China as a Rising Power Versus the US-led World Order

That is the title of Suisheng Zhao’s short but informative piece.

Here is the abstract.

Although a rising China is not a status quo power content to preserve and emplace the US-led world order, it is not yet a revolutionary power discontented with and willing to undermine the existing order. Not only is China far from the position to overtake the US power, it has not articulated distinctive values to underwrite the world order. China is a reformist/revisionist power, dissatis ed not with the current order but its position in the order.

You can read the rest here.

On a different yet related note, in Zhao’s footnotes I was directed to David Cowhig’s Translation Blog, a translation blog from Chinese to English or what looks like mainland publications. Very much appreciated service and a Web site I expect to consult often.

Hegemony with Chinese Characteristics.

I argue that these conclusions are premature. China’s grand strategy is clearly aimed at supplanting the United States as the dominant military power in East Asia. But this alone does not mean that Chinese and American interests are incompatible. The real question is what China plans to do with its emerging regional preponderance.

 

Would China use its hegemony to maintain an economically open, institutionalized, and rule-based regional order, even if one that is tilted in its own favor? Or would it seek to fundamentally overthrow these decades-old rules and norms in ways that effectively exclude outside economic engagement and threaten the territorial integrity of America’s regional allies?

 

If the latter, then the costs and risks of a more confrontational policy of “containing” China’s rise may be justified. If the former, then Chinese regional hegemony is perfectly compatible with America’s substantive interests, and may even help reduce the burden of the United States’ expansive global commitments. To date, there are surprisingly few indications that a Chinese-led regional order would be antithetical to core American interests in the region.

The author is Kyle Haynes and you can read the full version at the Diplomat.

My only disagreement with the piece is that he implies that Taiwan is an American core interest. It is not and the balance of interest is vastly in favor of China on this interest.

Do we want China to reform?

Moody’s recently downgraded China sovereign debt, a move which was probably overdue.

The article I link to writes that China “has 70 percent more money sloshing around its economy than the United States does, even though the American economy is bigger.”

As well, “More than half of the bank debt in China consists of loans from state-owned banks to state-owned enterprises.”

This isn’t sustainable and is only one aspect of the fragility of the Chinese economy. Other  issues include rising labor costs (making it increasingly difficult to rely on their workhorse model of exporting labor intensive goods), overcapacity, and a still sizeable amount of party corruption.

All of this suggests that China is headed towards an economic crash.

From a security perspective, most analysis I read imply that it is in American interest for the Chinese to reform their economy. The general line of thought is that Chinese economic reforms will help avoid a future economic crash that leads to some sort of nationalist inspired confrontation between China and the regional players (either America or our allies). Yet from a security perspective, if economic power is the best indicator of state power and China is indeed the next and most probable serious contender to America regional hegemony, it’s not clear that America would want China to reform.

For one, all major wars have been the result of an emerging power seeking to reorder its neighborhood to its likening. From Athens and Sparta to Nazi Germany and Europe, the wars that define eras are from not from the emerging powers stagnating but from emerging powers continued rise.

But two, the biggest geopolitical beneficiary of the American financial crisis of 08 was arguable China. It not only gained persuasive power for its style of politics, but from a pure relative power perspective, 2008 was a blessing to China.

Below are IMF data for the GDP based on purchasing-power-parity (PPP) share of world total expressed in percent of world GDP in PPP dollars. This is obviously crude and it’s difficult to know how much of the Chinese growth captured by the data is genuine but the chart is still informative.

 

You can find the data here.

The Chinese and “White left”

That is the new insult being lobbed among China based netizens.

Although the emphasis varies, baizuo (or white left) is used generally to describe those who “only care about topics such as immigration, minorities, LGBT and the environment” and “have no sense of real problems in the real world”; they are hypocritical humanitarians who advocate for peace and equality only to “satisfy their own feeling of moral superiority”; they are “obsessed with political correctness” to the extent that they “tolerate backwards Islamic values for the sake of multiculturalism”; they believe in the welfare state that “benefits only the idle and the free riders”; they are the “ignorant and arrogant westerners” who “pity the rest of the world and think they are saviours”.

