Showing posts with label economic growth. Show all posts
Showing posts with label economic growth. Show all posts

China's New Role In Africa Review

China's New Role In Africa
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China's New Role In Africa ReviewChina has become an economic trading powerhouse, and its trading partners include many nations on the continent of Africa. "China's New Role in Africa" is a scholarly examination of the relationship of China and its African trading partners. Discussing in depth China's foreign relations when it comes to the continent, the importance of oil, what Africa gets in return, human rights concerns, arms trading, and what it all means for world peace, Taylor gives readers much to think about. "China's New Role in Africa" is a grand pick for those who ponder the world's foreign relations when America isn't directly involved.
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Capitalism Without Democracy: The Private Sector in Contemporary China Review

Capitalism Without Democracy: The Private Sector in Contemporary China
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Capitalism Without Democracy: The Private Sector in Contemporary China ReviewThe book refutes the prevailing modernization theory that capitalism can lead to democracy. Findings from the study of private entrepreneurs in different regions in China supports Professor Tsai's proposition that the relationship between economic liberalism and political freedom is not definitely correlated.
Putting it in a nutshell, this book has contributed to three major findings in the study of political economy in China. First, economic liberalization in China since 1976 has not resulted in the emergence of democratic regime or the decline of the authoritarian state. According to Professor Tsai, private entrepreneurs in China are not nuts about democracy and researchers cannot view private entrepreneurs as a homogeneous class because of their diverse identities, interests, and values in politics. Second, widespread apathy amongst private entrepreneurs in China towards democracy does not mean that they have an acquiescent nature. They tend to adopt different coping strategies rather than instigate virulent opposition against the regime or demand regime transition when various formal institutions constrain their business activities. The so-called "coping strategies" result in a variety of "adaptive informal institutions" being established in different economic regions in China. Based on hundreds of in-depth interviews and nationwide survey of private entrepreneurs, Professor Tsai divides them into five key types; namely Wenzhou model, Sunan model, Zhujiang model, state-dominated model, and Limited development model. For instance, private entrepreneurs in Wenzhou engaged in a variety of innovative financing practices to set up and expand their businesses which were outside of the state banking system. Private entrepreneurs in Guangdong province sought to establish fake foreign enterprises in order to enjoy policy advantages including tax breaks and preferential access to land. Third, the near ubiquity of adaptive informal institutions becomes an endogenous force that has prompted the government to generate institutional change without regime change. However, such institutional change to react to the existence of adaptive informal institutions cannot be likely to become sources of democratization. Professor Tsai maintains that private entrepreneurs in China show no intention of agitating for democracy but capitalism can exist without democracy, provided that the Chinese government can attend to adaptive informal institutions that complement endogenous institutional change.
This book is highly recommended to readers who are interested in political economy and the development of private enterprises in China.
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The Rise of China and the Demise of the Capitalist World Economy Review

The Rise of China and the Demise of the Capitalist World Economy
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The Rise of China and the Demise of the Capitalist World Economy ReviewI had hoped this would be a hopeful book somehow laying out a convincing argument that China's rise will eclipse the disintegrating international capitalist economy and usher in a new world order focused on meeting human needs in an environmentally sustainable manner. Sadly, that is not this book's argument.
"Chinese socialism was the historical product of a great revolution, which was based on the broad mobilization and support of the workers and peasants comprising the great majority of the population. As a result, it would necessarily reflect the interests and aspirations of ordinary working people. On the other hand, China remained a part of the capitalist world-economy, and was under constant and instance pressure of military and economic competition against other big powers. To mobilize resources for capital accumulation, surplus product had to be extracted from the workers and peasants and concentrated in the hands of the state. This in turn created opportunities for the bureaucratic and technocratic elites to make use of their control over the surplus product to advance their individual power and interests rather than the collective interest of the working people. This was the basic historical contradiction that confronted Chinese socialism as well as other socialist states in the twentieth century."
