After China

Spent a day in China visiting old friends and sitting in on a digital convergence lab that was set up by my old journalism school director, Ying Chan.

The school of journalism there is backed by Li Ka Shing Foundation, so it's an interesting case for China. Its probably the only public university in China funded by private dollars. Lots of implications here.

What does that mean for American investors who want to put money down on building up private education in China?

What happens with American or other foreign money in China? Just because you put private money into a state run and state-funded operation, it doesn't mean you are going to get that money back. There is always that risk.

So how can Ying Chan do it? Aside from having the backing of Li Ka Shing, Asia's richest man, she's also got ties to Hong Kong and is backed by solid partners. It's an interesting education about education in China. I am glad I got to see it first hand.

I learned two things about this:

Shantou University is on the cutting edge of how education will be done in China. I will be writing more about this later, but in a nutshell:

First university in China to use an open source, Chinese language-friendly digital publishing and curriculum tool. It started out in the Journalism School, but now the university itself wants to run it for the whole institution of 8,000 students.

If that is open source, there is no problem to think that they would make this expansion down to other schools in China and in Asia. Jeremiah Foo, CTO of the school said that he is already in talks with Malaysian schools to spread this technology.

They are working with Apple to launch something in March. More on that in March. I can't talk about it.

It is totally feasible that corporations in the United States can partner with a school like this and actually teach classes on the corporate culture, on business, and on everything from engineering, to accounting and more to these students. It's very possible we might see a day where actual global companies have teaching units inside some of these public universities in China. What does that mean? It's hard to even fathom how revolutionary that kind of education system would be.

There is so much more to talk about, and I will be mentioning some if it off and on in the next few weeks.

Now it is time to go back out into Hong Kong, and have some yum cha and talk with my friends. Good to be back "home" again.

By the way, for those of you in New York, it's 55 degrees today and I got sunburn. Suckers!

The Visa Office, and Standing in No Line

Something happened to me today that I thought you might want to know about.

I went to go submit my Chinese visa at the Consulate on 12th Avenue in New York City. I rushed over in the taxi, got out at the curb and walked in, expecting a huge line and hordes of people, or at the very best a bureaucratic nightmare. This has been my experience at other visa offices around the world -- especially in Hong Kong at the Indian Consulate and the Consulate of Myanmar.

Just past the security barrier, where the two officers screened my jacket, my phone and my Kindle, is a small room divided in two by two very wide pillars. There are about twenty chairs, blue colored, arranged in neat rows. And scattered in the chairs are a mix of about a dozen people, some of them Chinese-looking, waiting patiently. It was hard to figure out what they were waiting for, but they seemed to have been there for a while.

There was a rope cordon that directed traffic to windows, but at the end of the cordon corridor, another cordon had been erected, blocking any exit from that corridor. So, where was the line.

I reflected on this for a moment. It was so interesting that I anticipated and looked for a line. In China, and in fact, in many situations, there's no sense of a line. My China instincts kicked in. I moved around the back of the room, around the two large pillars, and just stood in a proximate way, next to two people I thought to be in what would probably be a line if there were more than two of them standing there.

One of them moved. He went to a window. Then the other person moved, and she went to a window. And then the first man who went to the previous window moved away, and then the woman in the window looked at me expectantly. I moved to the window, submitted the application, was given my form, and told to come back tomorrow.

What does this have to do with education?

We figure things out on our own, I think. I have learned from my time in Hong Kong, and my occasional trips to China, that my best laid defenses -- wanting and expecting order, following order, and looking for lines -- don't really work when you are on the move and in a new territory. It pays to plan ahead, but it also pays to let those plans slide, and do what is necessary in the moment.

Standing in the Chinese consulate, I was back in China, literally. I was on their turf. It is so refreshing to give up one's sense of order and adopt the expectations of another group.

Can we do that within our own culture? Can we practice a kind of capitalist compassion for the order that others wish to force on us, our schoolchildren and our teachers? Let's turn that into a passion for disruption and the creativity of disorder.

