Great article, many thanks for attempting to debunk the mass anxiety regarding China. My question: Can some of this "new Red Scare" be legitimately blamed on China? That is to say, is there something new/unusual/"wrong" that they are doing to rile the American psyche?
Good question. China's tone over the past year or so has become increasingly strident, according to US officials. So they haven't actually been helping their cause. Their reactions to the recent Taiwan arms sales or President Obama's meeting with the Dalai Lama have been generally more strident and pointed than before.
The article could also have noted issues of governance in China. Decisions made in Beijing, good or not, have difficulty finding their way through the system. Handling of the Sichuan earthquake is a case in point. Has China's efforts in handling the aftermath shown any more competence than the efforts of the US to deal with the Katrina catastrophe?
Obviously, the Chinese government was rightfully proud of the fast response to the Sichuan earthquake. And Chinese government officials have made comparisons between their work and the Katrina debacle. But at the same time, the government has taken steps to crack down on people who complained about the quality of the school construction in the region. (Many schools collapsed, killing many students.) And the government jailed several people for seeking compensation.
Your article overlooks two important points --
(1) starting from the decline of the Roman Empire, China & India had the world's largest economies for over a millennium until the Enlightenment began in the West.
As China finally catches up technologically, its ascendancy could be viewed as a natural return to long-term historical trends.
(2) Unlike Japan, China has a billion-plus people, making it inevitable that their economy will grow larger than ours (making this an Asian century). Plus, per-capita income doesn't dictate world influence -- just ask the rich (but small) Scandinavian countries.
Thanks for your point of view. I think China will no doubt have the biggest economy in the world at a certain point. But how it translates that economic power into real power is going to be a big question.
Having spent some time in China, I am struck by how fascinated by the U.S. and Americans the people there are. So, what do people in China think about this sort of existential crisis Americans believe they pose to the well-being of the U.S.?
This is a great topic. For years, Chinese were befuddled that the United States was worried about China. Now many are actually proud that Americans are concerned about China's rise. It's as if our concerns about their power are validating that power.
The Pew Center poll in December showed a more favorable view of China by members of Council on Foreign Relations, but American public's views of China as an adversary remains largely unchanged. Do you think journalists like you who have written many one-sided stories have contributed to average American's ignorance of China?
I think the media can often be blamed for all of America's ills. But in this case, I think if you read most of the stuff being written by correspondents IN China writing for the New Yorker, the Post or the NY Times, it's not anti-Chinese.
Do you think the majority of the Chinese people are happy with China being a Communist dictatorship with one party rule? Do lot of people yearn for more political freedoms?
This is a great question and it's difficult to tell because real polling in China on these type of attitudes is restricted. However, I think we can say that for most Chinese above the age of 40, it's quite a good time to be alive. For younger Chinese, they have opportunities for wealth and success that far surpass those of previous generations. Do they yearn for political freedom or democracy? Hard to say. But I also think the oft-repeated saw that Asians think differently about these issues is also wrong.
With the remnibi, China seems determined to work against market forces and keep its labor cheap. In a smaller country, I would guess that kind of tinkering would blow up in their faces. Do they think they can pull it off?
The United States has a legitimate beef about China's currency. Although China has been gradually increasing the value of its currency, the renminbi is still undervalued and that helps China's exports. But even in an economy China's size that could eventually cause problems. With the economy growing extremely quickly, I think Beijing might let the currency appreciate some more this year.
China seems to be dictating US behavior, being uncooperative on Iran, threatening boycott of American companies after Taiwan arms sale, and objecting to president one-year-delayed meeting Dalai Lama. Do you think Obama has been weak in dealing with China so far? Or is the US actually becoming weaker than China on the world stage?
This is another good question. I think as our piece said there are many people in the United States -- including many people in the US government -- that have overestimated China's strength. As such, that's affected US policy decisions.
Thank you for the good article. How long have you folks lived in China?
We've lived in China for a combined total of 14 years. I lived there for 10 and Steve has lived there for 4.
My years were 1980-82, 1988-1989 and 1998-2004.