You can read more here.

 

The Trump u-turn on China and Russia is welcomed policy: Why the United States should be wary of Russia, and not China.

During the presidential race, political commentators were equally dismayed and puzzled by the developing relationship between then candidate Trump and President Putin. All sorts of explanations were offered to explain the apparent goodwill, from naked business interests to an alleged sex tape. But whatever the reason, Trump complimented Putin on a regular basis, referring to Russia’s president as a “strong leader” and “smart,” and stated that he intended to have a good working relationship with Russia’s president.

China, however, would be the center of a Trump administration’s ire. Trump accused China of “raping” the United States and promised that on day one he would label China as a currency manipulator and erect steep trade barriers. During his confirmation hearing, his nomination for Secretary of State suggested denying Beijing access to their artificial islands in the South China Sea.

That was then but this is now. After 100 days of Trump, the expected rapprochement with Russia has cooled and Chinese-American relations have apparently warmed. President Trump has directed 59 Tomahawk cruise missiles at Russia’s ally Syria, accused Russia of complicity in Syrian war crimes, has made no attempt of removing the sanctions imposed after Crimea, and has publicly stated he expects the peninsula to be returned to Ukraine.

Trump, however, has failed to label China as a currency manipulator, reneged on trade barriers, and restricted Navy patrols in the South China Sea. Xi Jinping, apparently, is even President Trump’s friend.

This u-turn is highly welcomed news for the simple fact that Russia is the troublemaker, and China, not so much.

Russia is the bigger problem for American foreign policy primarily because Russia is seeking to undermine 50 plus years of European economic integration and political liberalism. As articulated in a 2013 Center for Strategic Communications policy paper titled “Putin: The New World Leader of Conservatism,” Putin’s strategy of gaining influence in Europe is by assuming the leadership role of a transnational movement that defends and renews traditional social values, both in side Russia in Europe. This means supporting positions that are anti-immigrant, homophobic, and Eurosceptic, among other anti-liberal policies. This essentially makes Russia a proselytizing power as Putin seeks to export these policies to Europe by hacking elections, funding far right parties, and spreading fake news. The French presidential election offers ample evidence of this strategy in motion.

Compare this to China which has no designs on the political makeup of foreign states, doesn’t seek to export any particular culture to its neighbors and, despite lifting 800 million people out of poverty, doesn’t pressure others to adopt its version of state sponsored capitalism. They do hack, but not to influence election outcomes, and the fake news it produces is mainly for Chinese consumption and not to influence foreign elections.

The Chinese and Russian objectives for their respected neighborhoods are in contrast to one another. Russia’s objective is to sow political and economic uncertainty throughout their neighborhood, as a Europe divided by nationalism and economic populism is a plus for Moscow. But where Russia is deliberately stirring up tensions throughout Europe, China’s number one regional goal is stability. From their policy towards North Korea to their relationship with the United States, China’s number one goal is to avoid destabilizing the region. This is because unlike Russia, China has experienced legitimate economic gains and political consolidation over the past 30 years and would prefer not to upset this trend.

When one also considers that Putin’s Russia has also invaded two countries, committed war crimes in Syria, has sold arms to the Taliban, and violated the 1987 Intermediate-Range Nuclear Forces Treaty, it is rather clear that Russia, and not China, should be considered the bigger problem for American. American priorities and rhetoric should reflect that.

 

 

Avoiding a Sino-American Confrontation: Why the US Should Accommodate a Rising China.

Many good points made in a Christopher Layne brief discussing how to manage China’s rise.

Here is one.

First, without delving too deeply into the arcane details of nuclear weapons strategy, we know that, because of the “stability/instability paradox,” although nuclear armed states are deterred from using nuclear weapons against each other, they are not stopped from fighting a conventional war. This isn’t speculation: in the 1999 Kargil conflict, India and Pakistan — both armed with nuclear weapons — fought each other with conventional forces.

 

It is ungated and can be read in it’s entirety here

China as the non revisionist power.

