`Foreign Minister, what is your assessment? What will the Americans do?'
`We have all of us, I think, expected this,' Kimura said.
`It was only a matter of time. The UN Security Council will meet, although we have little hope that it can do much. China will exercise its veto. Our best hope lies in our security treaty with the United States. I am, at best, ambivalent about this. Their economic relations with China have gone deeper and are spread wider than even ours which are considerable enough at total investment of $120 billion. Moreover, ever since the Americans withdrew from Okinawa and Yokosuka I have felt that their commitment to the security treaty was more one of form than substance.
`I will be seeing separately the US and Chinese Ambassadors after this meeting.'
The Prime Minister gathered his papers. `Very good, Kimura-san. Keep me informed.' He cleared his throat. `Gentlemen, I do not think our nation has faced so great a threat to its survival since the Pacific War. But adversity often presents opportunities. China is pushing us, and the Americans, to the limit. Maybe the time has come for Japan to stand up.
`Of one thing I am certain, it is high time we put our treaty with the US to the test. Tell the American Ambassador that we expect to see the treaty honoured in full. A threat to Japan's national interests used to be a threat to America's. Is that still so, and what do they plan to do about it? As for the Chinese Ambassador, I think we need to be more subtle. Explain to him our interests in China and the region and the need to minimize conflict. And if we are to have difficulties with the Americans, perhaps we should massage the European Union round to our way of thinking.
`Gentlemen, I suggest we be prepared to reconvene at a moment's notice. Thank you for your attendance.'
The White House, Washington, DC
Local time: 2130 Saturday 17 February 2001
GMT: 0230 Sunday 18 February 2001
President Bradlay said he would take no more calls unless in extreme emergency. Any Vietnamese or Chinese leader should be put through without delay. He then formally convened an extraordinary meeting of the National Security Council and asked the Secretary of State to begin his assessment.
Mr Newton Fischer, the Secretary of State, described China's attacks as having an element of military surprise, but not unexpected. The threat, and the stated claim to the South China Sea, had been made public for years. Since the end of Deng Xiaoping's leadership the shift had been irretrievably towards nationalism. With restructuring of the military and the purchasing of new weapons, it was inevitable that sooner or later the People's Liberation Army would do something to justify its role.
Fischer stressed that President Wang was not a mad dictator. He was a shrewd strategist determined to project China's power. For years, China had flexed its muscles. As far back as 1989, the People's Daily observed: `For a country to shake off foreign enslavement and to become independent and self-reliant is the premiss for its development . . . Once people lose their sense of country, of national defence, and of nation, total collapse of the spirit will inevitably follow.'
`What do they want?' interjected the President Bradlay.
`They want us out of Asia, sir,' was the reply. `It's been a long time coming. We have to face the fact that America will be dealing with a quasi-military government during this crisis. I have their most authoritative statement on the South China Sea and the islands which they claim as theirs. You get a feeling for the regime by the language they use.
`"Since Vietnamese warships were dealt stunning blows after encroaching on China's territorial waters in March this year, an upsurge of war preparations has been whipped up in Vietnam. "Vietnam will simply be seeking its own destruction if it really wants a major confrontation with the Chinese navy. A major factor in boosting the Chinese navy's combat capabilities in recent years is its combined blue-water training to protect our sovereignty against aggression.
"According to the provisions of the `UN Convention on the Law of the Sea' adopted by the world conference on the Law of the Sea, China has several million square kilometres of territorial sea including its continental shelf and associated economic zones, plus our original territorial waters. This vast sea area is extremely abundant in biological, mineral, and energy resources. Protecting and cherishing China's territorial seas and defending the country's maritime interests is the people's navy's unshirkable task . . . This strong concept of territorial seas is deeply imprinted in the mind of every cadre and fighter."'
Bradlay said he was alarmed at the element of surprise exacted by China after so much material was in the public domain. Secretary Fischer replied that the lobby of businessmen and the public relations machine of the Chinese government had been a far more persuasive force than defence analysts.
The meeting was interrupted by a flash telegram from the US Ambassador to Malaysia.
Five American oil workers escaped with Malaysian troops in the first few minutes of the attack on the Malaysian-claimed territory. They report that their naval patrol boat came under fire from the Chinese. There were Malaysian, but no (repeat no) American casualties. However, the Chinese opened fire when they stormed the atoll. The oil workers believe that some of their colleagues may have been hit. The Malaysians had been under standing orders to leave if confronted by overwhelming enemy forces. The oilmen will not (repeat not) be available to the press. Both they and the company believe they can go back to work once the conflict has ended.
Fischer responded that Malaysia would not be expected to react without consulting its neighbours from the Association of South-East Asian Nations (ASEAN). ASEAN itself would probably take a non-confrontational line. He did not expect a military response from these nations. Even collectively they were no match for China. The wealth in those countries was controlled by Chinese businessmen. They might live away from China, but they cultivated contact with the Communist leadership in order to win contracts. The Secretary of State reminded the President that one such Chinese/Malaysian family was a large investor in financial services in Maine, the President's own state, and that they had attended his inauguration only one month earlier.
