Don't fear China's success - fear its failure

By Bruce Anderson

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Although the chaos at Heathrow was an inauspicious start, it is important that the Prime Minister's mission to China should not crash-land. A formidable array of businessmen accompanied Mr Brown to pay economic homage, and rightly so. By the middle of this century, China could be the world's largest economy, and many of the greatest questions thrown up in the course of the century will be answered in Chinese characters. Some already are. Chinese goods have controlled American inflation while Chinese savings have financed American consumption. China's demand for raw materials is not only underpinning world commodity prices: as the Chinese do not care whom they buy from and are happy to pay their cheques straight to Swiss bank accounts, it is also undermining the quest for good government in Africa. We can only hope that in private - megaphone diplomacy would be worse than useless - Mr Brown has tried to persuade his hosts that well-run countries can still produce oil and minerals. But Britain needs China almost as much as China needs Africa. Free trade is in our DNA, so we should do everything to cultivate the Chinese market, while understanding the risks. Mr Brown's offer of London as a base for China's $200 billion sovereign wealth fund is a good start. advertisement China is not a country at ease with itself. Apart from the inevitable strains associated with rapid growth and development, there are at least three others: anger, sex and fear. The anger arises from historic humiliations. The Chinese, who think in millennia, are well aware that a century or so ago, British entrepreneurs had a different demeanour. Backed by the Royal Navy, they occupied ports, extorted concessions and forced the Chinese to buy opium. Other great powers also trampled on China. This culminated in Japan's attempts to ravage the mainland and turn the Chinese into coolies and comfort-women. This explains the anger of the Chinese over Taiwan. To them, it is a part of China, which was turned into a Japanese colony, then an American one. We should be grateful that the Taiwanese government is now behaving more sensibly, because if it ever declared independence, China would probably go to war. The Chinese see themselves as the greatest race on earth. They used to dismiss the Japanese as obscure fisherfolk, the product, according to legend, of the union between a Chinese princess and a sea-monster. The knowledge that China has been the least successful Asian nation for about 150 years, easily surpassed by the Japanese, is an open wound. So is the one-child policy, intended to control population growth, which has created the sexual problem. In a society which values male children, there has been female infanticide on a vast scale. In some age cohorts, there are 20 million more males than females. How will the spare men behave, especially as many of them are being bought up as "little Emperors"? Traditionally, peasants regard their offspring as their pension fund, the only hope of a meal ticket in old age. So these only children have been anxiously watched over, cherished and spoiled. Even so, there may not be enough of them to support the non-working population. China might grow old before it grows rich. The one-child policy is a fascinating sociological experiment. It is unlikely to have a benign outcome. Finally, fear: the government's fear of its people. The peaceful death of Chinese communism has removed the regime's sole claim to legitimacy and the number of protests and demonstrations has been increasing. Thus far, the government has tried to offer a substitute for democracy; econ-ocracy - using higher living standards to buy acquiescence. This is not a futile tactic. Only 40 years ago, tens of millions of Chinese were trying to survive on bark and grass. Now, most have enough to eat. That is a great leap forward, and will buy the government some time. Yet econ-ocracy is only an interim solution. The Chinese are an individualistic race; they do not share the Japanese tendency to a group mentality. Eventually, the demand for rights and votes will become irresistible except by the most brutal repression. It is vital that such a conflict is avoided, but we have no means of influencing developments in China except by indirect attempts to promote goodwill. Cultural and intellectual exchanges can reinforce economic ones. Oxford and Cambridge have scholarship programmes for Chinese students. One trusts that the businessmen on the Brown mission will all be tapped for donations on their return. At best, however, this will have a marginal effect on the long march of Chinese history. We can only hope that it goes in the right direction. If China succeeds, there will be a price. The West would lose power. But Chinese success is much the lesser evil. Imagine what would happen if that huge and powerfully armed nation became a failed state.

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Quite so, and the anger if they become a failed state because of Western interest rate policy, which now looms as a distinct possibility, might be awesomely aggressive towards us, for they know as well as sensible economic commentators over here, that this deflationary crisis was and still remains, just about, avoidable.

