Posted on 10/17/2009 9:35:54 AM PDT by SeekAndFind
Review: When China Rules the World, by Martin Jacques
While the decades since the Vietnam War may be most known for their startling technological developments, they have also spawned a chic genre of literature: the ‘America is in Decline' tract. What started most prominently with the work of Paul Kennedy has turned into a veritable cottage industry. Tomes in this category have included Oswald Spengler's Decline of the West, Bruce Horton's Decline and Fall, and, most recently, Fareed Zakaria's The End of America, which Barack Obama was famously photographed holding last summer. Some of these books argue that the decline is inevitable as a result of "cultural decadence," others argue decline is a result of "environmental devastation," and others still attribute the supposed decline to falling birthrates. In the 1980s and early 1990s, many of the more-economically oriented books of the genre argued that the West's decline was partially a result of the rise of Japan. Today, many are devoted to the proposition that western decline is linked to the rise of another Asian tiger: the People's Republic of China.
Into this presumably lucrative declinist field now enters Martin Jacques, and his new, hefty-looking tome, When China Rules the World: The Rise of the Middle Kingdom and the End of the Western World. Jacques' volume, while obviously the result of serious scholarship (he name drops everyone from Confucius to Barack Obama), and fluidly written, has one grave problem: its persistent refusal to deal with facts that negate its thesis.
Jacques' argument has the benefit of being simple, if unoriginal: China, with its huge population, manufacturing might, and (alleged) technical prowess, is destined to surpass the United States midway through this century to become the world's leading economic power. In so doing, so-called Chinese values - stability, authoritarianism, collectivism - will eclipse the (allegedly now outmoded) "Western values" of human rights, democracy, and individualism. (Jacques et al. always forget to acknowledge that Japan, South Korea, India, and other Asian states have happily adopted the "Western" values of democracy and individual liberty.) The reasons for this shift, Jacques' argues, lie in the numbers.
Jacques opens his chapter, ‘China as an Economic Superpower' with some impressive sounding demographic figures, intended to hit home just how big, very big, in fact quite massive China really is. "When the United States began its take-off in 1870," Jacques notes, "its population was 40 million. By 1913 it had reached 98 million . . . In contrast, China's population was 963 million in 1978 when its take-off started in earnest: that is, twenty-four times that of the United States in 1870." These numbers are intended to wow us with their sheer size. And indeed, Jacques makes much of them: he argues that due to the size of China's population, the Middle Kingdom's domination of the world is all but inevitable.
Jacques makes two fundamental errors here. First, he ignores the fact that there is no evident correlation between population size and economic strength. Consider a few examples. Qatar (population 1,600,000) has a per-capita GDP of over $85,000. Luxembourg (population 493,000) has a per-capita GDP of $82,000, and Norway (population 4,800,000) boasts a per capita GDP of nearly $50,000. (One wonders where the breathless When Oslo Rules the World is.) China has a per capita GDP of less than $6,000, placing it below such economic heavyweights as Angola, Kazakhstan, and El Salvador. So despite the fact that China now has the third largest gross GDP in the world (at about a third the size of the United States), this, like the empty skyscrapers that crowd Shanghai's skyline, is merely an illusion of strength. China has certainly made laudable economic and social progress in the past decades, lifting hundreds of millions of people out of abject levels of poverty. That being said, China remains fundamentally poor. And while its economy continues to grow at a steady clip despite the global recession (though this is illusory as well: the growth is nearly entirely the result of government spending), China is facing a grave problem that will ultimately retard its ascension into the pantheon of truly prosperous countries.