Analogies to other rising powers with shallower histories — France, the United States, Germany, Japan, the USSR — are not helpful in predicting the consequences of China’s rise. China has no messianic ideology to export; no doctrine of “manifest destiny” to advance; no belief in social Darwinism or imperative of territorial expansion to act upon; no cult of the warrior to animate militarism or glorify war; no exclusion from contemporary global governance to overcome; no satellite states to garrison; no overseas colonies or ideological dependencies to protect; no history of power projection or military intervention beyond its immediate frontiers; no entangling alliances or bases abroad.

This is supportive of the logic of accommodation and against  the logic of confrontation.

You can read the rest here.

BBC interview with North Korean Diplomat

They are not Iran. They have no ideology they want to export.

They want the regime to survive.

As Vice-Foreign Minister Han made clear to me, North Korea has learned the lessons from recent history, in particular the US-led attempts at regime change in Iraq and Libya.

 

“If the balance of power is not there, then the outbreak of war is imminent and unavoidable.”

 

“If one side has nukes and the other side doesn’t, and they’re on bad terms, war will inevitably break out,” he said.

 

“This is the lesson shown by the reality of the countries in the Middle East, including Libya and Syria where people are suffering from great misfortune.”

I’m not defending the regime (they aren’t the sort of government I want to be ruled by) yet if America does want to fix this issue it should address it’s post-cold war foreign policy first, NK foreign policy second.

From a third party view, NK foreign policy appears to be rational.

You can read the rest here.

Recreating China’s Imagined Empire

That is the title of Ian Johnson’s review of Howard W. French’s Everything Under the Heavens: How the Past Helps Shape China’s Push for Global Power. 

 

Regarding Chinese policy of cliaming owndership of South China Sea, Johnson writes

China’s leaders have not directly discussed theses actions, but broadly say that their claims are based on history. The argument is simple: because Chinese ships once sailed here, the reefs and shoals are Chinese. but as French puts it:

 

“These historical claims are not worth exploring because of any legal power they might possess. Almost all non-Chinese experts agree that claiming distant waters are one’s own “historic waterway” is not something that international law or conventions governing the sea either contemplate or permit…

 

The merit our attention instead because of how they speak to China’s ambivalence about the international system itself, and to the continuing resonance of a certain imperial perspective – tian xia.”

My view is that Chinese behavior in the SCS is mostly a form of balancing American military policy, but Johnson’s review is an interesting exploration of how China’s behavior is shaped by its history.

It is gated, but you can read the review here.

“Almost 88 percent of job losses in manufacturing in recent years can be attributable to productivity growth, and the long-term changes to manufacturing employment are mostly linked to the productivity of American factories.”

That is the conclusion of 2015 research conducted by Michael J. Hicks and Srikant Devaraj.

Here is the summary

Manufacturing has continued to grow, and the sector itself remains a large, important, and growing sector of the U.S. economy. Employment in manufacturing has stagnated for some time, primarily due to growth in productivity of manufacturing production processes.

 

Three factors have contributed to changes in manufacturing employment in recent years: Productivity, trade, and domestic demand. Overwhelmingly, the largest impact is productivity. Almost 88 percent of job losses in manufacturing in recent years can be attributable to productivity growth, and the long-term changes to manufacturing employment are mostly linked to the productivity of American factories. Growing demand for manufacturing goods in the U.S. has offset some of those job losses, but the effect is modest, accounting for a 1.2 percent increase in jobs beyond what we would expect if consumer demand for domestically manufactured goods was flat.

 

Exports lead to higher levels of domestic production and employment, while imports reduce domestic production and employment. The difference between these, or net exports, has been negative since 1980, and has contributed to roughly 13.4 percent of job losses in the U.S. in the last decade. Our estimate is almost exactly that reported by the more respected research centers in the nation.

 

Manufacturing production remains robust. Productivity growth is the largest contributor to job displacement over the past several decades. This leads to a domestic policy consideration.

Short reading with plenty of data. You can read the entire thing here.