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Communist China Army Force Invades Nation of India: Dangerous PLA Deep-Incursion Outrages Indian People

China - IndiaAssociated Press

By Nirmala George

NEW DELHI (AP) – The platoon of Chinese soldiers slipped across the boundary into India in the middle of the night, according to Indian officials. They were ferried across the bitterly cold moonscape in Chinese army vehicles, then got out to traverse a dry creek bed with a helicopter hovering overhead for protection.

They finally reached their destination and pitched a tent in the barren Depsang Valley in the Ladakh region, a symbolic claim of sovereignty deep inside Indian-held territory. So stealthy was the operation that India did not discover the incursion until a day later, Indian officials said.

China denies any incursion, but Indian officials say that for two weeks, the soldiers have refused to move back over the so-called Line of Actual Control that divides Indian-ruled territory from Chinese-run land, leaving the government on the verge of a crisis with its powerful northeastern neighbor.

Indian officials fear that if they react with force, the face-off could escalate into a battle with the powerful People’s Liberation Army. But doing nothing would leave a Chinese outpost deep in territory India has ruled since independence.

“If they have come 19 kilometers into India, it is not a minor LAC violation. It is a deliberate military operation. And even as India protests, more tents have come up,” said Sujit Dutta, a China specialist at the Jamia Milia Islamia university in New Delhi.

“Clearly, the Chinese are testing India to see how far they can go,” he said.

That is not China’s stated view.

Chinese Foreign Ministry spokeswoman Hua Chunying said Thursday that Chinese troops had been carrying out normal patrols and had not crossed the boundary.

“China is firmly opposed to any acts that involve crossing the Line of Actual Control and sabotaging the status quo,” she said at a daily briefing in Beijing as she was repeatedly questioned about the dispute.

Hua said talks to defuse the dispute were ongoing and that it should not affect relations. “As we pointed out many times, the China-India border issue is one which was left over from the past. The two sides reached important consensus that this issue should not affect the overall bilateral relations,” Hua said.

Local army commanders from both sides have held three meetings over the crisis, according to Indian officials. India’s foreign secretary called in the Chinese ambassador to register a strong protest. Yet the troops did not move, and even pitched a second tent, Indian officials said.

The timing of the crisis, weeks before Chinese Premier Li Keqiang is to visit India, has surprised many here. The Chinese leader’s decision to make India his first trip abroad since taking office two months ago had been seen as an important gesture toward strengthening ties between rival powers that have longstanding border disputes but also growing trade relations.

Manoj Joshi, a defense analyst at the New Delhi-based Observer Research Foundation, said the timing of the incursion raises questions about “whether there is infighting within the Chinese leadership, or whether someone is trying to upstage Li.”

Indian External Affairs Minister Salman Khurshid said Wednesday that while he had no plans to cancel a trip to Beijing next week to prepare for Li’s visit, the government could reconsider in the coming week.

“A week is a long time in politics,” he told reporters.

Indian politicians accused the scandal-plagued government of Prime Minister Manmohan Singh of floundering in fear before China.

“China realizes that India has a weak government, and a prime minister who is powerless,” said Yashwant Sinha, a former foreign minister from the opposition Bharatiya Janata Party.

He demanded a stronger response. “A bully will back off the moment it realizes that it’s dealing with a country which will not submit to its will,” Sinha said.

Former Defense Minister Mulayam Singh Yadav called the government “cowardly and incompetent.” He warned that China was trying to annex more territory to add to the spoils it took following its victory over India in a brief 1962 border war.

Defense Minister A.K. Antony countered that India is “united in its commitment to take every possible step to safeguard our interests.”

Supporters of the right-wing Shiv Sena party burned effigies of Singh, Antony and other top officials Wednesday, demanding India retaliate by barring Chinese imports.

China is India’s biggest trading partner, with bilateral trade, heavily skewed in China’s favor, crossing $75 billion in 2011.

Analysts feel linking a troop withdrawal to continued trade could work.

“The Chinese have to learn that such aggression cannot be delinked from trade,” said Dutta.

Though the two countries have held 15 rounds of talks, their border disputes remain unresolved. India says China is occupying 38,000 square kilometers (15,000 square miles) in the Aksai Chin plateau in the western Himalayas, while China claims around 90,000 square kilometers (35,000 square miles) in India’s northeastern state of Arunachal Pradesh.

Analysts said they were baffled by Beijing’s motives, since its actions could force India to move closer to Beijing’s biggest rival, the United States.

“The Chinese for some reason don’t seem able to see that,” said Joshi.

China’s aggressive posture could also force India to accelerate its own military modernization program, analysts said.

The stand-off may eventually be resolved diplomatically, “but what it really shows is the PLA’s contempt for our military capability,” former Indian navy chief, Sushil Kumar, wrote in The Indian Express newspaper.

It could also push the government to agree to the army’s longstanding demand to create its own strike corps on the border.

