China e o futuro das democracias de mercado - Rana Mitter (Oxford)

How the one-party state may shape our future

Tomorrow belongs to Beijing, but how can China win hearts around the world

Rana Mitter

Chatham House, Londres – 1.8.2019

China is seeking to define the future. At home, the Chinese Communist Party, or CCP, intends to instil ‘socialist values’ that underpin an ever-expanding ‘China dream’. Overseas, its nexus of economic, political and military influence is framed by the idea of a ‘community of common destiny’. The past 40 years, since the ascendancy of Deng Xiaoping in 1978, have been marked by astonishing economic growth, a greater global role and strongly authoritarian politics at home.

This year, the CCP marks 70 years since the foundation of the People’s Republic of China. Plans are already afoot for the centenary of the party’s founding in 2021. But how realistic is it to assume that China will maintain its momentum over the next three decades until the People’s Republic marks its centenary?

The answer is that this is possible, but only if China changes. In the next phase of its development, China will need to embrace economic and social openness in a way that it is still reluctant to do. This may happen in a counterintuitive way. A more open China would not necessarily abandon its one-party system, but it would need to allow significantly more freedom for discussion, economic activity and genuine two-way engagement with the wider world.

How likely is such a change? In the short term, perhaps not that likely. China’s political direction has been changing rapidly since the rise to power of Xi Jinping and it has become clear, as the 2010s have progressed, that Xi not only has no intention of liberalizing China’s politics but is actively steering the country in a different direction.This trend did not in fact begin in 2012 when Xi became secretary-general. Rather, it was the failure of the West to deal with the global financial crisis in 2008 that began the process of disillusionment with the Washington Consensus on democratic politics and neoliberal economics.

Xi’s rise, however, made it clearer that the Chinese state would be re-invented in the new leader’s image. We have seen a sharp move away from the trend of the early 2000s for state rather than party organizations to dominate Chinese government, with the direction of travel being reversed in the past few years as the party element of the party-state becomes ever more pronounced. For the next five to ten years, it seems unlikely that that trend will alter. China’s public sphere – its media, academia and legal system – has been placed firmly under the control of the party, with the constitution changed so Xi can take a third and possibly fourth term of office. But what will emerge after that period?

To answer this, we need to move beyond the sharp divide we make between authoritarianism and democracy. The likelihood that China will become an electoral democracy in the next few decades is low. But the probability that it will become a less restrictive although still authoritarian state is much higher.

China has never really had a full democracy, but during the years of communist rule the pendulum has swung between what the political scientist David Shambaugh has referred to as ‘hard’ and ‘soft’ authoritarianism. Most of Mao’s rule was relatively hard, in its level of top-down control.

The 1980s was an unprecedently ‘soft’ period, although the 1989 Tiananmen Square killings brought this to an end. The run-up to the 2008 Beijing Olympics saw a remarkable opening up in areas such as investigative reporting, a trend that has come to an abrupt halt under Xi.

A demographic timebomb

Why, then, would things change? Consider one key date: 2029. This is the year when demographers calculate that China will begin to see the effects of its one-child policy come home to roost. Its population will start to fall by about five million people a year, and it will start to age.

This is a problem that has been faced by other countries such as Japan and South Korea, which have sought to resolve it either through technology or by allowing more immigration.

Experience has shown that older people don’t like being looked after by robots, so it is possible that China, like Japan, may allow immigration by larger numbers of young people, mostly women, from the Southeast Asian region. If that were to happen the influx of people would change Chinese society. Democracy may not follow, but a necessary engagement with other people and their cultures, points of view, and needs would provide more diversity within Chinese society, and allow new voices to thrive, particularly in the most vibrant part of China, its cities.

Another impetus for political change is the continuing issue of Taiwan. Beijing has always made it clear that it reserves the right to invade and occupy Taiwan, by military means if necessary. Yet this has always seemed a short-term way to ‘resolve’ the Taiwan question. True, mainland China may have the military capacity to capture the island. But what sort of unification would that offer the 23 million inhabitants of one of Asia’s most lively democracies, a place with free media, world-class education and a range of civil liberties that make it one of the most liberal societies in the region?

China has long sought to wield ‘soft power’, hoping to show that the Chinese path is an attractive, progressive, forwardlooking one to follow. A violent reunification would destroy any hope of burnishing that image.

Instead, a softening of attitudes that provide different levels of freedom would offer a skilful solution to a perennial problem. By liberalizing at home, making it clear that Hong Kong’s freedoms will be kept intact – and those that have been eroded will be restored – China would be in a far better position to make its case that reunification would be beneficial for all.

Right now, that story is hard to tell. Yet the depressing developments in Hungary, Turkey and Philippines in recent years show that democracy which exists only in a technical sense is no guarantee of liberal freedoms. This could mean that the space for China to reinvent itself as a state that allows genuine freedoms, even under a one-party state, is greater than it was at the height of global democratization in the 1990s.

The newly confrontational response of the United States may also give China a pressing reason to burnish its image in this area in the next decade. Under the Trump administration, it has become clear that containment of China is a top priority. However, the growing sense of confrontation with China is now cross-partisan. Democrats embrace the idea as much as Republicans.

In Asia, there is still unease about Trump’s commitment as an ally, but signs such as US arms sales to Taiwan suggest that creating an anti-Chinese alliance still beats Trumpian instincts to withdraw from the region. Meanwhile, China is trying to find the silver bullet that will win it genuine partners in the region and remove the US from it.

The answer may lie in China’s strategic framework, the Belt and Road Initiative, or BRI. Despite the hype, rather than this being some masterplan organized from a headquarters in Beijing, much of the initiative has been pushed by internal economic factors, including the need to find somewhere to place misallocated capital, as well as providing opportunities for provincial corporations to compete with each other. There have also been setbacks, including the spat with Malaysia, which earlier this year threatened to pull out of the BRI highspeed rail contract it had signed until it was given a considerable discount.

