A countercultural take on China

That is what I serve up in my Bloomberg column, note it is a reminder more than a modal prediction.  Here is one excerpt:

Is the rest of the world getting China wrong yet again? Maybe the country is not doomed to live out unending top-down rule. What is history, after all, but the realization of the wills of countless unpredictable human beings.

Past mistakes about China are too numerous to mention.

A list then follows.  And:

But has China suddenly become so predictable? Are events there now no longer contingent on the exercise of human will? Modern China is one of the most unusual and surprising societies humankind has created. There are no good models for it, nor are there data from comparable historical situations.

There is, unfortunately, a tendency for Westerners to impose superficial narratives on China and the Chinese, often based on scant observation.

To close:

For myself, I don’t have a coherent story about how the Chinese might move to greater liberty in the next 10 to 15 years. But I do think the actions of the current regime can be read as signs of vulnerability rather than entrenchment. Taiwan and Hong Kong, despite its current crisis, remain strong examples of the benefits of liberalization. Meanwhile, the notion of the internet — even with censorship — as a liberalizing force has been too quickly dismissed, especially in an America that has fallen out of love with Big Tech.

Which leads to a reality even deeper than China’s unpredictability: people’s continuing capacity to respond to current events and shape their futures for the better. As you listen, watch and read about China, keep in mind this essential human quality.

There is much more at the link.

Comments

'a modal prediction'

Could be a prediction? Might be a prediction? May be a prediction? Should be a prediction? Ought to be a prediction?

This allows one to scale truly dizzying Straussian heights.

I'm no economist.

So, I see China as a trial balloon for modern monetary theory.

The Communist party in China seems to have it down: monopoly supplier of money allows deficit spending for public purposes. Maintained full employment by ordering state-owned banks to lend and local governments, state-owned enterprises to spend vast amounts. Suppressed inflation with credit controls, land seizures, and has comparative advantage of low human rights. Long term consequence: promote investment at expense of consumption: ghost cities, industrial overcapacity, pollution, and widespread poverty. Time will tell if this works.

A little over half of China's population of 1.3 billion people live in urban areas. Over the coming decades, a much higher proportion of people will live in urban areas, because effective wages will be higher in cities. Those buildings will not be permanently empty.

Urban areas sure, the ghost cities maybe not.

The US still urbanizes, but Rust Belt cities are in the wrong place, etc.

You can guess other, but seems a lot of faith to place in command economics.

It should make for some splendid urban decay though. Think an urban version of Spiked's 'Ugly Japan' photo series - https://spikejapan.wordpress.com/ugly-japan-2/

Succession has always been the problem with China's politics. Xi blew up the attempt to create an orderly system of succession. So who knows what will happen?

The Chinese Communists have managed to deliver steady positive improvements for their citizenry since the collapse of the Soviets. A remarkable run, but contained within is a threat. What happens if they don't deliver? They are not loved, the Communist functionaries are not so much hated as disrespected.

This is an interesting moment. The Communists are facing the realization that they are the problem. They created this mess in Hong Kong by their actions. They are facing a challenge with broad support. There is a real power with tools that could trigger what they fear most, an economic downturn. The more the Communist push, the more money is taken out of the country in a flight to safety.

What happens next is in their hands. The choice seems to be them losing face or losing everything.

"...but contained within is a threat."

Very very well said. It is a not-so-veiled understanding in China and among most PRC Chinese that price for 改革开放 and a rising middle-class is loyalty. This was very strongly reinforced during Tiananmen. None of these improvements are 'free'.

There is a distinct lack of sentimentality that pervades Chinese political history. This deal the Chinese populace has with its government - this 'mandate of heaven' as it were - is supposed to be understood at all times and tempered by the populace with moderation, forbearance, and gratitude. If they fail to understand this than the deal is effectively over.

Hong Kongers have been living in an illusion that this understanding did not apply to them. I have no doubt that China lacks the compunction to assert its legitimate rights to the province, including violence. The HKers that got out of HK in the 90s were probably smarter in hindsight.

