The Bear And The Dragon Part 45

"It surprised me, too," SecTreas admitted. "It appears that they've been purchasing a lot of things on the international market lately, especially jet engines from France, and because they're late paying for the last round, the French company has decided to take a harder line-they're the only game in town. We won't let GE or Pratt and Whitney bid on the order, and the Brits have similarly forbidden Rolls-Royce. That makes the French the sole source, which isn't so bad for the French, is it? They've jacked up the price about fifteen percent, and they're asking for cash up front."

"The yuan's going to take a hit," Gant predicted. "They've been trying to cover this up, eh?"

"Yeah, and fairly successfully."

"That's why they were hitting us so hard on the trade deal. They saw this one coming, and they wanted a favorable announcement to bail them out. But they sure didn't play it very smart. d.a.m.n, you have this sort of a problem, you learn to crawl a little."

"I thought so, too. Why, do you think?"

"They're proud, George. Very, very proud. Like a rich family that's lost its money but not its social position, and tries to make up for the one with the other. But it doesn't work. Sooner or later, people find out that you're not paying your bills, and then the whole world comes cras.h.i.+ng in on you. You can put it off for a while, which makes sense if you have something coming in, but if the s.h.i.+p don't dock, you sink." Gant flipped some pages, thinking: The other problem is that countries are run by politicians, people with no real understanding of money, who figure they can always maneuver their way out of whatever comes up. They're so used to having their own way that they never really think they can't have it that way all the time. One of the things Gant had learned working in D.C. was that politics was just as much about illusion as the motion-picture business was, which perhaps explained the affinity the two communities had for each other. But even in Hollywood you had to pay the bills, and you had to show a profit. Politicians always had the option of using T-bills to finance their accounts, and they also printed the money. n.o.body expected the government to show a profit, and the board of directors was the voters, the people whom politicians conned as a way of life. It was all crazy, but that was the political game.

That's probably what the PRC leaders were thinking, Gant surmised. But sooner or later, reality raised its ugly head, and when it did all the time spent trying to avoid it was what really bit you on the a.s.s. That was when the whole world said gotcha. And then you were well and truly got. In this case, the gotcha could be the collapse of the Chinese economy, and it would happen virtually overnight.

"George, I think State and CIA need to see this, and the President, too."

Lord." The President was sitting in the Oval Office, smoking one of Ellen Sumter's Virginia Slims and watching TV. This time it was C-SPAN. Members of the United States House of Representatives were speaking in the well about China. The content of the speeches was not complimentary, and the tone was decidedly inflammatory. All were speaking in favor of a resolution to condemn the People's Republic of China. C-SPAN2 was covering much the same verbiage in the Senate. Though the language was a touch milder, the import of the words was not. Labor unions were united with churches, liberals with conservatives, even free-traders with protectionists.

More to the point, CNN and the other networks showed demonstrations in the streets, and it appeared that Taiwan's "We're the Good Guys" campaign had taken hold. Somebody (n.o.body was sure who yet) had even printed up stickers of the Red Chinese flag with the caption "We Kill Babies and Ministers." They were being attached to products imported from China, and the protesters were also busy identifying the American firms that did a lot of business on the Chinese mainland, with the aim of boycotting them.

Ryan's head turned. "Talk to me, Arnie."

"This looks serious, Jack," van Damm said.

"Gee, Arnie, I can see that. How serious?"

"Enough that I'd sell stock in those companies. They're going to take a hit. And this movement may have legs . . ."

"What?"

"I mean it might not go away real soon. Next you're going to see posters with stills from the TV coverage of those two clerics being murdered. That's an image that doesn't go away. If there's any product the Chinese sell here that we can get elsewhere, then a lot of Americans will start buying it elsewhere."

The picture on CNN changed to live coverage of a demonstration outside the PRC Emba.s.sy in Was.h.i.+ngton. The signs said things like MURDERERS, KILLERS, and BARBARIANS!

"I wonder if Taiwan is helping to organize this . . ."

"Probably not-at least not yet," van Damm thought. "If I were they, I wouldn't exactly mind, but I wouldn't need to play with this. They'll probably increase their efforts to distinguish themselves from the mainland-and that amounts to the same thing. Look for the networks to do stories about the Republic of China, and how upset they are with all this c.r.a.p in Beijing, how they don't want to be tarred with the same brush and all that," the Chief of Staff said. "You know, 'Yes, we are Chinese, but we believe in human rights and freedom of religion.' That sort of thing. It's the smart move. They have some good PR advisers here in D.C. h.e.l.l, I probably know some of them, and if I were on the payroll, that's what I would advise."