China’s military presence is unwelcome

Yet the future of BRI as a project to spread Chinese influence may lie in a dilemma that will become clearer over the next decade. China can now offer significant funding for infrastructural projects, and has become the most significant trading partner for almost all other Asian states. There is simply no equivalent western source of funding for many of the proposed projects, particularly the more financially problematic ones. Despite this, the US remains the only reliable provider of security in the region.

Some countries, such as Myanmar, Laos and Cambodia, are close to China and becoming closer. But few states yet relish the idea of a significant Chinese military presence in their territories, and it is hard to imagine that those countries that have a US presence would welcome swapping it for a closer alignment with China.

South Koreans will not exchange the US soldiers on their soil for People’s Liberation Army troops. China has its work cut out over the next decade to persuade people that its security presence should be welcomed. Yet without such a presence, large parts of the BRI, which goes into hostile territory in parts of South and Central Asia, will remain vulnerable.

Another factor, perhaps the single most important game-changer in China’s ability to spread its influence today, is technology.

Britain is currently consumed by arguments about whether Huawei should be allowed to install its 5G broadband network. The debate rather misses the point, however. China’s technological capabilities now make it a likely provider of technological infrastructure for large parts of the non-western world which need efficient, cheap capacity.

China can draw on experiments at home such as the social credit system, which is using a combination of big data, artificial intelligence and face recognition to create a system that allows close surveillance of the population.

There is potential now for China to create a cross-continental technological ecology, linked to the BRI, that could give it a major foothold in Southeast Asia, East Africa and Latin America.

What are the chances of China managing to turn the next three decades into a narrative as powerful as its story since 1978, which contains both a rise to economic superpower status and a continuing control over individual freedoms?

On its current path, China will run up against major obstacles. The drive towards globalizing China is becoming harder to reconcile with a domestic regime that is closing down the space for discussion. The technological revolution can help embed a Chinese economic presence, but it is unlikely on its own to create widespread admiration of Chinese values or what they bring to other societies.

The Chinese Communist Party has had some of its greatest successes in the past half-century when it proved open to major change: the shift from a command economy to market socialism, or the move from the totalitarianism that Mao espoused at the height of his regime to the relatively open periods of the 1980s and the early 2000s.

Could the development of a more liberal state, with one-party rule, but a genuinely free public sphere, be the next stage?

No other state in history has managed such a trick. But then no other state has posted ten per cent a year growth for the best part of a decade. In the end, it won’t be America’s decision as to whether China can dominate the next three decades. It will be China’s.

Rana Mitter is Professor of the History and Politics of Modern China at the University of Oxford and Director of the University China Centre

China's Global Identity: Considering the Responsibilities of Great Power - Tiang Boon, Hoo, book review by Ngeow Chow Bing

Um importante livro sobre o papel da China na ordem mundial, uma trajetória bem sucedida de inserção gradual no sistema global, sob o emblema do "Responsible Global Power", agora em crise, por causa da atitude confrontacionista assumida pela administração Trump, o que realmente pode provocar novos surtos de tensão.
Paulo Roberto de Almeida

Chow Bing on Tiang Boon, 'China's Global Identity: Considering the Responsibilities of Great Power' [review]

by H-Net Reviews

Hoo Tiang Boon. China's Global Identity: Considering the Responsibilities of Great Power. Washington, DC: Georgetown University Press, 2018. xxxi + 196 pp. $32.95 (paper), ISBN 978-1-62616-614-1; $98.95 (cloth), ISBN 978-1-62616-613-4.

Reviewed by Ngeow Chow Bing (University of Malaya) Published on H-Diplo (July, 2019) Commissioned by Seth Offenbach (Bronx Community College, The City University of New York)

Printable Version: http://www.h-net.org/reviews/showpdf.php?id=53903

Jeffrey Bader, senior director for East Asian Affairs at the US National Security Council from 2009 to 2011 and often considered one of the top “China-hands” of the early Barack Obama administration, in his memoir noted the “emergence of a somewhat different China” between 2008 and 2010 “from the one the United States had been dealing with for several decades.” “One could detect a changed quality in the writing of Chinese security analysts and Chinese official statements, and in some respects in Chinese behavior,” Bader observed.[1] Many China watchers agreed. After the 2008 Global Financial Crisis, a qualitatively new China seemed to have emerged: a China that is more confident, decisive, assertive, some say revisionist; a China that sees itself as a Great Power. Under the present Chinese president Xi Jinping, who ascended to leadership in late 2012, there has been an even stronger and heightened sense of China as a rising Great Power, exemplified by the nationalistic “China Dream” narrative and the ambitious “Belt and Road Initiative” diplomatic strategy. In January 2017, a new conception of China as a global leader even emerged, as Xi in the World Economic Forum in Davos eloquently presented China as a defender of free trade and an open global order, at a time when the United States was widely seen as abdicating its global leadership role under the isolationist “Make America Great” agenda of President Donald Trump.  

What are the sources and stimulants of this Great Power identity? What is its major external reference point? Why has it taken the shape of its present form? How has it evolved? How does it guide and affect China’s foreign policy? By consulting large tracts of writings by Chinese scholars and analysts, together with a careful examination of official Chinese statements and actual foreign policy behavior, this illuminating book by Hoo Tiang Boon seeks to clarify and answer these questions.