The author, Minqi Li, was a member of the student dissident movement of the 80s in China. He describes the milieu during which he studied neoclassical economics at Beijing University: "The 1980s was a decade of political and intellectual excitement in China. Despite some half-hearted official restrictions, large sections of the Chinese intelligentsia were politically active and were able to push for successive waves of the so-called 'emancipation of ideas' (jiefang sixiang). The intellectual critique of the already existing Chinese socialism at first took place largely within a Marxist discourse. Dissident intellectuals called for more democracy without questioning the legitimacy of the Chinese Revolution or the economic institutions of socialism.
After 1985, however, economic reform moved increasingly in the direction of the free market. Corruption increased and many among the bureaucratic elites became the earliest big capitalists. Meanwhile, among the intellectuals, there was a sharp turn to the right... The politically active intellectuals no longer borrowed discourse from Marxism. Instead, western classical liberalism and neoliberal economics, as represented by Friedrich Hayek and Milton Friedman, had become the new, fashionable ideology."
A turn towards neoliberalism had, by the 1980s, been made possible by decades of Maoist development policy, which had developed "the necessary industrial and technological infrastructure [allowing China to] become a major player in the global capitalist economy." Li does a good job explaining the capitalist world-system, according to Immanuel Wallerstein's formulation, with its separation into core, semi-peripheral and peripheral states. The international division of labor has core states, like the U.S. and Japan, performing cutting-edge production requiring massive investment and organization, and which offer the greatest profit margins; the semi-peripheral states, like South Korea and most recently China, performing second-generation production that was cutting edge decades ago but which still offer substantial profits; and the peripheral states, like Angola and Bangladesh, which perform low value-added production like raw material exports and low-tech manufacturing.
Li argues that China's move from peripheral to semi-peripheral status (as China now produces all sorts of high- and low-tech products for the core states) signals trouble for the capitalist world-system: "the current 'rise of China' as well as the 'rise of India,' could be the signal that the capitalist world-economy is calling upon its last strategic reserves (such as China, India, the remaining resources, and the remaining space for pollution) to make one more attempt to jump-start global accumulation... The current global development is likely to suggest that several secular trends, which result from the inherent laws of motion of the existing world-system, are now reaching their historical limits."
Why? Because the capitalist world-system relies on strategic reserves of labor that can be called upon when existing labor forces begin to successfully fight for higher wages. Since the system needs high profit margins to reproduce itself via investment, and since high wages put pressure on profit margins, the capitalist world-system needs countries like China and India to turn to for their cheap labor forces once wage costs, or lack of effective demand (in other words, low wages that reduce a market's buying power) begin to threaten profitability. But the very process of exploiting labor in China - building factories and creating an urban working class, moving China from peripheral to semi-peripheral status - threatens to undermine the ability to exploit such labor in the future. Li explains: "To the extent that the non-core states have lower levels of proletarianization, workers tend to be less educated, less effectively organized, and under constant pressure to compete against a large rural reserve army [of laborers]. The workers in these states, therefore, tend to have much lower bargaining power and receive significantly lower real wages. *The low real wages in the periphery and semi-periphery make it possible for the world surplus value to be concentrated in the core and help to keep down system-wide wage costs*. However, in the long run, the development of the capitalist world-economy has been associated with the progressive urbanization of the labor force. After some initial disorientation, urbanized workers have invariably struggled for higher degrees of organization and extension of their economic, social and political rights. Their struggles have led to growing degrees of proletarianization within the capitalist world economy." (emphasis added)
This spells trouble for the world-system, since as production costs increase in China as workers successfully fight for higher wages, there will be few alternative states for producers to turn to for cheap, educated labor and efficient infrastructure. Also, China's ever-increasing contribution to environmental degradation threatens to undermine the world economy through destruction of the natural environment of which it is a part.
Li's analysis of economic - and, more depressingly, ecological trends - leads to the following conclusion: "With the decline of the US hegemony (reflected by its ever-declining ability and willingness to pursue the system's long-term, common interest), no other state is in a position to replace the US and provide effective leadership for the system. China and every other potential hegemonic candidate all suffer from insurmountable contradictions and weaknesses. None has the ability to offer 'system-level solutions' to 'system-level problems.' Either the existing world-system has exhausted its historical space for potential new leadership and therefore is doomed to systemic disintegration, or the new leadership will have to assume the form of an alliance of multiple continent-sized states, which will then become a world-government and therefore bring the existing world-system to an end.
