The China Factor and the Overstretch of the US Hegemony

FIRST STORY
A view from an insider
George Zhibin Gu
CHINA IS BECOMING A GLOBAL THEATER
“A new power balance will emerge gradually and most likely indirectly”

STORY NUMBER TWO
A critical view from the center of the Global Power
Chalmers Johnson
CHINA REPLACED THE UNITED STATES AS THE TOP EXPORTER TO JAPAN
“The US is treading the same path followed by the former USSR”

THIRD STORY
A contrarian view from Europe
Andre Gunder Frank
RISING DRAGON
“We are witnessing the re-emergence of Asia”

http://www.gurusonline.tv/uk/conteudos/gu_report.asp

(1) “Exponential growth can’t last forever.” True, but, as the examples of Japan/South Korea/Taiwan show us, it can last for a long time—- long enough.

(2) “An authoritarian regime is bad for the economy.” As a blanket statement this is clearly wrong. There are authoritarian regimes that are economic disasters (Zimbabwe, Myanmar, maybe—- not clear yet—- Venezuela). There are also those that have done reasonably well (Indonesia, Malaysia, white South Africa) to very well (South Korea, Taiwan). It may perhaps be true that, averaged over all cases, blah blah, democracy does better, but that’s a very different statement. Given the evidence so far, China looks a lot more like South Korea/Taiwan than it looks like Myanmar.

(3) “All hell will break loose as the country gets richer/as a result of uneven wealth distribution”. This one is more problematic—- as I have repeatedly stressed, the question is governance. However, on the positive side we have the following points

• Taiwan is perhaps the closest model we have to China, and they made the transition OK (bloodily, but not as bloodily as South Korea and, as these things go, pretty well). The point is that it would seem, a priori, unreasonable to argue that there is something in “Chinese character” that is hostile to rule of law or that accepts and encourages corruption.
• The biggest problem with a dictatorship giving up power is the fear of those at the top of retribution. As far as I can tell, there’s no long much of anyone in power in China who can be considered a bona fide war criminal Pol Pot/Milosevic type, so this fear for one’s life is not an issue. (Sure Hu Jintao has some pretty nasty marks against his name for Tibet but, as I have pointed out earlier, sadly this is analogous to the US behavior against native Americans, behavior that didn’t seem to much dent the political popularity of people like Andrew Jackson.)
  So, I suspect, like the Soviet Union and like white South Africa, the issue of democracy will hinge on the wealth and comfort of those in power now—- at some point they will make the calculation that leaving power with at least some of their goodies and retiring comfortably will be more pleasant than the discomfort and deprivation of a sagging economy and sullen undeclared civil war.

And I keep hearing about Mao, Tibet, Taiwan, … Whatever happened to the Opium Wars? The Nanjing Massacre?

Since there are some jingoists who like to use sarcasm to stifle debate, I’ll do the same to them: Yes, you jingoists. Go on slinging mud on China. Go on hating China mindlessly. Because that’s all you can do.

( Time for another meme. :-B )

Back to my point about China’s economy when it grows 10% that would be $140 billion to the world’s growth, not 10% of $5.7 trillion (PPP GDP). The difference between these numbers is $430 billion or about the size of Spain’s economy. If the US grows 3% that is $330 billion to the world’s growth. That’s why purchasing power is only important to the Chinese. It’s not important to world economic growth which is what people outside of China care about. How much a meal in a restaurant in Guangzhou costs or how much a flat is in Nanjing shouldn’t be important to people who don’t live there.

That’s all. Sorry if I offended anybody.

Rocks, sticks, that particular trope to me and anyone raised in South Africa carries with it a very particular set of associations. I guess, given all you have said about yourself, it is only fair to assume that this particular mode of rhetoric is something which which you are not familiar and which you were not specifically trying to emulate or tap into.

Thanks, Roger; that needed saying. The highminded grandstanding about China’s human rights records would be more convincing if it weren’t for the fact that they’re basically subsidizing our own fiscal irresponsibility.

Democracy is incompatable with effective capitalist system, because people will inevitably vote themselves a safety net and it weakens the economic engine.

