A Good Piece On US Advantages
This essay by Hass of the Brookings Institute said what I have been meaning to say about China, perhaps with me adding more analytics. For example, Hass sees that China “is using the Belt and Road Initiative—the largest development project of the twenty-first century—to win greater influence in every corner of the world.”
I would not reduce the Belt and Road to just one thing of winning political influences, but rather something driven partly by China’s domestic economic reality of an increasingly saturated market in infrastructures and overcapacity, and partly by developing overseas markets to turn them into bigger economies and bigger trading partners — something similar to the Marshall Plan by the US after WWII to Western Europe — in addition to projecting a positive China image in the world.
In general, I wish to see more analytics in international relations, which has been filled with oversimplified ideas, opinions and conclusions. Honestly, politicians are excused for having an instinct of seeing everything in political colors, but someone else must get the analytics done right to help politicians make optimal policy moves.
That said, I do find Hass an insightful — and useful — essay. It is useful because it solves a collective mindset issue of overly anxious about someone or something we do not fully understand. It is insightful because he has been more analytical than others, like this earlier essay published by the Atlantic, in which the author talked about the inherent advantages associated with abstract things like democracy, open society and free market. In contrast, Hass talks more about the specific and particular advantages of the US and the corresponding disadvantages of China.
Hass is better because as I pointed out earlier, no system of government possesses complete, irreversible and permanent advantages. To think otherwise is to ignore the tradeoffs behind all systems of government. Joe Biden was exactly right to tell Xi, Jinping of China that no US president can sustain without supporting or upholding the value of democracy. Simply put, democracy is a domestic mandate because Americans believe it and prefer it to anything else.
Bidding High On the Biden Administration
The Biden administration has formally defined US-China relationship as one of competitions, with eight priorities declared by the Secretary of State Antony Bliken, who made several excellent points like acknowledging past mistakes in embracing free trade, as “we didn’t do enough to understand who would be negatively affected and what would be needed to adequately offset their pain.”
My favorite point is that “we must remember what we’ve learned about the limits of force to build a durable peace”, which is a hard learned lesson that will potentially save billions of dollars for the US going forward, if the country seriously sticks to the lesson, something we should not be taken for granted if past experiences are a guide.
To give him credit where it is due, Donald Trump raised the issue and saw the need of revitalizing the US economy, but did a terrible job in implementing a feasible strategy.
China Is A Paper Tiger In Global Leadership
Why do I fully support a US leadership in the world? Why not China? The short answer: It is better for the world because it costs less and with less uncertainty than switching to a Chinese leadership. I want to use the same words that Blinken said about China, but apply them to the US: The country is the only one with the diplomatic, economic, military and technology powers to lead the world, no any other country comes even close. In addition, the US is the only country in the world possessing both soft and hard powers, again no other country comes close to it.
In numerous ways China has been a global outlier, which makes it very hard to convince the world of its way of running things, let alone to lead the world. Its citizens care so much about material gains and so little about anything else, unlike most if not all citizens in other countries. Its economy grows the fastest in the world but its political system changes so little that the current leaders even try to return to the old days under Mao.
A country is like an individual: You get what you care about but not what care little. China is materially much better off now than before, but the soft power of its culture has pretty much stayed the same. I have never seen citizens in any other country who care so much and so sensitive about the international images of the homeland. Everyday the online news media are full of baseless fake news with eye-popping headlines like “Americans are shocked by China’s speed of infrastructure development,” or “The breakthrough of our semiconductor chips scared the US” or “The Pentagon was totally surprised by how advanced China’s third aircraft carrier is!” One cannot help but to come to the conclusion that these people have lived in their own dreams. It also gets to the point of being funny that their national confidence seems to be entirely built on the recognitions and appreciation of people in the western world. For them, national confidence = international recognition.
It is hard to imagine that the Chinese way of governance will become the globally accepted best practices, such as providing guidance in central documents, always opaque operations of governments at all levels, no check and balance between government branches, and no press conference hosted by national leaders.
The best sign that China’s is a “paper tiger” in terms of a global leadership comes from Hong Kong. Despite the same culture and same language, people in Hong Kong have not been impressed by the way the mainland system works. It is one of the best field experiments in human history that a local competition between the mainland and the legacy UK systems has proclaimed the winner to be the latter, not the former — especially among the elites of Hong Kong who plan to leave the place altogether. Taiwan has not been “unified” with the mainland but China is likely to face similar challenge of governance after it takes over the island, which is no longer an issue of “whether” but “when”.
Simply put, if the way of governance in the mainland cannot even work in places immediately outside its borders, it is far less likely to work in the entire world.
Globalization & Sino-US Competition
There is one side of the competition that concerns me and I have yet to see anyone talking about it: the danger that the US may give up its leadership in globalization altogether, or at least being marginalized. Given the prevailing — and currently negative — sentiment in globalization in this country, it is a serious possibility.
At its core, globalization is about two things: growing the global economy (i.e., to make the cake bigger) and distributing the gains among trade partners (i.e., to divide the cake). Granted, there are other ways of growing global economy without globalization, as the latter does come with its unique costs and risks. For one thing, there is no guarantee that countries will have the same share of gains from globalization. In fact, if we follow the Shapley value rule, equal distribution of gains should not happen. What is important is all countries stand to gain and to be better off than before.