That's when the phone rang. It was Ryan's private line, the one that usually bypa.s.sed the secretaries. Jack lifted it. "Yeah?"

"Jack, it's George across the street. Got a minute? I want to show you something, buddy."

"Sure. Come on over." Jack hung up and turned to Arnie. "SecTreas," he explained. "Says it's important." The President paused. "Arnie?"

"Yeah?"

"How much maneuvering room do I have with this?"

"The Chinese?" Arnie asked, getting a nod. "Not a h.e.l.l of a lot, Jack. Sometimes the people themselves decide what our policy is. And the people will be making policy now by voting with their pocketbooks. Next we'll see some companies announce that they're suspending their commercial contracts with the PRC. The Chinese already f.u.c.ked Boeing over, and in the full light of day, which wasn't real smart. Now the people out there will want to f.u.c.k them back. You know, there are times when the average Joe Citizen stands up on his hind feet and gives the world the finger. When that happens, it's your job mainly to follow them, not to lead them," the Chief of Staff concluded. His Secret Service code name was CARPENTER, and he'd just constructed a box for his President to stay inside.

Jack nodded and stubbed out the smoke. He might be the Most Powerful Man in the World, but his power came from the people, and as it was theirs to give, it was also sometimes theirs to exercise.

Few people could simply open the door to the Oval Office and walk in, but George Winston was one of them, mainly because the Secret Service belonged to him. Mark Gant was with him, looking as though he'd just run a marathon chased by a dozen armed and angry Marines in jeeps.

"Hey, Jack."

"George. Mark, you look like h.e.l.l," Ryan said. "Oh, you just flew in, didn't you?"

"Is this Was.h.i.+ngton or Shanghai?" Gant offered, as rather a wan joke.

"We took the tunnel. Jesus, have you seen the demonstrators outside? I think they want you to nuke Beijing," SecTreas observed. The President just pointed at his bank of television sets by way of an answer.

"h.e.l.l, why are they demonstrating here? I'm on their side-at least I think I am. Anyway, what brings you over?"

"Check this out." Winston nodded to Gant.

"Mr. President, these are the PRC's current currency accounts. We keep tabs on currency trading worldwide to make sure we know where the dollar is-which means we pretty much know where all the hard currency is in the world."

"Okay." Ryan knew about that-sort of. He didn't worry much about it, since the dollar was in pretty good shape, and the nonsqueaky wheel didn't need any grease. "So?"

"So, the PRC's liquidity situation is in the s.h.i.+tter," Gant reported. "Maybe that's why they were so pushy in the trade talks. If so, they picked the wrong way to approach us. They demanded instead of asked."

Ryan looked down the columns of numbers. "d.a.m.n, where have they been dumping all their money?"

"Buying military hardware. France and Russia, mostly, but a lot went to Israel, too." It was not widely known that the PRC had spent a considerable sum of money in Israel, mainly paid to IDI-Israel Defense Industries-to buy American-designed hardware manufactured under license in Israel. It was stuff the Chinese could not purchase directly from America, including guns for their tanks and air-to-air missiles for their fighter aircraft. America had winked at the transactions for years. In conducting this business, Israel had turned its back on Taiwan, despite the fact that both countries had produced their nuclear weapons as a joint venture, back when they'd stuck together-along with South Africa-as international pariahs with no other friends in that particular area. In polite company, it was called realpolitik. In other areas of human activity, it was called f.u.c.k your buddy.

"And?" Ryan asked.

"And they've spent their entire trade surplus this way," Gant reported. "All of it, mainly on short-term purchase items, but some long-term as well, and for the long-term stuff they had to pay cash up front because of the nature of the transactions. The producers need the cash to run the production, and they don't want to get stuck holding the bag. Not too many people need five thousand tank guns," Gant explained. "The market is kinda exclusive."

"So?"