Sometimes decision makers, like presidents, policy makers and legislators and other lofty people want to make decisions for us in education. They want to tell us what to read, or how to learn. They want to tell us where to go to school and how to build that school model.

There are great people out there, don't get me wrong. But there are so many people out there with great business ideas that are not being heard, or, having been heard, cannot realize their dreams because of what amounts to a love of structure and a distaste for disruption.

A calm and business-like approach to passion for disruption should create a dignified and powerful conversation.

And if you want to talk about this with me personally, or with people like Ron Packard, CEO, K12 and some other professionals in the space, you can find us on January 20 in New York at the collaborative and worlwide Business Breakfast at the Omni Hotel.

Register, and get into the disruption.

Misaligned market assessment and cost management : Case of U21Global

A recent story on U21Global highlights the challenges of executing a vision which has arrived ahead of its time.

U21 had a very unique positioning of leveraging the power of university consortium and technology to build a global online university. However, it seems to have missed on two important aspects--market readiness and cost management. For example, its biggest target markets like India and China are still not ready for online programs which are expensive, although they are ready for cheaper programs that add "credentialing" aspect to their profile.

As pointed out in this article, price of brick-and-mortar courses in China was US$2,000 as compared to US$7,000 for U21.

Likewise, in India, Symbiosis Centre for Distance Learning (SCDL), started right around the same time as U21, claims to enroll more than 200,000 students and charges around US$500 for similar programs. Thus, while on the revenue side, U21 has limitations on the tuition pricing. On the cost side, U21 has heavy expenses associated with international administrators and faculty members. This has resulted in inefficient administration of the venture.

Online education model works on scalability and not selectivity. And the scalability in markets like India exists with the price conscious mass segment. With the transfer of controlling stake to Manipal Education, cost structures could be better balanced with the market needs in China and India.

At other level, U21 needs to expand its outreach by partnering with institutions in different segments. For example, U21's partnership with IGNOU to offer joint Postgraduate Programme in Information Technology Management would enable it to leverage IGNOU's large student base (total enrollment of 2million students) and established credentials in a price-sensitive mass segment. The program is priced at $3,750 and accepted 112 students for its first intake in Sept'09. For global online universities considering to enter Indian market this reaffirms the pricing challenges in Indian market.

posted by:
Rahul Choudaha, PhD
New York
http://www.dreducation.com/

Leading American Universities for Sending Students Abroad

The Institute of International Education released some figures of overseas education recently.

Here's their top ten list of the leading US universities that send students overseas, ranked in order of numbers of students sent each year.

New York University remained the leading sending institution, reporting that it gave academic credit for study abroad to 3,395 of its students, followed by Michigan State University (2,969), University of Minnesota – Twin Cities (2,521), University of Texas – Austin (2,342), University of California – Los Angeles (2,330), University of Wisconsin – Madison (2,216), University of Washington (2,124), Penn State – University Park (2,101), University of Illinois – Urbana-Champaign (2,086), and University of Georgia (2,058). Open Doors 2009 reports that 53 U.S. campuses, primarily large research institutions, awarded academic credit for study abroad last year to more than 1,000 of their students.

But there are actually schools that send the largest percentage of their entire student body to study overseas during some point in their educational career.

Open Doors 2009 data on study abroad participation rates show 23 institutions that reported sending more than 80% of their students abroad at some point during their undergraduate careers. These institutions are (in alphabetical order): Antioch College, Arcadia University, Austin College, Berea College, Carleton College, Centre College, DePauw University, Earlham College, Elon University, Goucher College, Hamline University, Hartwick College, Kalamazoo College, Lee University, Lewis and Clark College, Oberlin College, Pepperdine University, Saint Olaf College, Taylor University, Transylvania University, University of Dallas, Warren Wilson College, and Wofford College.

A Town Hall, A Wall, Opportunity for All

There is a saying in Cantonese, that when you cross the ocean you will be kings. [ed. note: I have looked all over the internet and not found the Cantonese phrase, so any help would be appreciated]

President Barack Obama was either a puppet or a truly naive country mouse making his way through China and East Asia for the first time earlier this month, when he held a staged town hall, visited the Great Wall and seemed disoriented, and claimed that he never touched Twitter, even though he apparently has his own twitter feed.

