Possibly the most fashionable theme in current discussions of the future is whether China will replace the United States as the leading world power. That it will do so seems to be taken for granted in pop-historical circles, as well as among economic forecasters or futurists (who currently have a record that does not inspire confidence). A Goldman Sachs analysis declares that China will replace the United States as the largest economy in the world by 2027. But the largest economy is not automatically the leading nation. And ruling the world is more of a problem than one thinks, as Washington is discovering.
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Only Tribes held together by a group feeling can survive in a desert. (Ibn Khaldun, 14th century Arab historian)
Time to chuck into the dustbin the cosmopolitan notions so celebrated at global conferences: a world run by wise men of the United Nations, science-driven socialists or their ostensibly more pragmatic twins, global free marketers. We are leaving the age of abstractions and entering one dominated by deep-seated ethnic, religious and cultural loyalties, some with roots from centuries and millennia ago.
The 14th century Arab historian Ibn Khaldun noted that what most holds people together is biology and shared history. These create the critical bonds of kinship and trust and a sense of common purpose that have animated every ascendant group from the days of the Greeks and Romans through the British empire, America and modern day China.
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With U.S. domination of the world on the wane, the time is now to embark on a multilateral future
Columnist Charles Krauthammer wrote in 2004 that the predominance of U.S. power in the world after the fall of the Soviet Union was a “staggering development in history, not seen since the fall of Rome.” Krauthammer and his fellow neoconservatives famously concluded from this disparity in power that the United States needed to adopt an aggressive foreign policy agenda to enhance and continue its dominance in the “New American Century.”
“Because of statistics I can dig out the deepest secrets, because of statistics I am not alone any more, I can play in the numbers, because of statistics I can re-arrange the stars in the sky” — Love the Motherland, Love Statistics, by Wang Jiaowei, a statistician in Shandong Province
The Global Bears on the Hunt
Several prominent global bears – hedge fund managers Jim Chanos and Hugh Hendry among them – have concluded that China is engaging in a major misallocation of capital that will not have a happy ending. Overinvestment in basic materials and infrastructure, lack of profitability of the state owned companies that dominate the economy, death of the export model, and a major real estate bubble are among their concerns.
Are Chinese elites ready to go for superpower status and stop “hiding their claws,” as Deng Xiaoping used to put it? Does the leadership feel prepared to play the role of a dominant power? Here are some of the smarter answers that I’ve read in recent memory, from a Chinese thinker who doesn’t fall under one of the easy labels of either a western liberal or a reflexive nationalist. Wang Jisi, dean of the School of International Studies at Peking University, tells Yoichi Funabashi of Asahi Shimbun, that — Some younger-generation opinion leaders and others, maybe some officials as well, are calling for a more assertive policy toward other countries.
But the mainstream thinking, I mean the top leadership, is still very sober-minded about China’s own power and influence, and they are very conscious of China’s internal challenges combined with external challenges. Here is a snippet of an extended interview that is worth the time:
Until the global financial crisis, few in the United States believed the country was in decline. A minority now recognize this might be the case. The challenge to America’s position as premier global power comes from China. The fact it is only a developing country, with an economy much smaller than America’s and far less advanced, persuades many than this is a distant prospect.
China’s reemergence as a major power doesn’t challenge U.S.
BEIJING (Caixin Online) — In a long-term view, the rise of China is to be welcomed, but today China remains what the journalist Martin Wolf calls a “premature superpower.”
China’s current reputation for power benefits from projections about the future. In one poll, 44% of respondents mistakenly thought that China already had the world’s largest economy, compared to 27% who accurately picked the United States (which is three times larger). Martin Jacques even entitled his recent book “When China Rules the World: The End of the Western World and the Birth of a New Global Order.”
American elite opinion has been, for the most part, dead wrong about China. The People’s Republic is not liberalizing and it is not aligning itself with the West to resolve the world’s most pressing problems
Back in February, Robert Samuelson, one of America’s top economic commentators, began his Washington Post column with a critique of China:
Samuelson is neither an alarmist nor a reflexive China basher. He is calling it like he sees it. And I think he is correct. American elite opinion has been, for the most part, dead wrong about China. The People’s Republic is not liberalizing and it is not aligning itself with the West to resolve the world’s most pressing problems. Its military build-up is destabilizing and, in many cases, it is not playing by the rules of international trade.
For the growing number of Americans who see China heading for inevitable global dominance, nudging aside the United States, a brief walk down memory lane helps put long-term predictions into perspective. Not so long ago, Japan was seen as the next (economic) number 1. American executives studied the 14 management principles of The Toyota Way, developed by the automobile manufacturer that grew into the world’s biggest car maker and is now recalling millions of defective vehicles.
The quest to secure Middle Eastern oil and the wars in Iraq and Afghanistan consume much of the foreign policy establishment in Washington today. But in the next decade, more of the U.S.’s attention will shift to the new Middle East: China
Economists have been predicting this shift for decades. China is already the world’s top manufacturer, top auto market, top cement producer and top polluter. Its military and naval capacity is growing. Its construction-driven hunger for natural resources, especially timber and energy, is reshaping the landscapes of Africa, Southeast Asia and South America. Experts may argue about the pace of China’s economic ascent — Nobel laureate economist Robert Fogel predicts that China’s economy will be an eye-popping 40% of global GDP by 2040, while others project somewhat more modest growth — but few question that it’s happening dazzlingly fast.