China Steals Micron Memory Chip Innovations

(p. A8) A Wall Street Journal study of 10 recent technology-related prosecution cases in Taiwan found that in nine of those, prosecutors allege the technology ended up with or was intended for companies in China.

China’s technology ministry has in public statements said Taiwan and China should cooperate in high-tech sectors including semiconductors. It didn’t reply to requests for comment on the Taiwanese cases.

One case involved a Taiwanese unit of Idaho-based Micron Technology Inc., America’s largest memory-chip manufacturer. On a spring day in 2016, a 41-year-old engineer for the unit opened his company laptop and, according to Taiwanese prosecutors, tapped into Google search: “clear computer use records.”

Wang Yongming found a file-erasing program called CCleaner, which he used to try to delete traces of more than 900 files from his laptop before returning it to his employer, the prosecutors say.

Ten months after Mr. Wang returned the laptop to the company and left for a job with a smaller Taiwanese rival, United Microelectronics Corp. , Taiwanese authorities say they unearthed evidence of the documents, which detailed production-design secrets of Micron’s memory chips.

In August, Mr. Wang and others were indicted in Taiwan on charges of stealing Micron’s trade secrets for illegal use in China. Prosecutors allege Mr. Wang transferred the data to his new employer, which used the designs in service of a Chinese chip maker called Fujian Jinhua Integrated Circuit Co. Jinhua is now planning to mass produce its own version of the chips.

In Mr. Wang’s case, prosecutors say he has confessed to some charges. Mr. Wang couldn’t be reached, and his attorneys declined to comment. UMC declined to comment. Micron, in a separate lawsuit in California, alleges Jinhua masterminded the plan to take a shortcut through a thicket of knowledge Micron accumulated during decades of investment.

. . .

Around the time Mr. Wang left Micron Taiwan, in April 2016, the company conducted an internal investigation based on suspicions that he had made illegal copies of documents. When investigators raided UMC in February 2017, say Taiwanese prosecutors and Micron, Mr. Wang handed his personal cellphone to an assistant and instructed her to take it away—unaware that prosecutors had already obtained a court order to track the device, which investigators allege also contained incriminating information.

UMC, which Mr. Wang joined in April 2016 a few days after trying to erase files from his laptop, had in January 2016 struck a deal with Jinhua to supply the designs to mass-produce DRAM in exchange for more than $700 million in fees, equipment and a cut of future licensing revenues. Before then, UMC was mostly a foundry that made other companies’ designs. Micron alleges in its civil lawsuit that Jinhua knew that the technology to be delivered under the deal would be based on Micron’s designs.

. . .

“The Micron trade secrets that Wang stole proved invaluable to UMC’s development effort and critical to the timeline of the Jinhua DRAM project,” Micron said in its filing.

The speed of UMC’s design development helped Jinhua in October 2016 to start marketing its first two DRAM products, which it called F32 and F32S—names that Micron says were identical to the ones used for chips it produced at its Taiwan facility.

For the full story, see:

Chuin-Wei Yap. “China Targets Taiwan’s Tech Secrets.” The Wall Street Journal (Monday, July 2, 2018): A1 & A8.

(Note: ellipses added.)

(Note: the online version of the story has the date July 1, 2018, and has the title “Taiwan’s Technology Secrets Come Under Assault From China.”)

Future Population Lower Than U.N. Estimates, Perhaps by Billions

(p. A15) Is a dangerous population explosion imminent? For decades we’ve been told so by scientific elites, starting with the Club of Rome reports in the 1970s. But in their compelling book “Empty Planet: The Shock of Global Population Decline,” Canadian social scientist Darrell Bricker and journalist John Ibbitson lay out the opposite case: “The great defining event of the twenty-first century,” they say, “will occur in three decades, give or take, when the global population starts to decline. Once that decline begins, it will never end.”

. . .

So why exactly is everyone still worried about the opposite problem? The authors pin the blame on faulty assumptions by the population establishment, as represented by the U.N. Population Division. They don’t use the United States as an example, but I will: The U.N.’s most recent population forecasts suggest that the average U.S. total fertility rate from 2015 to 2020 should be 1.9 children per woman. In reality, CDC data shows U.S. fertility has averaged about 1.8 children per woman from 2015 to 2018. In 2019, early indications are that fertility will probably be nearer 1.7 children per woman.

. . .

As Messrs. Bricker and Ibbitson point out, U.N. forecasts are substantially out-of-step with existing data from many countries, including China, India and Brazil. As a result of these mistakes, the most widely used population benchmarks in the world are probably wrong. The future will have far fewer people than the U.N. suggests; perhaps billions fewer.

For the full review, see:

Lyman Stone. “BOOKSHELF; A Drop In Numbers.” The Wall Street Journal (Thursday, February 7, 2019): A15.