Hoo’s book makes four major contributions. First, Hoo couples the conception of Great Power with the idea of Great Responsibilities (cleverly borrowing from the American comic book Spiderman): essentially this was not just a Great Power identity but a Responsible Great Power (RGP) identity, as narrated through the Chinese lens. The book documents the rich discourses of Chinese scholars and officials on the idea of responsibilities, which became more pronounced after 2005, when the then US deputy secretary of state Robert Zoellick urged the Chinese to take on the role of “responsible stakeholder.” The Chinese were first bemused to be urged by Zoellick to be more responsible but essentially mostly welcomed his statement as they saw it as recognition by the US of China’s Great Power status. For a long period after the beginning of the reform of the opening up era, Chinese leaders had deliberately kept a low-profile foreign policy. But such a posture became more and more untenable as the share of China’s GDP in the global economy kept increasing, and China needed to create a more positive image to counter the “China threat” discourses as well. However, Chinese and US understanding of “responsibilities” are markedly different. China has taken up responsibilities consummate with its status, capabilities, and strengths by signing the Paris climate accord, contributing to the largest peacekeeping force among the permanent members of the UN Security Council, addressing developmental weaknesses in developing countries through infrastructure investment, working with the international community to handle the North Korean and Iranian nuclear issues, and so forth. Even controversial behaviors, such as the building up of island features in the disputed South China Sea, have been portrayed by China as fulfilling a responsibility to provide public goods to the littoral states (serving as stations for disaster relief). But it is easy to surmise that these Chinese achievements in delivering responsibilities are seen under a different light in the US, especially under the current Trump administration. They are either viewed as insignificant (peacekeeping), inadequate (North Korea), or selfish and predatory actions disguised as responsibilities (infrastructure investment in developing countries). 

Second, Hoo’s study provides a comprehensive historical perspective. He carefully traces the evolution of the identity all the way to the era of imperial China but focuses his study on the post-Mao period. Nevertheless, sufficient historical context before the post-Mao period is provided, and it is shown that even during the era when China was victimized by external aggressors, there was a sense among leaders, such as Sun Yat-Sen and Chiang Kai-shek, that China would one day resume its Great Power status and deliver its responsibilities, especially as leader to its fellow developing countries. This line of thinking was inherited by Mao Zedong but with the twist of ideological support of revolutionary internationalism. The advent of the pragmatic leadership under Deng Xiaoping ushered in an initial period of modesty. While cognizant of its own immense potential, China in the 1980s was keenly aware of the huge gap between itself and the developed world, and it truly did not identify itself as a Great Power. But the end of the Cold War, together with the isolation imposed on China because of the violence in Tiananmen, made China rethink its status in the international system. It was within this context that the more recent rendition of the RGP identity was incipiently formed. Western sanctions reinforced the determination of China to pursue its own independent course of development. The end of the Cold War, although momentarily bringing to the world a unipolar system, eventually resulted in a multipolar system in which China would occupy a “pole.” Concomitantly discourses of “comprehensive national power” began to emerge in Chinese academia to attempt to objectively assess Chinese power in comparison with others. All these trends suggested that China, after the ambiguities in the 1980s, was once again ready to see itself as an emerging Great Power, albeit one that still had to strive to close its development gap with the developed world. Hoo also sharply notes how each of the major external shocks in the post-Cold War era reinforced this identity. The 1997 Asian Financial Crisis propelled China to undertake the responsible role in halting further financial deterioration in the Asian economies. The September 11 terrorist attack was a golden opportunity for China to present itself as a responsible partner in tackling the global terrorist challenges. The 2008 Global Financial Crisis, of which China was widely seen as the only major economy that got through it with decisive action, strongly cemented this RGP identity. 

The third contribution of this book is to highlight the ongoing role of the US in shaping and influencing the development of China’s RGP identity. The idea that China could be “socialized” and “encouraged” to adopt behaviors that are more consistent with both its own power status and with prevailing international norms has always been one of the major justifications of the engagement policy since the time of Richard Nixon. The importance of this idea varied across and within different administrations, but the three successive US administrations before Trump (Bill Clinton, George W. Bush, and Barack Obama), in their respective China policies, all actively attempted to shape and encourage the RGP identity of China. For Clinton, agreeing to form a “partnership” with China during his summit with then Chinese president Jiang Zemin, exercising positive rhetoric (such as commenting on China’s actions in the Asian Financial Crisis and the Indian nuclear testing in 1998), and bringing China into the World Trade Organization were all aimed to shape China’s RGP identity—to make China feel welcome as a rising Great Power but one with consummate responsibilities. The initial hostility of the Bush administration quickly gave way to strong US-China cooperation after the war on terror began; in fact, the Bush years in retrospect could be said to have been the best years in US-China relations in recent memory, and it was from the Bush administration that the call for China to be a “responsible stakeholder” emerged. The Obama administration agreed to the US-China Strategic and Economic Dialogue, clearly a sign according China the proper status as a Great Power equal to the US, and continued to apply rhetorical pressure on the Chinese leadership through such bilateral or other multilateral mechanisms, which stressed that Chinese power must be matched by growing responsibilities. The Chinese leadership responded to these calls by American presidents and officials over the years; in this sense the evolution of its RGP identity was deeply influenced by its interactions with the US. Nevertheless, only in selective areas did Chinese foreign policy behavior match the “responsibilities” expectations from the US. China clearly had its own considerations in reacting to these calls of being an RGP.

This leads to the fourth major contribution of this book: the analysis of Chinese discussions and debates on the concepts related to the RGP identity. Hoo identifies three general positions in the debate: the internationalist, the developmental, and the skeptical. Broadly speaking, the internationalist position agrees that China should undertake more responsibilities as its power grows. There are both instrumental and moral reasons. For instrumental reasons, greater Chinese responsibilities imply greater opportunities for China to shape the rules and be accorded a larger share of rights. Morally, Chinese philosophical and ethical traditions also encourage China to have a moral obligation to the international community once China has become rich and powerful. The developmental perspective takes a more guarded view of the RGP identity, essentially still emphasizing the developing country status of China. China can only assume responsibilities in accordance with its own development status, and the first priority should still be the domestic welfare of its own people. Finally, the skeptics hold a cynical view of the RGP. Accordingly, taking up global responsibilities will drain Chinese limited resources and slow Chinese growth, and it could be a manipulative ploy by the United States to check the rise of China. Among these three schools, the internationalist is ostensibly the one that is most congruent with the expectations of the US, and it is the school that essentially has become increasingly more reflective of official Chinese policies. And according to Hoo, this is the school that is on ascendance under Xi. Yet the result is disappointing to US officials, especially under the Trump administration. An internationalist is not the same as an integrationist. The kind of responsibilities China should take should be self-determined rather than selected and imposed on China by the US. China is seeing itself as an RGP today, which is exactly what the engagement strategy of the past US administrations had tried to shape, but the kind of RGP China conceives of itself is still profoundly different from US expectations.

