I think there is a concern that, with our very different perspectives and views of the world, that there is a potential for collision. But what worries me is that we don’t make more of the opportunity for bridging. There are so many reasons that the United States and China are inexplicably bound. We have a borderless globalization that means that goods go back and forth. I actually heard that when the Chinese Foreign Minister met with senior Bush and Barbara Bush that she was wearing a hat that was made in China. We have the benefit of $20 shoes and $7 t-shirts as a result of trade with China. If China decided to pull out from the treasury market, the United States would go into a tailspin. We are bound up with each other in so many different ways.
DALJIT DHALIWAL: But why does this fear still exist that China is going to take American jobs. Even though there are returns that come back to the United States as a result of American companies investing, doing business in China. Why isn’t that explained better to the American people?
ALICE YOUNG: Well, I think that’s really up to you all in the media to a better job of explaining.
DALJIT DHALIWAL: Also to our political leaders as well, right?
ALICE YOUNG: And to our political leaders. I think that we need to be better educated as the public as to the interconnections of economics and politics. And I don’t think that we have been doing a terribly good job of that. I would hope that over the next couple of years we can develop bridges, informally. In other words, government to government, there is always going to be the ideological differences in the political arena, the tension of the trade imbalance in the economic arena. But there are lots of things that we can do to try to improve that trade imbalance. There are things that China can do as well. It really does take joint efforts. What we don’t do, it seems to me, is try to engage at all levels. In other words, we owe it to ourselves, I think, as Americans, to know more about China. To be better educated about China. To have more people speaking the language.
DALJIT DHALIWAL: Few people understand and speak Mandarin and Cantonese, right?
ALICE YOUNG: Absolutely. And, yet, there are, maybe 80 to 100,000 Chinese who are studying in the United States. My daughter and son were recently working as summer students in China and they said, “You know, we’ve met people from all over Asia, from Europe, from Africa. We seldom see Americans in China.” That is appalling. If we consider that China is going to be a huge challenge for us, why aren’t we trying to learn the language? Why aren’t we trying to understand a little bit better what that culture is all about? And I think that if we can develop relationships, cultural exchanges, military exchanges – there are so many things that are at stake, globally – why create this animosity unnecessarily? We’ll always have differences.
DALJIT DHALIWAL: Right.
ALICE YOUNG: And there will always be tensions. But I think this is really an opportunity. This is not the Cold War. China is not Russia. It is not known to be interested in invading other countries. And, frankly, they’ve got a lot of things they have to do at home.
DALJIT DHALIWAL: Yeah.
ALICE YOUNG: Clearly they’re concerned about Taiwan. That’s something that continues to be an issue. But we are at a point in U.S.-China relations where if we act with a great deal of distrust, and we refuse to really talk and try to create some connections, it’ll be a self-fulfilling prophecy.
DALJIT DHALIWAL: And, yet, there are some very real tensions to the U.S.-China relationship. China owns something like one trillion dollars in US bonds and stocks. Why wouldn’t we be scared?
ALICE YOUNG: Absolutely. So why wouldn’t we try to have some direction and control, rather than continue to bash and insult. For example, recently CNOOC [China National Offshore Oil Corporation], one of the Chinese oil companies, attempted to buy Unocal, which had no assets in the United States. We stopped that deal for fear of some kind of control over an American company, even though there were no assets in the United States. Recently, the Chinese government talked about investing into Blackstone. It’s money. As far as I understand, the way the potential deal was structured, there’s was no ability for the Chinese to control what Blackstone does. And, yet, there’s tremendous amount of concern in the United States. Then we find it shocking that the Chinese, when we try to export to China, say, “No, we’re not going to allow this. We are going to protect our industries.”
DALJIT DHALIWAL: But a trillion dollars – what does that mean for the U.S. economy and for American consumers?
ALICE YOUNG: That means we should have been saving instead of spending. That we are credit carded out as a nation. We really do have to try to deal with the trade imbalance. But you can’t just deal with it by telling other people to stop selling to us or to change their currency. Yes, there are things that can be discussed, that ought to be discussed. But I think we also have to take a good hard look at ourselves and see what we can do. I mean I am American through and through. I embrace democracy. And it’s made me what I am. I’ve been able to become a lawyer, to do deals, to enjoy a wonderful life. But there’s no guarantee that if we continue with the way we’re spending money in the United States, that we are going to continue to be a strong economy. So I’m concerned about that.