The capitalist world-economy rests upon the ceaseless expansion of material production and consumption, which is fundamentally incompatible with the requirements of ecological sustainability. Depletion of material resources and pollution of the earth's ecological system have now risen to the point that the ecological system is on the verge of collapse and the future survival of humanity and human civilization is at stake.
To summarize, multiple economic, social, geopolitical, and ecological forces are now converging towards the final demise of the existing world-system, that is, the capitalist world economy."
What comes next could be a rational world-system of production geared towards first fulfilling human needs, then wants, in an ecologically-sustainable manner. But while the current system's demise is assured, there is no guarantee of the character of its replacement, and, at this point, very little likelihood it will resemble the description above.The Rise of China and the Demise of the Capitalist World Economy Overview

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When China Rules the World : The End of the Western World and the Birth of a New Global Order Review

When China Rules the World : The End of the Western World and the Birth of a New Global Order
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When China Rules the World : The End of the Western World and the Birth of a New Global Order ReviewMartin Jacques' "When China Rules The World" carries a provocative title, but it should not be a surprise. Anyone can see this outcome coming by simply projecting economic growth in the U.S. and China at roughly their current rates; Goldman Sachs gave such conclusions credibility in 2007 when it concluded that China would surpass U.S. GDP in 2027, and double it by 2050. Jacques' book suffers not from an overly wild imagination, but from taking entirely too long to get this already obvious conclusion, and then not exploring enough about what that means for either Britain (his nation) or the U.S.A.
Far too much of "When China Rules The World" is taken up by a detailed historical summary and analysis of China's 5,000-some year history - to establish that it is not prone to colonizing other parts of the world, values unity among its people, and that its predominantly Han 'nationality' of people are becoming increasingly smug (racist?) as China's economic power grows. Jacques could have shortened this material enormously by simply pointing out that the key to China's recent growth has been the pragmatic orientation of its leaders. Obviously, economic growth has been their #1 objective since Mao's death, and public announcements communicated that the military would have to take a back seat. The late Premier Deng Xiaoping demonstrated this pragmatic focus when - despite being Mao's #2 and having been purged twice for not being a strong-enough Communist, he turned the nation's direction around after Mao's death. At the time, Deng explained his lack of commitment to ideology or history as follows: "I don't care if it's a white cat or a black cat. It's a good cat so long as it catches mice." This was interpreted to mean that being productive in life is more important than whether one follows a communist or capitalist ideology.
Regardless, even if Chinese history was the clear determinant of its direction, the topic is so immense and complex I doubt anyone but a Chinese scholar would have the resources or credibility to synthesize the thousands of years involved. That rules Jacques out. However, Jacques' material on today's China is much more useful.
Many China naysayers contend it cannot continue with anything near its recent growth rates because rising demand for labor will end the supply of its low-cost labor. Jacques, however, points out that China needs to create 8 million new jobs/year for its expanding urban population, plus another 15 million for new rural migrants coming to the cities. By 2020 it is estimated that there will be 553 million non-agricultural workers in China - 100 million more than in all the developed world. Another estimate is that 20 years from now China will still have 20% of its population looking for non-agricultural work - in other words, China has a relatively limitless supply of cheap labor.
How will China continue to rapidly grow its economy? First, by increasing its internal consumption, and secondly by moving up the value chain. Manufacturing comprises only about 15% of the cost of getting a product to market. China's leaders aim to increase China's proportion of the whole by raising R&D from $25 billion in 2004 to $45 billion in 2010 and $113 billion in 2020. China is also intensifying efforts to persuade overseas Chinese to return (eg. one-third of Silicon Valley's professional and technical staff are Chinese), and to raise the status and enrollment of its best universities. China has also been very successful in leveraging access to intellectual knowledge in exchange for granting foreign firms access to its markets. Then there's also its reputation for intellectual piracy. Jacques envisions strong Chinese total-product competition in aircraft manufacture, electric automobiles, communications, computers, and solar panels. Given their growing number of engineering graduates and American research labs located in China, I suspect they will also be strong contenders in household goods, biomedical products, wind turbine production - probably about any area they decide to move into, given their strong cost advantages.