Steve was 1994-1998
Dear Sirs, Thank you for your informative Outlook article. My question for you is this: how much of an internal threat to the Chinese economy do you see coming from the behavior of government bureaucrats? It seems to me that Chinese bureaucrats have more or less hijacked economic reform to benefit themselves, but is there any truth to this?
I think corruption is a big problem in China and it could affect the stability of the country. However, I would hesitate to go as far as you and say that economic reforms have been hijacked by the bureaucracy. Hard-working people can still succeed without official government backing.
China has bought a lof of American debt. How might Chinese decisions affect American spending, especially when choosing to not accept more debt, and even selling American debt to other investors?
China has actually become more cautious about buying US debt. In December it was a net seller and Japan once again became the largest holder of US Treasury securities. With China such a large holder of those securities, it won't do anything that would damage its own interests by dumping them and driving down their value. But it will diversify more, I believe. Ultimately the US problem is the budget deficit in the United States. That could eventually drive up interest rates. Moreover, a lot of our government spending on interest will be flowing out of the country, which is a drag on the economy.
In your experience, what have you found to be some of the most successful paths for increased bilateral cooperation and understanding between China and the US? I feel as though a great part of the anxiety in the US stems from a fundamental misunderstanding of the outside world, and China is a perfect example of this phenomenon. What are our best paths to diminish this disruptive chasm?
I think the areas that the US and China have cooperated well in are areas where the two have done concrete things together. An example would be law enforcement cooperation. And also cooperation on protecting international fisheries. These might be small but they are important
China is opening to the outside world, yet seems intent on containing what messages from the outside reach its people. How soon do you see a day when the Chinese government will not block selected web sites and Internet communications between the Chinese population and outsiders?
Yes, I think that slowly but surely that day is coming. The Chinese government controls a lot less of the information flow than it did 30 years ago when I first went to China. Obviously things get tighter and then looser and then tighter again -- as they are now, for example. But the general trajectory is towards more openness.
What is the current status of environmental problems in China? How clean is their air and how accessible is clean water throughout the country?
China is ground zero for environmental problems. I don't know the current stats, but when I was based in Beijing in the 90s five of the ten most polluted cities in the world were in China. Beijing's sky usually looks pretty milky, and it's not from fog or clouds. Water pollution is also a grave problem. One of the two main reservoirs for Beijing is practically unusuable now. Only about a quarter of industrial waste water nationwide is treated. The list goes on and on. Pollution is one of the biggest threats to the country's economic growth and to people's health there.
I totally agree with the authors on the overstated China power and its threats to America's position around the world.
China may have some cash reserve vs our huge debt. But its problems are tremendous. And I don't think it's ready to challenge us.
As an American who grew up in China. I do know China a bit. I love the United States of America. And the last thing I want to see is the two nations fight each other.
The media is doing our country and the globe a disservice by crying wolf. We need each other, especially at this kind of times. I thank you for your insightful observations.
My question to Mr Mufson and Mr Pomfret is, do you think it's possible for the relationship between the two countries to go back to normal? If yes, what will it take?
Back to "normal." I think the United States and China will never have a "normal" relationship. We are just too big and too interconnected for it to be "normal." Both sides will continue to have outsized expectations for the other.
China may be thriving, and we might not be, but can we really say that China is "well governed?" Would you like your children to go to a Chinese elementary school? Would you put your ailing parents in a Chinese nursing home? Will you drink water out of the tap in Chongqing? I am happy that China is doing better than ever, and I hope that we can start do better than ever too...
I think you've hit the nail on the head. That's a variation of what we're saying. Yes, China is making incredible progress and will be a bigger and bigger factor in world economics and politics. But...it still has a ton of problems.
I've read about many unsafe products from China, including toxic toys and tainted medicines. How real is the possibility of a major health scare due to imported food from China?
The challenge that China -- and other countries that export to the United States -- pose to us is one that really is our responsibility. We've got to ensure that the FDA and the Consumer Products Safety Commission do their jobs. It's easy to blame bad Chinese toothpaste or pet food, etc. But at the end of the day its the responsibility of our government to keep the American people safe.
In tandem with the U.S. losing manufacturing capacity to China, I'm concerned that we're simultaneously losing key portions of our defense industrial base. As but one example: the U.S. now purchases much of its printed circuitboards from China. We also purchase naval sonabuoys from China, which use these printed circuit boards. How wise is it to become reliant on China for some of our key military technology and components?