For America's first "Pacific" president, he didn't seem to know a whole lot about China, America's certainly largest, and relatively speaking nearest neighbor, if you don't count the Philippines, Russia or Taiwan.

Much has already been written about what a fool's game the whole diplomatic trip to East Asia appeared to the rest of the world. I won't hash over it. Read through the link if you like.

However, Obama presented one gleaming and golden opportunity for America's youth, for-profit education and the future of China - U.S. bilateral relations and the possible creation of a new multilateral regulatory and financial system.

China and the United States agreed that they would renew efforts to bring at least 100,000 students from the United States to China. Currently, there are only 20,000 American students studying in China while there are nearly 100,000 Chinese students in the United States, and nearly 100,000 students from India studying in the United States.

I'm sure the effort was started in the hopes that these students would bring all the democracy and hope and glory back with them to their countries of origin. So why don't we send more students to China?

Do they just not want to go? Are they unable to go, because of finances? How is the government going to pay for these expected 80,000 students to go to China? Does the federal loans program enable that right now? I don't think it does.

Efforts have been made to extend this cross-cultural partnership before. I am a by-product of one of those efforts. So is 27 - year old Cornelius Rahn, a journalism student at the University of Hong Kong's Journalism and Media Studies Centre.

The vision there is simple: train foreign students to be journalists in China. Introduce them to China, spread the word about China, help China at the same time enrich and develop its burgeoning media.

Ying Chan, a celebrated investigative journalist, who has won many awards for her reporting, especially on the snakeheads that traffic humans into the United States from China, laid out this vision several years ago and has been steadily building on it. She not only directs the program in Hong Kong, she also, with backing from Li Ka-shing, helps run his journalism school at Shantou University in mainland China.

Ying always says, "Learn Chinese. The future is in China." I never doubt her. "Understand China," she also says. And she is right. Obama's trip to China shows the perils of not knowing the people you should and could be doing business and politics with.

Why did people pay Chinese snakeheads thousands of dollars to travel illegally and covertly to America? There was opportunity there. For some it was to be forever. For others, as China began to open up, it was temporary. Take what is best in America and bring it back. They call these people Sea Turtles, in Chinese.

But now, the future is going to be shaped by a strong China and US relationship, which could produce a much stronger multilateral global financial system.

As I always say, it's already tomorrow in China. And it started out as a joke.

George Soros On China: U.S. Can Help Score a Win for China

If you read this through and like it, email me, or leave a comment if you want the whole pdf. I can email it to you. dcrets [at] iirusa [dot] com


It's too bad that none of the major "western" news organizations wrote about some of the great comments George Soros made recently about China's new power in the global economy. Maybe President Barack Obama would not have appeared so passive in front of the Chinese delegation who welcomed him on his first visit to the Middle Kingdom.

Under reported -- to the detriment of financial executives everywhere -- is a series of lectures George Soros has been giving around the world about what he considers to be the true implications and opportunities created by the economic collapse and the seizing up of the credit markets after the Lehman Brothers collapse.

The only good story that I have seen so far on the issue is by a former student colleague I worked with at the University of Hong Kong, Vivian Kwok, who now works at Forbes.

She points out that Soros, a billionaire, worth something like US$11 billion, who escaped the Nazi death squads in Budapest, Hungary during World War II, just made a spent a combined US$126 million on subscriptions for new shares of China Minsheng Bank and Longfor Properties in their initial public offerings in Hong Kong.

But his real achievement to date is a series of lectures where Soros is calling out the G20 countries, but especially the United States, for not only precipitating the failure of the economy, but not doing enough to embrace new partners in re-establishing a global economic order. Partners like China, for example.