Another reason some doubt China's continued success is that it isn't bringing democracy to the masses. Jacques, however, contends that very few countries have combined democracy (as now envisioned) with the process of economic take-off. (The U.S., for example, was late to grant voting to women and minorities.) Jacques also contends that developing countries are especially likely to value a government's ability to deliver economic growth, maintain ethnic harmony, limit corruption, and sustain order and stability as equal, if not greater values to democracy. Regardless, "When When China Rules The World" also presents data showing that most Chinese believe the political climate has improved since 1989 (Tienanmen Square), and 72% of its population are satisfied with the condition of the country vs. only 39% in the U.S. (As for the widely reported large number of civil disturbances within China reported each year, Jacques contends most have nothing to do with the central government - eg. local land issues.)
Bottom line - like it or not, China will become the major global power by 2050 - assuming continued rapid economic growth, and Jacques doesn't think that is going to stop. What does this mean? Jacques says Chinese companies will be the biggest in the world, as will its stock exchanges and banks. Macao will take Las Vegas' place as gambling capital of the world. The dollar will continue its decline and American military bases overseas will become increasingly difficult to finance. China's new aircraft carriers, stealth submarines, etc. will take over the Pacific near China, and its anti-ship missiles render the U.S. Navy obsolete. Taiwan will return to China's jurisdiction.
My projections for the U.S. are a return to protectionism and/or continued decline in our standard of living. Off-shoring will expand to include higher-level jobs such as engineering design, R&D, branding, corporate ownership, and even some marketing. Absent gaining control of our trade and government deficits, the U.S. risks substantial inflation. Government spending will have to drastically reduced at all levels, especially existing outlays for health care, education, and defense.
The "good news" is that there is already compelling evidence of U.S. overspending in all three areas. U.S. health care and education expenditures as a percentage of GDP are both about 2X and more those of other major developed nations, while U.S. defense expenditures (6-7% of GDP) equal those of the rest of the world combined (more if Homeland Security is added in). U.S. outcomes in these areas, however, are middling at best. Thus, about 15.5% of GDP could be eliminated from government and private expenditures for these three areas - about $2.2 trillion/year. In addition, Social Security benefits will have to be cut, the maximum level of taxable earnings eliminated, or both.
Jacques makes a very good point when he says that globalization was largely developed and instigated by Western nations, especially the U.S.; the benefits, however, have largely accrued to East Asia and China, and the drawbacks to the U.S. Combined with increased private and public efforts to outsource service jobs to India, and more jobs lost to technology, its going to be a very rough next few decades in the U.S.A. Americans need to be much more careful about what they wish for!When China Rules the World : The End of the Western World and the Birth of a New Global Order Overview

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China Safari: On the Trail of Beijing's Expansion in Africa Review

China Safari: On the Trail of Beijing's Expansion in Africa
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China Safari: On the Trail of Beijing's Expansion in Africa ReviewOf the modest number of books focused on China in Africa, this is one of the two best, and both are unique--if you buy only one, at least read my summary of the other, China into Africa: Trade, Aid, and Influence Whereas this book is direct journalism with wonderful color photos and direct ground-truth stories, China Into Africa is a best in class collection of academic essays.
Sixteen full pages of color photos in the middle of the book were unexpected and a complete delight.
On balance between the two books, this one taught me more and provided insights I could not get elsewhere to include the clear understanding, documented across multiple encounters by the authors, that the Chinese consider any Chinese business area or housing area of, by, and for their Chinese workers, to be sovereign territory of China immune to indigenous inspection or intervention.
Highpoints for me:
+ Africa is undergoing a huge transformation, and in combination, the infusion of Chinese infrastructure with the discovery of new energy fields and the growing need of all for what Africa has, is creating a perfect environment for a wealth explosion, and the US is missing it.
+ US has given up in Africa, in large part because the US Government other than the military does not have the resources, the human capital, the area knowledge, or the innate interest to actually do something strategic. The Chinese, in contrast, are unifying and pacifying Africa with infrastructure and commerce, while gaining direct access to natural resources that they can take possession of at half the market value by controlling the supply chain and no doubt lying about how much they are extracting.
