A Sobering Look at the Rise of China and Asia

china-map

China’s decade long surge into becoming an economic power house and global heavy hitter has given rise to a myriad of theories and assertions regarding the role of Asia in this century. It has been widely touted that the 21st century will be “Asia’s Century” as the US fades from virtual hegemony and hyperpower and joins its European cousins in the ranks of imperial has beens. That the on going economic crisis embattling what I’ll term the “Old Order of Global Primacy” has left China’s 10% annual economic growth unscathed seems to be validating those theories and assertions.

The Chinese leadership appears to accept at least a nascent version of this wind of change, as it were and are flexing the new found confidence of an emerging power. China’s belligerence during the Copenhagen Climate Conference, staunch opposition to sanctions on Iran, loud protests of a US/Taiwan arms deal and the subsequent threat of sanctions on US firms selling those weapons suggest a state looking to call attention to its own considerable might. Indeed a recent poll suggested that a majority of Chinese foresee a “cold war” with the United States, suggesting the specter of another global bi-polar century.
Of course for all its growth and success late in the last century and early into the current there lurks endemic threats to China and very real challenges to the concept of anything remotely like a unified Asian renaissance. The downfall of America and the rise of Asia are the theme of this very skeptical piece in the Boston Globe (the link will take you to Council on Foreign Affairs) written by Joshua Kurlantzick entitled “Dazzled by Asia.” Kurlantzick presents the above mentioned threats and challenges to the “Asian Century” and suggests the end of American hegemony isn’t quite as nigh as some would have us believe. A brief selection from the article:
<blockquote>Yet there are many good reasons to think that Asia’s rise may turn out to be an illusion. Asia’s growth has built-in stumbling blocks. Demographics, for one. Because of its One Child policy, China’s population is aging rapidly: According to one comprehensive study by the Center for Strategic and International Studies, a Washington think tank, by 2040 China will have at least 400 million elderly, most of whom will have no retirement pensions. This aging poses a severe challenge, since China may not have enough working-age people to support its elderly. In other words, says CSIS, China will grow old before it grows rich, a disastrous combination. Other Asian powers also are aging rapidly – Japan’s population likely will fall from around 130 million today to 90 million in 2055 – or, due to traditional preferences for male children, have a dangerous sex imbalance in which there are far more men than women. This is a scenario likely to destabilize a country, since, at other periods in history when many men could not marry, the unmarried hordes turned to crime or political violence.</blockquote>
Kurlantzick goes on to discuss China’s growing income gap between the urban wealthy and the rural impoverished and the some 90,000 so called “mass incidents” per year, a nifty turn of phrase China’s security apparatus has for protests. Beyond China he sites India’s own endemic issues not the least of which is its Maoist Naxalite insurgency and the unlikely, regional “EU-ification” due to Asia’s healthy appetite for nationalism. Moreover he suggests the lack of a common political or cultural thread to build such a semblance of unity. He wraps his analysis up with a convincing conclusion that while the US may be embattled economically its days of being the “go to guy” for disasters (think Haiti or ’04 tsunami,) conflict moderation (think Israel/Palestine) and reform movements (think Iran or the Orange revolution) are hardly over. I suggest going beyond my own brief synopsis and giving the piece a full read.

One brief bit I would add that the article doesn’t mention is China’s grand strategy as an emerging superpower and one glaring difference it has with the post WWII American emergence. The US emerged as a superpower not only through economic and military might but also by launching a global marketing campaign to export its model of governance abroad. While China jealously guards its proxy states and happily engages the more nefarious to obtain resources I see zero evidence of marketing its hybrid of authoritarianism and capitalism abroad. Whose to say that China <i>wants</i> to lead a unified Asia into the 21st century and shoulder the burden of casting a shadow over the previous hegemon?

Map via Wellesly College Chinese Politics

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22 Responses to A Sobering Look at the Rise of China and Asia

  1. kurt9 says:

    I’m sure Jim Rogers would beg to differ with the Boston Globe article.

  2. Curzon says:

    I’ve said similar before (see: here), but what we need to remember is that China doesn’t need to have a comfortable middle class for it to flex its might well beyond its borders. The biggest danger to the world will be when China democratizes, when we should expect that it becomes very unstable as it tries to channel the demands of the pissed-off citizenry.

  3. kurt9 I’m not clear on who or what you’re referring to.

    Curzon, excellent point regarding China’s democratizing. I’ve often considered that if China democratizes it will fracture politically along ethnic lines. A democratized China is a major case of “be careful what you wish for.”

  4. kurt9 says:

    Jim Rogers was the co-founder, along with George Soros, of the Quantum fund in 1969. Unlike Soros, who is liberal, Jim Rogers is somewhat libertarian and is very much a believer in the “Austrian” school of economics. He now lives in Singapore and is very bullish on China.

    He website is http://www.jimrogers.com

    You can find videos of him on Youtube where he is very critical of the bailout of Wall Street following the crash in ’08. Jim Rogers and Peter Schiff are well-known opponents of “keynesian” fiscal policy.

    I think Rogers is right about China.