The Trump administration has ruptured the continuous China policy of the US government of the past several decades. Not a few officials in his administration believe that it was a treacherous mistake for the US to shape China into an RGP. China has indeed become a Great Power but not a Responsible Great Power, rather a Great Power ungrateful and deeply distrustful of the US, and it is time for the US to adopt a more confrontational strategy toward China. In the conclusion of this book, Hoo seems to disagree. In his assessment, while the evolution of Chinese RGP identity did not exactly match every expectation of the US, it did match more than just a few, ranging from managing the North Korean nuclear issue, counterterrorism, and nonproliferation, to dealing with climate change and global public health. In fact, Hoo argues that “from a policy standpoint, the implication is that the long-standing American strategy of engaging China is not as misguided as what some critics assert. More than that, the evidence suggests Washington should continue and indeed do more to encourage China’s pursuit of the RGP identity” (pp. 174-75). Alas, this suggestion would not be welcome in Washington at this moment.

Note

[1]. Jeffrey Bader, Obama and China’s Rise: An Insider Account of America’s Asia Strategy (Washington, DC: Brookings Institution Press, 2012), 79-80.

Ngeow Chow-Bing is director of the Institute of China Studies at the University of Malaya.

Citation: Ngeow Chow Bing. Review of Tiang Boon, Hoo, China's Global Identity: Considering the Responsibilities of Great Power. H-Diplo, H-Net Reviews. July, 2019. URL: http://www.h-net.org/reviews/showrev.php?id=53903

This work is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 United States License.

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Boom or bust in China? - A. E. Clark (Law and Liberty)

Decline and Fall of China?

by A.E. Clark

Law and Liberty, July 16, 2019

https://www.lawliberty.org/2019/07/16/decline-and-fall-of-china/

China’s rise has awed foreign observers and inspired a stream of books, many of them excellent, recounting the Asian juggernaut’s recent history and speculating about its future. The topic is of more than casual interest. China’s rulers tout their authoritarianism as superior to the liberal tradition, are upgrading their military in ways that seem designed to drive the United States out of the Western Pacific, and after concentrating an enormous part of the world’s manufacturing capacity in their country, are now working their way up the value chain. China has set itself the goal of dominating the Artificial Intelligence industry—and by implication, all the industries likely to be transformed by that general-purpose technology—before the year 2030.

“Tell me how this ends,” the clever general used to say.

To his credit, George Magnus knows he doesn’t know how it will end. But Magnus, the British former chief economist at UBS, knows a lot. I will try to summarize Magnus’s insights while noting limitations in his perspective and registering a demurral with respect to his conclusions.

At times, this book ventures deep into the economic weeds. Magnus’s four pages on the stalling of the reform of State-Owned Enterprises between 2013 and 2018 may be more than some readers want to know about that subject. But no one can gainsay the importance of economics for understanding modern China, and often Magnus complements more familiar perspectives in valuable ways. He mentions, for example, that at the time of the 1989 Tiananmen protests, the rate of inflation was 30 percent.

The thesis of Red Flags: Why Xi’s China Is in Jeopardy is twofold: First, China has reached the “end of extrapolation” and what worked for it in the past will not continue to work. Second, what makes it doubtful that China will adapt to the challenges now facing it is the insistence of the Chinese Communist Party (CCP) (and especially of Xi Jinping, who recently made himself in effect President-for-life) on tightening control over the economy and society.

Most of the book elucidates the first proposition. Like the four Asian Tigers (Hong Kong, Singapore, North Korea, and Taiwan), China relied on cheap exports and massive infrastructure investment to work a growth miracle. It is a familiar trope in the literature of development that after succeeding in this way, countries must adopt new strategies to keep growing richer, because they need higher-value-added industries and maybe don’t need any more bridges. The goal for these nations, upon arriving at middle-income status, is often said to be a “rebalancing” under which an expanded share of output is devoted to domestic consumption.

Magnus covers this ground but in greater detail than most authors, and with some surprises. He shows, with hard data, that the most serious imbalance in the Chinese economy is no longer the trade surplus but the over-reliance on domestic investment and debt-financing, the marginal productivity of which has fallen. At the beginning of the 1980s, you could get an extra yuan of GDP from as little as two yuan of investment; in 2015, the same growth required nine yuan in investment. With figures such as these, rather than anecdotes about ghost cities, Magnus draws a picture of widespread malinvestment in an economy laboring under rising debt.

Now, China is at no risk of a meltdown such as traumatized the other countries of East Asia in 1997, since its debt is not owed to foreigners. Even after describing the highly leveraged and under-regulated shadow-banking sector, and weighing the risk of a banking crisis, Magnus suggests in the end that the debt problems, in and of themselves, are manageable. What makes them a threat to China’s stability is that they will place a drag on growth.

Dealing gracefully with a fall in growth, and a fortiori with a recession, is difficult in a country with severe income inequality. Adding to the danger is the CCP’s insistence on tightly controlling the exchange rate, which requires capital controls that are hard to maintain in times of falling confidence. The greater the quantity of domestic credit, the greater the reserves needed to “back” it in a regime of fixed exchange rates, and confidence in the currency becomes more fragile. Magnus has an excellent section on the missteps during 2014 and 2015, and the cascading panics that shook the stock market and put pressure on the Renminbi. It cost the State about $150 billion to stabilize the former, and almost $500 billion in currency reserves to support the latter.

