O que é este blog?

Este blog trata basicamente de ideias, se possível inteligentes, para pessoas inteligentes. Ele também se ocupa de ideias aplicadas à política, em especial à política econômica. Ele constitui uma tentativa de manter um pensamento crítico e independente sobre livros, sobre questões culturais em geral, focando numa discussão bem informada sobre temas de relações internacionais e de política externa do Brasil. Para meus livros e ensaios ver o website: www.pralmeida.org. Para a maior parte de meus textos, ver minha página na plataforma Academia.edu, link: https://itamaraty.academia.edu/PauloRobertodeAlmeida.

quarta-feira, 28 de dezembro de 2011

Grandes corporacoes: para o bem e para o mal - Economist


The East India Company

The Company that ruled the waves

As state-backed firms once again become forces in global business, we ask what they can learn from the greatest of them all

A POPULAR parlour game among historians is debating when the modern world began. Was it when Johannes Gutenberg invented the printing press, in 1440? Or when Christopher Columbus discovered America, in 1492? Or when Martin Luther published his 95 theses, in 1517? All popular choices. But there is a strong case to be made for a less conventional answer: the modern world began on a freezing New Year’s Eve, in 1600, when Elizabeth I granted a company of 218 merchants a monopoly of trade to the east of the Cape of Good Hope.
The East India Company foreshadowed the modern world in all sorts of striking ways. It was one of the first companies to offer limited liability to its shareholders. It laid the foundations of the British empire. It spawned Company Man. And—particularly relevant at the moment—it was the first state-backed company to make its mark on the world.
Twenty years ago, as the state abandoned the commanding heights of the economy in the name of privatisation and deregulation, it looked as if these public-private hybrids were doomed. Today they are flourishing in the emerging world’s dynamic economies and striding out onto the global stage.
State-controlled companies account for 80% of the market capitalisation of the Chinese stockmarket, more than 60% of Russia’s, and 35% of Brazil’s. They make up 19 of the world’s 100 biggest multinational companies and 28 of the top 100 among emerging markets. World-class state companies can be found in almost every industry. China Mobile serves 600m customers. Saudi Arabia’s SABIC is one of the world’s most profitable chemical companies. Emirates airlines is growing at 20% a year. Thirteen of the world’s biggest oil companies are state-controlled. So is the world’s biggest natural-gas company, Gazprom.
State-owned companies will continue to thrive. The emerging markets that they prosper in are expected to grow at 5.5% a year compared with the rich world’s 1.6%, and the model is increasingly popular. The Chinese and Russian governments are leading a fashion for using the state’s power to produce national champions in a growing range of “strategic” industries.
The parallels between the East India Company and today’s state-owned firms are not exact, to be sure. The East India Company controlled a standing army of some 200,000 men, more than most European states. None of today’s state-owned companies has yet gone this far, though the China National Offshore Oil Corporation (CNOOC) has employed former People’s Liberation Army troops to protect oil wells in Sudan. The British government did not own shares in the Company (though prominent courtiers and politicians certainly did). Today’s state-capitalist governments hold huge blocks of shares in their favourite companies.
Otherwise the similarities are striking. Both the Company and its modern descendants serve two masters, keeping one eye on their share price and the other on their political patrons. Many of today’s state-owned companies are monopolies or quasi-monopolies: Brazil’s Petrobras, China Mobile, China State Construction Engineering Corporation and Mexico’s Federal Electricity Commission, to name but a few of the mongrel giants that bestride the business world these days. Many are enthusiastic globalisers, venturing abroad partly as moneymaking organisations and partly as quasi-official agents of their home governments. Many are keen not only on getting their government to provide them with soft loans and diplomatic muscle but also on building infrastructure—roads, hospitals and schools—in return for guaranteed access to raw materials. Although the East India Company flourished a very long time ago, in a very different world, its growth, longevity and demise have lessons for those who run today’s state companies and debate their future, lessons about the benefits of linking a company’s interests to a nation’s and the dangers of doing so.
The gifts of government
One of the benefits the Company derived from its relations with the state was limited liability. Before the rise of state-backed companies, businesses had imposed unlimited liability on their investors. If things went wrong, creditors could come after them for everything they possessed, down to their cufflinks, and have them imprisoned if they failed to pay. Some firms had already been granted limited liability, and the Company’s officers persuaded Queen Elizabeth that it should be given this handy status too.
A second benefit of state backing was monopoly. In the 17th century, round-the-world voyages were rather like space missions today. They involved huge upfront costs and huge risks. Monopoly provided at least a modicum of security. The third benefit was military might. The Company’s Dutch and Portuguese competitors could all call on the power of their respective navies. The English needed to do likewise in order to unlock investors’ purses.