  5. Curzon says:

    I love Jim Rogers book “Adventure Capitalist” in which he drives around the globe for two years with his wife. That book is a great and irreverent, Kaplan-free travel account.

    My problem with his analysis is that there is no shades of gray for Rogers. You’re either a disaster (Europe, America, Japan, real estate) or rocketing towards the future (China, India, commodities). He’s a typical contrarian investor (which every investor must be to be successful), but his commentary is too much gut for me to take seriously.

    It should be noted that in 2001, he said in an interview: “I don’t expect the Euro will be around in ten years, certainly not twenty.”

    Sure, Rogers in retrospect looked very correct in his writings on commodities over the past ten years, but you can’t be right forever on everything. Personally, I think China is in a big big bubble right now, and there are going to be century-long consequences when it pops.

  6. Curzon says:

    MF, the more I think about China the less I think that ethnic lines will be relevant to a future civil war/revolution. Yes, the <10% minority ethnic groups were, decades ago, a majority in 50% of the territory, but Hanification has made the Han the majority in every major city. Also, I think China as a state is now strong enough to hold on to most of that territory regardless of what political unrest occurs, even a revolution. I think the bigger issue will be fratricide between the three historically combative Han regions, north south and central, with the ethnic regions being mere proxies and victims in such a battle for power. I think the bigger issue will be whether or not Mongolia or North Korea — and possibly even South Korea or Japan — surive as independent states after such a revolution.

  7. Carl says:

    The PRC, in its present form, will not last to see its 80th birthday.

    China has too many major problems ahead that I do not believe they can resolve without serious internal upheaval. It could be one of many things or more likely a combination of several: demographics, both a rapidly aging population (older generations are far more dependent on younger ones in China compared to Western nations) and a sex imbalance that means China already has 20m extra males; rich-poor gap and accompanying social problems; inherent corruption within the political and economic system; an increasingly restive and independent-minded middle class; an increasingly restive and incredibly pissed off (and huge) lower class; the house of cards economy, the fact that GDP and growth numbers are complete political fabrications; the stupid or unforeseen consequences factor, where the CCP overplays its hand during a (most likely internal) crisis; etc. (I am sure I missed a few)

    God help us all when this happens.

    As for democratization, I can’t see it happening anytime soon. The CCP obviously doesn’t want it and the Chinese majority aren’t clamoring for it either. I agree with the above that such an occurrence would probably, for China, be a very bad thing.

  8. Brent says:

    Curzon,

    I agree that China is a big bubble, and when it bursts, it will be a trauma for the world. Probably similar to what we experienced at the end of 2008. And the bubble keeps blowing bigger. I read in Stratfor this morning that AVERAGE real estate prices more than doubled in China in 2009. Meanwhile, China is building entire cities that are completely devoid of people and owned by investors (I mean, speculators). So far, the Chinese government has used its accumulated dollars to prop up its economy (and fudging the numbers certainly helps too).

    This isn’t going to end well.

    Carl – I have to disagree regarding democratization. While such a transition would likely be bloody (since when have totalitarian governments given up power willingly and without conflict?), it will most certainly NOT be a very bad thing. Not for the Chinese, nor their immediate neighbors, nor the West. Especially over the long run.

  9. spandrell says:

    Guys this is irrelevant. Yeah, China sucks. It can’t last too long.

    But so won’t the US. So China will have to many old hags by 2040. By 2040 the US whites will become a minority. Good look with a 40% Mexican US battling the Chicoms.

  10. kurt9 says:

    Another view on 2040:

    http://maxlifefoundation.typepad.com/maximum-life-foundation/2010/02/david-kekich-how-long-will-it-take-and-how-much-will-it-cost-to-cure-aging.html

    Do note the modest amounts of money discussed, relatively speaking. We’re not talking about anything like an Apollo space program.

  11. Bob Harrison says:

    As has been noted, the fault lines in Chinese society will likely not be ethnic ones as the Han are 90% of the country and constitute majorities in every city. The real division seems to be between the wealthy coastal provinces and the desperately poor interior. This map illustrates it very well. I’m fairly certain its from The Economist.
    http://www.shanghaienglishteachers.com/images/maps_china/map_of_china_prov_gdp1.gif

  12. Guest469 says:

    “China: Statistics of Mass Incidents” By Roland Soong
    http://my.opera.com/PRC/blog/show.dml/581789

    I have been reading numerous articles about China as a country boiling with rage with angry youths ready to explode in revolution/regime change at any moment since 1989. Are we there yet?

    Brent, if I may re-phrase your question slightly:
    “since when have authoritarian governments given up power willingly and without conflict?”
    Taiwan, South Korea, Chile, Spain amongst many others.

    “it will most certainly NOT be a very bad thing. Not for the Chinese, nor their immediate neighbors, nor the West.”
    You are assuming there will be no “fallout” (pun intended)

  13. Curzon

    I think the bigger issue will be whether or not Mongolia or North Korea — and possibly even South Korea or Japan — surive as independent states after such a revolution.

