China

Up to 40 million Chinese people still live in caves. That's more than the populations of Texas and Illinois, combined. In fairness, a fraction of these caves are apparently pretty nice, complete with electricity and well-compacted dirt floors. But that's grading on a curve because, well, they're still caves. Meanwhile, 21 million Chinese live below what the Communist Party calls the "absolute poverty" line. That sounds pretty good if you have in mind our poverty line, which is just under $11,000 per year for an individual and roughly $22,000 for a family of four.

When President Barack Obama blocked the Keystone XL pipeline, Republicans said the move would encourage Canada to pursue oil deals with China instead of the United States and cede a massive chunk of North American oil assets to the communist nation. Now, China's state-run oil company CNOOC is poised to cut a $15.1 billion deal - the largest ever foreign acquisition for a Chinese company - with the Canadian oil company Nexen. This deal prompts great concern about the Chinese government's continued attempts to use its state-owned enterprises to acquire global energy resources.

Chemical company W.R. Grace & Co. said Friday it has opened a new manufacturing facility in China as part of its efforts to expand its footprint in the Asia-Pacific region. The facility, in the city of Chongqing, will manufacture cement additives and concrete admixtures. It will also have a quality-control lab and administrative and personnel offices. The additives are used by cement producers to improve grinding efficiency and enhance the quality of cement. They are also more environmentally friendly, reducing energy consumption and carbon dioxide emissions.

Only 42 politicking days to go until elections, and the Obama administration has decided to get a little tougher on the single biggest distorting factor in the world economy. U.S. Trade Representative Ronald Kirk says the timing of Washington's increased pressure on China over currency manipulation and other issues is a coincidence. Whatever the reason, it's welcome. "We're going to have to engage China," Kirk said in an interview Monday. "We're going to have to continually push, cajole and in some cases where that doesn't work, file suit to say: 'Look, we invited you into the global trading community.

- China again urged President Barack Obama on Wednesday not to hold a planned meeting with Dalai Lama, saying it would further hurt already strained bilateral relations. It was the second successive day that China has spoken out against the meeting, and comes after Beijing said ties had been harmed by a U.S. announcement last week that it would sell arms to Taiwan. The United States has already brushed aside previous warnings from China, and White House spokesman Bill Burton said Tuesday the meeting was still planned, although no date has been set. "The president told ... China's leaders during his trip last year that he would meet with the Dalai Lama, and he intends to do so. The Dalai Lama is an internationally respected religious and cultural leader, and the president will meet with him in that capacity," Burton said.

Baltimore-based RTKL Associates Inc. recently beat two international rivals to win a contract to design an iconic structure for a city along the Yangtze River in China. Last winter, RTKL and two other architectural firms — one British, the other French — were invited by a real estate subsidiary of Chinese steel conglomerate Jiangsu Shagang Group to submit plans for a twin-tower, mixed-use project in Zhangjiagang, a city of about 1.5 million people 60 miles west of Shanghai. RTKL won with a design for two high-rise towers connected by an elliptical atrium.

Every country renounces a two-China policy, diplomatically. Just as universally, every major country pursues a two-China policy, commercially.That's why Beijing's attempt to "isolate" Taiwan in military hardware sales is doomed to fail. In a time of recession and arms restraint, Western manufacturers trying desperately to survive will sell to any country their own governments approve. And no country has a credit rating as good as Taiwan's.To punish France for Dassault Aviation's selling 60 MIrage 2000-5 fighter planes to Taiwan, China ordered the French consulate in Guangzhou to shut down.

President Bush is willing to risk a fight with Congress over human rights to retain most favored nation status for China, a designation worth billions of dollars in foreign trade. The president, who represented the United States in Beijing as the countries began to resume diplomatic relations and considers himself an expert on China, cites "big picture" concerns -- the strategic importance of this huge country as well as its cooperation in the U.N. Security Council during the Persian Gulf crisis.

A HALF-CENTURY ago, when American-led U.N. troops drove North Korean forces across the Yalu River into China, the Chinese army entered the civil war on the Korean peninsula, ultimately succeeding at pushing the frontlines back to the 38th Parallel - the division between the Koreas that remains today. Then, following the Asian model of Stalinism pioneered by China, the North proceeded to register the first Korean economic miracle, roughly two decades of growth outstripping that of postwar South Korea.

China got through the recent anniversary of the massacre of demonstrators on Tiananmen Square in Beijing with little difficulty. Police presence was overwhelming. A few dozen key dissidents were rounded up beforehand. Order was kept.Senior leader Deng Xiaoping is 90 and in failing health. The regime is understandably edgy. Like him, it fears disorder, far more than it worries about a little criticism from abroad.But ferment cannot be kept from China for long. The reforms of Deng to unshackle the enterprise of the Chinese people make this inevitable.