Still, getting into bed with the government was risky for the Company. It meant getting close to courtiers who wanted to extract revenue from it and exposing itself to politicians who wanted to rewrite its charter. The Whig revolutionaries who deposed James II in 1688 briefly promoted a competing outfit that the Company first fought and eventually absorbed. Rival merchants lobbied courtiers to undermine its monopoly. But for the most part it dealt with these political problems brilliantly. Indeed its most valuable skill—its “core competence” in the phrase beloved of management theorists—was less its ability to arrange long-distance voyages to India and beyond than its ability to manage the politicians back home.
The Company created a powerful East India lobby in Parliament, a caucus of MPs who had either directly or indirectly profited from its business and who constituted, in Edmund Burke’s opinion, one of the most united and formidable forces in British politics. It also made regular gifts to the Court: “All who could help or hurt at Court,” wrote Lord Macaulay, “ministers, mistresses, priests, were kept in good humour by presents of shawls and silks, birds’ nests and attar of roses, bulses of diamonds and bags of guineas.” It also made timely gifts to the Treasury whenever the state faced bankruptcy. In short, it acted as what George Dempster, a stockholder, called a “great money engine of state”.
The Company was just as adept at playing politics abroad. It distributed bribes liberally: the merchants offered to provide an English virgin for the Sultan of Achin’s harem, for example, before James I intervened. And where it could not bribe it bullied, using soldiers paid for by Indian taxes to duff up recalcitrant rulers. Yet it recognised that its most powerful bargaining chip, both home and abroad, was its ability to provide temporarily embarrassed rulers with the money they needed to pay their bills. In an era when governments lacked the resources of the modern tax-and-spend state, the state-backed company was a backstop against bankruptcy.
State-backed monopolies are apt to run to fat and lose their animal spirits. The Company was a model of economy and austerity that modern managers would do well to emulate. For the first 20 years of its life it operated out of the home of its governor, Sir Thomas Smythe. Even when it had become the world’s greatest commercial operation it remained remarkably lean. It ruled millions of people from a tiny headquarters, staffed by 159 in 1785 and 241 in 1813. Its managers reiterated the importance of frugality, economy and simplicity with a metronomic frequency, and imposed periodic bouts of austerity: in 1816, for example, they turned Saturday from a half to a full working day and abolished the staff’s annual turtle feast.
The Company’s success in preserving its animal spirits owed more to necessity than to cunning. In a world in which letters could take two years to travel to and fro and in which the minions knew infinitely more about what was going on than did their masters, efforts at micromanagement were largely futile.
Adam Smith denounced the Company as a bloodstained monopoly: “burdensome”, “useless” and responsible for grotesque massacres in Bengal
The Company improvised a version of what Tom Peters, a management guru, has dubbed “tight-loose management”. It forced its employees to post a large bond in case they went off the rails, and bombarded them with detailed instructions about things like the precise stiffness of packaging. But it also leavened control with freedom. Employees were allowed not only to choose how to fulfil their orders, but also to trade on their own account. This ensured that the Company was not one but two organisations: a hierarchy with its centre of gravity in London and a franchise of independent entrepreneurs with innumerable centres of gravity scattered across the east. Many Company men did extremely well out of this “tight-loose” arrangement, turning themselves into nabobs, as the new rich of the era were called, and scattering McMansions across rural England.
Money and meritocracy
The Company repaid the state not just in taxes and tariffs, but also in ideas. It was one of the 18th and 19th centuries’ great innovators in the art of governing—more innovative by some way than the British government, not to mention its continental rivals, and outgunned only by the former colonies of America. The Company pioneered the art of government by writing and government by record, to paraphrase Burke. Its dispatches to and from India for the 15 years after 1814 fill 12,414 leather-bound volumes. It created Britain’s largest cadre of civil servants, a term it invented.
State-backed enterprises risk getting stuffed with powerful politicians’ half-witted nephews. The Company not only avoided this but also, in an age when power and money were both largely inherited, it pioneered appointment by merit. It offered positions to all-comers on the basis of exam performance. It recruited some of the country’s leading intellectuals, such as Edward Strachey, Thomas Love Peacock and both James and John Stuart Mill—the latter starting, at the age of 17, in the department that corresponded with the central administration in India, and rising, as his father had, to head it, on the eve of the Company’s extinction.
