VZCZCXRO0447
RR RUEHCN RUEHGH RUEHVC
DE RUEHBJ #0160/01 0200937
ZNR UUUUU ZZH
R 200937Z JAN 09
FM AMEMBASSY BEIJING
TO RUEHC/SECSTATE WASHDC 1914
INFO RUEHOO/CHINA POSTS COLLECTIVE
RHMFIUU/CDR USPACOM HONOLULU HI

UNCLAS SECTION 01 OF 02 BEIJING 000160 
 
DEPARTMENT FOR INR/R/MR, EAP/CM, EAP/PA, EAP/PD, C 
HQ PACOM FOR PUBLIC DIPLOMACY ADVISOR (J007) 
SIPDIS 
 
E.O. 12958:  N/A 
TAGS: OPRC KMDR CH
 
SUBJECT: MEDIA REACTION: U.S. - CHINA RELATIONS, U.S. POLICY, NORTH 
KOREA, FINANCIAL CRISIS 
 
-------------------- 
  Editorial Quotes 
-------------------- 
 
¶1. U.S.-CHINA RELATIONS 
 
"China could take more initiative when dealing with Obama" 
 
The official Communist Party international news publication Global 
Times (Huanqiu Shibao)(01/20): "Recently, American scholars advised 
Obama to visit China for his first official presidential visit. 
Although Obama decided not to take the advice, the sensitivity, 
understanding, and openness of the American intellectuals and 
think-tanks responsible for this advice are admired by Chinese 
scholars. Why is it that Chinese scholars have not reciprocated by 
taking the initiative to visit the U.S., attend the inauguration, or 
further their diplomacy with the U.S.? After Obama takes office, on 
the one hand, the U.S. needs China's cooperation to revive its 
domestic economy and consolidate the U.S. dollar's monopoly 
position; but, on the other hand, the U.S. may resume U.S.-China 
trade disputes in order to shift the trade deficit with China. Both 
choices are possible and depend on China's diplomacy efforts. Only 
when China takes initiative and influences the U.S.' decision-making 
on major foreign policy initiatives, will the U.S.-China 
relationship have a good start during Obama's post." 
 
¶2. U.S. POLICY 
 
"Don't be overly sensitive about the concept of 'smart power'" 
 
The official Communist Party international news publication Global 
Times (Huanqiu Shibao)(01/19): "Chinese experts always respond 
quickly to new American phrases, busying themselves with analyzing 
and comprehending each phrase. Recently they focused on the phrase 
'smart power'. The world will still operate without the U.S. And, 
Chinese analysts should not focus on the U.S. alone. Hillary 
mentioned the phrase on a special occasion given her new identity. 
She did not come up with the idea. The phrase has become popular 
because people are fed up with Bush's concept of 'war on terror', 
etc. What's more, in fact, the concept of 'smart power' is old wine 
in a new bottle. Smart diplomacy does not depend on what a 
politician says, but on what that politician does. China should wait 
and watch for further developments and then make a conclusion." 
 
¶3. NORTH KOREA 
 
"North Korea threatens to fight, in all aspects, against South 
Korea" 
 
The official Communist Party international news publication Global 
Times (Huanqiu Shibao)(01/19): "The North Korean military has 
recently said that it will have an all-out confrontation with South 
Korea. The North Korean foreign affairs department has warned the 
U.S. that it can live without the formalization of the North - South 
relationship, but cannot live without nuclear weapons. Experts 
believe that this is simply a negotiation strategy for North Korea. 
However, the South Korean military believes that it is more than 
just a tactic. Chinese experts indicate that it is not a surprise 
that this has happened. The North-South confrontations and the 
U.S.-North Korea conflict have never been solved. North Korea was 
eager to improve relations with the U.S. but has not gained their 
attention because the U.S. is busy with the financial crisis. Obama 
is a side-liner on the North Korea issue. However, the current South 
Korean government is a hard-liner on the North Korea issue. This is 
just a ploy, the North Korean government really intends to take 
action during the U.S. power transition to promote the conciliation 
process of U.S.-North Korea relations and North-South relations." 
 
¶4. FINANCIAL CRISIS 
 
"U.S. has itself to blame for the financial meltdown" 
 
Liu Junhong, a researcher with the China Institutes of Contemporary 
International Relations, commented on the official English-language 
newspaper China Daily (01/20): "Along with drastic tax reductions, 
almost all nations have resorted to an expansive fiscal and a loose 
financial policy over the past four months to tackle the global 
financial crisis that broke out in the US. ...It is regrettable to 
see a responsibility-evading attitude from the United States, the 
epicenter of the global financial crisis. ...From a financial and 
economic perspective, the ongoing financial crisis is a combination 
of securities and banking problems in the U.S. ...The U.S. financial 
crisis lies in its ill-conceived financial capital mode and was 
directly ignited by the burst of the bubble in its housing market. 
The busting of its property bubble also helped trigger another 
inflated bubble in the consumption market. 
It is well known that the U.S. economy has long been driven by 
robust consumption and even by individual and government 
 
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overspending. ...The busting of the current housing bubble also 
triggered the bursting of the consumption bubble. ...The lack of 
strong consumption together with a defective crediting system has 
rocked the foundation of the market economy and now threatens to 
have a far-reaching impact on the global economy." 
 
PICCUTA