The overriding threat of the Chinese adventure was to Japan. Its total European and South-East Asian trade traversed the South China Sea. Moreover, Japan was a big oil importer with no supply of its own. Three-quarters of its oil came from the Middle East, and the rest from Brunei, Indonesia, and Australia. The major issue, the Secretary said, was the security treaty with Tokyo. The consequences of any American equivocation on the issue would almost certainly end the treaty and unleash on Asia a more militarily assertive Japan.
`Mr President, it is my considered advice that we move very carefully in this area. We have had a military alliance with Japanese since 1960. One should not discard a relationship like that lightly. I know there are those who will say China matters more deed, some at this table but the Japanese have been good friends to the United States.'
President Bradlay then turned to Martin Weinstein, the National Security Adviser, who confined his report to the intelligence-gathering activities of both governments.
`We put a network of satellites over the region when the military exercises began. We've had AWACS in the air and we've got Aegis cruisers with a carrier battle group off the Philippines. Not much moves there without us knowing it. I'm happy with our IMINT and SIGINT [imagery and signals intelligence]. The Chinese have their own satellites, but the technology is faulty and outdated. We can assume they don't watch everything. But we don't know what they're missing.
`The flaw in our operation is HUMINT [human-source intelligence]. We do not have any quality operatives on the ground in Beijing. We have no one inside Zhongnanhai. We don't know what Wang Feng is thinking. Are there divisions between him and the other powerful players in the government? How supportive is MOFTEC [Ministry of Foreign Trade and Economic Cooperation] towards the PLA action, which has extreme economic risks? In most countries, including the Soviet Union when it existed, we had scraps of the jigsaw thr
own out to us. We ran agents. We had good networks. We don't have that anywhere important in China. Zhongnanhai is an impenetrable citadel. The best we get is information mainly from the children of the officials who live there. A lot of them fly over here and our agents befriend them. But it's gossip. Occasionally, one will leak a document to the New York Times or somebody.'
`What do they have on us?' asked the President.
Weinstein referred to his notes: `Their espionage operation is run through the Ministry of State Security or MSS. We believe in the United States itself the MSS draws upon the services of 1,500 Chinese diplomats and commercial representatives, 90 other Chinese establishments and offices, and 20,000 Chinese students arriving annually. They are either recruited to gather intelligence while here or debriefed back in China. If they don't comply their families are put under pressure; loss of job, home, medical care. That sort of thing. On top of that we have 15,000 representatives travelling through in about 3,000 delegations a year. The same happens to them. And there's an ethnic Chinese community of several million. In short, Mr President, if we enter into hostilities with the People's Republic of China they could have agents in every city.'
Bradlay turned to Peter Ray, the Director of the CIA. `So far, can you tell me what they know that they shouldn't know?'
`I can tell you the type of material. Two years before Richard Nixon redrew our China policy, the Communists knew of his desire to open diplomatic relations with them. In 1970 one of our analysts, Larry Chin Wu-tai, gave them a classified document which outlined his plan. They were able to adjust their foreign policy accordingly. We thought we were surprising them. They were across us all the time. Larry Chin worked for the CIA for thirty-seven years. He was indicted in 1981.'
`Are you telling me they have agents in our government?'
`I'm telling you, Mr President, that we don't have anyone with them. We don't know if they have anyone with us. The MSS actively seeks to penetrate American intelligence and policy-making agencies. Just recently, we had to bring out a communications officer from the embassy in Beijing. They had tried to recruit him. If they had succeeded, they would have had access to all embassy communications. We can be damn sure they'll be turning on all the taps today. We're watching. But HUMINT in Chinese society is very difficult.
`The other thrust of their intelligence operation is for technology. The South China Sea air strikes today could have been made possible by American technology. And you have to admire their nerve. The China Aero-Technology Import & Export Company, CATIC, bought a Seattle company which made aircraft parts, called Mamco Manufacturing Inc., in the late 1980s. Mamco had technology which could provide the Chinese air force with in-flight refuelling capabilities. In February 1990 we closed the operation down. But you look at the number of American engineering and technology companies now owned by Chinese firms. All those companies are ultimately responsible to the Communist Party. This is the policy of trade, interdependence, and constructive engagement. But tonight it reads to me like one of enemy infiltration.
`One point which also comes under the Joint Chiefs,' he said, winding up. `PLA intelligence activities have increased across the land border with Vietnam. In the past month, there have been low-level assassinations, the laying of mines, the killing of livestock. All no more than five miles across. A Vietnamese soldier was captured and tortured to try to get the Vietnamese order of battle. He escaped.'
`What are you saying?'
`We're watching that border, Mr President.'
Bradlay asked the Chairman of the Joint Chiefs to give his assessment.
`There's no doubt that the United States has the capability to regain control over the oil facilities in the Spratlys and the Paracels and to reopen the South China Sea to international navigation. Two carrier battle groups are close enough by to be there in a day.
`The Chinese have taken control of the oil-production facilities with Marine commandos. To retake them would not be easy. The best estimate is that at least several wells would be destroyed Iraqi-style, which could lead to an environmental disaster.