"So, China is essentially out of cash. And they have real short-term cash needs. Like oil," TELESCOPE went on. "China's a net importer of oil. Production in their domestic fields falls well short, even though their needs are not really that great. Not too many Chinese citizens own cars. They have enough cash for three months' worth of oil, and then they come up short. The international oil market demands prompt payment. They can skate for a month, maybe six weeks, but after that, the tankers will turn around in midocean and go somewhere else-they can do that, you know-and then the PRC runs out. It'll be like running into a wall, sir. Smack. No more oil, and then their country starts coming to a stop, including their military, which is their largest oil consumer. They've been running unusually high for some years because of increased activity in their maneuvers and training and stuff. They probably have strategic reserves, but we don't know exactly how much. And that can run out, too. We've been expecting them to make a move on the Spratly Islands. There's oil there, and they've been making noises about it off and on for about ten years, but the Philippines and other countries in the area have made claims, too, and they probably expect us to side with the Philippines for historical reasons. Not to mention, Seventh Fleet is still the biggest kid on the block in that part of the world."

"Yeah." Ryan nodded. "If it came to a showdown, the Philippines appear to have the best claim on the islands, and we would back them up. We've shed blood together in the past, and that counts. Go on."

"So, John Chinaman is short of oil, and he may not have the cash to pay for it, especially if our trade with them goes down the toilet. They need our dollars. The yuan isn't very strong anyway. International trading is also done in dollars, and as I just told you, sir, they've spent most of them."

"What are you telling me?"

"Sir, the PRC is just about bankrupt. In a month or so, they're going to find that out, and it's going to be a bit of a shock for them."

"When did we find this out?"

"That's my doing, Jack," the Secretary of the Treasury said. "I called up these doc.u.ments earlier today, and then I had Mark go over them. He's our best man for economic modeling, even whacked out with jet lag."

"So, we can squeeze them on this?"

"That's one option."

"What if these demonstrations take hold?"

Gant and Winston shrugged simultaneously. "That's where psychology enters into the equation," said Winston. "We can predict it to some extent on Wall Street-that's how I made most of my money-but psychoa.n.a.lyzing a country is beyond my ken. That's your job, pal. I just run your accounting office across the street."

"I need more than that, George."

Another shrug. "If the average citizen boycotts Chinese goods, and/or if American companies who do business over there start tr.i.m.m.i.n.g their sails-"

"That's d.a.m.ned likely," Gant interjected. "This has got to have a lot of CEOs s.h.i.+tting their pants."

"Well, if that happens, the Chinese get one in the guts, and it's going to hurt, big time," TRADER concluded.

And how will they react to that? Ryan wondered. He punched his phone b.u.t.ton. "Ellen, I need one." His secretary appeared in a flash and handed him a cigarette. Ryan lit it and thanked her with a smile and a nod.

"Have you talked this one over with State yet?"

A shake of the head. "No, wanted to show it to you first."

"Hmm. Mark, what did you make of the negotiations?"

"They're the most arrogant sons of b.i.t.c.hes I've ever seen. I mean, I've met all sorts of big shots in my time, movers and shakers, but even the worst of them know when they need my money to do business, and when they know that, their manners get better. When you shoot a gun, you try to make sure you don't have it aimed at your own d.i.c.k."

That made Ryan laugh, while Arnie cringed. You weren't supposed to talk that way to the President of the United States, but some of these people knew that you could talk that way to John Patrick Ryan, the man.

"By the way, along those lines, I liked what you told that Chinese diplomat."

"What's that, sir?"

"Their d.i.c.ks aren't big enough to get in a p.i.s.sing contest with us. Nice turn of phrase, if not exactly diplomatic."

"How did you know that?" Gant asked, the surprise showing on his face. "I never repeated that to anybody, not even to that jerk Rutledge."

"Oh, we have ways," Jack answered, suddenly realizing that he'd revealed something from a compartment named SORGE. Oops.

"Sounds like something you say at the New York Athletic Club," SecTreas observed. "But only if you're four feet or so away from the guy."

"But it appears it's true. At least in monetary terms. So, we have a gun we can point at their heads?"

"Yes, sir, we sure do," Gant answered. "It might take them a month to figure it out, but they won't be able to run away from it for very long."

"Okay, make sure State and the Agency find this out. And, oh, tell CIA that they're supposed to get this stuff to me first. Intelligence estimates are their job."

"They have an economics unit, but they're not all that good," Gant told the others. "No surprise. The smart people in this area work The Street, or maybe academia. You can make more money at Harvard Business School than you can in government service."