If this world deflationary crisis is not soon defused, wars could easily result.
Posted by David Goldsby on January 20, 2008 12:33 PM
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Dear Sirs,
A procovative and well thought out article. Diplomatic clumsiness as practised by some of our neighbours could create an unlikely backlash if any attempt of manipulation is mounted. The Chinese look forward a hundred years, not merely the space between American elections. They also remember the insult that we committed through Hong Kong, and will neither be forgiven too lightly. China will become a heady challenge and with a civilisation that trancends the history of many lesser countries, a country to respect. If their society reforms at the speed of their industrial revolution, the image of superpower will loom large over the world. Winston had it right as usual!
Posted by Vivian J Phillips on January 20, 2008 12:12 PM
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Haha, I suspect the author has recently read David Wingroves fiction series: Chung-Kuo.

Regardless of China's sense of unjust historic injury, they must accommodate themselves to the 21st century.

That includes the issue of the Taiwanese peoples desire for recognised independence. Were China to respond by launching Salvo's of ballistic missiles and amphibious assault craft I would fully expect the RN to play its part by sending the latter to the bottom of the strait.

One does not appease a bully, especially not one with a population soon to reach 1.5 billion. The result of such a foolish move can best be seen in the pages of Chung-Kuo.

Regards
Posted by Matthias Gris on January 20, 2008 11:55 AM
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This is crass, trite, and silly. It is testimony to the truth of the adage: If you have nothing sensible to say, keep your mouth shut. Is this what passes for journalism in the Telegraph, these days?


Posted by V.J.Foley on January 20, 2008 11:19 AM
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One should always remember that if the Chinese government had not had the one-child policy, most Chinese would currently be living in poverty, and many would be facing future starvation. Considering that crucial fact, the present situation is a pretty good one.
R C S
Posted by R C S on January 20, 2008 10:51 AM
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a well written article. I like the part about anger and sex. China needs women. This would be a big problem. There are two solutions, increase male death rate or find women from other countries like importing them.

I am surprise how honest, Bruce Anderson discuss the British empire's colonial history. We, Chinese hate it but it is not the first time we have been humiliate by foreign powers. The Mongol and Manchurian has ruled China for over a centuries. The Mongol now is in a box, if not Russian intervention, they would be part of China by now. About the Manchurian, they are facing extinction. In next 20 yrs, they will be assimilate in the Chinese race. We remember our history and pay back is in order. It is bad that British is so far away from us, but the world is getting smaller.

About the Japanese, like Bruce Anderson said, thx for the British arming them and show them the way into China which lead to their defeat in WII. I don't feel wound about the Japan. 150 years is nothing compare to Mongol and 267 yrs of Manchurian rulez. Japan has no resources and we have a lot.

individualistic race? China which making up of the "Han" race which I am part of and proud. We shares common culture, blood and history. In our 5000 yrs history, many of us have be killed for the greater good of Han and our Emperors(leaders). U think us individualistic?


Posted by smoothn00dle on January 20, 2008 10:14 AM
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Peaceful death of Chinese Communism?? I'm not so sure about that. Chinese people I've spoken to say that they are now socialists on the road to Communism. The Communist Party is still firmly in control and capable of unbelievable brutal supression of groups it feels are a threat, such as the Falun Gong. The Chinese spends a fortune in the supression of these people. I once stayed in a Beijing hotel with with Chinese police friends, the police had taken over the entire hotel and were from cities from all over China, they used the hotel as a base. They basically interogated suspects held in local prisons and then transported the prisoners back to their home cities for incarceration, all helping to improve China's infrastructure, building the Beijing to Lhasa spur of the M25. A policewoman friend went to another city to 'work' for a couple of days, her 'work' involved the arrest of over 200 gays and lesbians, 1 year inside. China still has the capacity for brutal supression of it's people, however I must say that the cracks in Chinese society are clearly visible.
Posted by Jon on January 20, 2008 9:43 AM
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Maybe China is destined to be at war with itself, when consideration is given to the idea that just a small proportion of its population could possibly produce all the worlds manufactured goods.
Modern manufacturing requires less and less labour to produce ever more technical products. The problem China will face is how a small employed workforce will be able to live alongside the remaining poor, or 1,750,000 people.
Posted by wayne on January 20, 2008 8:16 AM
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First I should declare that as I am married to a part Chinese wife and have many mainland Chinese friends and relatives I must be biased.
But I do not recognise the China in this portrayal. The emotions I would choose are pride in China in its growth and strength. The weak and divided China of WW2 still managed strong resistance at a cost unimaginable to the UK. They are second to no one especially Japan. Friendship to the rest of the world coupled with a certainty of China's special place in it and finally optimism and confidence for the future that change will be orderly and well managed. Failed state? to quote Reagan on another smaller power " you aint seen nothin yet"
Posted by Michael on January 20, 2008 8:08 AM
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The basic tenets of the article seem at odds with the headline. Of course the Chinese think in millenia, and yes they do think of themselves as superior. Why then, should they not try to use their new found economic might, together with their numerical and military supremacy, to make their own case for being the one superpower of the 21st century?