`The Chinese have stationed surface ships and submarines at the chokepoints to the South China Sea. These are the straits of Malacca, Sunda, and Lombok, through which, most crucially, Japan's oil supplies go. As of a few minutes ago, President Wang cited China's 1992 Territorial Waters Act, banning military and nuclear-powered ships. Commercial shipping is allowed.'
`What's it doing?' interrupted the President.
`Some tramp steamers are going through. The big shipping lines are telling their captains to hold back.'
`I think, then,' said the President, `for the sake of tonight's assessment we should think of this blockade as not being on just Japanese or East Asian trade, but on American trade. We get a lot of stuff through those sea routes. With American national interest threatened, our thinking will be much clearer. My next question is a natural follow-on. What happens if we go in with the carrier battle groups?'
`Ultimately, they would be unable to defend themselves. But it will not be like the 1996 Taiwan stand-off. I understand that after that a policy was put in place by the PLA to fight and shed blood rather than be humiliated by a foreign hegemonistic power. So we would win, but we could take horrible casualties. Our Navy SEALS would be in hand-to-hand combat to take back the reefs. There is no reason to believe that the Chinese commandos would not fight to the death. In the sea battles, they have fifteen to twenty submarines out there. We might get nineteen of them. But two torpedoes could kill a lot of our servicepeople.
`As yet we are uncertain of support from our allies in the region. South-East Asia has become rich through pragmatism and neutrality. If they believe that China's going to win this, they're not going to let us use their ports and airports.
`Effectively, Mr President, they are daring us to go to war or give up our security role in Asia. What they lack in training and technology, they make up with balls and numbers. They also have location on their side.'
Ms Bernadette Lin, the Commerce Secretary, spoke with what had been the predominant voice in the Sino-American relationship, but she began on a personal note.
`We all heard the CIA assessment of Chinese intelligence-gathering operations here. I would like to stress one point. Please, no witch-hunts. No leaks to the press that every Chinese could be a spy. I am a Chinese-American. As a child, I fled from Shanghai in 1952. Our immigration policy doesn't come without risks. Let us accept the risks and not create a knee-jerk reaction which might effect the lives of hundreds of thousands of American citizens just because they look Chinese. It's not going to be an easy ride for any of us until this crisis winds down.'
`Your point is taken, Madam Secretary,' replied the President.
`Now, I'll be blunt,' Ms Lin continued. `Corporate America does not want confrontation with China. The country has too much to lose. In the mid-nineties, China sold $30 billion worth of goods to us. We sold $9 billion to them which meant that if there had been a trade war we would have won. Since then, that gap has closed. It's not equal yet, but China has diversified so that its exports now go in large quantities to South-East Asia, Europe, and Latin America.
`What would happen if we stopped buying Chinese goods? Sure, China would be hurt bad and people would be thrown out of work. But it would not be crippled. If China stopped buying American goods, Mr President, it would cost us maybe $15 billion this year. There are fifteen states whose economies are heavily reliant on trade with China. I'll list examples. In California, exports to China keep 216,000 people employed. In Seattle, Washington 112,000, many of them with Boeing. In Arizona, 16,000. New York, 100,000. Clearly, there would a domestic political impact with many families affected. That would be reflected by the electorate in the next elections. And to give you an idea, California has fifty-two Congressional seats going in the next election. Washington has nine; Arizona, six; New York, thirty-one. Florida, with 32,000 jobs at stake, has twenty-three seats. Throughout America there are 469 seats whose r
epresentatives will take China trade to their election platform.
`It's true that in China millions more will be thrown out of work. What are all those farmers going to do who gave up the rice paddies to set up a Barbie Doll factory? I can tell you what they're not going to do, Mr President. They are not going to protest. They are not going to vote out the government because they can't. Throughout America, there are one and a quarter million jobs which need China trade. Taking families and dependants into account, that means upwards of five million Americans would suffer severely if we let this crisis spiral.
`There are a number of blue-chip companies which consider China to be an integral part of their growth and survival. Boeing estimates that the total market for the sale of commercial jet aircraft to China through 2013 will be worth $66 billion. Other companies like Motorola and AT&T make similar sales projections. But the investments today are huge: Motorola has invested $1.2 billion in China and now makes the latest computer chips there. Hewlett-Packard and IBM both have $100 million investments as well. Auto makers have a big exposure to China d by Ford with $250 million invested in three factories making components, light trucks, and vans, and followed by General Motors with a $130 million investment in three auto parts facilities. In all our top ten investors in China have more than $4 billion invested in the country and it will grow.
`Mr President, I watched when President Jimmy Carter tried to stop selling wheat to the Russians and the business went to the Australians and the Canadians. I watched when Ronald Reagan tried to stop construction of a natural-gas pipeline in the Soviet Union, as it then was, and Caterpillar almost went out of business. And I watched as Clinton flailed about on the issue of Most Favoured Nation status for China. He learned the lesson. The simple truth is that more and more, money not war is the major point in foreign affairs. This incident in the South China Sea is regrettable but it's not going to change that.'
Dragon Strike -- A Novel of the Coming War with China (Future History Book 1) Page 5