This is a good question. But my sense is that all important equipment used by the US in the national security arena is either made in the USA or by companies in allied countries -- e.g. the UK, Australia, Japan, etc.
As someone who lives in Asia and travels to Beijing on a regular basis, make mistake that the Chinese do see the world right now in a zero sum game
I think the zero-sum mentality in Beijing is a powerful one.
No question, but I must say how much I appreciated your common sense approach. We have to look at the world as China sees it and think that our best future is one of cooperation. We can trade our way to success if we do it right. China needs to go easy on the espionage and tricks and we need to let up on the attitude.
Thanks for your feedback
Doesn't our new found fear about China's growing economic power highlight the problem with how the US has maintained its economic position? If China reaches oil consumption equal to that of the poorest EU27 member world consumption would increase by over 45%. Even a moderately successful threatens the US's 4.5% of world population's ability to consume 10-20% of most resources.
I agree. Generally when the United States starts pointing fingers abroad, it is because we are worried about things going badly at home. Look at how much we feared Japan in the 1980s and early 1990s.
Does China expect its international debts to be repaid? If so, are they looking for hard coin or enriching policy concessions? Can their expectations be met?
I think that China is investing its foreign exchange reserves in a relatively conservative manner, with some tilt toward natural resources. I think it expects all sovereign debts to be repaid, as does the United States. These are primarily investments. But I do think that people in the administration here have started to factor China's holdings of U.S. Treasuries into their thinking about U.S. policy toward China. Whether that's changed U.S. policy is another question, and one I don't know the answer to. This is a story we'll watch going forward, especially given how much more borrowing the US government will do in the coming years.
Given your many years experience in China, please address the issue of any lingering sense among Chinese that they have been kept down by malevolent outside powers and that they must seize what they are entitled to.
Mao Tse Tung, at his moment of triumph, famously declared that "China has stood up," suggesting that his revolution and seizure of power established China among nations.
A sense of denied entitlement prevailed in Germany in the last 20 years before World War 1, German policy makers and public opinion felt that the other powers has denied Germans their "place in the sun."
The naval race with Britain, the Agadir incident, the belated rush to colonies in Africa, all were manifestations of this and contributed to the tensions that led to WWI. Do you see similar public and official opinions in China today?
I think there are two competing strains in Beijing right now. On one side there are people who believe that China should continue taking a low profile in international affairs and hide from the spotlight. There are others, however, who embrace this "now is China's time" view. They believe China should be bolder and more assertive. It's unclear which side will hold sway.
More broadly, the world has always had a difficult time managing the rise of a new power. Britain handled America's rise well. It was tough but they made room -- but again we were very close to them culturally. Germany and Japan were disasters. I think it's an open but very important question how we will handle China's rise. So far, the US has done pretty well, though. But it's still early days.
One of the most interesting aspects of China's economic success has been the demise of the idea that living standards could only flourish in a democracy.
The so called Chinese economic model has become attractive to despotic regimes such as Sudan and Zimbabwe, and the Chinese leadership, with their policy of not interfering in the political leadership of other countries, could actually encourage more such despotic regimes.
I suppose that time will tell if China becomes more democratic or if it will suffer an economic impasse like Japan, but don't you think that the accendency of China in it's current state will alter the geopolitical realities and expectations around the world?
This is a great topic. With China's rise you now hear people talking about the China model or the Beijing Consensus -- a road map for continued authoritarian government with market-oriented reforms.
That's what's been so successful in China, so far.
The issue though is will it be able to propel China up the value chain. Will a political system that doesn't allocate capital very efficiently and controls information flow be able to ride heard over an economy in the information age?
I look at the labels as I walk through Wal-Mart and 90% are from China. Are American businesses selling us down the river with all of the product now being manufactured there? I don't blame the Chinese, they are just doing what we have done in the past and what we should be doing more now. What can be done to encourage American businesses to manufacture more here?
I was just talking to one of my teenage daughters about David Ricardo, the 19th century British economist, and his theory of comparative advantage. That supporter of free trade told us that countries will do what they are relatively good at and sell those goods/services to other countries. So our focus shouldn't just be in getting American businesses to manufacture more for US shelves, but on keeping China's market open (and currency fairly valued) so that we can sell the things we're best at there while they sell what they're best at here.