The Company also established a feeder college—Haileybury—so that it could recruit bright schoolboys and train them to flourish in, and run, India. These high-minded civil servants both prolonged the Company’s life when Victorian opinion was turning ever more strongly against it and also provided a model for the Indian and domestic civil service.
The Company liked to think of itself as having the best of both private and public worlds—the excitement and rewards of commercial life, on the one hand, and the dignity and security of an arm of the state on the other. But the best of both worlds can easily turn into the worst.
The perils of imperialisation
In the end, it was not rapacious politicians who killed the Company, but the greed and power of its managers and shareholders. In 1757 Sir Robert Clive won the battle of Plassey and delivered the government of Bengal to the Company. This produced a guaranteed income from Bengal’s taxpayers, but it also dragged the Company ever deeper into the business of government. The Company continued to flourish as a commercial enterprise in China and the Far East. But its overall character was increasingly determined by its administrative obligations in India. Revenue replaced commerce as the Company’s first concern. Tax rolls replaced business ledgers. Arsenals replaced warehouses. C.N. Parkinson summarised how far it had strayed, by 1800, from its commercial purpose: “How was the East India Company controlled? By the government. What was its object? To collect taxes. How was its object attained? By means of a standing army. What were its employees? Soldiers, mostly; the rest, Civil Servants.”
Sir Robert Clive with wife, daughter and local help
The Company’s growing involvement in politics infuriated its mighty army of critics still further. How could it justify having a monopoly of trade as well as the right to tax the citizens of India? And how could a commercial organisation justify ruling 90m Indians, controlling 70m acres (243,000 square kilometres) of land, issuing its own coins, complete with the Company crest, and supporting an army of 200,000 men, all of which the East India Company did by 1800? Adam Smith denounced the Company as a bloodstained monopoly: “burdensome”, “useless” and responsible for grotesque massacres in Bengal. Anti-Company opinion hardened further in 1770 when a famine wiped out a third of the population of Bengal, reducing local productivity, depressing the Company’s business and eventually forcing it to go cap in hand to the British government to avoid bankruptcy.
The government subjected the Company to ever-tighter supervision, partly because it resented bailing it out, partly because it was troubled by the argument that a company had no business in running a continent. Supervision inexorably led to regulation and regulation to nationalisation (or imperialisation). In 1784 the government established a board to direct the Company’s directors. In 1813 it removed its monopoly of trade with India. In 1833 it removed its monopoly of trade with China and banned it from trading in India entirely. In 1858, the year after the Indian mutiny vindicated the Company’s critics, the government took over all administrative duties in India. The Company’s headquarters in London, East India House, was demolished in 1862. It paid its last dividend in 1873 and was finally put out of its misery in 1874. Thus an organisation that had been given life by the state was eventually extinguished by it.
A dangerous connection
Ever since its ignominious collapse the Company has been treated as an historical curiosity—an “anomaly without a parallel in the history of the world”, as one commentator put it in 1858, a push-me pull-you the like of which the world would never see again. But these days similarly strange creatures are popping up everywhere. The East India Company is being transformed from an historical curiosity into a highly relevant case study.
The Company’s history shows that liberals may be far too pessimistic (if that is the right word) about the ability of state monopolies to remain healthy. The Company lasted for far longer than most private companies precisely because it had two patrons to choose from—prospering from trade in good times and turning to the government for help in bad ones. It also showed that it is quite possible to rely on the government for support while at the same time remaining relatively lean and inventive.
But the Company’s history also shows that mercantilists may be far too optimistic about state companies’ ability to avoid being corrupted by politics. The merchants who ran the East India Company repeatedly emphasised that they had no intention of ruling India. They were men of business who only dabbled in politics out of necessity. Nevertheless, as rival state companies tried to muscle in on their business and local princelings turned out to be either incompetent or recalcitrant, they ended up taking huge swathes of the emerging world under their direct control, all in the name of commerce.
The Chinese state-owned companies that are causing such a stir everywhere from the Hong Kong Stock Exchange (where they account for some of the biggest recent flotations) to the dodgiest parts of Sudan (where they are some of the few business organisations brave enough to tread) are no different from their East Indian forebears. They say that they are only in business for the sake of business. They dismiss their political connections as a mere bagatelle. The history of the East India Company suggests that it won’t work out that way.

