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War without an end

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Why you can trust SCMP
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Americans are fighting a war in China, a more unwinnable war than the one they are fighting in Iraq. So far, the casualties are not high enough to have mothers screaming for their sons' safety. But the worry beads are being stroked hard enough at the White House for President George W. Bush to have recently appointed a 'piracy tsar', and sent him to China to see what can be done about the violations of US companies' intellectual property rights.

Chris Israel's job is to co-ordinate the US government's global struggle against what might be called counterfeit extremists. There are only two other tsars that I know of in the US government: one handling the forgotten war (on drugs), and one handling the current war (homeland security).

Like those two, this is a position that is unlikely ever to be abolished. That is because, like those two, the enemy grows stronger and multiplies by the day. Counterfeiters in China are well funded, have big prizes to play for and - like the drug lords and al-Qaeda - generally do not consist of a big whole, but are rather a massive sum of small parts.

One has to wonder, then, at what point intellectual piracy will become the single biggest sticking point in Sino-US relations. It is hard to put a monetary value on the problem right now, and Mr Israel's recent claim that piracy has cost American businesses US$250 billion - or the equivalent of 750,000 jobs - is, thankfully, still laughable rhetoric. The damage has traditionally been done within China, by local consumers picking up goods they otherwise could not have afforded. But counterfeit goods produced in China are increasingly showing up in global supply chains. This is raising the ante considerably.

So far, the American side, despite some requisite grandstanding for the media, has been well mannered. It is easier to bang on the table about an undervalued yuan, which is an issue that can be - and has been - addressed by centralised policymaking.

Getting upset about the Chinese government's failure to do enough against hundreds of thousands, if not millions, of counterfeiters spread across the entire country is a more sensitive matter. Not that there is nothing to bang on the table about. Mainland enforcement agencies have overlapping jurisdictions and conflicts of interest.

Edicts from the top are seldom carried out with vigour at the bottom. There is generally not enough deterrence built into punishments, and so offenders easily become repeaters.

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