China and the Time Warp

 

China has fascinated the West for a very long time. They have been inquisitive about the way China has gone about in it thousands of years of history. Partly because China has been secretive, in part the curiosity has been about China’s handling of its relations overseas, its expeditions, its kingdoms in the Middle to Late Age, the Forbidden City and of course its Communist Revolution and post Maoist period. China was largely forbidden to the West for many years. For many years, China played a role of contented kingdom which had everything to satisfy the needs. The only things it needed perhaps was those goods which had certain snob or entertainment value. In the Middle to Late Middle Ages, it projected itself as something interested in Veblen imports and not something routine. In the Maoist period, the revolutionary impact made it forbidden to the rest. China was perhaps not colonized the way India for instance, yet there were many regions in China that were under Western control at different points of time.

 

China played the role of US subordinate in its battle against the Soviet Union as long as it suited it. The tensions between the Soviet Union and China in the late 1960s allowed an opening for the US to build a rapport with China. China used this especially in the Deng era to build its manufacturing prowess. To the US even in the post Cold War era, its national security calculus was obsessed with the Russian threat. China was given a free pass virtually every time it sought to transgress on US interests. China exploited this weakness to accumulate foreign exchange reserves through becoming a manufacturing base and later using the power to capture the US institutions. In fact by the late 2010s China had executed a smart institutional capture in academics, industry, think-tanks and policy measures to great effect across countries in Europe and US not counting its inroads into the developing and emerging world. In recent times, US has sought to move towards a confrontational approach at least in part towards China. Yet the defeat of Trump has led to some recalibration of the strategies. While US continues to see China as a threat, they might not be in the same confrontational mode as Trump adopted as a President.

 

In this context, there is a very interesting article (link) which talks about the current Chinese situation as very much 20^th century rather than the current century. The author cites the popular perception that China currently is in the same situation as the US was about a century ago. In fact, many believe, that China is going through the same path as its predecessors did in their quest for being great powers. The author believes that China’s current scene resembles more of what US, Soviet Union or Germany or Japan went through in the last century. Somewhere the author seems to believe that China is a twentieth century creation that has accidentally landed up in the twenty first century. The author argues that the US and UK both led their growth in manufacturing something caught up later by Germany and Japan despite starting late. The manufacturing powers were essentially the defining features in the 19^th and 20^th centuries, something China consolidated around in the early part of the 21^st century. The Chinese manufacturing machine got an impetus given its huge size, it was a magnet for relocating production given the cost pressures in the Western economies. As the shelf life shrunk, and pressures to innovate increased, in a world racing towards zero price, China offered an attractive proposition for cost reduction to Western giants. Using their technologies through hacking or stealing or whatever means might me, China has caught up with the West and beginning to flex its muscles.

 

Despite a decline in the manufacturing share of the GDP, it continues to occupy more than a fourth of total GDP in China. Unlike US which has moved towards a service oriented economy, China remains a manufacturing powerhouse. Incidentally the author notes that path to industrialization did lead to environmental externalities. These externalities have led to worsening of pollution both air and water in the country. This was resembling of US or UK at their peak industrialization. China seems to be executing a trade-off something evident in the environmental Kuznets curve. The curve posits the environmental protection does come at the cost of some GDP growth and vice versa. The piece argues that China perhaps is evidently skewed towards growth as opposed to the protection of environment on which it keeps making symbolic noises.

 

The Chinese government is of course autocratic. From Maoist days till present, the opposition is hardly tolerated and suppression of dissent through imprisonment and death is very common. From Tibet to Xinjiang, suppression of the local interests and minorities is well known to be repeated. The author uses this to argue this was exactly the scenario of many a power in the early part of the last century. US was segregated and had an institutional sanction something that is prevalent even today in some measure. The British imperialism did leave millions of people dead due to its callousness despite its pretensions of wearing a burden to civilize the natives. The French were no different given their involvement in imperialistic tendencies. It was a pursuit to break a status quo of balance of power that Germany and its ally Austrian Habsburgs led the First World War. The Soviet Union was no less genocidal that Hitlerian Germany in many aspects. Japan too led its imperialist drive in Asia through series of excesses across China Korea and other places. In fact, little needs to be said about Hitler and his rule. Therefore, in the words of the author, China is following a certain copybook that was evidently the monopoly of the West not too long ago. Yet, it must be prudent that China’s autocracy is not new and has been inherent for centuries or maybe millennia. While other powers have moved towards a democratic ethos, China has still stuck on. It is not what China is trying to do is resembling of past century West, but it is an intrinsic Chinese characteristic something the author perhaps misses or chooses to ignore. Yet, there does seem to be some merit that China does remain anchored in the power games of the twentieth century. How well it executes the same to disrupt the model of the twenty first century will perhaps determine its progress and future.