Sun Tzu e a arte chinesa de conquistar o mundo - The Economist

Aproveito a deixa do artigo abaixo, da Economist, para pequena propaganda sobre um artigo meu inspirado em Sun Tzu:
1023. “Formação de uma estratégia diplomática: relendo Sun Tzu para fins menos belicosos”, Espaço Acadêmico (ano 10, n. 118, março 2011, p. 155-161; ISSN: 1519-6186; link: http://www.periodicos.uem.br/ojs/index.php/EspacoAcademico/article/view/12696/6714). Republicado em Mundorama (7/03/2011; link: http://mundorama.net/2011/03/07/formacao-de-uma-estrategia-diplomatica-relendo-sun-tzu-para-fins-menos-belicosos-por-paulo-roberto-de-almeida/). Relação de Originais n. 2251.

China abroad

Sun Tzu and the art of soft power

China is using a new tool to boost its influence abroad. Is it the right one?

IN HUIMIN COUNTY in the Yellow River delta, a push by China to build up the nation’s global allure has fired the enthusiasm of local officials. Young men and women dressed in ancient military costumes goosestep across a rain-soaked open-air stage. Their performance is in homage to the 6th-century-BC strategist, Sun Tzu, author of pithy aphorisms beloved of management gurus worldwide. Local cadres sitting on plastic chairs stoically endure the sodden spectacle.
Huimin county regards itself as the birthplace of Sun Tzu and thus the fountainhead of an ancient wisdom which, officials believe, can help persuade the world of China’s attractiveness. The damp display marks Sun Tzu’s supposed birthday. Organisers try to whip up enthusiasm with fireworks and a massive digital screen flashing images of the bearded sage and his one slim work, the “Art of War”, a 6,000-word booklet. Under an awning, journalists from the Communist Party’s newspaper, the People’s Daily, feed live video of the event onto their website. The world gets to see it, even if most locals have stayed at home.
At a local hotel, a Sun Tzu symposium is held. Colonel Liu Chunzhi of China’s National Defence University (also a leader of the China Research Society of Sun Tzu’s Art of War) told this year’s gathering that Sun Tzu was part of “the riches of the people of the world”. Promotion of his work, he said, was “an important step toward the strengthening of China’s soft power”. Sun Tzu may have written about stratagems for warfare, but Huimin’s assembled scholars prefer to tout him as a peacenik. Their evidence is one of the sage’s best-known insights: “The skilful leader subdues the enemy’s troops without any fighting.” What better proof, say his fans in China, that the country has always loved peace?
Chinese leaders, determined to persuade America that they mean no harm, have recruited Sun Tzu to their cause. In 2006 President Hu Jintao gave President George Bush silk copies of the “Art of War” in English and Chinese (not, it seemed, as a way of suggesting better ways of fighting in Afghanistan and Iraq, but of hinting that the wars need not have been fought in the first place). Jia Qinglin, the fourth-ranking member of the party’s supreme body, the Politburo Standing Committee, said in 2009 that Sun Tzu should be used to promote “lasting peace and common prosperity”. In July this year, Beijing’s Renmin University presented an “Art of War” to Admiral Michael Mullen, the chairman of America’s joint chiefs of staff, during a visit to the capital.
China has long been proud of Sun Tzu. Mao Zedong was a great fan, even sending aides into enemy territory during the civil war to find a copy of the “Art of War”. But it is only relatively recently that the party has seized upon the notion of building up soft power, a term coined 20 years ago by an American, Joseph Nye of Harvard University, a former chairman of America’s National Intelligence Council and senior Pentagon official, to describe “the ability to get what you want through attraction rather than coercion or payments”. President Hu’s use of it in 2007 signalled a shift in party thinking. Throughout the 1990s and into this century, China had been trumpeting Deng Xiaoping’s slogan of “economic construction as the core”. Over the past decade building soft power has emerged as a new party priority.
Mr Nye himself drew a link between soft power and Sun Tzu in a 2008 book, “The Powers to Lead”. Sun Tzu, he said, had concluded that “the highest excellence is never having to fight because the commencement of battle signifies a political failure”. To be a “smart” warrior, said Mr Nye, one had to understand “the soft power of attraction as well as the hard power of coercion”.