The author suggests, without making the reference explicit, that the authorities are reenacting the movie Speed on a grand scale. GDP growth depends on increasingly inefficient credit, with a strengthening headwind of rising debt. Everyone knows that rebalancing the economy will require slowing it down, but that would stress both the financial system and the social compact, with possibly explosive results. The People’s Bank of China therefore keeps its foot on the credit accelerator, so financial leverage and the debt overhang continue to mount . . .

Continuing his tour of the “traps” in which he thinks the Chinese leadership finds itself, Magnus provides a helpful overview of demographics. Terms like “demographic dividend” are lucidly explained, as is the history of migration from the countryside to the cities.

The author points out that China’s growth in the last three decades received an impetus from several events that were “one-offs”—by their nature, they can’t happen again. Bringing previously unproductive peasants by the hundreds of millions to work in urban factories, that’s over. Joining the World Trade Organization, that’s over. Enjoying a huge working-age population with few children to raise thanks to the One-Child Policy—not only is that over, it has left a demographic hangover in the form of a gender-skewed citizenry whose median age is rising rapidly, straining the nation’s minimal social security system.

The Need for Institutions

The second part of his thesis cites the finding of developmental economics that, to rise out of the “middle-income” bracket, a nation needs not merely more of the ingredients of prosperity: it needs those ingredients to combine more efficiently amid evolving challenges. What this comes down to, in Magnus’s view, is largely a matter of institutions. Trust in courts and contracts; mobility of labor and capital; accepted mechanisms to balance competing interests; an educational system not limited to the urban centers—all of these requirements of a modern economy are lacking. (We read herein the remarkable statistic that only 24 percent of the working-age population has completed high school.) Lacking, as well, is the freedom that people need to try new things even when (especially when), if successful, they will disrupt the industrial status quo.

No economy, he says, can remain dynamic and vigorous without these conditions. Magnus eloquently describes what is working against China here: the CCP’s fixation on control, a fixation that has intensified under President Xi. Xi appears to be bypassing much of the apparatus of the state in favor of new “leading groups” directly controlled by the CCP, and in many cases personally chaired by himself. Control of private enterprises is being tightened by means of Party cells and Party secretaries placed within them.

The Great Leap Forward, when no one dared challenge the crack-brained directives coming down from the top, offers a warning of what can happen in this kind of environment. But Magnus does not predict disaster. He suggests only that the CCP will never allow the kind of free-wheeling flexibility that would bring China into the top tier of economies. And he offers a pithy insight concerning Chinese business, which is notorious for conflicts of interest. President Xi’s anti-corruption drive purportedly aims to reduce them. But as Magnus points out, the most fundamental conflict of interest is the CCP’s own, since it acts at the same time as the owner, the manager, and the regulator of economic enterprise.

Similar arguments have been made elsewhere (even by your humble reviewer), usually emphasizing the role of civil society rather than economic efficiency. Some dismiss this critique as an attempt to impose Western values on an Eastern reality. Time will tell. More troubling is the fact that much of what threatens China is also happening in America: rising debt, pervasive propaganda and surveillance (though not necessarily by the government), and a widening gulf between classes. We are even trying out our own version of the Red Guards, struggle sessions, and officially sanctioned infanticide. Not long ago, Americans dared to hope that trade and the Internet would bring about a “convergence” in which China would become more like us. It seems instead that we are becoming more like China.

As a bonus, Red Flags includes a discussion of the One Belt, One Road initiative, which Magnus tries to consider fairly without uncritically accepting its advertising. But there are indications—which came out, I believe, after the book went to press—that this ambitious project is even more self-serving and exploitative than the author indicates.

The Limits of Expertise

It’s a useful and interesting book, but it is not wholly satisfactory. For someone so well-informed, Magnus makes curious mistakes.

After accurately describing “China’s looming water crisis,” he writes: “Yet water figures almost nowhere in the policy and political rhetoric of Chinese leaders.” In fact, as long ago as 1999, Wen Jiabao, then Deputy Prime Minister, described the water crisis as a threat to national survival. An enormous infrastructure project has been under way to divert billions of cubic meters of water each year from the South to the North. As of 2018, more than 400,000 people had been relocated and almost $50 billion had been spent on this project, which is functioning but unfinished and continues to prompt debate within officialdom as well as among citizens and environmentalists. (There are other examples that suggest caveat lector. I will put two somewhat technical ones in an end note.[1])

A certain worldview suffuses the work. Magnus finds President Trump deplorable and rarely misses a chance to say so. As a former chief economist for one of the world’s largest banks, he is a distinguished member of the global elite that has managed the Western world into its present condition. Experience has not dimmed his confidence in free trade with mercantilist counterparties, or made him less sanguine about the alignment of interests among social classes and among Western nations. Although his book conveys many a sign that China has adopted an aggressive intransigence, his recommendations imply that all we need is more of the same policies that have brought us to this pass, except perhaps now implemented with greater refinement.

The United States “should look to persuade China,” he writes. “The US should seek a dialogue with China . . . The Comprehensive Economic Dialogue is an appropriate forum . . . If calmer heads prevailed, the US would sit down with allies and try to work out a collective approach.” He doesn’t seem to realize that U.S. voters chose Trump’s confrontational style because they judged the modulated counsels of the experts to have failed; or probably he dismisses their views, like Trump’s, as “petty and misinformed.” After all, this British economist knows America. He describes towns near “Fort Meyers” in Florida (p. 112). Yet some of us believe that Trump, rather than turning away from the rest of the world, is negotiating with it—and not ineffectually.

Of Gold and Steel

Yet even though his globalist certitudes had me rolling my eyes, Magnus has written an astute and nuanced assessment of the economic challenges facing the Chinese dictatorship. I think he is right that, while there is no reason to anticipate collapse, the regime’s leadership style will compound the difficulties and ensure that stress will rise.