Despite doing what almost all of the Bretton Woods Agreement and Washington Consensus countries have done, propping up the financial system by offering massive loans to banks with balance sheets saturated with questionable assets and liabilities, the United States and other G20 nations stand to lose ground significantly during the economic recovery if they do not make partnerships and reformulate the IMF and World Bank strategies to foster new power positions for emerging economies. Why? As of September 2009, China owns US$789 billion of U.S. Debt

On Oct. 30 Soros gave a lecture called "The Way Ahead, Comments On China" at Central European University that clearly delineates a new policy agenda for the United States and the Bretton Woods countries.

Soros claims that "the Washington Consensus [of keeping global capital moving around the world] has failed". New potential leaders of the global economy stand to benefit from a failure of this fundamentalist strategy of globalization, and:

The United States stands to lose the most, and China is poised to emerge as the greatest winner[...]China has discovered a remarkably efficient system of unleashing the creative, inquisitive and entrepreneurial activity of the people who are allowed to pursue their self-interests, while the state can cream off a significant portion of the surplus value of their labor by maintaining an undervalued currency and accumulating a trade surplus.

China can either spread the use of state capitalism to the detriment of the global economy, or they could work in a multilateral system to further a kind of hybrid internationalist system of economic and financial markets regulation.

China could help re-write the rules on financial regulation, introducing a new role for emerging market countries, who have until now suffered the brunt of, ironically, the speculation against currency led by people like Soros, causing massive loans given out by the World Bank and IMF, offering sometimes impossible terms of agreement, and further troubles.

Still:

That is what a new Bretton Woods conference could accomplish in one fell swoop. It would reconstitute the IMF to better reflect the prevailing pecking order among states and revise its methods of operation. It would decide how to treat financial institutions that are too big to fail and it would consider new rules to control capital movements. The total freedom of financial capital to move around internationally has proved to be a source of instability and needs to be curbed.

The process needs to be initiated by the United States, but China and other developing countries ought to participate in it as equals. They are reluctant members of the Bretton Woods institutions which are dominated by countries that are no longer dominant. The rising powers need to be present at the creation of the new order to ensure that they will be active supporters of it.

BIG PROBLEM, though, credibility and relationship trust-wise: China has engaged in somewhat unsavory behavior by getting into relationships with countries isolated form the world community of nation-states that formerly led the now defunct Washington Consensus -- countries like Burma, North Korea, and now Guinea, whose leader Moussa Dadis Camara is accused of directing soldiers to shoot into a crowd of opposition supporters during recent elections.

There is hope:

Why should China submit to a new multilateral system in view of the fact that it is set to emerge as the winner from the current turmoil? The answer is equally simple. In order to continue rising it must make itself acceptable to the rest of the world. That means that it must move towards a more open society, combining an increased measure of individual freedom with the rule of law. Given the current military power relations, China can continue rising only in a peaceful environment where the rest of the world willing accepts the rise of China.

That last bold statement for emphasis? Well, I don't see that happening. Soon. Even though, as Soros admits earlier in the lecture, keeping things in their current state is in itself still a threat to the stability of the Communist Party's rule.

At the same time, an international system based on state capitalism would inevitably lead to conflicts between states. The first signs of conflict are already beginning to surface because, ironically, China is repeating the mistakes of the colonial powers in dealing with the countries that are rich in natural resources just at a time when the colonial powers have learned from their past mistakes and are trying to rectify them. In order to gain access to natural resources, China is dealing with the rulers and neglecting the people. This helps oppressive and corrupt regimes to stay in power. This is an undesirable outcome but China is not the only one to be blamed for it. When a Chinese company tried to buy Unocal, it was rebuffed. And more recently, Rio Tinto reneged on a deal to sell an interest to a Chinese company. This has pushed China into dealing with those countries that the international financial institutions have shunned—Burma, Sudan, Zimbabwe, the Congo and Angola stand out.

The Chinese and the United States both face equally challenging choices. The United States must take on a new manner of thinking and help China become an equally powerful leader on the world stage. The Chinese, as much as they have gained by their effort to allow America to put itself into so much debt it threatens its existence, must also relent and be an equal partner, emerging as a stable and democratic culture and country.

Otherwise, not much hope of tomorrow. So, what can the G20, President Obama, the Japanese, and the UK do to make something new and positive happen?