Mr Hu may have been slow to adopt Mr Nye’s term openly, but soon after he took office in 2002 he began trying to make China a more attractive brand. In June 2003 a small group of senior propaganda officials and foreign-policy experts met in Beijing for the first time to discuss the importance of soft power. Later that year officials began touting a new term, “peaceful rise”, to describe China’s development. Their message was that China would be an exception to the pattern of history whereby rising big powers conflict with established ones. Within months of the slogan’s launch, officials decided to amend it. Even the word “rise”, they worried, sounded too menacing. The term was changed to “peaceful development”. Mr Hu also adopted the word “harmonious”, sprinkling speeches with references to China’s pursuit of a “harmonious world” and a “harmonious society”.
From Little Red Books to little red boots
The results have been mixed. With rich countries on the skids, China’s economic model is looking good. Development driven by the state as well as the market seems to be delivering dividends, and China’s success has helped popularise the idea that state-owned companies should have a large role in economies. Businesspeople around the world admire the efficiency of both the public and private sector in China. Chinese investment in African countries is giving the continent a welcome boost. Yet the economic model is inseparable from the political model; and, as the Arab spring has shown, authoritarianism has little appeal in the West or anywhere else. China’s hard power, in terms of cash, is certainly increasing; but its careless use of that power has not attracted admiration. Its truculent behaviour at the Copenhagen climate-change conference in 2009, its quarrels with Japan over fishing rights in 2010 and its more assertive behaviour recently in the South China Sea have created deep unease about the nature of its evolving power, not least among neighbours that once saw China’s rise as largely benign. Such concerns have been compounded by its persistent efforts internally to suppress dissent, control the internet and stifle the growth of civil society.
This is not how the party sees it. After a meeting in October this year, the party’s Central Committee declared that the soft-power drive had made “conspicuous gains”. But it said further efforts were urgently needed. Many Chinese would agree. The word “harmonise” is now widely used ironically by ordinary Chinese to mean suppressing dissent. Abroad, officials have been trying to win over Western audiences by pouring billions of dollars into the creation of global media giants to rival the soft power of brands such as CNN and the New York Times. A provincial propaganda official complained in January that America, with only 5% of the world’s population, “controlled” about 75% of its television programmes. “Combined with the influence of brands and products such as Hollywood, Kentucky Fried Chicken, McDonald’s, jeans and Coca-Cola, American culture has permeated almost the entire world,” he wrote.
China is hamstrung by a contemporary culture that has little global appeal. Its music has few fans abroad; indeed, China’s own youth tend to prefer musicians from Hong Kong, Taiwan, Singapore and America. Its political ideology has few adherents: Mao Zedong and his little red book no longer enjoy the cachet they did in Western counterculture during the 1960s. The goosestep of the Sun Tzu soldiers in Huimin county notwithstanding, officials are now well aware that to market China abroad they must avoid references to authoritarianism. The party and its ideology were barely hinted at in the pageantry of the opening ceremony of the Olympic games in Beijing in 2008. Since the present is a hard sell, China is having to lean heavily on the distant past.
The party has not bought into Mr Nye’s view that soft power springs largely from individuals, the private sector and civil society. So the government has taken the lead in promoting ancient cultural icons whom it thinks might have global appeal. Even here it has limited options. Buddhism, which is anyway a foreign import, has been cornered by the Dalai Lama. Both it and Taoism, a native religion, sit uncomfortably with an atheistic party doctrine. This leaves only a handful of figures to choose from.
At the forefront is Confucius. Few Westerners can quote a saying of Confucius. But most at least regard him as a bearded, wise dispenser of aphorisms, far more profound than America’s superficial consumerism. The party is promoting him as a kind of Father Christmas without the undignified jolliness; a sage whose role in the development of centuries of Chinese authoritarianism the party glosses over in favour of his philosophy’s pleasant-sounding mantras: benevolence, righteousness and (of importance to Mr Hu) harmony. So it was that China used Confucius’s name to brand the language-training institutes it began setting up abroad in 2004. There are now more than 300 Confucius Institutes worldwide, about a quarter of them in America.
