At a July press conference, PLA Major General Zhu Chenghu appeared to threaten nuclear first strikes on the United States in retaliation for American intervention in the Taiwan Strait. Predictably, General Zhu's remarks received tremendous attention in Washington and elsewhere. In addition, the Pentagon's recently released annual report on Chinese military power evoked a harsh and excessive reaction in Beijing. Unfortunately, therefore, when many Americans reflect on the past few months of U.S.-China security relations, they will think of the specter of nuclear exchanges. In general, however, Beijing's diplomacy on security issues over the same period has improved, a more basic trend that should not be overshadowed by General Zhu's bluster and Beijing's heated response to the Pentagon report.

Standing apart from the many recent reports of rural instability is an account of a different nature: It singles out a township in a region of Zhejiang Province known nationally for its flourishing market-based prosperity, where innovative reforms have been implemented to enhance popular participation in political decisions. Although these reforms are intended to strengthen the rule of the Chinese Communist Party in local affairs and not as a step toward democratic transition, they do suggest that the growth of "social capital" at the local level is bringing about greater public roles in policymaking, improving local governance, and perhaps even changing, albeit to a limited degree, the way the party operates at the local level.