Early on, he weighs a basic question, namely why is it that China is so actively stepping up its centralization of power at this time: “Centralization of power can speak to pressing demands in the face of perceived threats for either military preparedness or economic reorganization. The latter seems overwhelmingly likely, and so it is plausible that China’s main purpose is economic transformation.”

That word—“overwhelmingly”—seems like a bit of hand-waving. Isn’t it remarkable that he raises two possibilities, at the highest level of strategic thought, and dismisses one of them in five words? Should we not consider the possibility that centralization was undertaken to facilitate both economic transformation and military adventures?

He writes more soberly near the end of the book:

China’s military might and naval build-up, along with the militarization of reefs and atolls in the South China Sea, are not hidden, and nothing would please China more than to drive the US Seventh Fleet away from the island chains off China’s coast and back across the Pacific. . . . [Xi Jinping] has pledged to return Taiwan to the Motherland during his rule, and we are left to wonder how China might contrive to make this occur.

And wonder, we do. Yet the author envisions only two ways the story might end: China bestriding the world as an economic colossus, or China entering a phase of slow growth, maladroit administration, and economic instability. He leans toward the second outcome.

Your reviewer considers it likely that economic developments, about which Magnus has written a fine book, will be overtaken by military ones that he doesn’t want to think about. If the Editor permits, I hope to address this question with you in a future essay.

  

[1] Magnus says the U.S. tax cut of 2017 worked at cross-purposes to professed concerns about the trade deficit: “Since the Trump administration and congress agreed to substantial cuts in taxation in 2018 and 2019, a much wider fiscal deficit will emerge. This is the equivalent of a fall in US savings, and since the external deficit is the outcome of the relationship between savings and investment, it follows that the wider fiscal deficit will simply expand the external or trade deficit.”

Not so fast. The national-income accounting identity [Y = C + I + G + (X-M)] , which Magnus relies on here and elsewhere, applies to a static snapshot of economic activity. To predict an economy’s changing behavior over time, we need a causal model, which the identity itself doesn’t provide.

To be sure, there is a classical, causal explanation which supports the view expounded above, but it depends on feedback loops involving both the interest rate and the exchange rate, which must be free to vary in response to market forces. (See a good discussion here.) But in fact the interest rate in the United States has been kept near zero by means of those policies known colloquially as “financial repression,” and the exchange rate can’t play its natural role if significant trading partners such as China peg their currencies to the dollar.

I mention these facts not to impute all our troubles to them, but to explain my skepticism toward macroeconomic axioms that derive from an idealized model of reality.

A third example of his occasional imprecision: The author distinguishes between utility patents and design patents (p. 152), terms of art in intellectual property law, but the definition he offers for design patents is actually the definition of utility patents, and his explanation of design patents relies on the wrong meaning of “design.”

A. E. Clark translates and, through Ragged Banner Press, publishes the literature of a few independent writers in the People's Republic of China who address social and historical topics deemed sensitive by the regime.

Apple Moves Mac Pro Production to China (WSJ)

O que o Trump vai dizer a partir desse anúncio, justo no dia em que ele se encontra com Xi Jinping? 
F...... Apple?
Mas é justamente ele que torna impossível a manufatura desses produtos nos EUA, ao elevar tarifas sobre importações de insumos e produtos da China.
Suas ações têm o dom de produzir o efeito justamente contrário ao pretendido, retirando renda, salários e empregos aos trabalhadores americanos.
Paulo Roberto de Almeida

Apple Moves Mac Pro Production to China

The $6,000 desktop computer had been the company’s only major device assembled in the U.S.

By Tripp Mickle and  Yoko Kubota 

The Wall Street Journal, June 28, 2019 9:32 am ET

Trade tensions are disrupting supply chains in China that have churned out electronics such as Apple's iPhone and Nintendo's Switch. Now companies are considering a move out of the country. Photo composite: Sharon Shi

Trade tensions are disrupting supply chains in China that have churned out electronics such as Apple's iPhone and Nintendo's Switch. Now companies are considering a move out of the country. Photo composite: Sharon Shi

Apple Inc. is manufacturing its new Mac Pro computer in China, according to people familiar with its plans, shifting abroad production of what had been its only major device assembled in the U.S. as trade tensions escalate between the Trump administration and Beijing.

The tech giant has tapped Taiwanese contractor Quanta Computer Inc. to manufacture the $6,000 desktop computer and is ramping up production at a factory near Shanghai, the people said. Apple can save on shipping costs for components given the proximity of many suppliers.

Cartas de Shanghai: um projeto de 2009, no blog Shanghai Express - Paulo Roberto de Almeida

Transcrevo abaixo, tal como publicada em meu antigo blog Shanghai Express, uma primeira "carta de Shanghai", que redigi quase dez anos atrás, pouco antes de partir para uma missão transitória naquela grande e moderna cidade chinesa, por ocasião da Exposição Universal de 2010, na qual dava início ao que pensava seria uma série de 15 "cartas", sobre os diversos aspectos da China moderna. 
Por que a reproduzo agora?
Porque acabo de preparar um depoimento (que vou revelar mais adiante), solicitado pelo diretor do Centro de Estudos Brasileiros do Instituto da América Latina da Academia Chinesa de Ciências Sociais, Zhou Zhiwei, sobre minhas interações com a China, e esta postagem foi a primeira dessa série, infelizmente não realizada em seu projeto e formato original, mas inserida num conjunto de centenas de postagens que efetuei naquele blog provisório, e neste mais permanente. O projeto original vai também reproduzido mais abaixo.
Paulo Roberto de Almeida
Brasília, 28 de junho de 2019

THURSDAY, NOVEMBER 12, 2009

78) Carta de Shanghai, 1: O que eu sei sobre a China?