+ Chinese presence in Africa is vertically and horizontally integrated, to include relatively thorough exploitation of what I have named the eight tribes of intelligence (academic, citizen-civil sector, commercial, government, law enforcement, media, military, and non-governmental), the Chinese appear to be way ahead of the US and all others in the Information Operations (IO) domain.
+ The Chinese are introducing simple robust technologies that work and that can be understood by indigenous workers accustomed to 1950's and 1960's technologies. Chinese machines that do equivalent work to Western machines are four times cheaper
+ China handles indigenous requests for Chinese visas strategically--they quickly recognize the local movers and shakers and give them red carpet treatment, unlike Europeans and US where the consular office has no clue and treats everybody badly
+ Chinese study every Minister they need, then assign a Ministerial-level contact from China to visit, cultivate, and then keep in touch--this is so far ahead of the US light-weight approach it makes me want to cry
Some of my flyleaf notes:
+ 900 Chinese companies active across Africa
+ 750,000 Chinese immigrants in South Africa ALONE
+ Cameroon is processing 700,000 visa requests in its Beijing Embassy
+ 300 million Chinese emigrants to Africa is a stated long-term goal
+ Core Chinese approach is a win-win package deal that trades infrastructure and unconditional loans for resource futures--they are approaching each nation strategically and far superior to US and European incoherence. West focuses on humanitarian and other broad issues, Chinese focus on business and longer term win
+ Chinese are beating the West on price and performance every time, to the point that Western firms are starting to bid Chinese subcontractors.
+ Africa and Chinese appear to share a view of democracy as being where everyone decides and no one works
+ Chinese get more out of everything, to include penny pinching, working all facilities and machines 24/7 with shifts, and completely avoiding "distractions" of local engagement outside of business to business dealings
+ NGOs are viewed by the Chinese in Africa as Western tools seeking to harass and set back the Chinese
+ Chinese laborers can earn five times in Africa what they can in China--$500 a month versus $100 a month
+ China is consuming 32% of the world's rice, 47% of the world's cement, 33% of the world's cigarettes, and 10% of the world's lumber but growing rapidly
+ 91,000 Chinese tourists visited Egypt in 2007
+ Chinese goods in Africa sell for one quarter to one fifth what the African's own products sell for
+ China close to #1 in small arms sales in Africa
+ China using private security firms, up to 5,000 individuals (probably Chinese) guarding one pipeline
+ Chinese farmers in Sudan growing vegetables for sale to the large Chinese population there, making ten times what they could at home
+ Darfur is the size of France, oil there, China poised to own Sudan, which is growing 9-13% a year
+ Ethiopia has China's biggest Embassy after India
+ Washington's China watchers fall into two camps according to the authors, the Panda Huggers and the Dragon Slayers. It is clear to me as a reader and intelligence professional that neither group has a strategic analytic model or any sense of what US should be doing and why, in Africa
+ Land mines and minefields do not slow down Chinese work. They use bulldozers to set off the mines, if a worker dies their family gets a $44,000 windfall and everyone is happy
+ Chinese created economic zones in Africa that appear to be phantom zones and a tax avoidance scheme, but Africa does not have a regional means of studying and then challenging Chinese moves of this sort
+ In Zambia Chinese treat local workers the way Israelis treat the Palestinians
+ The major regional downside is Chinese deforestation and over-fishing. Bribery appears to negate whatever NGO and national constraints may be in place.
The major downside of China in Africa that came up over and over was the total shut out of local workers who gain no employment, no training, no future.
I found this book fascinating, and give it five stars for the hard work of doing ground truth face to face across multiple continents, and the photos, and the deeper personal insights than provided by the academic work. My notes do not do this book justice, if I had to recommend only one of the two, this would be the one.