Mao is still correct unfortunately. Power grows out of the barrel of a gun. They will use it in HK if HKers don't take the 'mainlanders' deal that's being offered.

It will be pretty funny to see Trump lose the election because he caused his own recession. Trade wars are so easy.

Hey Donny,

One of your neo-nazi fans got arrested earlier today. Can you tell your "very fine people" to keep the Adolph worship down a little? Trying to study for my intersectional studies midterms this week.

https://www.miaminewtimes.com/news/neo-nazi-eric-lin-threatened-to-exterminate-miami-hispanics-fbi-says-11247579

Thanks,
A Student

Good idea, maybe he should send in the FBI. Oh yeah, I guess he did. Nevermind.

A Democratic president in 2020 would not solve the trade war. If anything, it will get a lot worse.

The Democrats cannot afford to be outflanked on the populist side, on the issue of jobs. They will pursue the same China agenda as Trump, except more purposefully and earnestly and less erratically.

But Trump at least has a businessman's instincts to cut a deal, whereas the radical progressive Democrats represent a campus-mindset constituency that embraces only confrontation. They instinctively regard the slightest compromise on any issue as a betrayal, and therefore will demand nothing less than a sweeping victory at the negotiating table.

President Sanders or Warren will thus have very little maneuvering room to make a deal with China without their own base ferociously turning on them. They will paint themselves into a corner with their own earnest rhetoric, without any of Trump's cunningly chaotic self-contradiction that absolves him of any accountability with his own electorate.

And although the radical progressive Democratic base is singularly focused almost exclusively on domestic sociopolitical issues, it will nonetheless be impossible for a Democratic president to turn a blind eye to events in Xinjiang or Hong Kong the way that Trump has. Raising human rights issues will infuriate China and derail trade talks even further.

China, meanwhile, seem increasingly willing to roll the dice and gamble on a winnable trade war. Their own internal political dynamics now make backing down impossible. After they run out the clock on Trump and then figure out that they can't get a better deal from the Democrats, they will go all in.

So be careful what you wish for, when you wish for a recession for short-term political gain. The trade war will be the next cold war, and will last a generation or two, as long as the previous cold war. We will end up with Japan-style neverending stagnation.

Yup. All started by Trump. People will remember that for a long time. The Trump Trade War. The Trump Cold War. The Trump Recession. The Trump Stagnation. Republicans have a history of starting forever wars. This will just be another one of their neocon failures.

We are in a Cold War.

It seems Australia is getting a little hot, though.

I disagree, actually. Remember, it was Lyndon Johnson who mostly got blamed for the Vietnam War, not John F. Kennedy.

Trump will show at least some restraint for the time being because he wants a deal of some kind to brandish and boast about during the election campaign, even if it's mostly optics and little substance. The Chinese will likewise show some restraint because they are hoping to wait out Trump and deal with a successor in 2020, and don't want to burn bridges with the US just yet.

But after 2020 we'll get a "Gulf of Tonkin Resolution" escalation of the trade war, and whoever is president at the time will own that. And for the reasons I mentioned earlier, the trade war will be considerably worse under President Sanders or Warren. (Forget Biden, by the way, he's the next Jeb Bush).

Jeb Bush was never this far ahead of that giant field in 2016. Sanders has no chance. It's Biden or Warren. Warren might not be able to beat Trump, Biden probably does.

It is nice when trolls put in punchlines that they are trolling. In this case Trump as Neocon.

But I'm afraid the rest may be embarrassingly spot-on. Trump's screwups may have more lasting effects than the ostrich-conservatives expect.

The Recession Lust And Crazy Talk Are Strong With You.

I don't want a recession, but I do subscribe to the view that we are ill equipped should one arrive. We've already run up the debt and already cut the interest rates. You have to admit that is a classic Republican lead-in to recession, should one occur.

Fear is the path to the dark side. Fear leads to anger. Anger leads to hate. Hate leads to suffering.

Is the USA the only developed country on the Planet that has raised rates since 2008?

Whatever it takes. Actually, you want a recession to defeat Trump.

