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Boycott Beijing?

By Frederick Stakelbeck
web posted May 15, 2006

The euphoria surrounding Chinese President Hu Jintao's visit in April to the U.S has faded into memory, replaced by the cold reality that significant ideological differences still remain between the two countries. The failure of President Hu and U.S. President George W. Bush to make progress on important economic, human rights and national security issues is not only an abrupt setback to bilateral relations, but it also creates the possibility for future disagreements and even open conflict.

So where does the Bush administration go from here? And how can Washington prove to Beijing that the time for real progress on key issues has finally arrived? One way for the Bush administration to gain the immediate attention of China's leaders would be to initiate transparent discussions regarding the possible costs and benefits of a U.S.-led boycott of the 2008 Beijing Olympic Games.

Arguments in support of a U.S.-led boycott of the Beijing games are based on a number of important issues. First, violations of basic human rights in the areas of speech, religion and assembly have continued under the close watch of President Hu. Second, Beijing continues to impede UN Security Council action against Iran by refusing to support economic sanctions or military action. Third, invasion threats made by China against Taiwan, coupled with the veiled buildup of the country's extra-regional military capabilities, continue to endanger world peace. Fourth, Beijing's refusal to adequately address the revaluation of its currency the yuan is counterproductive to global prosperity and market stability. Fifth, the Chinese government increasingly uses sophisticated technologies and penetration techniques to attack critical U.S. computer networks, stealing highly sensitive information from government agencies, financial institutions and defense contractors. Finally, President Hu and his comrades continue to actively support leaders such as Zimbabwe's Robert Mugabe in Africa and Venezuela's Hugo Chavez in South America, providing economic, military and technical assistance that is contingent upon their support of a "One-China" policy.

The impact of a U.S.-led boycott of the 2008 Olympic Games would be profound. An April Newsweek magazine article reported that approximately US$160 billion in infrastructure projects are going on right now in Beijing alone. From stadiums to luxury hotels, the country's capital is in the midst of an historic real estate boom. "This is an amazing opportunity for us and we feel a really big responsibility," noted Huang Yan, deputy director of the Beijing's Municipal Planning Commission.

The 2008 Beijing Olympic Games are expected to make significantly more money than the Athens Olympics of 2004. "It will be a huge windfall," noted International Olympic Committee (IOC) chief Jacques Rogge last month. The IOC, the Olympic regulatory body, has said that the profit for the Beijing games could exceed the record $224 million made during the 1994 Los Angeles Olympic Games with broadcasting and license fees reaching nearly US$2 billion dollars.

In addition to the economic repercussions that a boycott would have on Beijing, the damage to the country's global image and the government's reputation would be tremendous. President Hu and his counterparts in Beijing would certainly look foolish if China was forced to compete against 2nd and 3rd rate athletic competition during one of the most important national events in the country's history. Beijing wants the 2008 Olympic Games to reignite a sense of nationalism and pride within each Chinese citizen. The country is desperate for the world to witness its newfound wealth, opulence and splendor -- what the country has become and what it can be.

Although a boycott of the 2008 Olympic Games carries obvious economic and reputational risks for Beijing, it also carries the same risks for the U.S. as well. Beijing expects to award a number of lucrative transportation and communication contracts in the next few months, with U.S. and EU companies' as key bidders. Any punitive action taken by Washington or its allies would almost certainly cost Western companies billions of dollars. According to IOC officials, large corporate sponsors such as General Electric and Visa International have agreed to pay a combined $900 million for global sponsorship rights to the recently completed Turin Olympic Games and the 2008 Beijing Olympics Games.

Western businesses, already positioning themselves in the emerging Chinese market, could be temporarily denied access, placing them at an obvious disadvantage against their global competitors. There is little question that the result of any Chinese retaliatory economic action would immediately be felt on Wall Street, with shareholders becoming nervous about future revenue flows and profit margins. Making matters worse for the U.S., Beijing could decide to sell its U.S. dollar reserves increasing the likelihood of a global recession.

The image of the U.S. in the world, already tarnished by the Iraq invasion and recent prison abuse scandals, would be damaged by an Olympic boycott. Moreover, China, enraged by the audacity of the Bush administration, could sponsor more anti-U.S. movements in South America, Africa, the Middle East and Central Asia, in an effort to marginalize the U.S. -- creating a global coalition of the "unwilling." And then there are the athletes themselves. The years of hard work and dedication required for Olympic competition would be wasted. A large segment of the U.S. population would certainly view any boycott as a pointless political charade, similar to U.S. President Jimmy Carter's 1980 boycott of the Moscow Games in protest of the Soviet invasion of Afghanistan

Would a U.S.-led boycott of the 2008 Beijing Olympic Games force the China's communist government to democratize, reform its economic policies and promote human rights, or would it cause an escalation of hostilities between China and the U.S.? No one really knows the outcome for sure. But it will certainly be interesting to watch the geopolitical posturing that precedes the opening ceremonies of the 2008 Olympic Games.

Fred Stakelbeck is an expert on bilateral and trilateral alliances as they relate to China foreign policy. His writings address the implications of China's emerging regional and global strategic influence and relationships upon U.S. national security. He can be reached at frederick.stakelbeck@verizon.net.

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