“By needling the Indians, they are helping us to accelerate our modernization,” Joshi said.

OBAMA LOOKS FOR JOBS IN INDIA – AS HE SITE SEE’S AND SPENDS MILLIONS OF YOUR TAX PAYER DOLLARS – ON VACATION

An increase in U.S. visa fees, a ban on offshoring by the state of Ohio and the industry’s portrayal in campaign ads as a drain of U.S. jobs has set a frosty tone ahead of Obama’s visit to India in early November.
Obama is expected to visit Mumbai, India’s financial hub and the centre of the 2008 militant attacks. U.S. officials say much of the trip’s focus will be boosting trade that is expected to double in five years from the current level of $50 billion.
But it is a sign of the times that Obama is not expected to visit Bangalore, the country’s technology hub. Nor is he expected to visit Hyderabad, another Indian IT hotbed, where his predecessor, George W. Bush, stopped in a 2006 visit.
“It is a worry, there’s no question, but the worry is more about unemployment, not about the political rhetoric,” said Pramod Bhasin, chief executive of outsourcer Genpact Ltd.
“We as an industry have to help create jobs in America and we have to communicate that much better than we’ve done in the past,” said Bhasin, whose firm employs about 2,000 in the United States and expects to double or triple that over the next two to three years. Three-quarters of Genpact staff are in India.
Obama’s fellow Democrats are expected to take a drubbing in the Nov. 2 balloting amid unemployment stuck near 10 percent.
Legislation that would end tax breaks for firms that create jobs and profits overseas was thwarted in the Senate, but a new rule raising the cost of certain visas to enter the United States, part of a border security bill, will cost Indian IT firms $200 million and sets an ominous precedent for the industry.
“It has nothing to do with immigration, but it has had an impact on the costs of IT services companies from India. That is the kind of legislation that worries us,” said S Gopalakrishnan, CEO of sector bellwether Infosys Technologies Ltd.
SUCCESS VICTIM
India’s IT services industry, which generates 70 percent of its revenue from the United States and accounts for 5 percent of India’s economy, is a victim of its own success.
Before the global economic downturn, the sector was growing by roughly one-third per year as companies across industries shipped commoditised work to India and elsewhere to cut costs.
U.S. blue chips from Intel and Google to Cisco and Microsoft have substantial operations in India, which is increasingly a research hub for Silicon Valley. IBM alone is believed to employ more than 70,000 in India, although it would not confirm that figure.

Echoes of the Great Depression

As in the 1930s, policy uncertainty and hostility to business have retarded recovery. At least this time around the political price for economic failure promises to be swift.

The Wall Street Journal
OCTOBER 1, 2010

By PHIL GRAMM
This may not be your grandfather’s Great Depression, but many aspects of today’s situation would remind him of the 1930s. If the recession that officially ended a year ago feels uncomfortably surreal to you yet familiar to him, it’s probably because the recovery went missing.
During the average recovery since World War II, gross domestic product (GDP) surpassed the pre-recession high five quarters after the recession began. It has never taken longer than seven quarters. Yet today, after 11 quarters, GDP is still below what it was in the fourth quarter of 2007. The economy is growing at only about a third of the rate of previous postwar recoveries from major recessions.
Obama administration officials such as Treasury Secretary Tim Geithner have argued that without their policies the economy would be worse, and we might have fallen “off a cliff.” While this assertion cannot be tested, we can compare the recent experience of other countries to our own.
The chart nearby compares total 2007 employment levels in the United States, the United Kingdom, the 16 euro zone countries, the G-7 countries and all OECD (Organization for Economic Cooperation and Development) countries with those of the second quarter of 2010. There are 4.6% fewer people employed in the U.S. today than at the start of the recession. Euro zone countries have lost 1.7% of their jobs. Total employment in the U.K. is down 0.6%, G-7 average employment is down 2.4%, and OECD employment has fallen 1.9%.


This simple comparison suggests two things. First, that American economic policy has been less effective in increasing employment than the policies of other developed nations. Second, that if there was a cliff out there, no country fell off. Those that suffered the most were the most profligate, such as Greece, and their problems can’t be blamed on the financial crisis. While the most recent quarterly growth figures are just a snapshot in time, it is hardly encouraging that economic growth in the U.S. (1.7%) is lower than in the euro zone (4%), U.K. (4.8%), G-7 (2.8%) and OECD (2%).