What did Trump do to "ill-equip" the US to address a recession? Did he stop Chmn. Powell and The Fed from raising ST rates to a level (say, 500 basis points) that gives the Fed enough rate cut "room" to fight the recession The Fed had spawned?

The national debt has been rising since way before the glorious 2016 election.

Re: "already cut the interest rates." One aborted rate rise in December 2018 and one rate cut of 0.25% in July 2019 versus seven 0.25% ST rate rises since the glorious, January 2017 Inauguration.

I don't feel like any of that was on target, sorry.

The consumer is still spending. I see no imminent recession. CNBC will never again interview me.

The Economy Is Crashing ! I Hope.

I've always assumed a lady Democrat would get us into a real war as soon as possible, with the complicity of an approving media. I've thought it would be interesting to see whether she were even allowed to win the war.

Insane, imaginary, "counterfactual" defenses of an absurd status quo are increasingly DOA.

Road kill.

What you want is a clear and rational vision for the future. If you can't find that framework with Trump, boot him and begin again.

Oh good grief, it was certainly not Trump that prompted the thought, approximately 20 years ago.

What lady Democrat was there 20 years ago?

Well he's got you there, clearly there were no lady Democrat's running for President before 1999. {/Sarcasm}

It wouldn't have occurred to me that it would particularly matter what her name was, when she eventually takes office. But I don't always see what others find most salient. Maybe Sarah? Or Sally, or Mary, or Kayla, or Taylor, or Nell or Oprah or Mitzi or Julie or Gert or Sophie or Helen or Rihanna.

"But Trump at least has a businessman's instincts to cut a deal,"

Speaking of DOA arguments.

If Trump had those instincts, a deal would be done, and without a $1000 per US household tariff hit.

Jeez, you sound like Charlie Brown waiting for the Great Pumpkin.

No. Trump does have those instincts, and would readily settle for any deal that he can put a positive spin on even if it's short on substance. But China also has to go along with that. And the odds are increasing that they simply won't do it.

People confidently assume that China is desperate to avoid a trade war. But China is starting to believe that they can win one. After a long march through some tough times and much-needed restructuring that they can conveniently blame on foreigners, they aim to emerge as the unchallenged global leader in the same way that the West once prevailed over the Soviets. They might now believe that a trade war represents an opportunity too important to pass up.

That is why the trade dispute will not be resolved. It will turn into a clash-of-civilizations cold war that may last the rest of our lifetimes.

Let's be clear about who your boy really is:

"Trump went on Twitter on Wednesday to quote a conservative radio host and known conspiracy theorist who praised him as “the greatest President for Jews” and claimed that Israelis “love him like he is the second coming of God.”

In his tweets, Trump thanked Wayne Allyn Root for “the very nice words.”"

Article 25, if you have any love for America, or any strategic sense for American conservatism.

Tyler,

You are probably right to remind people that China has long fooled people by appearing very stable, with such westerners as Adam Smith and Karl Marx contributing to this perception, but then changing quite suddenly and dramatically with little warning.

A Love Letter to the Sino Dictatorship

I have visited China many times in the past 18 months travelling widely in east and Central China. The following impressions have struck me forcibly and I stress these are impressions gathered from observing and hundreds of conversations:
- Government security actions are shows of strength but above all are paranoid with fear of the people of China.
- Chinese Governance 1991 to maybe last year gotten economic development spectacularly right spectacularly quickly in a way never seen before in human history. Unspoken about Tianmen catalysed the most brilliant mix of economic and governmental social policy. What is happening now is almost certainly dissipating whatever the pixie dust was which made that era work so brilliantly.
- A combination of one child tilting the marriage market in their favour, traditional Chinese values triggering the need for early assertiveness within their families and huge educational advances has produced a generation of Chinese women 35 and under who are phenomenal; The future of the PRC is female if the old men don't get in the way.
- Finally there is a huge sense of unease just below the surface. CCP reasserting itself is undoubtedly undermining individuals' sense of autonomy. There was a functioning level of community politics, private businesses could mind their own business, and growth meant that entrepreneurial mistakes were not too heavily punished. Now it seems everyone who is thinking is wondering and being cautious.

