China in My Life — Exploring China’s Future

When it comes to economic and geopolitical influence, how does China compare to the United States?

February 16, 2008

When it comes to economic and geopolitical influence, how does China compare to the United States?

Ideally, I will do more than observe. As has been so frequently pointed out, in every preceding occasion when a big new global national player emerged, war ensued. Fully aware of that sad record of human history, the Chinese have expressed the view, indeed the conviction, that their case will be different — that it will be peaceful.

There are two main arguments. One is that China does not have a belligerent imperialist tradition. That argument actually depends on the reading of history — and is not very convincing.

More convincing is the second argument — that China’s domestic agenda and challenges are so many and so huge, that there will be no time, inclination or energy for foreign adventures. China has prioritized peaceful domestic economic development over foreign expansion.

This is the first time in history when one of the great economic powers is also a comparatively poor country. Or perhaps it may be more accurately stated that the great Chinese economic powerhouse contains among its inhabitants a very large proportion of people — in the hundreds of millions — whose incomes are well below the global average, indeed among the world’s poorest.

Bringing the 800 million still quite poor people of the rural areas to a higher standard of living is a very daunting challenge indeed. Not only that, but China is facing inequalities that are of chasm proportions.

Equally daunting is China’s environmental agenda. The high-speed pace of industrialization, coupled with widespread corruption at the local level, has created an environmental inferno.

Finding the proper balance between economic growth and environmentalism — between growth and greenery — will be tough. That is especially true when another central challenge for Chinese leadership is job creation.

It is estimated that urban unemployment could be as high as 15%, while rural underemployment is significantly higher.
The need to sustain growth, to create jobs and to provide the required public goods — education, health, infrastructure, social security — must also be balanced in meeting the rising expectations of China’s rapidly growing middle class. Institutions, especially all those that derived from the rule of law, are still weak.

One scenario that could thwart the peaceful rise prospect could be a sudden dramatic downturn in the economy. The only legitimacy of the Chinese Communist Party is its ability to generate economic growth.

If that ability is brought into question or disappears — as happened, for example, in Indonesia in the economic crisis of 1998 that brought about the downfall of the 32-year old regime of Suharto — the temptation to engage in a foreign war to distract attention from domestic ills could be strong. After all, political leaders have regularly resorted to throughout history.

It has to be said that whether China’s rise is peaceful or bellicose will to a very great extent depend on what is happening in China — but also on what is happening outside and vis-à-vis China.

If a Taiwanese government were seen to be taking measures to gain independence — no matter what condition the Chinese economy would be in — Beijing would almost certainly respond belligerently.

The Chinese are not wrong in arguing that this is a purely domestic matter.

Taiwan is mainly populated by migrants from the Chinese mainland — the aboriginal inhabitants of Taiwan account for less than 2% of the population — and has traditionally been seen as an integral part of China.

Today, only a small and dwindling handful of states — mainly in Central America and sub-Saharan Africa, along with the Vatican — recognize the government of Taipei as the legitimate government of China.

If rational minds prevail and there is no unwanted interference from outside, it is fairly certain that a positive solution for both sides could be found. That, however, may be a fairly big “if”.

This brings us to what is without doubt the greatest imponderable in the rise of China — the United States. There is a strong body of opinion among U.S. policymakers and policy thinkers that war with China is inevitable.

And this is not limited to the lunatic “neocon” fringe. At a meeting on China in Stockholm — which was attended by leading U.S. and European experts and policy makers — the position of a number of the U.S. participants was quite alarming.

They believe in a balance-of-power theory that justifies U.S.-led naval practices in the Bay of Bengal undertaken with India, Australia and Singapore — as a signal to contain China. They also favor strengthening the US-Japan alliance and making it more explicitly aimed at “containing” China.

A number of the American participants argued that ultimately a “showdown” must take place between dictatorships and democracies — though they seemed quite oblivious to the fact that Singapore is not, nor does it claim to be, a democracy. They also tend to overlook the fact that sometimes Washington’s best friends are dictatorships (witness Saudi Arabia), while its worst enemies are democracies (witness Iran).

From an economic perspective, China could be perhaps accurately described as America’s partner — indeed an indispensable one. As to geopolitics, China is still a pygmy in comparison to the American giant.

As the West loses its position of overwhelming dominance — which it has held for the last several centuries — a period of turbulence and volatility is inevitable. Humanity has not been very good at handling such periods in the past.

One absolutely essential imperative is that the West should not only sustain, but indeed strengthen, the values and institutions derived from the Enlightenment.

These values and the institutions that uphold them have universal appeal and application. However, if the West (and the United States in particular) is to violate them — as it did in, for example, Guantanamo — the prospect for a peaceful rise of and coexistence with China becomes jeopardized.

Adjusting to China’s rise would also require the maintenance — and indeed strengthening — of the multilateral framework that has served the world so well. This is one of the many reasons why it is extremely regrettable that the WTO Doha Round is currently grounded in paralysis.

Insofar as this will probably be the last decade of my professional life, my plan is to do more than simply “observe” what is taking place in China and China’s impact on the globe.

I shall move to the region and from there try to contribute to building robust bridges between China and the global community. Obviously this can be no more than a modest contribution, but if there are many modest contributions and they are aggregated, they can make a difference!

Those of us who are in a position to do so must make every effort to contribute to the peaceful rise, a peaceful transition, as well as a peaceful coexistence between China and the rest of the world.

What must be recognized is that China’s massive re-emergence has brought both enormous opportunities and a strong element of uncertainty, fragility and volatility to the international system — just as China’s own prospects are characterised by huge opportunities and by uncertainty, fragility and volatility.

Though there are many challenges, potential pitfalls and threats, I believe there are grounds for being cautiously optimistic about the long-term prospects.

I believe China is evolving and will continue to evolve towards a more liberal, more pluralistic and more accountable form of governance, bringing about a more just society.

Achieving that will necessitate reducing the inequalities and managing a program of urbanization that will dwarf any comparable phenomenon in the history of man. This may take 20 or 30 years, possibly beyond my own personal journey. Efforts should be directed at encouraging China down that road.

In retrospect, my own journey to date has been a very lucky one. Born in the late summer of 1945, I escaped war and deprivation — unlike my grandfather and father who experienced both world wars and the depression that occurred between the two.

For them and for all those whose journeys will continue well into this century, we must all face the challenge of making China’s peaceful rise a reality.

Takeaways

This is the first time in history when one of the great economic powers is also a comparatively poor country.

Finding the proper balance between economic growth and environmentalism — between growth and greenery — will be tough.

The high-speed pace of industrialization coupled with widespread corruption at the local level has created an environmental inferno.

One scenario that could thwart the peaceful rise prospect could be a sudden dramatic downturn in the economy.

China's massive re-emergence has brought both enormous opportunities and a strong element of uncertainty, fragility and volatility to the international system