China must be brought into situations that are multilateral, and helped to reduce the pressures internally -- the subjugation of free market forces caused by political arrangements, and the rampant corruption that instigates the clear but subtle fear that the center of the Communist Party can not enforce its will, and etc.

But the goal may be a good one. Soros, to close:

To sum up: the world is facing a choice between two fundamentally different forms of organization. We may label them international capitalism and state capitalism. The former, represented by the United States, has broken down and the latter, represented by China, is in the ascendant. The path of least resistance leads to the gradual disintegration of the international financial system as we know it. Yet a system of bilateral relations is liable to generate conflicts between states. A new multilateral system based on sounder principles needs to be invented. That would serve the best interests of both the United States and China and of course the rest of the world.

Spread it around. And email me, or leave a comment if you want the whole pdf. I can email it to you. dcrets [at] iirusa [dot] com

Video of Obama Meeting with Chinese Youth in Town Hall Style Gathering

这在美国总统和中国人之间的第一个市政厅会议，被带来以一个活格式和通过问题被提供在互联网。 您能观看网上录影这里，但是您大概是，如果您讲中文。 由于it' 在中国网的s。

So, it starts out with an intro from the Ambassador to China Jon Huntsman in Mandarin and in English.

Unfortunately, I think President Barack Obama mixed up the greeting. He said, "No Ho." I think he meant to say "Nin Hao." The Chinese were too polite, or mindful of their international exposure, to correct him. So they applauded generously.

Here is the first Chinese town hall meeting format by a United States president in China.

President Barack Obama receives town hall questions and online questions from Chinese netizens.

"No global challenge can be solved without the Chinese and the United States cooperating." -- United States Ambassador to China Jon Huntsman

Trade between United States and China: US$400 billion per year.

Productive Day, or Non-Productive Day

Here's a way you can be totally unproductive today: if you live in New York City, let's try to estimate which subway lines bring the most Halloween costumes into Manhattan. Right now, the D Line is losing, big time. I didn't see one costume the entire ride.

A friend in the office marked one: a man in a corporate suit, with a cardboard box shaped like a robot head on his head. Stunning. 5 Train wins!

Now, here's a way you can be very productive this morning. The director of the journalism school at my alma mater, University of Hong Kong, chatted with me last night and alerted me to the fact that George Soros is giving a series of lectures on his thinking about economics.

She said he is refashioning the way he thinks about even his own economics. George Soros lectures sponsored by the FT can be found at the link.

From the link:

George Soros explores the conflict between capitalism and open society, market values and social values. Focusing on the principal-agent problem, he will use contemporary economic and political examples to challenge market fundamentalism while presenting ideas for protecting the public good more effectively

He also gave a lecture that should be up on that site now at the University of Hong Kong about China. I have not seen it. But I want to. Have to get to it later in the day.

George Soros on the future of China.

Why China is not Holding the American Economy for Ransom

Many people fear the immense amount of US debt held by foriegn countries. But Richard Spencer makes a case why this is not necessary:

Peston I think is falling into a common trap here of thinking that because China holds 1.9 trillion dollars of foreign exchange reserves, including more than 600 billion dollars in US treasury bonds, it holds all the cards, and America should do what China tells it to. But as I have argued before, this is a symbiotic relationship, in which both sides were caught in a trap - China couldn't stop overproducing, and through its currency interventions ensured that America could happily go on buying. That's what led to the US trade deficit. Both sides failed to bring this imbalance to an end on time, and both sides will now suffer. This goes for Britain too, of course.

Chinese officials themselves are now going around and saying of America that it should be nice to people who lend it money.

But in some ways this is an old saw: it has been common enough for people to talk about the inevitable transfer of power from America to China in the coming years as being the result of China becoming "America's bank".

Yet China is not America's bank. America is China's bank. This is pretty obvious when you think about it. You don't need to be an economist; you just need to think about your own bank accounts.

Why Robert Peston is Wrong.

More American Students Study In China Than Ever Before

These days, when a student wants a real education, she studies abroad. The New York Times finds that more students than before are choosing China as their hot spot.

