Starbucks Conquers Tea-Drinking China

Map and flag of China, cups of starbucks coffee

The Skinny is Hillary Profita's take on the top news of the day and the best of the Internet.

The Wall Street Journal's front page features one more chapter in Starbucks' master plan to take over the planet: conquering China. The overwhelming obstacle there is that most Chinese people, um, drink tea.

But Starbucks executives didn't become the Starbucks executives that they are by letting that deter them from an emerging market. No, writes the Journal, "executives didn't think the coffee part stood in their way."

Indeed, if you shovel enough milk and sugar into it, pretty much anyone will chug a latte five days a week. So, Starbuck's has begun to execute plans to lure the young people into their clutches — by counting on "a new generation of Chinese with growing spending power and an appetite for high-status brands" who will soon become as addicted as you and I are.

And many are already being sucked in. Warren Guo, "a 30-year-old who works in foreign trade," told the paper that he doesn't actually like coffee. He comes to Starbucks because there are "many girls."

Runway model Fang Sun Yan "started coming to Starbucks to meet friends. Now she says she's grown 'a little bit addicted' to coffee and visits as often as three times a week." We were all "a little bit addicted" at the beginning, my friend.

The president of Starbucks Greater China shared this philosophy with the paper: "Coffee represents the change," said Wang Jinlong. Remember that quote. In the film that will be created 25 years from now about why the Earth was renamed Starbucks, that will be the tagline.

Sunny Iraq

In October, National Security Adviser Stephen Hadley met with Iraqi Prime Minister Prime Minister Nuri Kamal al-Maliki and provided a memo to the president regarding his impressions of the leader earlier this month.

"An administration official" provided the classified document to the New York Times, which carries an article about it on the front page, in advance of President Bush's meeting with Maliki. Serendipitous, no? While the administration has been reluctant to criticize Maliki publicly, the memo illustrates Hadley's concerns about his ability to govern the country.

Some highlights from the memo: "His intentions seem good when he talks with Americans, and sensitive reporting suggests he is trying to stand up to the Shia hierarchy and force positive change," the memo said of the Iraqi leader. "But the reality on the streets of Baghdad suggests Maliki is either ignorant of what is going on, misrepresenting his intentions, or that his capabilities are not yet sufficient to turn his good intentions into action."

The memo also includes some suggestions on how Maliki can establish control and steps the U.S. can take to strengthen his position. The official that provided the document to the Times "stressed that the administration retains confidence in the Iraqi leader."

That said, the Los Angeles Times carries a front-page story outlining Maliki's intentions for today's meeting with Bush: He "will push for the U.S. military to relinquish control over his nation's security forces," according to "aides and political insiders."

Maliki will also insist "that his government should drive negotiations with Iraq's neighbors, Iran and Syria." The Washington Post's front page outlines Bush's plans for the meeting, which he discussed with reporters in Estonia yesterday, where he "hinted at the U.S. government's growing impatience with Maliki when he said he would query the prime minister about his 'strategy to be a country which can govern itself and sustain itself.' "

So that should be an interesting meeting.

Deal Or No Deal

Also interesting (if you're into that kind of thing) will be the budgetary battles likely to transpire in Congress over military spending. The Los Angeles Times writes on its front page that "Congressional and military officials have said the Pentagon is considering a request of $127 billion to $150 billion in new emergency war spending, the largest such request since the special spending measures were begun in 2001."

In case you were wondering, $495 billion has been allocated so far for Afghanistan, Iraq and "terrorism-related efforts." The new request will likely roil Democrats, who were planning to limit such emergency supplemental spending measures "in favor of the regular federal budget process, which affords greater oversight and congressional control."

The spending request is irking some in the Pentagon as well. Some have been advocating for the increase to replace equipment, arguing that the overall budget is too small given the demands. Those opposing the supplemental request argue that an October memo from Deputy Defense Secretary Gordon R. England — which said that "allow the military to include a greater number of expenses more loosely tied to the actual wars" — has led to inflated requests.

"The England memo basically said, 'Let her rip,' " according to Winslow Wheeler, director of the Straus Military Reform Project and a former congressional budget aide. "Anything goes, as long as you can put it under the pretext of not only Iraq or Afghanistan but the global war on terror."

Wheeler is quoted in a front page USA Today article this morning, as well — noting that because of the complexity of today's military equipment, repairs are more expensive than ever. USA Today writes that according to "military leaders and outside experts" $2 billion worth of Army and Marine Corps equipment "is wearing out or being destroyed every month in Iraq and Afghanistan."

On the Web: Click Fraud

Here's a new phrase to share with your friends and neighbors: Click Fraud. No, this is not the name of an upcoming Sandra Bullock thriller. (But that would be a good title, no?)

Instead it's a dodgy little tactic that's gaining traction and beginning to give Google a headache, writes The Economist (which is why I just said "dodgy." That's how British people write.)

Here's how it works: Search engines such as Google place ads on the Web sites of their affiliates, who get a cut of ad revenue each time someone clicks on the ads. And "sadly, cheating the system is easy," writes The Economist.

And fun! "Unscrupulous affiliates can generate a stream of bogus commissions by repeatedly clicking advertisements on their own websites (or getting other people or machines to do so on their behalf)." Or they can sabotage the competition: "click on a rival company's advertisements, displayed on websites or alongside the results of an internet search, and its advertising budget will swiftly be exhausted." That's right, folks: bogus clickage.

At first, outfits like Google and Yahoo were playing down the problem. Eric Schmidt of Google "caused a storm" when he "joked that Google's engineers were having 'great fun' trying to keep ahead of the fraudsters." (Again, this is a British publication, hence the use of "fraudsters.") Anyway, now that they are "stung by class-action suits," they're taking the issue seriously. Watch it, fraudsters.