Carta de Shanghai, 1:
O que eu sei sobre a China?; e o que pretendo aprender…
Paulo Roberto de Almeida
(www.pralmeida.org; pralmeida@mac.com)
(escrito em vôo: Brasília-São Paulo, 4.11.2009)

http://shangaiexpress.blogspot.com/2009/11/78-carta-de-shanghai-1-o-que-eu-sei.html

O que eu sei sobre a China? Muito pouco, sem dúvida, mas tenho a intenção de aprender bastante, no curso dos próximos meses (e talvez anos).
Decidi aceitar uma missão temporária na China, mais precisamente em Shanghai, onde vou assumir a direção do pavilhão do Brasil na Exposição Universal que ali se realizará de maio a outubro de 2010. Trata-se de um novo e importante (e interessante) desafio em minha carreira profissional, tanto pelo trabalho em si, quanto pelo país, obviamente, o de maior projeção internacional na atualidade, pelas suas promessas de crescimento e de ascensão na escala mundial de poder e prestígio.

Por que aceitei a missão? Em primeiro lugar porque fui para tal autorizado pela minha caríssima, diletíssima e queridíssima esposa – desculpem o excesso de “íssimas”, mas cabem a ela – Carmen Lícia, que teria a última palavra em qualquer decisão nesse sentido: ou seja, se ela se opusesse à idéia, eu simplesmente não aceitaria o encargo, mesmo estando nele interessado e decidido a aceitar preventivamente. Parto do princípio de que a família passa na frente da carreira, ou das decisões profissionais, embora toda decisão, ou escolha, nesse âmbito sempre é difícil, tendo em conta as inúmeras variáveis em consideração. Uma vez recebido o convite, ou a oferta, procurei informar-me suficientemente sobre o país e sobre a natureza do trabalho, antes de apresentar tal oferta a Carmen Lícia. Para minha surpresa, e alívio, ela aceitou imediata e entusiasticamente, sem nenhuma objeção de princípio, o que me deixou muito contente, pois temia alguma hesitação ao projeto, pelo seu caráter provisório, ou pelas características do país. Eu lhe sou grato por isso, e creio que ela retirará, inclusive, bem maior proveito desta missão, do que eu, que terei de me desempenhar na representação burocrática e nos afazeres oficiais.
Bem, considerações pessoais à parte, vejamos o que me atraiu no convite e na perspectiva da missão. Porque se trata, em primeiro lugar, de um bom desafio intelectual, já que a China constitui, provavelmente, o país mais curioso, misterioso e fascinante da atualidade (ou talvez tenha o sido desde a mais remota antiguidade, pelo menos da perspectiva dos nossos olhos, ocidentais). Também porque se trata, como expressamente esclarecido, de uma designação temporária, sete ou oito meses no máximo, o suficiente para tentar conhecer a China – ou obter alguma compreensão um pouco mais ampla, e talvez uma idéia um pouco mais precisa – sobre o que ela representa para a economia mundial e sobre o seu futuro papel na política mundial. Ou seja, estarei de volta antes de ter tido tempo suficiente para aprender o mandarim.
Sobre a língua, de fato, se trata de um obstáculo relativo, mas menos do que se pensa e menos do que parece. Mas, aparentemente, não terei tempo para aprendê-la de maneira suficientemente satisfatória, tendo em vista minhas outras obrigações profissionais e emprego do tempo. Não que eu repugne aprender a língua oficial e veicular da China, mas é que também pretendo me concentrar em tantas outras coisas que, creio, não poderei alocar tempo suficiente para aprendê-la, tarefa que deleguei, em parte, a Carmen Lícia, esta inteligentíssima esposa que me acompanhará o tempo todo.

Mas, voltemos ao tema desta primeira “carta de Shanghai”: o que eu sei sobre a China e o que pretendo aprender durante minha curta estada na grande nação asiática? Em duas breves expressões: muito pouco, e tudo o que for possível aprender no curto espaço de seis ou sete meses (mas já estou aprendendo antes, desde agora, de forma sistemática). Paradoxalmente, já que pretendo aprender muito sobre a China, por que não dedicar-me mais intensamente ao estudo do mandarim, que seria instrumental para o meu objetivo principal? Bem, minha explicação seria puramente racional e tem a ver justamente com a insuficiência de tempo para fazer tudo o que seria humanamente possível de fazer em relação a um conhecimento mais aprofundado da China.
Minha área básica de trabalho é a economia mundial, o desenvolvimento econômico, as instituições políticas, os problemas da paz e da guerra em um mundo ainda em transição para uma ordem menos anárquica do que aquele que vivemos em grande parte do século 20 (e que ainda está conosco residualmente). Ora, a maior parte da literatura nesses campos está em inglês ou em outras línguas ocidentais, ainda que não se possa descurar a (presumível e esperada) produção própria da China, geralmente acadêmica, que é crescente e da maior qualidade (segundo leio em artigos especializados), à medida que o país já abandonou as misérias intelectuais do maoísmo delirante e se abre à globalização, inclusive científica. Possivelmente, também, todos os meus interlocutores chineses nas matérias e áreas por mim selecionadas falarão ou entenderão inglês, e com eles poderei interagir o suficiente para me informar e dialogar sobre o país e seu papel na economia e na política mundiais.
De toda forma, aprender mandarim seria importante se eu me dedicasse ao aprendizado de aspectos diversos da cultura chinesa, sua literatura, folclore, costumes e tradições, o que também procurarei fazer na medida do possível. Mas o cálculo é simples: o tempo empenhado no estudo da língua – seus fonemas e ideogramas – seria retirado de esforço equivalente no estudo e conhecimento de áreas de meu interesse primordial, o que poderei fazer em inglês, inclusive para interagir com o público at large. Dessa forma, estou decidido a concentrar-me na China da globalização, não na China da tradição, de suas aldeias e costumes ancestrais. Talvez seja um erro, do qual eu venha a me arrepender no mesmo momento, e pode parecer uma decisão mal avisada; na vida, contudo, sempre temos de fazer escolhas difíceis entre objetivos conflitantes. Por outro lado, não deixarei de aproveitar-me dos conhecimentos sobre o povo, seus hábitos e outras características que o domínio sobre a língua que Carmen Lícia pretende adquirir nos permitirá (o que, aliás, ela já vem fazendo preventivamente).