Hello, Can you explain why it would have been so difficult for China to tend to its own people's needs, and the US to tend to ours? We have a situation where the American consumer is helping ensure Chinese stability by pouring money into China to get Chinese made goods, and the Chinese are helping our stability by financing US government spending. I know that there is benefit to be made from producing things where labor costs are cheaper, but does that benefit outweigh the US being in debt to China to the tune of $1 trillion and millions of Americans out of work?
This is an issue that the Obama administration has raised with China. The admininstration is trying to convince China to rebalance its economy -- e.g. have its people buy more stuff and export less. Whether this going to succeed is an open question.
Last year, thousands of books, articles, scholarly treatises, movies and so forth were translated from English into Chinese, but just seven Chinese books -- according to one Chinese author I recently spoke with -- were translated into English.
The translation flow from English into Chinese far surpasses the trickle of Chinese to English translation. In other words, Chinese folks have much more access to our cultural reservoirs than we do to theirs.
Is this lamentable? Is it correctible? Is there something in the Chinese reservoirs that is worthy of translation, study, perhaps even emulation?
China's social sciences are still really weak and too controlled to be of general interest to American readers. However, there have been a few interesting books translated. One is Will the Boat Sink the Water.
Another is a novel called Wolf Totem
Has "'engagement" as presented (economic reforms => political reforms) worked? How long should it be pursued?
Engagement has not led to political reform. But it has benefited the United States, one could argue, in many other ways. For one, cheap consumer goods. And it has also helped to bring millions of Chinese out of poverty.
We frequently hear that US manufacturers should yield to China's "competitive advantage," and focus our attention on what WE do better .
The sense that China does things better than Americans is assumed, largely, from the fact that they charge lower -- in some cases, much lower -- prices, with very little attention to actual costs of production.
I am wondering what you might think is China's "competitive advantage?" Most people think it is labor costs, but that does not really apply to industries -- such as steel -- where labor has become a relatively minor "input" due to productivity gains over the years.
In fact, the cost of ocean shipping exceeds labor costs such that, in many cases, labor could be FREE in China and there still would be no real pricing advantage.
Studies have shown that China's steelmaking is higher cost than that in the U.S. and yet they charge much less for their steel. How do you think that is possible, in economic terms?
I think Chinese companies do have to pay attention to actual costs, but for years those costs were subsidized. Chinese energy costs were subsidized, but they aren't now, for example. Chinese companies saved money by not doing things like treating waste water, but that is gradually changing too. State owned companies have drawn on cheap credit from state-owned banks, but that is gradually fading too. It will be interesting to see how China's trade changes going forward and how its advantages change or disappear.
Drive down a highway in East China, and you will see mile after mile of dense plantings. Ask a Chinese person about them, and they will say they are there to combat pollution.
Visit a poor Chinese family's home, and find they have grown all the food themselves except the two kinds of mushrooms they collected. No wonder your number of $6546 for per capita income sounds low! And by the way, in 1980, many states in the U.S. had per capita incomes within a 1000 dollars of that!
Visit a Chinese family, and find, not only do they not have a car, but they do not have central heating or air conditioning. Even in luxury high-rise apartment building in downtown Shanghai, they will hang the laundry out to dry. They have on-demand water heating, and they use it sparingly, collecting the hot water they need for a day in the morning. Bring the same family to America, and they will think you are being extravagant for setting the heat to 58.
Go out drinking with a group of young Chinese men, and find that they will order a plate of brocolli with their drinks. Join up with a mixed-gender group of Chinese college students, and find they have the same innocence as an American middle schooler.
And then ask yourself: what is the difference between England using the banner of free trade to run drugs like opium into China and America using the banner of free speech to enable the internet pornography purveyors to expand their markets?
Walk up to an ordinary Chinese person and try a little English. Now walk up to an American and try a little Chinese. What's the difference? If the Chinese were actually speaking in a way Americans could follow, wouldn't we be having McCarthy hearings?