This serious problem, forgotten by Jacques, is simply unavoidable, for it lies in the country's demographics. Simply put: China is growing old - and fast. (Decades of the one-child policy are to blame for this.) At least a third of the population of the Middle Kingdom will be over 60 by the middle of this century. While Shanghai, for example, is widely known as the exciting and dynamic center of capitalist China, it also has one of the oldest populations in the world: more than a fifth of the population is over 60, and by 2030, a full 40% of the population will be at in at least its sixth decade. The Center for Strategic Studies has demonstrated that by 2030, there will be 2.5 Chinese workers to support each retiree - by 2050, there will be a frightening 1.6 workers in that position. So while nattering nabobs in the West fret over aging populations in their countries, don't let's forget that in 2050, a full 438 million Chinese people will be at least 60 years old. For those keeping score, that's more people than the entire population of the United States. This is going to cause crushing - if not catastrophic - problems to the Chinese pension system, sap productivity, and strip the Chinese economy of capital needed for reinvestment.
Meanwhile, a recent report from the Rotman School of Management at the University of Toronto predicts that China's huge labor force will begin to shrink in 2020. The very reason for China's tremendous success in the past few decades - its seemingly endless supply of teeming masses yearning to breathe factory air - is set to begin evaporating. At the same time, labor in China will become increasingly expensive, dissuading foreign companies from investing here. Little wonder that it has become a truism among more sensible academics and Sinowatchers that, "China is going to grow old before it grows rich." It is more of a curiosity that Jacques chooses to simply gloss over these inconvenient truths, so eager is he to trumpet China's rise and America's decline.
Jacques also spends much energy - both his, and his increasingly exasperated readers' - pushing back against the notion that as China becomes richer, it will become more "westernized." Yet there is much evidence on the ground here in China to refute his thesis. To begin on the surface level, China, like most countries in the world, has a healthy (or perhaps, unhealthy) share of McDonalds, KFC, and Burger King restaurants. It also has a voracious appetite for American movies, music, and sports figures. (Kobe Bryant is probably more popular in China than in the United States.) Meanwhile, women have entered the workforce in unprecedented numbers, the country is rapidly urbanizing, and citizens are demanding an increased amount of accountability from their government. All of there are classic examples of ‘westernization.' Indeed, Jacques' depressing and downright insulting insistence that Chinese people don't care about individualism, human rights, and fair representation is belied by recent developments such as the demands for government accountability by citizens groups in Sichuan province following the earthquake there last year, and the founding of the Charter 08 group.
Moreover, despite the increase in Mandarin-learners in the western, the global supremacy of English continues apace: when I worked for a business magazine in China earlier this year, I attended many business seminars, workgroups, and conferences in Shanghai. Even if the crowd was nearly exclusively Chinese, the meetings were held in English. I even witnessed groups of Chinese businesspeople, all obviously native Chinese speakers, speaking to each other in broken English at networking events. (This can be a truly painful experience.) English remains the dominant language of commerce, even in roaring China.
But Jacques ignores these facts, choosing instead to bang the drum of American declinism, and the alleged rise of China. Brushed aside throughout the book are China's demographic crisis, its steady "westernization," and its persistent poverty.
China may one day rule the world, but, to paraphrase Keynes, when China rules the world . . . we'll all be dead.
-- Ethan Epstein is a business writer based in Portland, Oregon. His work has appeared in the Weekly Standard, the New York Press, Spiked Online, and others.
Easy for you to say.
Obama is the president and Democrats run the congres. Do not underestimate the danger they can do.
Excellent article.
Various countries are posited as as replacing America as the dominant power. This is usually done by concentrating on America’s problems while ignoring those of the contender.
Europe, Russia and China have structural economic and cultural issues that dwarf those of the USA.
Dominance in the world is relative, not absolute. America could go into significant decline in absolute terms and remain dominant as long as competitors decline at equal or greater rates.
LOL.. now thats funny...
Yup, America will survive rule by punks and I think, when bambi and his minions are booted out, it will finally be the end of the sixties.
I may be a romantic but over my lifetime I have seen much good arise from tragedy.
Decline and re-examination by the American people of how their nation sees its future, questioning where we are headed and whether we are over-extended in our relationship to the other nations of the world.
Perhaps it would be a positive for the “divisive nation” as it is now to make some decisions with compromise and coming together to avoid future disaster.