I know of a well capitalized startup in China with plans to expand to all of the tier 1 and tier 2 cities within the next decade, but they have been having trouble getting permits. One of the complaints is that there are no party members on staff. The owners have the political muscle to get the managers into the party, but none of the managers want to do it. I don’t know why, and this is merely anecdotal, but it makes me suspect that the party isn’t held in that high of a regard. For what it is worth, I do believe that the people at the startup would leap at the chance to join the party if they felt it would help their careers.

Why would the Red Chinese give up their totalitarian regime if, even in our midst, there are those who aid and abet it. As a Japanese-American person, I feel appalled by how Disney and Paramount are getting a free pass to betray America in exchange for those juicy Chinese office boxes. I really think our country's authorities should look hard for ways to punish those companies and ban any and all cooperation between American media companies and Red China. It is hypocritical to impose sanctions on Huawei when American companies are even eagerer to hurt America to achieve their selfish ends -- and allowed to do so.

I was surprised that the article said nothing about the lack of a named successor for Xi. The most obvious source of potential political instability in China is that Xi dies in office without promoting or positioning the next group of party leaders to take control of the CCP.

Would it be a “Chinese Curse” to wish Xi the same good health as Trump (at least according to Trump’s doctors)?

Apart from the cultists in North Korea, named successors have not had much success in communist countries. There's no legal process or tradition to provide legitimacy to the successor, so it inevitably becomes an intraparty power struggle.

Not making light of your concerns or anything, but that's assuming Hollywood product even makes it to Chinese screens. They have been known to blacklist cultural products and people for any number of reasons. Not just movies but also actors i.e. Richard Gere, Sharon Stone, Brad Pitt among others. Miley Cyrus even got banned for posing for a photo while making "Asian eyes" with her fingers.

The movie Christopher Robin was banned due to sensitivities around president Xi's alleged Pooh-like appearance - hence fears of nationwide chortling. Alice in Wonderland was banned for "strangeness" under the category - "superstitious films." Ben-Hur and other movies with religious content got hit with bans for "superstitious propaganda." Even the fun Pirates of the Caribbean was banned on grounds that Captain Sao Feng demonized Chinese people.

Meanwhile, America kowtows to Red China.

https://www.smh.com.au/entertainment/movies/boycottmulan-over-hong-kong-protests-tests-disney-and-moviegoers-20190819-p52iiq.html
https://taskandpurpose.com/top-gun-maverick-jacket-patches-china
https://www.independent.co.uk/arts-entertainment/films/news/richard-gere-big-hollywood-movies-china-tibet-buddhist-dalia-lama-chinese-audience-blockbusters-a7693256.html
https://www.google.com/search?q=china+red+dawn&oq=china+red+dawn&aqs=chrome..69i57j0.9376j0j4&client=tablet-android-samsung&sourceid=chrome-mobile&ie=UTF-8

I think Mr. Toyotomi is right.

Good to know that you are not of two minds on this, Thiago.

I don't know what you are talking about. I am Mr. Johnson.

dearieme with a solid hit, I award 5 internet points.

It has to be the Southern Chinese who liberalize the country. The South has always developed faster economically and politically than the North because it is geographically far away from Beijing. Why engage in horse trading when you can engage in real trade? Deng Xiaoping, a Hakka who hails from Sichuan, liberalized the economy of China. Lee Kuan Yew, another Hakka but with ancestral roots from Guangdong, which is the richest province in China, liberalized his home country of Singapore as well. Taiwan is a full blown democracy and Hong Kong is a good percentage of the way there. There is absolutely a tradition here of liberalization in the South.

When you use the term "liberalize" I'm hoping you don't mean any facsimile of modern-day liberal/progressive culture in the West. Piers Morgan who I normally avoid like the plague, has a current interview in which he lambastes liberal culture in scathing terms as repressive and "fascist-like" in its intolerance of opposing opinion. Since he is a self-described liberal it was a little surprising, especially given his vehemence on the subject.