"And talent goes where the money is," Jack agreed. Junior partners at medium-sized law firms made more than the President, which sometimes explained the sort of people who ended up here. Public service was supposed to be a sacrifice. It was for him-Ryan had proven his ability to make money in the trading business, but for him service to his country had been learned from his father, and at Quantico, long before he'd been seduced into the Central Intelligence Agency and then later tricked into the Oval Office. And once here, you couldn't run away from it. At least, not and keep your manhood. That was always the trap. Robert Edward Lee had called duty the most sublime of words. And he would have known, Ryan thought. Lee had felt himself trapped into fighting for what was at best a soiled cause because of his perceived duty to his place of birth, and therefore many would curse his name for all eternity, despite his qualities as a man and a soldier. So, Jack, he asked himself, in your case, where do talent and duty and right and wrong and all that other stuff lie? What the h.e.l.l are you supposed to do now? He was supposed to know. All those people outside the White House's campuslike grounds expected him to know all the time where the right thing was, right for the country, right for the world, right for every working man, woman, and innocent little kid playing T-ball. Yeah, the President thought, sure. You're anointed by the wisdom fairy when you walk in here every day, or kissed on the ear by the muse, or maybe Was.h.i.+ngton and Lincoln whisper to you in your dreams at night. He sometimes had trouble picking his tie in the morning, especially if Cathy wasn't around to be his fas.h.i.+on adviser. But he was supposed to know what to do with taxes, defense, and Social Security-why? Because it was his job to know. Because he happened to live in government housing at One Thousand Six Hundred Pennsylvania Avenue and had the Secret G.o.dd.a.m.ned Service protect him everywhere he went. At the Basic School at Quantico, the officers instructing newly commissioned Marine second lieutenants had told them about the loneliness of command. The difference between that and what he had here was like the difference between a f.u.c.king firecracker and a nuclear weapon. This kind of situation had started wars in the past. That wouldn't happen now, of course, but it had once. It was a sobering thought. Ryan took a last puff on his fifth smoke of the day and killed it in the brown gla.s.s ashtray he kept hidden in a desk drawer.

"Thanks for bringing me this. Talk it over with State and CIA," he told them again. "I want a SNIE on this, and I want it soon."

"Right," George Winston said, standing for the underground walk back to his building across the street.

"Mr. Gant," Jack added. "Get some sleep. You look like h.e.l.l."

"I'm allowed to sleep in this job?" TELESCOPE asked.

"Sure you are, just like I am," POTUS told him with a lopsided smile. When they left, he looked at Arnie: "Talk to me."

"Speak to Adler, and have him talk to Hitch and Rutledge, which you ought to do, too," Arnie advised.

Ryan nodded. "Okay, tell Scott what I need, and that I need it fast."

Good news," Professor North told her, as she came back into the room.

Andrea Price-O'Day was in Baltimore, at the Johns Hopkins Hospital, seeing Dr. Madge North, Professor of Obstetrics and Gynecology.

"Really?"

"Really," Dr. North a.s.sured her with a smile. "You're pregnant."

Before anything else could happen, Inspector Patrick O'Day leapt to his feet and lifted his wife in his arms for a powerful kiss and a rib-cracking hug.

"Oh," Andrea said almost to herself. "I thought I was too old."

"The record is well into the fifties, and you're well short of that," Dr. North said, smiling. It was the first time in her professional career that she'd given this news to two people carrying guns.

"Any problems?" Pat asked.

"Well, Andrea, you are prime-ep. You're over forty and this is your first pregnancy, isn't it?"

"Yes." She knew what was coming, but she didn't invite it by speaking the word.

"That means that there is an increased likelihood of Down's syndrome. We can establish that with an amniocentesis. I'd recommend we do that soon."

"How soon?"

"I can do it today if you wish."

"And if the test is . . . ?"

"Positive? Well, then you two have to decide if you want to bring a Down's child into the world. Some people do, but others don't. It's your decision to make, not mine," Madge North told them. She'd done abortions in her career, but like most obstetricians, she much preferred to deliver babies.

"Down's-how and . . . I mean . . ." Andrea said, squeezing her husband's hand.

"Look, the odds are very much in your favor, like a hundred to one or so, and those are betting odds. Before you worry about it, the smart thing is to find out if there's anything to worry about at all, okay?"

"Right now?" Pat asked for his wife.

Dr. North stood. "Yes, I have the time right now."

"Why don't you take a little walk, Pat?" Special Agent Price-O'Day suggested to her husband. She managed to keep her dignity intact, which didn't surprise her husband.