As a person formerly employed in China, I highly recommend it. Nothing prepares the American better for participation in a hyper-capitalist global economy than doing business or learning how the world is run from the Chinese point of view.

China Banks Told to Stop Lending to American Banks

China tells its banks to stop lending to American banks for now.

I had earlier written on another blog that China's Central Bank was suffering from a potential lending crisis.

The Weekly Education Industry Investment Forum Poll

Escalator broken by job seekers at job fair, Source: Dahe dot com

Today you will notice a poll on the sidebar. The question is:

Is there room for the education industry to assist China's graduates or the job placement services industry in China?

Before you answer that, here's some context:

Recent graduates line up at a China job fair

In 2006, around 4.95 million Chinese students graduated college or a professional school. That number rose by 800,000 from 2005, according to a China Daily report. This is a state sponsored China newspaper. I always take those reports with a grain of salt.

If you listen to the way China Daily spins it, apparently they can't all find or keep jobs.

From that article:

Based on the average employment rate of 70 per cent for university graduates upon graduation, more than 1.49 million of them may become jobless next year.

To address the problem, the ministry has asked universities to give top priority to better employment services for graduates in 2007, the spokesman said.

What is the problem(s), and can school services companies address them?

Is it that there is not a targeted enough way to place students or to keep an eye on what they want during schooling? Are there gaps between exit interviews at the graduation level and their performance in the real world? Does the problem arise before graduation? Is there a mismatch between what courses are offered and what works in the industry? In other words, are the courses the right thing for what is needed in the marketplace? Or, could it be that the brightest, something like 20,000 Chinese a year, are going to the States, and more going to other countries for their post secondary work?

Lots of questions.

Here's another view of the China job situation: China's labor shortages with all those graduates keeps some people wondering.

From the article:

The Good - Educational opportunities in China are at an all time high. Teenagers about to leave school have never had it so good, and somewhere in the region of 30% of high-school leavers in the cities will have the option for further study.

The Bad - At the same time, this year will see 20 million new job seekers in China, among both high school and university graduates. They enter the market at a time when the overall world’s economy is drifting downward and they have gone through a rote learning education system that does not equip them for the workplace. Employers regard professionals with 1-2 years as their starting point, not graduates. Graduate unemployment is as common as multiple job offers for experienced hires.

And there is more:

A slightly slower growth might look like a small price to pay for economic stability. But it might be not be enough to sop up the additional new workers, and those laid-off in the event of an export downturn (which appears to be happening). The stock exchange ‘correction’ we have seen lately, plus the slowdown of housing prices around the country will only exacerbate the problem.

That should mean more Chinese going back to school, right?

Capella University Sees Revenue and Student Enrollment Rise

Capella CEO Steve Shank

The rise of internet use in America from the late 90s to the present day has meant more people are using the Internet for learning. The trend is set to continue. It has meant great things for Steven Shank, CEO of Capella Education, which runs Capella University, an online degree institution.

Minneapolis-based Capella University, which operates under its parent company, Capella Education Co., continues to see its enrollment increase -- along with its revenue and operating earnings. Capella, which focuses primarily on adult students seeking advanced degrees, has seen its enrollment and revenue grow by 20 to 25 percent per year in recent years.

But online growth in China, Vietnam, Singapore, India and many other countries in Asia outpaces American growth and there are also many more people who could potentially use Internet products and services in the Eastern Hemisphere.

As a thought exercise, would it be useful to think what online universities in the United States could be doing to expand their operations in partnerships with governments and commercial institutions in Asia?

The online growth is staggering there, as more fiber to the home and last-mile digital connections pair up consumers with not only Internet access, but multitudes of digital cable and interactive cable offerings.

For now Capella is concentrating on offering the staff of Fortune 500 companies classes through incentive structures at their companies. This is a brilliant move, because in an economic downturn most people will not want to leave their job, but they would be willing to pay more to educate themselves and boost their chances for promotions.

Story about Capella University, courtesy of the Minneapolis Star-Tribune.