So I take it you mean liberalization with respect to a more open climate, greater accessibility etc. The Chinese have a genius when it comes to cultural adaptation but it will always be on their terms. They preserve the right to step in to limit or redirect cultural "openings" that they perceive as unhelpful or perhaps threatening. So liberalization comes with pre-conditions. Given some of the insane excesses to which elements of the left have gone in the West, the Chinese probably see these preconditions as necessary, even essential. You can of course debate the rights and wrongs of their approach, but it's unlikely change any time soon.

"They preserve the right to step in to limit or redirect cultural 'openings' that they perceive as unhelpful or perhaps threatening."

Well, their leaders, at any rate, do.

https://en.m.wikipedia.org/wiki/Cultural_Revolution
https://en.m.wikipedia.org/wiki/1989_Tiananmen_Square_protests#Military_action

Rare and refreshing to see an acknowledgement of the importance of regional difference within China.

If the CCP snaps, for any reason, I think there is reason to believe that China will not be rebuilt along the same lines - the south will split and take all of the best talent from the north with it (a la Taiwan), leaving the north to revert back to an earlier form of state control. A lot will depend on what "the south" is - my guess is Guangdong as the main player with the Greater Bay Area (inc. HK) as the economic center, with Fujian as a less advanced player with a special relationship with Taiwan.

Regional identity shows up in interesting places in China - a few rash Fujianese guys in Hong Kong decided to attack protesters (before realizing they were horrendously outnumbered and getting their asses kicked), and the following week several men were spotted walking around that area wearing "I am Fujianese" shirts. They may be pro-government for now, but what happens when a conflict is framed as Fujian vs. others when the CCP is the "others"?

That split could be very, very nasty.

In China, there's a longstanding cultural contrast of Southern collectivism and Northern individualism.

(And you see this in business, with more family firms and the like in the South - https://editorialexpress.com/cgi-bin/conference/download.cgi?db_name=CICF2019&paper_id=466).

It'll be interesting to see how that confounds, or doesn't, Communist Party centrality in the North and global orientation in the South.

Northerners *should* be more interested in policy that allows for individual autonomy, but....

I suspect China won't liberalize, but perhaps it may return to its long run norm of general low taxes and in practice relatively small government (if elaborately hierarchical), but no actual explicit checks and balances on government and rule of law and no restrictions from interference in commercial business on a whim. Laissez-faire in the general run, but not exactly liberal and impartial. That's what China always was. Or maybe that path is broken.

This blog post and the next one about Warsaw and Poland are about nationalism. In China, China uses nationalism as a cudgel against perceived enemies of the state, from the crackdown on religion to the crackdown on protesters in Hong Kong: one is either for (one) China and loyal to the state or an enemy of the state. In Poland, "there seems to be a kind of intertemporal substitution into a new nationalism", combining a revisionist past, an ascendant present, and a glorious future, all wrapped in nationalism. "Do not be surprised if more and more of Western Europe sees Polish nationalism as a model to be copied."

I'm not sure whether Cowen is making the case for a "New Nationalism" to replace the globalism that has preceded it, but Theodore Roosevelt espoused it to support an activist government to promote social justice and economic welfare, while Woodrow Wilson opposed New Nationalism as collectivist and instead promoted "New Freedom", which stood for political and economic liberty. Is history linear or cyclical? Are we doomed to repeat the sames mistakes made in the past?

Interesting comment rayward, especially your first paragraph. Not sure if Roosevelt and Wilson would have seen current-day developments as even recognizable in the context of their priorities.

"Are we doomed to repeat the sames mistakes made in the past?"

To an extent but with the benefit of hindsight. Ideological adaptation can and does occur along with a changing cultural landscape. The traps of the past can be avoided with a renewed polity. The nationalist model continues to wield enormous sway... as we are seeing in Europe. There are however significant and important differences when compared to the nationalisms of former decades.

Keynes: "When the facts change, I change my mind". Friedman (attributed to Nixon): "We are all Keynesians now." I remember a few years ago Cowen supported globalism, pointing out that it is responsible for lifting millions from abject poverty, greatly reducing global inequality, and promoting peace (the latter by reducing the probability of inter-state military conflict between the trading partners). Has Cowen changed his mind?

