The hype about China's future is unremitting. Indeed, there is a growing sense in some quarters that China is the future. There are two ways of highlighting this "fact." One is to recount China's rapid economic growth over the last two decades and to conclude that, with this kind of growth continuing over the next two decades, China would outrank the US as the world's largest economy. The second way is to focus on the US' perceived decline, with a resurgent China stepping into the resultant gap.
According to an Australian columnist who is given to hyping China's rise, "We live in a world where the era of US pre-eminence as the only superpower is suddenly gone," having lasted only 13 years from the fall of the Berlin Wall on Nov. 9, 1989, to May 2, 2003, when US President George W. Bush hastily announced the completion of the mission in Iraq.
As of now, "Greater China [including Taiwan and Singapore -- whether they like to be included as part of Greater China or not] now exerts the influence of a superpower through trade and commerce in a globalized economy where borders are not respected as much as money."
There are other studies which make the same point about the US decline without necessarily suggesting that China would step into the resultant void. But comparisons are nevertheless made to highlight China's rise. A new book entitled Empire of Debt: The Rise of an Epic Financial Crisis makes grim reading. It talks in detail about the US sitting on a mountain of debt that is rising every day. It is argued that the US has gone on a "borrowing binge." Its annual current account deficit is estimated at US$750 billion to US$800 billion.
According to Bill Bonner and Addison Wiggin, the authors of the study, "The total value of assets in the US is about US$50,000 billion. Current debt stands at about US$37,000 billion." They conclude, "America is broke. Busted. Bankrupt. It couldn't pay its debts even if it wanted to."
The picture is probably not as bad as made out by Bonner and Wiggin. According to an AFP report, "The net foreign liabilities of the US grew to more than US$3,000 billion, equaling about 25 percent of the US GDP," which is not good, but hardly disastrous.
China, for instance, has a non-performing bank loan ratio estimated at 25 percent to 50 percent. Which would make it technically bankrupt. But it is still seen in some quarters as "the future."
The US is also said to be in trouble because of its political and military over-extension, it is now mired in Iraq and Afghanistan, with another crisis brewing in Iran after its decision to restart work on developing nuclear fuel. This, of course, adds to the US' budgetary problems.
China, on the other hand, is said to be sitting comfortably on foreign currency reserves of over US$800 billion, with an economy growing at an annual rate of about 10 percent. It is also free of foreign military entanglements, enabling it to expand its economic and political sphere of influence in the Asia-Pacific region, with the US preoccupied elsewhere. For instance, the US didn't make it to the East Asia Summit forum launched last December in Kuala Lumpur.
According to Martin Jacques, a visiting professor in Beijing, "China has arrived and will increasingly shape our future, not just its own." And he dismisses the relevance of Western-style democracy for China, because "the regime has not only survived [in the wake of the Tiananmen massacre in 1989] but prospered to an extraordinary extent over the last quarter-century."
Therefore, communist China is here to stay and prosper as a competing and alternative system. In other words, economics has subsumed politics. The people in China, according to this line of argument, are not bothered about the party's monopoly on political power when it continues to deliver economic goods.
This is a spurious argument even in economic terms, because the majority of the people (nearly 900 million) are still living marginal lives.
In political terms, the question is not one of Western-style democracy. The pertinent question is how to synthesize a modern economy with an archaic political system based on a narrowly constituted power base.
Two examples will illustrate this point. First: Indonesia's authoritarian system simply collapsed under the weight of the 1997-1998 Asian financial crisis, even though the country had been lauded for its economic progress under the Suharto regime. Its political system was completely out of kilter with the needs of a modern economy.
Second: In the case of South Korea, it is still a thriving economy after making the transition in the late eighties to a democratic political system.
In China's case, the party might tolerate some criticism in some areas of economic and social activity, but once it impinges on the political system, it practices zero tolerance with all the coercive and punitive force of state machinery.
Take, for instance, the recent case of the ban on a weekly section of the state-run China Youth Daily which tended to question the party line here and there. The four-page supplement, Freezing Point, popular with its readers for its forthrightness, has been condemned by the authorities for "viciously attacking the socialist system."
According to the axed supplement's editor, "What [the authorities] have done has no basis in the constitution or law and is against the party constitution as well."
The axing of Freezing Point comes not long after the sacking of the editor of the Beijing News for failing to tow the party line. Compounding this attack on state-run sections of the press is a host of measures to further tighten control over the Internet, with companies like Yahoo, Microsoft's MSN.com and Google succumbing to Chinese government pressure.
Which means that politics is important and the Communist Party knows that if it were to lose control, it would lose both economic and political power for its own self-aggrandizement.
Therefore, any imagery of China as a world of its own with "Chinese characteristics" is a myth. It might be the ambition of its rulers to recreate a new Middle Kingdom, but the world has changed since. For a start, they are operating as part of a globalized market economy based on information technology.
They might tighten control over the Internet but people manage to find ways around it. While the authorities are trying their utmost to keep out the "baneful" influences of Western political and social "decadence," it is unsustainable over a period of time.
Anyone can see that the US is politically, militarily and economically over-stretched, causing problems for its global image and role. Isn't it also time to question more rigorously the oft-repeated mantra one hears these days about China as the future?
China has immense social, economic and political problems which the Communist Party is either unwilling or unable to address, because any serious effort in this direction will need a complete overhaul of the political system in favor of popular participation. This is a risk the party is not willing to take.
Hence, the continuing aggregation of social unrest (the number of public order disturbances increased from 74,000 in 2004 to 87,000 last year, according to official figures) might erupt in some spectacular explosion when it is least expected.
Sushil Seth is a writer based in Australia.
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