As long as China has authoritarian capitalism – it’s a threat to the US economic domination.

The US should try to develop a more authoritarian system for itself or democratize China or both.

How did my sentance imply a racial flaw? My comment was only that China has not made many significant scientific achieves yetsofar. I now think that you are bigoted to believe that a comment such as mine implies racism. Only those who think along racist lines would make such a connection.

My wife is Korean-Australian, and is a PhD in computer science and one of the most brillaint people I know. I lived nearly a third of my life in East Asia, speak two East Asian languages very well, and do not harbour any racist feelings, especially not towards East Asians. If you knew me even a little bit you couldn’t possibly call me a racist or imply that I was one. You are ignorant and a bigot.

It’s also grossly wrong to call what’s happening there a free market economy, even in those sectors which are not still nationalized. Private property does not a free market make. It does make for crony capitalism, which is private profits ensured by unfree markets.

Really, the PRC seems to have wandered from Communism into a kind of non-explicit low-grade Fascism. Authoritarian, collectivist/communitarian, nationalist, moderately private propertyish and intensely crony capitalist. (People think that the Fascists and Nazis were free marketeers, but they weren’t, not by a long shot. They weren’t even that keen on preserving private property.)

Personally I’d say that qualifies you as a bigot. A statement like that strongly implies a claim to some sort of racial or cultural flaw in the Chinese that will hold them back (otherwise why is it relevant)? Now it is quite possible, as many of us have stated, that flaws in Chinese governance could lead to the whole country coming apart, but there are ways to make this argument that are bigoted, and ways that are not.

Well, yes—I think that’s generally true. The question is: to what extent can China be considered Totalitarian (as opposed to authoritarian, and what degree/consequence at that), and what is the sustainable trend there? No doubt, that’s a BIG question (especially concerning, as I noted earlier, peasant/itinerant worker class).

Andrew McNamana: I’m not concerned to call you a racist—though I did put in the bit about sticks to counter, proleptically, the “Chinese can’t innovate like us,” a sentiment I gather you share: they’re certainly capable of it. They’re also capable, as my own brief experience with a joint-venture in early 90s showed me, and many friends have relayed in their China experience, of exceptionally comic lassitude/disaster-making face-saving behavior (“Will that order be done?” “No problem!” “Is that order done?” “No problem!” “No—no order IS problem.” “No, no order not problem—make X unhappy IS problem,” where X is someone on our side and Y is now angry customer.)

I’m not concerned that the US is going to become a third world country (though, there, Buffet’s shantytown economy isn’t a bad metaphor for our direction), but rather with a) the environment and b) the US middle class’s further downfall as China (and the rest of our global competitors) continue to get better and better at doing both basic and value-added labor (and we become, relatively-speaking, more and more unhealthy, uneducated, etc—also read: less productive).

I’m not A. Sen, but I think if you look at worldwide population/resource/geography distribution, and have any reason to think that humans are all more-or-less equally capable by the billions, you have to be concerned with how both global economy gets distributed and the attendant resource consumption as it grows to US-like rates—as well as concerned by the concommitant trends in the US regarding education, health care, aging, debt, etcetera.

With respect to China, if China only grows at a 7-percent rate to our 4-percent, it will surpass us in about 60 years… if they continue at their 9.5 rate, it will be in 35. Regardless of the rate at which this happens, they ARE four times larger than US in population: do we really expect, ad infinitum, to remain four times more productive (assuming EQUAL economies)—or even, as US population grows (and it should, relative to China, given our respective geographic holding-capacity), will we remain even twice as productive? What if the US continues with its debt and wars and educational decline and becomes less productive? What does global pollution/energy problem look like if China is even, say, 50-percent the size of the US—and India 25-percent?

The massive structural pressures put on the US from the answers to these questions dwarfs the Iraq problem, and even, per the original article that opened this thread, the military problem concerning China. How many MiGs they have or whether they develop a carrier-based navy seem like pale questions compared to “What does world oil consumption look like when China achieves economic parity with US?”