Missing parenthetic matter supplied for free:

" . . . especially in an America that has fallen out of love with (serially lying and heedlessly predatory) Big Tech."

In scant decades someone's beloved Internet has become little else than a global Potemkin village, ANOTHER two-dimensional façade to drape over the planet and its beleaguered occupants.

Don't neocon my favorite libertarian blog!

I agree with Tyler, but as sometimes happens, not the framing. I don't think this view is new and countercultural. I think it's a (possibly momentary) return to the optimism of 5 years ago. Remember when all the American kids wanted to go to Shenzhen? When the world was a changing for the better?

The size and seeming power of the Hong Kong protests do give some optimism, and remind us of those hopes.

But of course at this point who the hell knows.

Isnt "rule" top-down by definition?

"What If Everyone’s Wrong About China?"

Seems more likely than not that everyone is wrong. Humans are unpredictable. And China has failed to follow the obvious road maps. Time will tell. I hope eventually that China becomes a non-authoritarian, non-expansionist state.

It's always fascinating and frightening to find that other countries outside of the US can have agency and sovereignty outside of US neocon will sometimes.

But it is ironic that Israel exerts such an outsized influence on a certain G7 nation! Might as well make them a state and give them 100 electoral votes.

"For myself, I don’t have a coherent story about how the Chinese might move to greater liberty in the next 10 to 15 years. "

Well yeah, it might happen. But I'm not optimistic. We're seeing huge chunks of the world including the US revert to populistic nationalism and away from liberalism. China of course might not follow that trend but if we're entering an era of trade wars, tariff barriers, and anti-immigrant xenophobia, that's not exactly an environment that suggests movement toward greater liberties.

Summary of Tyler's paper. "Predictions are difficult"
No kidding.
Here's another angle of approach to predicting things:
Chinese culture and philosophy is mostly shaped by Confucianism which places obedience as a key virtue. The communist party uses its domination of all speech and media to have the most advanced propaganda brainwashing machine ever invented. So they have a populace with a culture of obedience connected to a massive propaganda machine that is always getting better at steering people. China does not have cultural/philosophical foundations suggesting that individual rights are moral rights. What is more popular is a narrative that suggests the historical backwardness of China was entirely imposed by foreigners who held China down, and that the CCP is who allowed China to "stand up" against the foreign bullies, and we must rally behind the CCP leaders of our motherland to show the world who is the new boss. This is not of course the official external line, but it's been the pervasive internal narrative for at least the last 10 years.
Or take an outside view. The Communist Party has in many ways become the next Chinese dynasty. Each of the last 9 dynasties have lasted 97 years or more.

Just revisited this thread and see my comments were deleted.

You're a fucking bitch Cowen.

The Tariffs Are Not Just About The Economy

The post-WWII world order based on the United Nations and the Western liberal tradition of human rights is now being challenged by the autocracies of China, Russia, and Iran and their proxies in North Korea, Syria, and Venezuela. What is telling is that China, Russia, and Iran have significant historical and Ideological conflicts, but these are superseded by their common bond of autocratic control of power. Their common desire is to replace the Western liberal tradition with a new type of world order and to make the world safe for autocracies.

China does not seek a direct military conflict with the United States, but seeks to use its technological advances to achieve a global economic hegemony. A control of the infrastructure in communications, transportation. artificial intelligence, aerospace, biomedicine, renewable energy, and advanced weapons systems, as well as a global leadership in manufacturing and trade, can all be used to achieve a predominant military position as well. Iran and Russia also have energy and military resources with which to make other countries dependent. The common objective that they share is to replace the world order based on the Western liberal tradition of individual freedom and equality. Their tactics also show a disregard for ethical constraints as demonstrated by their support of North Korea, Syria, Venezuela, and terrorist groups, as well as their own abuse of human rights and the persecution of any opposition. The overt uses of power are less needed, however, when one also controls where a person can live or even travel, their educational and job opportunities, and their ability to freely assemble or to freely express their opinion or religion.

China -- The Good, The Bad, and the Ugly -- at www.TheFarCenter.com

Comments for this post are closed