But Confucius is problematic. Mao and his colleagues regarded Confucius’s philosophy as the ideological glue of the feudal system they destroyed; and so attempts to promote him are vulnerable to the growing split in the Communist Party. In January, with great fanfare, the National History Museum unveiled a bronze statue of him standing 9.5 metres (31 feet) high in front of its entrance by Tiananmen Square. Three months later the statue was quietly removed. The sage’s appearance so close to the most hallowed ground of Chinese communism had outraged hardliners. They saw it as an affront to Mao, whose giant portrait hung diagonally opposite.
Sun Tzu is not so tainted. His is the only big name among China’s ancient thinkers to have survived the communist era with barely a scratch. In the 1970s he was held up as an exemplar in Mao’s struggles against leaders he disliked. The study of Sun Tzu, said a typical tract published in 1975, offered useful guidance for “criticism of the rightist opportunist military line” and the “reactionary views of the Confucianists”. The party still keeps Confucius at the forefront of its soft-power drive, but Sun Tzu is making headway.
That’s partly because the West’s enthusiasm for Sun Tzu makes him an easy sell. The “Art of War” is widely used by after-dinner speakers short of ideas. Take, for example (from the 1910 translation by Lionel Giles, the first authoritative one in English): “The best thing of all is to take the enemy’s country whole and intact; to shatter and destroy it is not so good”; “all warfare is based on deception”; and “it is the business of the general to be still and inscrutable, to be upright and impartial”. Sun Tzu beat the Christmas-cracker industry by two –and-a-half millennia.
In the West Sun Tzu’s advice has been adapted for almost every aspect of human interaction from the boardroom to the bedroom. The publishing industry feeds on Sun Tzu spin-offs, churning out motivational works such as “Sun Tzu For Success: How to Use the Art of War to Master Challenges and Accomplish the Important Goals in Your Life” (by Gerald Michaelson and Steven Michaelson, 2003), management advice such as “Sun Tzu for Women: The Art of War for Winning in Business” (Becky Sheetz-Runkle, 2011) and sporting tips such as “Golf and the Art of War: How the Timeless Strategies of Sun Tzu Can Transform Your Game” (Don Wade, 2006). Amazon offers 1,500 titles in paperback alone. Paris Hilton, an American celebrity and author of an aphorism of her own: “Dress cute wherever you go, life is too short to blend in”, has been seen dipping into him (see picture).
The sage’s popularity in the West still owes more to Hollywood than China’s own efforts
Rather more seriously, in his recent book, “On China”, Henry Kissinger revealed how impressed he was by the ancient strategic wisdom Chinese officials seemed to draw upon when he visited the country in the 1970s as America’s national security adviser. Mao, he noted, “owed more to Sun Tzu than to Lenin” in his pursuit of foreign policy. To some historians Mao was a dangerously erratic despot. To Mr Kissinger, he was “enough of a Sun Tzu disciple to pursue seemingly contradictory strategies simultaneously”. Whereas Westerners prized heroism displayed when forces clashed, “the Chinese ideal stressed subtlety, indirection and the patient accumulation of relative advantage”, Mr Kissinger enthused in a chapter on “Chinese Realpolitik and Sun Tzu’s Art of War”. Praise indeed, from the West’s pre-eminent practitioner of Realpolitik, whose mastery of the art of ideology-free diplomacy enabled President Nixon’s visit to China in 1972.
Yet a closer look reveals Sun Tzu’s flaws as a tool of soft power. Chinese attempts to remould him as a man of peace stumble over the fact that his book is a guide to winning wars, avidly studied by America’s armed forces as it was by Mao. Sam Crane of Williams College in Massachusetts says that during the Abu Ghraib prison scandal in Iraq he delighted in telling students attending his Sun Tzu classes (some of whom were preparing to join the army) that the “Art of War” advised that prisoners be treated kindly. But, he says, “I think the thing that makes [the book] universal in a grim way is war and competition. War is not a Western construct: the Chinese have been really good at war for a long time.”