(Note: ellipses added.)

(Note: the online version of the review has the date February 6, 2019, and has the title “BOOKSHELF; ‘Empty Planet’ Review: A Drop in Numbers; Governments stoke fears about overpopulation, but the reality is that fertility rates are falling faster than most experts can readily explain.”)

The book under review, is:

Bricker, Darrell, and John Ibbitson. Empty Planet: The Shock of Global Population Decline. New York: Crown, 2019.

F.A.A. Regulations Slow Drone Innovation

(p. B2) Chinese aviation administrators, . . . , have already approved drone deliveries by the e-commerce giant JD.com and delivery giant SF Holding Co. But in the United States, it will depend on whether regulators eventually allow drone companies to have autonomous systems in which multiple aircraft are overseen by one pilot and whether they can fly beyond the vision of that pilot. Current regulations do not permit multiple drones per operator without a waiver. Operators like Wing, the drone-delivery company owned by Google parent Alphabet, have that capability.

. . .

Wing is . . .  one of several companies participating in a pilot program in Virginia. As with its testing in Finland and Australia, Wing will focus on the delivery of consumer goods, including food.

The Virginia site, in Blacksburg, near Virginia Tech, is one of 10 chosen by the Federal Aviation Administration as part of its Unmanned Aircraft Systems Integration Pilot Program.

The 10 were culled from 149 applications from “state, local and tribal governments,” agency spokesman Les Dorr said in an email. Those in the industry didn’t apply directly, but could show their interest, he said, and more than 2,800 companies responded.

. . .

While the F.A.A. has chosen the 10 pilots, the programs still need to apply for agency waivers because they will fly beyond the visual line of sight, fly at night and fly over people, fundamentals not allowed under current law. The agency is seeking comments on expanding permissible uses under current law; it is also testing to evaluate the parameters of regulation.

As a practical matter, this means that some of the pilot programs are not yet operational as they await F.A.A. approval.

That’s O.K., said James Pearce, a spokesman for the North Carolina Department of Transportation, which prefers to ensure that the drones can safely fly and that those on the ground are not exposed to any risks, including those that are self-inflicted. “We need to make sure that people know not to try to grab the drones.”

. . .

While the deliberate pace may seem slow, Mr. Levitt, like others interviewed, remains sanguine. “It’s like the red flag laws when cars began to populate the roads. You had to have someone walking ahead with a flag to warn others. That’s where we are today with drones — not being able to fly beyond the visual line of sight is like not allowing a car to drive faster than a person can walk.”

For the full story, see:

(Note:  ellipses added.)

(Note:  the online version of the story has the date March 19, 2019, and has the title “Skies Aren’t Clogged With Drones Yet, but Don’t Rule Them Out.”)

“Seek Truth from Facts”

(p. A15)  . . . 2019 . . .  marks the anniversary of the result of a . . . defiant protest—one that will receive little attention in or out of China, even though it launched the economic reforms that kick-started the country’s rise.

Forty years ago this spring, corn farmers in Xiaogang village, in the central province of Anhui (where Pearl Buck set “The Good Earth”), reported a grain yield of 66 metric tons. This single harvest equaled the village’s total output between 1955 and 1970—but for once the figure was not exaggerated. In fact, villagers underreported their actual yield by a third, fearing officials would not believe their record haul.

What caused this massive spike in production? A new fertilizer or hybrid seed? Better equipment? A catchy, rhymed propaganda slogan? No; Xiaogang’s farmers were starving. After taking power in 1949, China’s Communist Party had effectively abolished private land ownership, grouping farms into “people’s communes” subservient to the state. By 1978 villages were crippled by quotas that seized most of what they grew for redistribution.

Continue reading ““Seek Truth from Facts””

Chinese “Entrepreneurs Were Like Famished Goats Set Free from a Pen and Allowed to Flourish”