DALJIT DHALIWAL: Your business and legal dealings in China give you a unique perspective. Fast-forward, if you can for me, ten years. Where is China?
ALICE YOUNG: I think China is going to have a lot of hiccups. A lot of problems. I’m also amused, having dealt with Asia for over 30 years. I’ve seen the rise of Japan. I’ve seen the rise of Korea. Of Taiwan. The ups and downs.
DALJIT DHALIWAL: China. India. India. China. Right?
ALICE YOUNG: Absolutely. And what I’m always amazed at is how quickly we forget that this is a process. And that there are going to be wonderful opportunities, and there are going to be risks. China still is a Communist country. It has a long ways to go. There are still tremendous risks in investing there. But I think it’s never as bad as the nay-sayers say, and never as bright and shiny and perfect as the optimists say. It takes a lot of hard work to do well in any foreign country. And China’s no exception. And China’s an emerging economy. It is not an industrialized economy that’s been robust, and has a solid middle class, and has been stable for hundreds of years. China is still emerging as a country. And so I think that there are going to be lots of problems. My advice is to be lean in what you do. To have staying power. And to really try to understand the culture and the business transactions. And, in the long term, it will work out. Assuming that China can cope with all of these huge problems. Electrical shortages, water shortages, labor unrest -
DALJIT DHALIWAL: Pollution.
ALICE YOUNG: Pollution. I think what will be interesting though is that the Olympics are coming up in 2008. For every country – Japan in 1964, Korea in 1988 – the Olympics have provided a platform to show off the country. To show the success. To encourage investment. To help people to understand the culture. I think that the Olympics are going to provide this opportunity for China to showcase itself. And I think that’ll really drive the economy for a couple of years. Ten years from now I think that China will continue to be a major force in the world. But I don’t think it’s going to be smooth sailing. They also have to deal with banking reform, and corruption is a huge problem that they’ve got to fix.
DALJIT DHALIWAL: Do you think that the United States is going to be surpassed by China as the next superpower?
ALICE YOUNG: No. My honest opinion. The reason is the United States, over the years, has built a tremendous infrastructure. We have intense military power. We will continue, I think, to be a major force in the world. China, despite the fact that it has grown tremendously, has a lot of weaknesses. And I don’t think that its focus, right now, is on trying to be a superpower. What they’re trying to do, as best I can see it, is make sure that the vast population is fed, that they have -
DALJIT DHALIWAL: The focus is very much internal right?
ALICE YOUNG: Right. That they have energy and the resources that they need. And I think they are going to concentrate on that for a while before they venture out. Not to say that they necessarily will. But their approach has been really to try to be friendly to their neighbors and to the sources of the resources that they need. Aside from Taiwan – which is a matter of high stakes because it’s an issue of reunification and sovereign rights, in their minds – they really have not indicated a desire to take over the world, nor are they equipped to do that. So I’m not particularly worried about China either becoming in the near future, or even wanting to become, a superpower in terms of military and other strength. But they’re clearly going to be an economic force to be reckoned with. Right now, in terms of ease of doing business, according to a World Bank report, they’re down at 93. We’re at number 3. Singapore is at number 1, and Hong Kong – which is one country-two systems since the hand-over, has maintained its own legal system, but is a part of China – they’re number 5. So I think there are some models for economic strength. Hong Kong has managed to survive very well. I think Fortune magazine in 1995 had this big headline saying “Death of Hong Kong,” in advance of the hand-over. I believe that the cover of Fortune is now going to be “Oops.” They made a mistake. Hong Kong is alive and well. So I am guardedly optimistic about the future. And I’m just hoping that we, as the United States, can figure out a way to relate to China in a positive way because I think that that’s going to be best for the United States.
DALJIT DHALIWAL: If the legal reforms in China continue, could it lead to a more democratic China?
ALICE YOUNG: It’s certainly possible. They have local town elections now in China. But I doubt very much that the goal is democracy. And, frankly, when I talked to ordinary business people in China their primary objective is not democracy as such. They see a lot of problems with democracy. Their goal is to do well and to have a good future for their children. And so I think that it’s less ideological on their part.
DALJIT DHALIWAL: Alice Young, thank you very much for joining us on Wide Angle.
ALICE YOUNG: It’s been a pleasure to be here.