Pois bem, retomando o título desta minha primeira “carta de Shanghai” – não pretendo usar a forma brasileira Xangai – o que, de verdade, eu conheço sobre a China? Para ser claro, muito pouco, apenas o que consegui aprender, rápida e superficialmente, nos artigos de jornais e revistas – tipo Economist, Financial Times, New York Times, Foreign Policy e Foreign Affairs – ademais de boletins e estudos de organismos internacionais e think tanks americanos e europeus. Ou seja: um conhecimento basicamente ocidental e focado na economia e nas relações internacionais, o que é, obviamente, uma parte muito pequena das realidades chinesas. Também já li alguma coisa nos livros de história e de política internacional, no se refere à China, materiais que estou agora devorando com uma ênfase particular naqueles temas de meu interesse. Em recente viagem à Europa adquiri um bom guia – Lonely Planet, que recomendo – e diversos livros sobre a China. Graças a Carmen Lícia, acabo de ler a Historia Mongalorum – Storia dei Mongoli, ou Tartari (1247) – do franciscano Giovanni dei Pian di Carpine, o primeiro ocidental a ter visitado a China, entre Gengis Khan e Kublai Khan, numa missão (diplomática, mas também de espionagem militar) a serviço do papa Inocêncio IV.
Preparando-me para a minha missão (puramente diplomática, mas certamente, também, de espionagem intelectual), criei um blog, Shanghai Express, no qual estou “depositando” tudo o que eu encontro de interessante sobre a China naquelas áreas de meu interesse específico. Nada de muito planejado ou organizado: apenas uma plataforma eletrônica de apoio a minhas leituras e para a coleta e disponibilização de todo tipo de dado sobre os “meus tártaros”. Tenho grandes expectativas a essa missão transitória, além e acima do mero encargo burocrático de representação do Brasil durante a Shanghai Expo.
Gostaria de ter a oportunidade de viajar pelo país e adjacências, o que farei na medida do possível. Pretendo entrar em contato com acadêmicos, funcionários do governo e cidadãos comuns, capitalistas ou trabalhadores, para interagir em função de meus objetivos de conhecimento aprofundado e de compreensão do papel da China no contexto internacional. Ou seja, pretendo aprender muito e, conscientemente, tentar disseminar um pouco do que eu conseguir aprender para um público mais vasto, especialmente no Brasil, que continua a ser a base principal de meu trabalho intelectual.
De fato, nunca fui um “orientalista” e muito menos um “asiatista” ou sinólogo; ao contrário, sempre fui um “brasilianista”, obsessivamente preocupado com os problemas do desenvolvimento brasileiro. Pois bem, chegou a hora de me ocupar agora de um país distante, mas muito presente, quase desconhecido para a maior parte dos ocidentais, mas tremendamente importante para o mundo e para o Brasil, nessa ordem. Espero estar à altura do desafio, não exatamente o de representar o Brasil na Expo – pois isso é o mínimo que se poderia esperar de um profissional – mas do gigantesco desafio que representa aprender o máximo possível sobre a China e a sua vasta região, de fato “apreender” exatamente qual é o seu papel no mundo de hoje, na economia do futuro, e depois ser capaz de transmitir tudo (ou pelo menos um pouco) do que consegui aprender a meus eventuais leitores e colegas de academia e de profissão.

A China é, em si e por si, mais do que um continente inteiro, um vasto mundo, o país do momento e também a nação do futuro, o imediato e o previsível. Desejo aprender, compreender, traduzir e transmitir algo de meus novos e projetados conhecimentos; creio, aliás, que Lao Tsé, Confúcio e outros distinguidos pensadores chineses se encaixariam bem na minha coleção de “clássicos revisitados”, dos quais já “extraí” um Manifesto Comunista na era da globalização, um Moderno Príncipe (que Maquiavel talvez apreciasse) e um De la Démocratie au Brésil, que precisou mobilizar novamente os dotes de viajante de Tocqueville. Não tenho certeza de que, no plano puramente político, a China tenha mudado muito desde os tempos de frei Giovanni, no século 13. Mas ela certamente se transformou enormemente nos últimos trinta anos, e está transformando a região e o mundo. Espero testemunhar um pouco sobre esse seu papel revolucionário no contexto das relações internacionais e da geoeconomia mundial. Veremos o que resulta desta aventura intelectual e deste empreendimento de sinologia aplicada.

Brasília-São Paulo, 4 novembro 2009.

SUNDAY, NOVEMBER 22, 2009

104) Cartas de Shanghai: esquema redacional

Cartas de Shanghai, Planejamento Editorial
Paulo Roberto de Almeida
(o que eu poderei, ou não, escrever nos meses à frente)

http://shangaiexpress.blogspot.com/2009/11/104.html

1. A China: o território, o país, características básicas no plano geográfico
2. A China: sociedade, povos, cultura, diversidade e unidade das civilizações locais
3. Desenvolvimento histórico da sociedade chinesa: império e cultura milenares
4. Desenvolvimento histórico da sociedade e da economia chinesa: grandes tendências
5. Ordem política e instituições: uma longa história de centralização e despotismo
6. Economia: da maior economia mundial à decadência e à recuperação atual
7. Economia: desenvolvimentos desde as reformas da era Deng Xiaoping
8. Economia: perspectivas da China na economia mundial
9. Equilíbrios geopolíticos e questões de defesa e de segurança
10. Desenvolvimentos nos campos científico e tecnológico
11. Aspectos de sua literatura e cultura: breve síntese contemporânea
12. A China no mundo: do centro do universo à interdependência soberana
13. Relações com os Estados Unidos: osmose necessária e contraditória
14. Relações com o Brasil: considerações no plano econômico e diplomático
15. O que o Brasil pode aprender com a China; o que a China espera do Brasil

Esquema tentativo: 30.10.2009