Globalization Is Like The Marshall Plan
There is another side overlooked in the story of globalization. In general, being a rich country means more options than a poor country. In other words, a rich country can grow with or without globalization, while for a poor country globalization could be the only way of lifting its economy.
Even better, globalization is such a significant opportunity for poor countries that it does not require too much from local and native governments. All they have to do is to open its doors to welcome resources pouring from outside, which will find their ways to leverage locally abundant resources.
We can do a thought experiment and assume no globalization had ever happened in human history. It is still highly likely for the US to develop automation technologies to replace the expensive labors, but almost impossible for poor countries to follow suit.
This makes me thinking: Globalization is similar to the Marshall Plan — without the conscious and centralized planning of government but relying on firms and local market resources — but with the same net result of growing and strengthening previously weak and vulnerable economies and turning them into viable trading partners with larger domestic markets.
The beauty of globalization, in comparison with the Marshall Plan, is that from the very beginning, the flow of resources has been bi-directional. I know some scholars have been critical of globalization but to me, it is the best case in human history to bring rapid growth of the global economy, in favor of the poor countries.
Expanding the Cake & Dividing It
Started from the Trump administration, the US has been focusing on the issue of how to divide the cake (i.e., the gain from globalization). I will not get into details about the US accusation of China of not following fair rules, but simply say that the issue is more complicated than China being a reckless offender of the rules throughout the globalization.
What is more important is to look forward, and it is here I see a real danger for the US to focus too much on how to divide the cake, but not enough on expanding the cake. The problem there is that how best to divide the cake can be more complicated than growing the cake. We should not expect to settle all the division issues through one or two rounds of negotiation. Sometimes keeping the cake growing solves the division problem at least half the way.
I like the words from the White House Interim National Security Strategic Guide that “We will move swiftly to earn back our position of leadership.” One of the keys to avoid American being marginalized in globalization is to restore or reestablish its manufacturing industries, like I said before. For decades the US economy has been too much in services and too little and too weak in manufacturing. The nice thing about restoring manufacturing in the US is that it will do the word a big favor. Having an advanced and high-quality manufacturing will benefit everybody, including China.
Can An Authoritarian Country Contribute To A Better World In The Future? Yes!
By claiming its willingness to work with the US on economic cooperation, China has taken a higher moral ground as a sincere promoter of free trade and globalization. The US and the world have not paid much attention to this gesture partly — even mostly — because China is the weakest when it comes to sending its messages out to the world. Its cookie cutter terms and its “all-through-government” channel have greatly reduced its power of spread.
Still, the message has been weak but its content deserves attention. To the extent that globalization does help the world for a better future and reduce gaps in global welfare, China has taken the right side of the history, while the US is likely to step back to domestic issues.
This is a good example not excluding an authoritarian country from moving the world forward. Each country is a multi-dimensional entity. Politically China is authoritarian, but economically the country has greatly benefited from global trade in the past and as such is at a natural position to gain more from maintaining its course in globalization.
The point here is that Americans should not only look at its political side and reject everything it does or say. I believe China is sincere when it says cooperating with the US will lead to “win-win,” while fighting between the two will be “loss-loss.” It is speaking from its own experiences in the past. In addition, we have yet to see evidences from China to put its ideological interest above its economic interest, something that Mao, Zedong did all the time, if both interests coexist at the same time.
Use China As We Can
The above reasoning leads to another point that I said before: The best scenario is for the US to have sufficient self confidence to allow China a role to grow the cake of global economy, while it is busy dealing with its own domestic challenges first. Not every move of China is meant to destroy the US. Even more importantly, not every move CAN destroy or hurt the US — even if China wants to. Win-win is still possible even in fierce competitions. Sometimes the best help comes from a competitor rather than an ally.
This goes back to my thesis of generalized game resources: Do not limit your resources to what you directly own by yourself, but to expand them to anything and everything that you can use to your advantage.
Despite China’s international brouhaha from time to time, despite Xi, Jinping’s misjudgment that the US is weakening by days while China is gaining ground also by days, the fundamental fact of today remains that the US pretty much still owns the world. The last time I checked it, which is this morning about five minutes ago, I have seen nobody else qualified as a replacer of the US leadership even on the horizon.
China has a long way to go before it reaches the same per capita GDP as the US. Honestly I don’t even know if China can ever go that far, even if we assume China can have a bigger total economy than the US. I think this is a point that deep down even the Chinese leaders, including Mr. Xi, Jinping, have seen and understood. Hass was absolutely right that over-exaggerating China’s power and strength can only hurt us in the US leadership of the world.
Being a widely accepted global leader means the US stands to gain the most by leveraging resources that it does not own, but exist somewhere else. We should allow China to send is vaccines to developing countries, while the US has chosen to prioritize its domestic distribution of the vaccine. I have no objection against such a priority — given the US has been the largest country suffering from more caseloads and deaths from the pandemic.
Just like other new world powers, China wants to prove its worth by helping others. Instead of criticizing or suspecting its motive(s), the US should hold its fire as long as the recipients appreciate the Chinese assistances. Praising China’s effort in offering its vaccines to others, at least not to criticize it, costs very little and go a long way to strengthen the US leadership role.