The Asian Century 1 11 July 2019.

Much of our understanding of the contemporary world is essentially historical.  (OK, you wouldn’t know this from watching the news on the devil-box.  Still,…)

“Manifest Destiny” = “An Obvious Fate.”  It’s a term in American history, but it applies to China as well.  Both countries believe themselves to be “bound away” to greatness.  Historically, China was the “middle kingdom,” an axis around which the rest of the world revolved, and where civilization and good government prevailed.[1]  From this point of view, China’s degradation at the hands of the “Southern barbarians” is but a speed-bump in History.

Since the economic reforms launched by Deng Xiaoping, China has become the center of world manufacturing.  Literally hundreds of millions of people have been lifted up out of an abject poverty of a kind most Western progressives cannot imagine.

Industrial power transforms into military power.[2]  China’s potential for a military build-up and its effort to shoulder-aside other claimants to various reefs and islets in the South China Sea have alarmed many observers.  What if China tries to seize Taiwan or test America’s will to back its traditional allies like the Philippines, Japan, or South Korea?

If we did an audit of China’s problems, what would we find?  First, state-owned firms are gigantic and powerful.  They’re also inefficient and deep in debt.  Second, Communist China has not regained the high level of creativity that characterized much of the history of Imperial China.  As a result, it depends on the massive theft of intellectual property from the West.  Third, the income inequality and environmental degradation have begun to arouse resistance.  (There are as many as 180,000 demonstrations each year.)  Fourth, the lack of well-established legal norms is scaring people.[3]  There is a grave danger of an elite “brain drain”: one report says that up to half of the wealthiest citizens want to move abroad within the next five years.  A Gallup poll recently estimated that 120 million Chinese would like to move to America.[4]

Then, “off-shore China” has done best of all.  Places where traditional Chinese values have been combined with Western legal codes—Hong Kong, Singapore, Taiwan—have done even better than has mainland China.  Yet the current Chinese leadership seems not to take the obvious, if uncomfortable, point.

For a long time, American policy has been to encourage the liberalization of trade and economic management in other countries, China included.  The underlying theory holds that economic liberalization will lead to the growth of a middle-class.  A growing middle-class will demand political liberalization.[5]  This “long game” will then lead to the spread of economically and politically congruent societies.  Wars will end.  Prosperity will flourish.  Well, “Scotch verdict” on that.

[1] Michael Auslin, The End of the Asian Century: War, Stagnation, and the Risks to the World’s Most Dynamic Region (2017).

[2] See: Germany, 1865-1945.

[3] It looks very much like the long-running “anti-corruption campaign” is directed chiefly at rivals and opponents of the current leadership.  If you’re a “FOX” (“Friend of Xi”), you’re probably safe.

[4] It seems at least reasonable to think that many of the would-be migrants are people who have already been to the US.  In 2015, there were just over 300,000 Chinese students in American universities and colleges.  See: https://foreignpolicy.com/2015/11/16/china-us-colleges-education-chinese-students-university/

[5] That’s what happened in 19th-Century Europe.

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