There are faults in Chinese society, and they may one day bring the Chinese empire down in the way that other empires have fallen in the past. The seeds of the collapse of the Roman Empire were sown from within. America is a fissiparous unit bursting apart socially and on the verge of economic collapse. The British lost an empire, was in search of a role and has now committed suicide under a welter of incompetence and corruption.

The Chinese may well recognise this as their moment in history, and therein lies the reason for our fear at their supremacy. Theirs is not a benevolent nature, and if they see the Japanese as inferior they have even less time for the western world and its values. History shows us that when nations grow strong they need to flex their muscles. The story of the US in the 20th century is ample evidence of that. Does anyone believe that when Chinese power reaches its zenith in the near future its leaders will act benevolently towards the rest of the world?
Posted by Schopenhauer on January 20, 2008 8:07 AM
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My dear Andersen

"Don't fear China's success - fear its failure".

You tend to fall short of the mark with this declaration.

The REAL issue is that intelligent people should be fearing China´s successes, failures and especially their gifts.
Posted by Henry Pilkington-Smythe on January 20, 2008 7:35 AM
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I SHARE THE ARGUMENTS IN YOUR WRITTEN
YOUR CONLUSION IS MUCH MORE BETTER.

Posted by LONG on January 20, 2008 6:44 AM
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Japan's attempts to ravage the mainland and turn the Chinese into coolies and comfort-women perhaps you should read some history if you can find it but it makes what Hitler did to the Jews look minor. As for the one child policy it would have to be the most green on the whole planet when will other governments adopt it.
Posted by James Hendry on January 20, 2008 5:01 AM
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The "huge and powerfully armed nation" was a failed state for a long time with no serious consequences for other nations. I can imagine that Nothing would happen if it resumed a failed state anew. Furthermore, I suspect that China become if not a "failed state" than definitely a poorer and humiliated state when all the green paper they accumulated in recent years turn to dust (remember Japan?)
Cheers.
Posted by Millicent on January 20, 2008 4:37 AM
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Clever Chinese they saw a desperate mug coming and he fell for it hook, line and sinker.
So the Chinese are going to spend £10 billion over the next few years and create jobs in the UK.
Why? they have enough worker fodder as it is, so what do they really want?
In a nutshell, your technology and know how, they will buy into hi-tech companies and then export the technology back to China where factories will be set up to utilize that technology, why re-invent the wheel when it already exists?
They are not interested in the EU as a market, why should they be? you have 500 million people and a saturated market for high tech products, they also have to comply with very strict health and safety rules.
Now lets look at the emerging market here in the Far East and just take 2 countries, China and India with between them 2.5 billion people and an unsaturated market right on their doorstep.
Even the Americans are not as stupid as Brown, they fiercely resist any form of investment from China into their high tech industries to protect their technology and know how.
Brown has just fallen into a carefully laid trap.
Posted by mike williams in Bangkok on January 20, 2008 4:23 AM
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Bruce Anderson's article on China
has brought up another fresh look at
the world's most populous nation.
China's aggressive pursuit of its
future is just as fierce as the
portent reaction to its past traumatized by humiliation, colonialism, oppression and exploitation. So, it seems to make
sure it never happens again. But,
the problem is the paradoid extremism
displayed in the nation's expression
of self-determination. I don't know
of any nation trying, or planning
to engage China. But, the great nation, sometimes, acts like another
is trying to do so.

If at all, the only two major, territorial, colonial or sovereignty
challenges China has are on that of
Tibet, peacefully seeking autonomy,
after enduring more than half a
century of occupation; and Taiwan doing the same for nearly 70 years--even though voices of separatism are clearly echoed by independence-mined,
Taiwanese politicians and leaders.

China's economic prowess came under
intense scrutiny in my recent commentary under Richard Spencer's Jan. 4 commentary: "Dollars, pounds and China's financial system." China's human-rights abuses, also,
came under discussion in my July 12
op-ed commentary: "China's toxic
system." And, China's ambitious,
economic investments in the Third
World is shown in my comentary under
David Blair's Aug. 31 article: "Why
China is trying to colonize Africa."
Here, I showed that it's not colonialism; but investments and
friendship treaties that began in the Cold War years, as communist rival,
Soviet Union (now exemplified by
Russia) focused on costly arms race
with the West.

