The PRC At 70

At the Wall Street Journal the editors remark on the anniversary of the People’s Republic of China:

China’s Communist Party on Tuesday marks the 70th anniversary of its 1949 revolution, and the fireworks and military parades will celebrate the country’s rise to become the world’s second largest economy. Yet there is no denying that this anniversary comes with a paradoxical unease about China’s place in the world. China is more powerful but less free than it was a decade ago and the world views its external aggression with growing concern.

China’s rise since Deng Xiaoping set the Party on the path of market reform 40 years ago has few historical parallels. China has taken advantage of open markets in the West, and the lure of its domestic market of 1.4 billion people to foreign investors, to lift hundreds of millions out of poverty and become an export and increasingly a technology behemoth. The U.S. and the world have for the most part benefited from this development. Imagine the alternative if China had remained stagnant and its people sought to emigrate in the millions.

The second to last sentence is an enormous oversimplification. What seems to be the case is that a very small number of people in the United States and “the world” have benefited enormously from China’s participation in the global economy, a somewhat larger group has been hurt enormously (those who’ve lost their jobs), a much broader group has been hurt somewhat, and a broad group has been helped a little. In econspeak most of the economic surplus has been captured by a small number of very rich people while most of us have not seen a great deal of benefit. I trust it is the same in China although the results seem to show that moving labor resources from relatively nonproductive subsistence agriculture to manufacturing, in some cases by force, has had a beneficial effect on China as a whole. There aren’t nearly as many people who are desperately poor there as there used to be.

The editors express a preference for closing the barn door after the horses have already bolted:

We are not among those who believe that China’s economy must be decoupled from America’s or that China must be “contained” a la the Soviet Union. At least not yet.

That statement would be more credible if China had ever lived up to its international commitments in full. It hasn’t. As I’ve said before, the authorities there write a heckuva press release which seems to be enough for most Western leaders including the editors of the WSJ.

I think this is naive:

The Party’s larger challenge is the aspirations of its own people. The attempt to craft a hybrid part-market, part-socialist economy has saddled China with rampant corruption, endemic pollution and unsafe food. Worse is coming as the one-child policy the Party enforced for decades burdens China with a rapidly aging population.

China’s 2 million man military is mostly turned inwards, better prepared to control China’s populace than it is to defend China against invaders. The greatest challenge for China is whether the PRC will use the force it has at its command to maintain its own power to China’s detriment. The greatest challenge for the United States is whether at this late date there is any will to do anything other than just put up with China’s routine violations of its international agreements.