China today and tomorrow

China : Time for New Realism

23 January 2010

Charles Grant, of the Centre for European Reform, has written - not for the first time - a very timely and prescient essay on the growing disenchantment of the democratic world with the Middle Kingdom. David Rennie in his current Bagehot column in the Economist has a good take on it too.

The problem arises from the fact that China has fused communist authoritarianism with capitalist development.

The old belief that market capitalism would inevitably lead to more freedom is now under question. Chinese nationalism helps shape unilateral nationalist responses with the US responding to China without reference to other democracies. The EU cannot find one voice. Japan is silent. Russia would like to have Chinese economic development and Chinese political authoritarianism as Moscow de-aligns itself from a European future.

All that is needed is a flash point - Uighurs, Taiwan, Indian frontiers, north Korea, oil fields in seas close to China - and China decides to use military force in a major way and faces a response. At that point the world starts to close markets and take other action.

As with Japan in the 1930s a cornered China that wants access to western markets but refuses the multilateral obligations of being part of an integrated global geo-eco-market-rule of law world system can be very dangerous.

Meanwhile there are 300 million Chinese over 60 without adequate incomes or social and health care cover. China is getting old and rich at the same time. But Chinese wealth is not being used to build more fairness or to bind in all Chinese. Is this sustainable indefinitely?

Do we have too many China boosters like Martin Jacques or Mark Leonard who are like those writing 'Japan as No 1' books three decades ago? We need more Bill Emmots who have sharper eyes and ears to explore what may be going awry in China.