Correction: In a story on page 1 Sunday, the foreign trade zones approved by federal officials were misidentified as free trade zones.
Don Dietrich doesn’t overreact when he gets emails calling him a traitor or a dupe opening the way for an invasion of Idaho by Chinese Communists.
“Given what they’re reading, they are rightfully concerned,” said Dietrich, director of the Idaho Department of Commerce. “But what they are reading is in some cases nonsense.”
Much of the attention stems from what he told the Statesman a year ago, just before Gov. Butch Otter led a trade mission to China. The state has been looking for foreign investment to boost the economy here, and there is one foreign country with more investment potential than all the others.
“The Chinese are looking for a beachhead in the United States,” Dietrich said then.
The quote got a new life on the Internet starting six months later, when the Statesman wrote about a proposal to develop a technology zone south of the Boise Airport, broached with state and city officials in December by representatives of the China National Machinery Industry Corp.
A host of bloggers have reported that the zone has already been sold or that Idaho was looking at turning over a 55-square mile area to the Chinese government.
None of that is true — or even allowed under U.S. law. But that hasn’t stopped right-wing bloggers and the John Birch Society from turning exaggerated claims about the proposal and Idaho’s efforts to attract Chinese investment into a conspiracy.
“It just isn’t possible to develop Little China in Idaho,” Dietrich said. “U.S. labor laws don’t allow it.”
So far, the Chinese national company, also known as Sinomach, has not offered a specific proposal to state or local officials. Jeff Don, whose company C3 served as Sinomach’s representative in Idaho, said, “It’s not appropriate for me to make a comment at this time.”
But Dietrich and Idaho are not backing off their aggressive efforts to attract investment from China and other foreign countries. Already, foreign investment creates 14,000 jobs in Idaho.
“People have to understand this goes directly into Idaho projects,” Dietrich said.
A LOT OF ATTENTION
The flurry of blogs and talk radio reports have generated hundreds of emails to state officials from people around the country fearful Idaho is selling its sovereignty to the Chinese. Links from blogs including the Drudge Report to the Statesman story that broke the news on Sinomach’s proposal in December brought tens of thousands of viewers and rocketed the 6-month-old article to the No. 1 most-viewed page on IdahoStatesman.com last week.
Some bloggers and Glenn Beck criticized the state soon after the story first came out. But the issue got new legs when the New American, a magazine published by the John Birch Society, ran a detailed article in May. The anticommunist group started in 1958 by candy manufacturer Robert Welch was named for an American soldier killed by Chinese Communists in 1945.
Author William F. Jasper portrayed Sinomach as a “commercial-political-military-intelligence instrument” of China’s Communist Party, and he used the Idaho example as a warning against allowing Chinese investment in the United States.
Another author, Joe Wolverton, later suggested that Project 60 — Otter’s economic development program that includes attracting foreign investment as a way to get the state’s gross product to $60 billion — was a plan to sell the state to the Chinese.
“Several years of recession and high unemployment, coupled with state and local budgets sliding toward the bankruptcy abyss, have led many political and business leaders to discount ethical and security concerns and look to China for a lifeline,” Jasper wrote.
Bill Turner, the self-described minister of the American Patriot Church, authored the post “Idaho to be first Chinese state” in the conservative Boise Examiner blog. He would not respond when his statements about China’s ownership of Idaho land were challenged.
“It appears that your line of questioning has gone from inquiring to attacking,” he said.
IDAHO‘S MANY SHADES OF CONSERVATISM
The reports prompted questions for Gov. Butch Otter earlier this month when he held his Capital for Day in Castleford near Twin Falls. Otter explained the investment was producing tax revenues and jobs, but was limited by state and federal laws.
Otter’s long political history has been staunchly conservative, but he described what the blogs were reporting as “a lot of bad information,” that people have taken as fact “when one person writes it down.”
“There was probably a day long ago when I, too, would be concerned about this,” Otter told them.
The attack of such an isolated group would have little political impact in most states. But in Idaho, one of the nation’s most conservative, groups like the John Birch Society are in the mainstream, said David Adler, a politic science professor at the University of Idaho.
“The far right should find comfort in the leadership of Governor Otter and his overtures to China precisely because he hails from that ideological background,” Adler said.
AN OPPORTUNITY TOO GOOD TO PASS UP?
Dietrich isn’t giving up on the idea of a foreign development adjacent to the Boise airport, Chinese or otherwise. Sinomach was looking at developing a manufacturing and warehouse zone that could one day become a base of operations for Chinese companies doing business in the United States.
Boise’s Airport Commission can grant long-term leases and landing rights to air carriers, including those from China. The state could work with the federal government to set up a foreign trade zone where companies could qualify for reduced duties and higher quotas if they add value to products in the zone — like hiring American workers to assemble foreign-manufactured goods, for instance.
“Our Western airports’ ramp space is full,” Dietrich said. “It takes time to get through a place like Los Angeles Airport. They’re limited for space.”
Oregon recently provided Korea’s Asiana Airlines more than $800,000 in incentives to expand service to Portland. Boise would like to convince Asian shippers to fly the 45-minute longer flight to land here and increase trade and investment.
China is Idaho’s third-largest trade partner, with $657 million in exports from Idaho sold in China in 2010. And the state is on pace to see that increase. Idaho maintains a positive trade balance with China.
“We sell them more than we buy,” Dietrich said.
Idaho is one of 35 states that have attracted Chinese investment — investments that totaled more than $5 billion in 2010 alone, creating more than 10,000 jobs — according to a new report published by the Center on U.S.-China Relations of The Asia Society and Kissinger Institute on China and the United States.
The authors warn that political fear mongering will divert the Chinese investment stream elsewhere and recommend that the U.S. should send a clear and bipartisan message that Chinese direct investment is welcome. But they also say that not all Chinese investment is good for the United States.
David Shambaugh, a China scholar at George Washington University who spoke last year at Boise State University about the U.S.-China relationship, said strategic minerals like molybedenum and telecom companies are among the few products that should be excluded.
“We Americans need to look at inbound China investment with our eyes open for potential national security concerns, but we should welcome it because it brings jobs,” he said.
Rocky Barker: 377-6484