(p. 11) YULIN, China — For months, Zhao Faqi was a folk hero for entrepreneurs in China — an investor who fought the government in court and online, and against the odds, seemed poised to win. He accused officials of stealing his rights to coal-rich land, and ignited a furor by accusing China’s most powerful judge of corruption.
Now, Mr. Zhao has dropped out of sight — and the authorities want to erase his story.
. . .
The state news media has painted him as a cunning schemer. A judge who supported his case was paraded on television. A crusading former talk show host who helped bring the case to light has fallen silent.
Mr. Zhao’s arc from self-declared victim to officially designated villain has been dramatic even for China, where the party controls the courts and businesspeople can abruptly fall from grace. Mr. Zhao’s descent — and possible disappearance — is a demonstration of the hazards that entrepreneurs face in taking on powerful Chinese officials.
“I’ve faced a lot of risks and pressure because of this lawsuit,” Mr. Zhao said in an interview in Beijing a few weeks before he disappeared. Chinese entrepreneurs, he said, yearned for the rule of law to replace arbitrary power. “You can’t say someone is protected one day, and take away protection the next day.”
Mr. Zhao drew support from liberal economists and lawyers who have been unsettled by Mr. Xi’s reverence for communist tradition and support for state-owned companies, which he has urged to grow “stronger, better and bigger.”
. . .
Mr. Zhao, 52, was among the entrepreneurs who plunged into business after Deng Xiaoping, then China’s paramount leader, unleashed market overhauls. At the time, Mr. Zhao said, entrepreneurs were like famished goats set free from a pen and allowed to flourish.
“But we’re seeing this vitality steadily shrink,” he said.
. . .
. . . , Mr. Zhao’s phone has been turned off, and he appears to have gone into hiding or official custody.

For the full story, see:
Chris Buckley. “Chinese Entrepreneur Takes On the System, and Drops Out of Sight.” The New York Times, First Section (Sunday, March 10, 2019): 11.
(Note: ellipses added.)
(Note: the online version of the story has the date March 9, 2019.)

Li Rui Stood Up to Mao and Xi

(p. A8) BEIJING — While alive, Li Rui was a decades-long headache for China’s ruling Communists — a former aide to Mao Zedong who became an obdurate, sharp-tongued critic of the party. And the controversy did not stop in death, even for his funeral.
Hundreds of people gathered in Beijing on Wednesday to say goodbye to Mr. Li, four days after his death at 101. But the funeral revealed tensions between the government, which wanted a brisk Communist ceremony, and mourners who celebrated Mr. Li as a renegade — one who, even as he lay dying, railed against the authoritarian policies of Xi Jinping, the party’s leader and China’s president.
. . .
A few paid tribute to Mr. Li by holding up handwritten signs, or by making brief speeches that praised him as a freethinker who had stood up to Mao — opposing the calamitous excesses of the Great Leap Forward — and pressed Mao’s successors to take China in a more liberal direction. Police officers and officials kept watch, and tried to keep foreign reporters from talking to mourners throughout the morning.
“He was someone who had the guts to speak up for the people,” said Sheng Lianqi, a retired worker in his 70s, who said he never met Mr. Li but admired his writings.
He held up a handwritten sign that read in part: “Li Rui’s name will live in eternity. The ordinary people have sharp eyes and clear minds.”
. . .
These days, the party restricts criticism of Mao. But Mr. Li seemed determined to have the last word. He donated many of his papers — including notebooks and letters from his decades in the party, and a diary he kept for more than 80 years — to the Hoover Institution at Stanford University, where scholars will eventually be able to study them, said his daughter, Ms. Li.

For the full obituary, see:
Chris Buckley. “A Red-Banner Funeral in Beijing for a Critic of the Party From Mao to Xi.” The New York Times (Thursday, Feb. 21, 2019): A8.
(Note: ellipses added.)
(Note: the online version of the obituary has the date Feb. 20, 2019, and has the title “In Beijing, a Communist Funeral for an Inconvenient Critic.”)

Tariffs Evaded by Misclassification and Transshipment

(p. A1) One day in June [2018] , seven months after the U.S. imposed stiff tariffs on plywood from China, a wood importer in Oregon got a call from a supplier asking if he would like to get some Chinese plywood tariff-free.
How would that work, asked importer David Visse. The products carry an identification code that is checked by U.S. Customs agents.
“Don’t worry about it,” Mr. Visse says the supplier told him. The plywood would be stripped of its Chinese markings, and “we’ll ship it under some other code.”
Every product imported into the U.S. carries a 10-digit designation called an HTS code, of which there are 18,927 in all. Like a taxonomic version of Noah’s Ark, the code provides a common language to bridge disparate markets and identify products in all their variety.
In a world of increasing tariffs, the code has another function: evading those levies. The business of code-fudging is expanding in step with tariff increases, undermining U.S. efforts to shield American business from foreign competition, according to importers, customs officials, trade attorneys and shipping brokers.
As trade conflict grows between the two largest economies, these professionals say, code misclassification is starting to compete (p. A10) with transshipment–the rerouting of goods through third countries–as a way to duck tariffs.

For the full story, see:
Chuin-Wei Yap. “Trade Fight Spurs Tariff Dodges, With 18,927 Options.” The Wall Street Journal (Tuesday, Oct. 9, 2018): A1 & A10.
(Note: bracketed year added.)
(Note: the online version of the story has the date Oct. 8, 2018, and has the title “The U.S.-China Trade Battle Spawns a New Era of Tariff Dodges.”)