    I get the inclusion of Mongolia and I’d wager North Korea won’t survive very long after Kim Jong Il passes the torch much less the advent of a democratized China. But why South Korea and Japan?

    Bob Harrison, thanks much for the informative map.

    Spandrell, not really sure where you’re going with your point. Is this some sort of white supremacy rant?

  14. Jing says:

    You do not need to be an adherent of white supremacy to recognize that America with a near plurality lumpen-proletariat mestizo population will be radically different than a predominantly Western European protestant demographic. A population which is more accurately Mexifying America rather than being absorbed into the bourgeois mainstream. I suspect that rather than China overtaking America, the likelihood is that American living standards will likely converge down towards China’s.

  15. guest says:

    Would you please use “its” when you mean the possessive of a thing, and “it’s” when you are contracting “it is”? Thank you.

  16. I wonder if there exists anything beyond anecdote to validate this claim of Mexification I often hear? Having lived in cities with large hispanic populations what I’ve seen looks more like the Americanization of second and third generation latinos.

  17. Jing says:

    Two words, California and Florida. California in particular. The massive drain incurred by entitlements, high taxation, and social dysfunction as a result of mass emigration of lower-class Mexicans is turning/has turned the once golden state into a catastrophe.

    Second and third generation Latinos are being socialized into Americans (though not in particular areas where their demographic size has reached critical mass) but not the Americans that make/made America successful. I’m afraid the data points out that even after three generations, Latino-Americans socio-economic indicators still indicate a considerate gap with the Non-hispanic white mean.

  18. Actually that was three words :)
    California’s demise looks to be much more about piss poor budget management, short sighted assessments of home value trends and the placement of special interests (by both sides of the aisle) above budgetary realities. I’m sure immigration plays it’s part but to assert the states economic woes are wholly attributed to immigration seems a bit of a stretch. Texas, which looks to have more Hispanics by percentage of overall population, is in much better shape economically than most any other state in the union even lily white states in the north east.

  19. Jing says:

    Texas is still doomed, its a matter of when not if. True illegal immigration wasn’t singularly responsible for California’s budget crisis, but it is the major contributing factor for the state’s general decline. You can keep self-destructive policies going for a relatively long time with a bourgeois yuppie population, not so much with semi-literate semi-skilled labor.

    Texas survives today because of productive “refugees” from elsewhere and that unlike California, non-hispanic whites are still a majority of the population. Once a tipping point is passed, brace yourselves for California 2.0 with cowboy hats.

  20. Aceface says:

    “I think the bigger issue will be whether or not Mongolia or North Korea — and possibly even South Korea or Japan — surive as independent states after such a revolution.”

    Both Mongolia and Korea would probably keep their independence.
    Korea closed down it’s China town back in the day(and reopened the one without Chinese)and maintained a draconian policy on Chinese citizens which would only be called as racism had it’s been applied to Zainichi Koreans.It’s immigration policy is changing but done so without much influx of Han Chinese.

    Mongolians allow Koreans to occupy small shops and restaurants and bars in Ulaanbaatar just because they dislike Chinese(Also expelled Chinese citizens in the 80′s)Which makes penetration through population difficult.

    I’d worry about that after Japan gets independence.

  21. kushibo says:

    Aceface wrote:
    maintained a draconian policy on Chinese citizens which would only be called as racism had it’s been applied to Zainichi Koreans.

    Nice try, but no. I myself wrote, back in 2006, “The hwagyo (Korea-born ethnic Chinese) were treated at least as badly as Japan-born ethnic Koreans were in the past.”

    Mine was an impression easily gleaned from discussions with native South Koreans who were keenly aware of the inherent unfairness, an unfairness which was cited by the government as a reason for dismantling the restrictive policies put on the hwagyo.

  22. Roy Berman says:

    ” the more I think about China the less I think that ethnic lines will be relevant to a future civil war/revolution… I think the bigger issue will be fratricide between the three historically combative Han regions, north south and central, with the ethnic regions being mere proxies and victims in such a battle for power.”
    Well, that’s the thing about China. The ideology of the unified state and the inclusive “Han” ethnicity means that internal divisions that would be considered major if they were between separate regional polities are considered minor within the context of Chinese society. Mandarin, Cantonese, Shanghaiese and Minnan (of which Taiwanese is a variant) are at least as mutually unintelligible as French and Spanish, or German and Dutch. But because the speakers are all “Chinese”, these are all commonly referred to as “dialects” of the “Chinese language”, rather than “languages” of the “Chinese language group”, as similarly divergent modes of speech are in most other parts of the world. While the concept of China has maintained remarkable unity over the millenia, there is great linguistic and cultural diversity between regions. The idea that different regional communities are incontrovertibly all “Han” not necessarily eternal. Within a different political framework, the Cantonese and Beijingese could easily be considered different ethnic groups, and an fact this can be seen to a certain degree in Taiwan, where some people on the far green (i.e. pro-independence from China Taiwan-nationalist) side of the political spectrum openly refer to the Hoklo (i.e. Minnan/Amoi/Taiwanese speakers) or Hakka as separate, albeit closely related, ethnic groups from Han Chinese.