American strategists often read the “Art of War” to understand China not as an alluring and persuasive wielder of soft power, but as a potential enemy. A psychological operations officer in America’s Army Central Command, Major Richard Davenport, argued in the Armed Forces Journal in 2009 that China was making use of Sun Tzu’s advice to wage cyber warfare against America. The incriminating quotation was “Supreme importance in war is to attack the enemy’s strategy”.
The sage’s popularity in the West still owes more to Hollywood, source of much American soft power, than China’s own efforts. John Minford, whose translation was published in 2002, says that after Gordon Gekko, a villainous corporate raider played by Michael Douglas in the film “Wall Street”, quoted a line from Sun Tzu (“Every battle is won before it’s ever fought”), the book acquired a “mystique” among students of entrepreneurship.
Professor Minford says he is mystified by this. “I had to struggle with the book at the coal face, with the actual Chinese, and it’s a very peculiar and particularly unpleasant little book which is extremely disorganised, made up of a series of probably very corrupt bits of text, which is very repetitive and has extremely little to say.” He calls the work (whose authorship is even disputed) “basically a little fascist handbook on how to use plausible ideas in order to totally destroy your fellow man”.
Some Chinese say openly that using ancient culture to promote soft power is a bad idea. Pang Zhongying of Renmin University says it does not help the country boost its standing abroad. Instead, says Mr Pang, a former diplomat, it highlights what he calls “a poverty of thought” in China today. “There is no Chinese model, [so] people look back to Confucius and look back to Sun Tzu.” Mr Pang argues that democracy is the best source of soft power. President Hu gives short shrift to that notion.
As Mr Nye sees it, soft power stands a better chance of success when a country’s culture includes “universal values” and its policies “promoted interests that others share”. But China’s soft-power push has coincided with an increasingly strong rejection by Chinese leaders of the very notion of universal values. Among China’s leaders, the prime minister, Wen Jiabao, has come closest to supporting the universalists’ view, but his is a lone voice.
At least in Huimin, Mr Wen appears to enjoy some support. The title last year of the county’s annual Sun Tzu symposium was “Universal values in Sun Tzu’s Art of War and [the work’s] use in non-military realms”. But local officials are more preoccupied with revving up the economy of Huimin, whose dreary main street enjoys a burst of colour from the frontage of a 24-hour McDonald’s. Sun Tzu is seen as a potential new engine of growth; a draw for tourists to the agricultural backwater. In 2003, at a cost of 65m yuan ($7.9m), the county opened Sun Tzu Art of War City, a vast complex of mock-imperial buildings which hosted the rain-soaked birthday celebration. Huimin’s main urban district has been renamed Sun Wu (as Sun Tzu is also called).
But the vast empty car park outside the Art of War City and its near-deserted courtyards suggest the town is struggling. It is not being helped by fierce competition with another county 100km (60 miles) away, Guangrao, which in recent years has been laying a rival claim as Sun Tzu’s birthplace. In June the county, whose tyre, petrochemical and paper-making industries have made it much richer than Huimin, held a foundation-stone ceremony for its own Sun Tzu theme park. Chinese media say this is due to open in 2013 and will cost a prodigious 1.6 billion yuan ($250m).
But Guangrao too will have a hard time turning Sun Tzu into a soft-power icon. In April about 700km (430 miles) to the south, Disney broke ground in Shanghai at the site of an amusement park that it says will feature the world’s largest Disney castle. It is due to cost 24 billion yuan and open in five years. Xinhua, a government news agency, published a commentary on its website calling such theme parks “a big platform for soft-power competition between nations”. One widely reposted blog put it more bleakly. American soft power, it said, had “conquered 5,000 years of magnificent Chinese civilisation”.
Sun Tzu had an aphorism to suit China’s predicament: “Know the enemy, know yourself and victory is never in doubt, not in a hundred battles”. If China wants to influence the world, it needs to think hard about the values it promotes at home.