China and Continuity

We spend a lot of time on this blog writing about China, and we think with good reason. It's common to hear the last 100 years referred to as "The American Century," and many observers now suggest that the next 100 years eventually will be known as "The Chinese Century."

Of course, a lot could happen to change that outcome. For one thing, China faces huge internal and external challenges on its path to global supremacy. For another, the United States is still the preeminent superpower in both economic and military terms and is likely to remain so for some time.

But in looking outward over the next several decades, it's hard to conceive a plausible scenario of world development that does not include China in some capacity. So, as we try to envision how, where, and when molecular manufacturing will emerge and what its implications will be, we must include China in our calculations of context.

In an analysis piece this week in the New York Times, Joseph Kahn writes:

To judge by the reports in China’s state-run news media, the Communist Party took a bold step toward democracy at the just completed 17th National Congress, which approved a new leadership team to run the country.

President Hu Jintao used the word democracy 61 times in his main address to the congress. The official Xinhua news agency reported that the party nominated 221 candidates to fill the 204 full seats on the Central Committee, meaning that 7.6 percent of those declared eligible did not get a seat. Xinhua called this a “competitive election.”

In reality, of course, China’s one-party system still owes more to Lenin than to Jefferson. It convenes congresses every five years to ratify leadership decisions on policy and personnel. The message is not change, but continuity.

And specifically what type of continuity are they looking for? Kahn says:

They want fast growth, a nonaligned foreign policy and political stability.

Okay, remember that, because we'll come back to it at the end.

An article by John Feffer in the November 2007 issue of The Nation describes various perspectives from which U.S. foreign policy analysts may view China. I'm paraphrasing here, but the basic question seems to be this:

Should America (and the rest of the world) view China as a political threat or partner, as a military threat or partner, as an economic threat or partner, or as some combination thereof?

I encourage reading the whole article (and while you're at it, also read this snarky-but-informed critique by a "Qing historian"). I'll offer a few quotes, and then my own slant from CRN's position.

On the matter of weaknesses that may qualify China's rise to power, Feffer notes:

Foreign policy analysts speak of various crunches that China will face. There's the demographic one, when China suddenly becomes a senior citizen society virtually overnight because of its one-child policy. There is the economic one, when rapid growth begins to sputter and an angry middle class joins hands with the disenfranchised to close down the party. There's the environmental one, when the poisons of industrial development choke the country to death...

Washington should pay less attention to the strength of China, some knowledgeable courtiers are whispering, and more to the great country's weakness. In this telling of the story, China is an elaborate pyramid scam, its prosperity resting on a foundation of sand. Only by continuing to generate unprecedented levels of growth -- 11 percent in 2006 -- can China continue to fool its domestic supporters and foreign investors into playing the game.

Inside China, troubling stories appear every day. There is rampant corruption. Some grow impossibly rich while many remain impatiently poor. Tens of thousands of protests break out in the cities and the countryside every year. The AIDS and SARS scandals, the harrowing coal mine disasters, the ruthless suppression of dissidents -- eloquently described by Chinese activists themselves in the new collection Challenging China, edited by Human Rights in China staffers Sharon Hom and Stacy Mosher -- all have the potential of sapping the confidence of the population in the leadership's capacity to govern.

What about the growing military might of China?

The issue of greatest controversy is China's increased military spending. Beijing argues that it is spending around $36 billion a year; some US estimates run double or even triple that amount. However you slice it, China wants a world-class army to match its world-class economy. But with its air and sea power still limited, China has an anemic ability to project force over distance. A mere twenty long-range nuclear missiles serve as a very slender deterrent force. And while the bean counters scrutinize China's arms purchases, the annual US military budget has sailed past $500 billion (not including the Iraq and Afghanistan supplemental spending). To match the United States, China would have to play Soviet-style catch-up, and it knows the endpoint of that strategy.

Finally, Feffer concludes:

Predicting what will happen with China is a fool's errand. China is the exception that proves so many rules wrong. It is a Communist system that has managed a transition to "capitalism with Chinese characteristics." It has fostered market growth without much political reform. And it has pulled huge swaths of its population out of poverty and illiteracy faster than all the well-paid development professionals in the West. Yet as Gifford [an NPR reporter] argues, "For every fact that is true about China, the opposite is almost always true as well, somewhere in the country." The data set is so large that it defies generalizations.

We said earlier that China's leadership wants "fast growth, a nonaligned foreign policy and political stability." But let's assume for a moment that all three are not possible to maintain at the same time...if challenges arise that require China to choose between them, which aims will take priority?

I assume political stability would be valued above all else. Keeping the regime in power is the one essential goal; therefore, sacrificing some amount of growth or even making concessions in foreign policy alignment would be considered before risking significant political instability.

Tomorrow we'll continue this discussion by looking at "Radical Breakdowns."

Mike Treder

Tags: nanotechnology nanotech nano science technology ethics weblog blog

Comments

[Brian Wang]

Any business or country has vulnerabilities. China is not unique in this regard.

In terms of things built on sand, the same could be said of any technology or business startup. Google had and continues to have vulnerabilities, but fast growth and
momentum are powerful assets.

High growth companies can do things and are given money and business deals because of their fast growth. The most recent example is Facebook. They got $240 million for 1.6% of the company from Microsoft.

This is more than their 2007 revenue.
http://www.internetoutsider.com/2007/07/time-to-update-.html

The longer you can keep it going then the more the sand can be turned into cement.

China has 7.48 yuan conversion rate now and there has been talk floated in China's internal top planning agency (National Development and Reform Commission) about a 15 percent to 20 percent one-off revaluation.

http://advancednano.blogspot.com/2007/10/china-yuan-and-economy-update.html

that would put the Yuan in the 6 to 1 range. If it could be sustained without disrupting growth (which I believe it can) then China next year would be about equal to Japan's economy on an exchange rate basis.

As for China fooling foreign investors. Profits for foreign companies are booming. the promise is being realized.
http://yaleglobal.yale.edu/display.article?id=9852

china's middle class is rapidly expanding. So domestic supporters are being "fooled" with real lifestyle and economic gains.
http://www.csmonitor.com/2007/0102/p01s02-woap.html

China does not need to force its military budget to the percentage levels of the Soviet Union. They have enough deterrence and even if China's economy is twice the size of the USA. The US military will not be shrinking. It would be idiotic to build more military to try and win a military conflict with the USA or Russia or China. They all have reached military critical mass and more stuff will not win the day. A completely new technological and strategic approach is another story, but just bigger budgets is not the measure.

The evidence that I have seen shows that Chinese leaders have a rational future vision for China and by and large are trying to make choices for the good of the nations future. There are problems and they are being addressed.

It is in the interest of all people to want China, USA, Russia, India and the other nations to succeed and continue to succeed.

Just as in the last century the US can be the big winner but that does not mean the UK, Canada or others have to lose.

Economic competition can and should be win-win.

It would be in the interest of the USA to help China fix its problems with the environment and corruption. Big unrest and loss of central control in China could make us long for the days of only having unrest in the middle east.

[Tom Craver]

Biz week article:

http://www.businessweek.com/globalbiz/content/oct2007/gb20071016_143714.htm