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I Love Dollars and Other Stories of China (Weatherhead Books on Asia) Review

I Love Dollars and Other Stories of China (Weatherhead Books on Asia)
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I Love Dollars and Other Stories of China (Weatherhead Books on Asia) ReviewThis book can only be fully appreciated by Chinese readers. It is a realistic portrait of the transformation of the whole Chinese society generated by the policies of Deng Xiaoping. As Julia Lovell writes astutely in her excellent introduction, `Deng was convinced that Communist China's stability depended on the spread of material prosperity. To the ever-pragmatic Deng, it was irrelevant whether the means were capitalist or socialist, provided that the end of preserving party rule was achieved.'
The impact on Chinese society was nothing less than tremendous on all levels: family life, generation conflicts, sex, art (literature), human relations or working conditions.
The generation clash is preponderant in `I Love Dollars': the current generation is `greedy for everything, everywhere, smashing, grabbing, swearing.' Or, in `Pounds, Ounces, Meat': `You, youth of today! You can't cook; you can't convert pounds into metric! You treat your family like dirt. You're all useless.' In `A Hospital Night', a young man is pestered nearly into a nervous breakdown by older people.
Sex is purely business: `As long as we're paying for the genuine article at a fair price, into the shopping cart it goes, just like everything else.' Prostitutes are `businesswomen controlled, like we all are, by macroeconomic price regulations.' (I Love Dollars)
Art (literature): `they write for money. `Commercial and popular success becomes paramount. For the older generation, `a writer ought to offer people something positive, ideals, aspirations, democracy, freedom.' (I Love Dollars)
In `Wheels', a bike incident turns into a violent extortion.
In `Ah, Xiao Xie', a pastiche of the centrally planned `Soviet' system, you cannot leave your factory unless you have a long arm.
In the best story of the bundle `A Boat Crossing', a Kafkaesque haunting nightmare, everything is for sale, even a young lady, in a corrupt mini-society (boat = country) under the spell of mysterious powers. Where can people go?
Zhu Wen's fluently written brilliant stories show a China and its population at crossroads.
Highly recommended.
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What Does China Think? Review

What Does China Think
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What Does China Think ReviewTo get a perspective on what some Chinese political theorists are thinking, consider this: While Westerners "anguish" about how to manage China's rise, Chinese think-tankers debate about "how to manage the West's decline"! Wang Yiwei, from Fudan University, shares this worry, and asks, "How can we prevent the USA from declining too quickly?" (pp. 115-116)
What this book attempts to provide is a Chinese perspective on the rise of China and its place in the world as it has grown from a largely agrarian society in the days of Mao to a superpower of the 21st century. To do this, Mark Leonard, who wrote "Why Europe Will Run the 21st Century," traveled in China and interviewed many of China's leading thinkers on politics and economics. A number of these scholars have advanced degrees from American universities. They have taken Western ideas back to China and incorporated them into traditional Chinese ways of thinking, consistent with the dictates of the ruling Communist Party. Leonard shows that within this unique political culture there have arisen various points of view, from the "New Right" of, e.g., Zhang Weiying, to the "New Left" of, e.g., Wang Hui, from ideas about the "peaceful rise" of China to notions more in keeping with the thinking of the so-called "neo-comms." Part of the debate is about the use of military power, part of it is about how to influence other countries, and part of it is about how to manage its own people.
Since Deng Xiaoping opted for a market economy within the political dictatorship, the growth of China has been extraordinary. But with this growth have come problems: pollution, growing economic inequalities, the yearning for political democracy, and the infusion (perhaps one might even say the "invasion") of ideas foreign and inimical to the perceived interests of the communist state. To fight the disagreeable ideas from without, the government has trained "an e-police force of 100,000 people employed to scour the net, blocking sites and checking e-mails."
Leonard allows that this number may be exaggerated, but the point is clear: China wants to modernize, and to do so, must learn from the West, but at the same time it must not allow Western ideas to ferment dissention at home. Just how this delicate tightrope walk works in the public forums for China's leading thinkers is part of what makes this book interesting.