In a world where resources are a real issue, what is the sense of telling ordinary Chinese people who save like the dickens, that they ought to start buying things they don't want or need, like the Americans (my net worth literally went up 500 times after a married one, although I haven't had a single pay raise during that period; my environmental impact has gone way down although I was "environmentally conscious" before). And of course, I could go on and on.
Of course, there are many wonderful things about China and the Chinese. Both Steve and I have experienced them.
Now that there have been some recent product scares and recalls with Chinese manufacuted products and production is only increasing, aren't we headed towards bigger problems faster. If American's want cheaper products and Chinese factories produce them - isn't it inevitable that shoddy products will be the result? It seems as though if worker standards improve in Chinese factories that their wages will increase and the cost of doing buisiness will increase as well. Am I thinking too simplistically?
I think the biggest issue is whether our bureaucractic structures -- like the FDA and the Consumer Products Safety Commission -- have the wherewithall to protect American consumers.
Steve and John, Good piece that brings some balance to the issue. Rather than look at different asopects of China's current conditions, would it not be much better to looks at the long term trends? For example in higher education where was China 20 years ago and where will they be in 10 years? Snapshots of now look either bad or good depending on where and from what anglke the picture is taken.
Snapshots can be limited, but trend lines can be misleading. We tend to see trendlines as straight lines when that's rarely the case. Moreover, there is the fact that improvement from a very low base is relatively easy, but it becomes harder and harder to improve at the same rate from a higher base.
A word on education: You hear a lot of complaints these days about access to good schools. Chinese people have higher standards / expectations for their children but there are only so many top schools.
The term "red scare," in my opinion, is unnecessarily sensationalist, not consistent with its traditional use by historians, and inaccurate, as China no longer has a communist economic system.
Anyway, don't you agree, from a historical perspective, since the mid or late 19th century, the United States has been more of a threat to China than vice versa? This country's participation in the unequal treaties system, role in helping suppress the nationalistic Boxer rebellion, thousands of troops stationed in China until about 1945, overt threats over the offshore islands during the Eisenhower administration, assistance to Tibetan fighters around 1959, ongoing support for Taiwan all seem examples.
Secondly, China has historically never posed a military threat to any country not on its borders, except to Japan during one or two ancient dynasties. Your comments?
Interesting points. China was a weak country then and it was routinely bullied by Western powers, the US included. However, I'd take issue with notion that China has never been expansionist. China's land mass almost doubled during the Qing Dynasty for example. It also controlled Korea and regularly fought with Vietnam.
If the Chinese growth continues on a average yearly 8 to 9 percent and your political gridlock keeps your decision making at 60 senators versus to one person in China, I do not care what is your theory of not to be scared of China, my friend you will be behind in the next 10 to 20 years. I spent a lot of time in China, I can tell you these people are moving.
Interesting point. Moving they are! But is China's success to be feared?
the words "China" and "eco-friendly" in the same breath boggle the mind. And why is it glossed over that China invaded and has occupied Tibet by force?
I don't think we would call China "eco-friendly." It is getting more eco-conscious, but the environmental situation is grave.
As for Tibet, we do write about it as part of the whole story of China and about negotiations between the Dalai Lama and his representatives and the government in Beijing.
I'm Chinese-American, and I know both cultures. It's difficult for Americans to understand Chinese. Chinese media will publish mostly praise and good news, but the American media will be contentious. For a person, American people wear their clothes so that they are comfortable, but Chinese emphasize how their clothes look to others, even if they are uncomfortable.
I am always kind of leery about people saying how different the Chinese are from the Americans. Actually, I believe as big continental countries we have a lot more in common than people from other countries. As for the media, China's will change with the times.
As Sen. Graham said, "they don't need 60 votes to get things done." The problem in the U.S. is that if I vote for your project, you vote fo mine, that is why we have no money left for what we need rather than what we want.
Due to technical difficulties (my difficulties), my answer to this question was posted without the question. So I'll repost the answer -- with the question this time.
It's hard to deny that the US Senate is gridlocked and that the need to get 60 votes has led to a lot of backscratching, or worse. China has its own version of regional politics but it's obviously a lot more centralized. In some cases that system produces its own quirks. One example: the mad rush to build wind turbines in Inner Mongolia outpaced the available transmission and a lot of turbines stood idle.