In sum - fear may bring out our spirit again as the great nation we are - the nation we have built and which we all are a part of - together - in cooperation.
The decline of the West in general (of which we are part) is the defining geopolitical fact of our era. It’s a process that’s already well under way. Industrial societies that don’t take in many immigrants (such as Russia) are already contracting, those that do (like us) have delayed the outward signs of their own decline. As we become an ever smaller and less important subsection of the world, global leadership will naturally pass to the East, before perhaps shifting elsewhere.
And there’s no need to see China, or India, or anyone else as the villain in all this. Everything that’s happening to us we’re doing to ourselves.
Authoritarianism is already eclipsing democracy, and in this country.
The article omits a key and I think decisive fact. It’s called education. Our educational system is in shambles and accounts for the loss of manufacturing industry and the migration of high tech jobs to to China, India, and the Asian tigers. In less than a decade China has emerged as major political power ( its influence in the Korean peninsula is massive- and we cannot even host the Dalai Lama for “fear” of offending China) and of course, China holds almost two-thirds of American debt. Where do we go from here?
Time to wake up. America IS in decline. Obama is the symptom of where we are. But it’s isn’t irreversible. We can get back to greatness and liberty again, but we are right now fullspeed into the opposite direction.
OK, I realize that China holds a large chunk of US debt, but let’s not exagerrate things. China does not own 2/3 of our debt.
See here :
The 15 Largest Holders of United States Debt
15: Luxembourg – $104.2 Billion
14: Depository Institutions – $107.3 Billion (commercial banks, savings banks, credit unions)
13: Russia – $119.9 Billion
12: Insurance Companies – 126.4 Billion
11: Brazil – 139.8 Billion
10: Caribbean Banking Centers – 189.7 Billion
9: Oil Exporters – $191 Billion
8: United Kingdom – $214 Billion
7: Pension Funds – $465.4 Billion
6: State and local governments – $522.7 Billion
5: Other Investors – $629.7 Billion (“other” refers to individuals, government sponsored enterprises, brokers and dealers, bank personal trusts, estates, corporate and non-corporate businesses)
4: Japan – $711.8 Billion
3: China – $776.4 Billion
2: Mutual Funds – $769.1 Billion
1: Federal Reserve and Intergovernmental Holdings – 4.785 Trillion
Now, can anyone explain to me what FEDERAL RESERVE ownership of US debt means and its implications ? It looks like we’re printing money and loaning OURSELVES the money at the same time...
My wife and I counted all of the nieces, nephews, cousins, children and grandchildren in our combined family circles.
The producers are vastly outnumbered by the non producers. Even the term non producer is generous. Those on that side of the equation are leaches, sucking out scary proportions of society’s assets.
And it is significant that many of these young adults were raised in productive middle class families.
One 37 year old has had 7 illegitimate children, all taken from her by the state of Florida. The costs to society are incalculable. Several are milking SS disability for so called mental problems.
The literacy level of those under 35 with HS diplomas is depressing.
If this is coming out of middle America, what does that tell us about other segments of society?
There is the 600 pound gorilla in the alley.
As far as I can tell, that is all simply paper. And a lot of the ink is still wet.
And the Fed is printing money to pay the interest on the money borrowed from other entities.
Exactly. China is going to have a meltdown not too long from now. Usually when that happens it means it will split up among provincial warlords, if history is any judge.
But that's not to say that America isn't in deep, deep trouble.
Another candidate for world leader is Brazil. But there, too, they have worse problems than we do. We're probably in for a bad time all over the world, which may last for 20 years or so. I hate to seem gloomy, but it's hard to avoid.
And that large an economic collapse is pretty sure to lead to wars. So, we'll see how it all plays out. Better if Pakistan didn't have nukes. Better if North Korea didn't have nukes. Better if Iran wasn't getting nukes from Putin. Better if Putin didn't have ambitions to reset the Soviet Empire. Because we're going to be seeing a world-wide mess.
That's exactly how they do it. Big ol' shell game!
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