The "New Right" which led the change from Mao's soviet style economy to what the Chinese call "Yellow River Capitalism," which ushered in the gargantuan economic growth, has come under fire from various quarters, including the "New Left" which unlike the "old left" supports market reforms. However, as Wang Hui sees it, "China is caught between the two extremes of misguided socialism and crony capitalism...."He adds, "We must not give total priority to GDP growth to the exclusion of worker's rights and the environment." (p. 33) "Princeling" Pan Yue (as some of the privileged and talented members of the younger Chinese generation are called) "has talked of `China's environmental suicide,' and in an interview with the German magazine, Der Spiegel, predicted that `China's economic miracle will end soon because the environment can no longer keep pace.'" (p. 42-43)
Cui Zhiyuan, who is professor of Politics and Public Management at the Tsinghua University in Beijing, sees Chinese politics in Machiavellian terms: "For Machiavelli power was not divided between two levels: the state and the people. Florentine politics was split between three groups, the prince (the `one'), the nobles (the `few') and the people (the `many'). In today's China, the `one' is the Communist Party, the `few' are the super-rich, and the `many' are the people." (p. 47)
There have been some experiments in "deliberative democracy" at the village level to allow some input into central party decisions. The Chinese have learned from the experience of the Soviet Union that ignorance of what people at the grass roots level think can lead to not just inefficiency but to disaster. However this token gesture toward political reform is not likely to replace the "deliberative dictatorship" that current holds sway. Nonetheless, "The government seems to realize that developing institutional ways of dealing with grievances can make the state more stable." (p. 74)
I think this last point is one that we in the West and especially in the United States need to understand. For most people in the world the first responsibility of the state is to provide security and stability. After that perhaps political freedom can evolve. China, learning from the failed Soviet experiment, has put economic reform first and political reform later.
In international relationships, China is trying to develop "soft power" as a means to further its interests. The US, until the recent rise of George W. Bush and the neocons, exemplified the use of soft power to influence others through its culture and its economic strength. China wants to avoid the recent mistakes of the US such as invading other countries and is pursuing a policy of non-intervention in the internal affairs of other nations. Unfortunately it is also indiscriminately supporting dictators such as Robert Mugabe in Zimbabwe. Leonard asserts that "China will never be supportive of multi-party elections and human rights: why would it promote rights for foreigners that it denies to its own citizens?" (p. 126)
Leonard provides a "Dramatis Personae" near the end of the book identifying some of China's leading political and economic thinkers. There are endnotes and an index. All things considered, this is a good, albeit short, introduction to contemporary Chinese political thinking.
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When China Rules the World: The End of the Western World and the Birth of a New Global Order Review

When China Rules the World: The End of the Western World and the Birth of a New Global Order
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When China Rules the World: The End of the Western World and the Birth of a New Global Order ReviewLike many journalists who covered China in 1989, I thought it obvious that China's Communist Party would fall to ashes within a few years, having lost all credibility at Tiananmen Square. Got that wrong.
As China's economy took off in the 1990s, I knew for sure that steady growth would force the country to become more democratic. Wrong again. (Open, yes. Democratic, no.) At the very least, I figured, a broad swath of Western economists must be right to agree that China's modernization would require a following of accepted rules of Western finance. To develop, China would have to become more transparent and legally accountable, starting with a freely convertible currency. Right? Not really.
As Martin Jacques argues effectively in this book, the West has misjudged China because of a bedrock assumption that modern financial and political systems have to follow some basic principles of openness, rule of law and democracy. That is the paradigm that favored the United States, and paved the way for its world domination, from 1945 onward. But China's remarkable progress is not following the script, and is challenging Western assumptions.
With clear and compelling writing, Jacques makes the case that when China is the dominant power, it will make the rules. It may even create a new international paradigm, one that is just as hard for Americans to foresee as it was for the British a century ago to foresee their own decline, and as it was for the Romans, long before that.
"The West has, for the most part, become imprisoned within its own assumptions," Jacques writes. "Progress is invariably defined in terms of degrees of Westernization, with the consequence that the West must always occupy the summit of human development."
In the past few years, there have been dozens of books about China's rise. Most of them are mindless, over-the-top enthusiastic or else utterly alarmist. This one is an exception, a book that offers true food for thought, and plenty to chew on. It shook me from preconceived notions.
Jacques has limitations. His predictions about the future get more flimsy as he gets more specific. He glosses over the evils of Mao's era. But his critique of Western assumptions is pretty trenchant.
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