So, one can still say that when it
comes to human rights, China and
Russia lately, have a lot in common.
But, China is far more ahead of
Russia in globalization, investing in
many countries and buying up raw
materials where it finds them, to satisfy the voracious appetite of its
1.3 billion people. With a foreign
exchange reserve of $1.5 trillion,
along with a gold reserve of
$1 trillion, China can continue its
quest for global economic domination,
expected to take effect within two or
three decades. Few doubt this
projection. Not bad for a nation that
has lifted 400 million of its people
out of poverty; cutting the poverty
rate from 53 percent in 1981 to
8 percent in 2001.

So, many nations are making economic
pilgrimage to China. The lastest
foreign head of government or state
to do so is British prime minister,
Gordon Brown, who's there to drum up
foreign and domestic investment,
with plegdes to investment up to
$100 million in energy-efficient,
industrial systems, which China
requested, and boosting British-China
trade from the current $40 billion to
$60 billion in the next few years.
China's economy grows at 10.8 percent
compared to 3 percent for that of
Europe and the United States.

Furthermore, China is investing in or
buying into airlines, hotels, oil,
banks, securities, parmaceutical
industries, insurance, investment
banking; and more, domestically, abroad or through collaboration.
Internet users in China grew from
137 million 2006 to 210 million in 2007--a growth of 53 percent. But, safety and quality still remain a major challenge for China in international trade and domestic industries and manufacturing. The recall of Chinese merchandises abroad has receded due to tougher enforcement of saftey laws,
restrictions and trade sanctions from
abroad to push reforms and progress in
these areas. China recorded almost
3,800 mining fatalities--the worst in
the world, which has triggered the
closure of over 100 mines.

China continues to advance, improve
and progress through economic
modernization and largesse diplomacy,
where it uses benefaction and supposed
humanitarian acts to woo nations away
from recognizing Taiwan. The lastest
such largesse beneficiary is Costa Rica; which is going to get a free, brand new stadium built by China.
Igonikon Jack, USA
Posted by Igonikon Jack on January 20, 2008 4:17 AM
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This a rare and accurate comment that
helps us see China from their eyes, It also points a finger at where our foreign policy should concentrate its influence. As a trading nation we cannot afford to neglect the potential of of this economic giant.
It would be unworthy of us to miss this chance to diversify our opportunity to seek other friends,and still maintain respect with our historical allies.
Posted by john gibbons on January 20, 2008 3:11 AM
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I know it is very, very hard for columnists in their nice offices in London to get this, but the CCP is respected by probably a majority of Chinese, as it is regarded as providing competent leadership, and is genuinely trusted to defend the national interest. Hu Jintao is more popular than Brown or Blair. It is true that few people are happy with the socialist system per se, but politics do not intrude much now--even censorship is very leaky--and few feel politically "oppressed." Patriotism and pride are stronger sentiments. There will be no serious challenge to the CCP for a long time--probably not before the vast majority of people have become as wealthy as Taiwanese were when they outgrew authoritarian government.

Based on 20 years' experence of China and a tourist knowledge of India, I think China is more stable and at ease with itself than India, which is hampered by its caste system--a far worse human rights issue than the "illegitimacy" of CCP rule--and its lack of national unity. India is a collection of peoples held together by a backward religion and the language of its former colonial master. China is an almost fully unified nation, and over the next 20 or 30 years will complete its job of achieving decent living standards for most. Only one thing could rock the boat before then, the Taiwan issue.
Posted by oohkuchi on January 20, 2008 2:19 AM
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This column is chock-full of ridiculous wrong racist rubbish.

The Chinese, who think in millennia

The Chinese are an individualistic race; they do not share the Japanese tendency to a group mentality

The Chinese may remember the 19th century, but you, sir, appear to be living in it.

Posted by Mr. Noah on January 20, 2008 2:17 AM
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It should be "became a failed state, again". The
recent "econ-ocracy" is worse than futile as it could
be taking China down that very road. China
urgently needs to re-engage on good faith reform
and opening up, particularly political reform. Mr.
Brown should speak up - the more publicly the
better.
Posted by JD on January 20, 2008 1:29 AM
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Bruce, I hadn't realised you were such an expert on the Chinese psyche. You must have spent years studying the subject. And there was me thinking you were just out to lunch. Well done. If you could only turn your attention to the mind-set of the British – a race whose mores are clearly more of a mystery to you – we might all learn something.
Posted by Walter Ellis on January 20, 2008 12:49 AM
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