Most striking about these comparisons is their similarity to the U.S. experience in the Great Depression. Using data from the League of Nations’ World Economic Survey, we can look at unemployment in developed nations between 1929 and the end of 1938. Ten years after the stock market crash, total employment in the U.S. was still almost 20% below the pre-Depression level. The decline in France was similar. But in the U.K. and Italy, total employment was up 10% and 12%, respectively. Industrial production on average in the six most developed countries was almost 16% above their 1929 levels by the end of 1938, but industrial production had declined by 20% in the U.S.
Today’s lagging growth and persistent high unemployment are reminiscent of the 1930s, perhaps because in no other period of American history has our government followed policies as similar to those of the Great Depression era
. Federal debt by the end of 1938 was almost 150% above the 1929 level. Federal spending grew by 77% from 1932 to 1934 as the New Deal was implemented—unprecedented for peacetime.
Still the economy did not take off. Winston Churchill gave a contemporary evaluation of the Roosevelt policy by observing, in the April 24, 1935, Daily Mail, “Nearly two thousand millions Sterling have been poured out to prime the pump of prosperity; but prosperity has not begun to flow.”
The top individual income tax rate rose from 24% to 63% to 79% during the Hoover and Roosevelt administrations. Corporate rates were increased to 15% from 11%, and when private businesses did not invest, Congress imposed a 27% undistributed profits tax.
In 1929, the U.S. government collected $1.1 billion in total income taxes; by 1935 collections had fallen to $527 million. In 1929, individual income taxes accounted for 38% of government revenues, corporate taxes accounted for 43%, and excise taxes for 19%. By 1939, individual income taxes made up only 26% of federal revenues, corporate income taxes made up 29%, and excise taxes made up 45%.
When Treasury Secretary Henry Morgenthau suggested to President Roosevelt that the administration cut income tax rates in 1939, Roosevelt, apparently concerned about the possible effect of deficit-financed tax cuts on interest rates, asked, “You are willing to pay usury in order to get recovery?” Morgenthau said that he responded, “Yes sir.” The president disagreed.
The Roosevelt administration also conducted a seven-year populist tirade against private business, which FDR denounced as the province of “economic royalists” and “malefactors of great wealth.” The war on business and wealth was so traumatic that the League of Nations’ 1939 World Economic Survey attributed part of the poor U.S. economic performance to it: “The relations between the leaders of business and the Administration were uneasy, and this uneasiness accentuated the unwillingness of private enterprise to embark on further projects of capital expenditure which might have helped to sustain the economy.”
Churchill, who was generally guarded when criticizing New Deal policies, could not hold back. “The disposition to hunt down rich men as if they were noxious beasts,” he noted in “Great Contemporaries” (1939), is “a very attractive sport.” But “confidence is shaken and enterprise chilled, and the unemployed queue up at the soup kitchens or march out to the public works with ever growing expense to the taxpayer and nothing more appetizing to take home to their families than the leg or wing of what was once a millionaire. . . It is indispensable to the wealth of nations and to the wage and life standards of labour, that capital and credit should be honoured and cherished partners in the economic system. . . .”
The regulatory burden exploded during the Roosevelt administration, not just through the creation of new government agencies but through an extraordinary barrage of executive orders—more than all subsequent presidents through Bill Clinton combined. Then, as now, uncertainty reigned. As the textile innovator Lammot du Pont complained in 1937, “Uncertainty rules the tax situation, the labor situation, the monetary situation, and practically every legal condition under which industry must operate.”
Henry Morgenthau
summarized the policy failure to the House Ways and Means Committee in April 1939: “Now, gentleman, we have tried spending money. We are spending more than we have ever spent before and it does not work . . . I say after eight years of this administration we have just as much unemployment as when we started . . . and an enormous debt, to boot.”
Despite the striking similarities between then and now, there is one major difference: Roosevelt’s policies remained popular even as the economy faltered. The magnitude of the Depression, with its lack of stabilizers and safety nets, traumatized Americans and undermined their confidence in the economic system. This induced voters, as historians would later do, to judge Roosevelt not on his results but on his intentions.
Today, however, the Obama program appears to be failing politically as well as in the marketplace. The trauma of the financial crisis did not approach that of the Great Depression, and Americans do not appear to have lost faith in our economic system or come to see government as the savior. While progressivism gave the New Deal its intellectual foundations, history today is driven by the freedom tide that produced our economic revival in the 1980s and ’90s and still drives economic liberalization in China and India.
Finally, we should not underestimate that this administration faces stronger and more united congressional opposition than FDR ever faced. The House and Senate Republican leadership has far surpassed all expectations of a minority party.
Mitch McConnell of Kentucky and John Boehner of Ohio have led a loyal opposition that, through its unity, has exposed the radical underbelly of the Obama program. Young guns like Paul Ryan of Wisconsin and Jeb Hensarling of Texas have provided vision and energy.
FDR rode the tide of history while President Obama strives mightily against it.
The progressive vision that resonated in the 1930s foundered on the hard experience of the 20th century, and it has no broad appeal in the 21st. The recovery from the Great Depression did not occur until World War II was underway, but it appears, as of today, that voters will bring the latest experiment in American collectivism to an end on Nov. 2. A real economic recovery won’t be far behind.
Mr. Gramm is a former U.S. senator from Texas and former professor of economics at Texas A&M University.