Chinas' Future

Dr. Demarche emailed me and invited me and other bloggers to post some thoughts on what and where China might be a decade down the road on the world stage, so to speak, in regards to their military, economy and culture. So here goes:

Chairman of the House International Relations Committee, Congressman Henry Hyde said:

Of the many competing forecasts of the century now unfolding, all agree that the rise of China will be a central determinant of its course. So great is China's potential that some have prematurely termed this the "Chinese century." Once hazily distant, that imagined prospect is rapidly becoming a tangible reality right before our eyes."

I have had some concerns over China for quite some time now; and I often felt, I was alone in this assessment based on a number of conversations I've had with others. But, I simply just don't trust China. Remember, this is a country that openly cheered as little as 3 1/2 years ago when planes crashed into the World Trade Center towers and the Pentagon.

This is a country that has about 4 1/2 times the population as that of the United States and represents 1/5th of all humanity. One estimate from July, 2004 put their population at 1,298,847,624 and the United States third in world population at 293,027,571.

"We are witnessing the emergence of a new and powerful actor on the global stage, one whose actions and decisions will reach deeply into every country on the planet.Whether that impact will be positive or negative, cooperative or combative, cannot yet be predicted with any confidence. That will in large part be determined by the evolution of China's political system."

They have a booming economy, but its’ true strength and stability is a bit of a mystery it would seem. Granted, the potential is vast, due to its’ large population - but economically poor population.

To be sure, almost every country would ideally like to increase its trade with China, and many will over the next decade. Since all countries will act out in whatever manner they think serves them best - what they think is in their best interest - China will not be lacking in trade partners.

Many people from around the globe, see China as this wonderful country of business expansion that has undergone economic reform and that it holds great economic opportunity. Today, for example, we see Japanese industries all too happy to rush into China and set up factories so that they can bring back home cheap products.

Due to this high rate of economic growth, China is experiencing unprecedented levels of foreign investment. They have an unlimited pool of low cost labor in its citizenry, and as already mentioned, are currently experiencing unsurpassed economic growth. In order to supply its domestic construction projects and export manufacturing industries, their demand for steel, plastics, and lumber, to name just a few, is raising havoc with supply and demand on these and other resources, causing prices for these resources to soar. We must also consider their need of oil which has skyrocketed and has caused the global energy markets to heat up.

The flip side of this is despite all the foreign investment pouring into China, the Chinese are taking vast sums of money out of China. Billions, in fact, of private money (and government money, for that matter) is being invested elsewhere around the world where it is deemed safer to invest. This of course hurts their economy because the money is not being plowed back in for further expansion.

According to Jack Wheeler,

"All four of China's main banks (all state owned) have more uncollectable debts than they have assets and loans."

Furthermore,

"The Shanghai Composite, China's largest stock market, has gone nowhere for five years.”

It is not a stretch to imagine this economic boom in China could carry through for the next decade. The need for and the resulting competition for fuel and other resources would only heighten the supply problem of these resources and drive prices up.

Victor David Hanson thinks,

“we will soon enter an age in which China may well change the world's environment, affect the price of oil, and govern the world's trade as much as the United States.”

What other problems could arise with a continuation of this growth? According to VDH,

“China is on the move and far more likely to disrupt environmental protocols, cheat on trade accords, and bully neighbors.”

Like Taiwan, perhaps? I don’t think there is much that would be done if (when?) China were to attack Taiwan. “Enemies” or not, I do not see Russia, or India, coming to the rescue of Taiwan. I’m not sure that America would have the appetite for it either. Economic sanctions? No doubt. War against China. I don’t see it.

Victor David Hanson observes,

“China and India are the new tigers, but their rapid industrialization and urbanization have created enormous social and civic problems long ago dealt with by the United States. Each must soon confront environmentalism, unionism, minority rights, free expression, community activism, and social entitlements that are the wages of any citizenry that begins to taste leisure and affluence. China is fueled by industrious laborers who toil at cut-rate wages for 14 hours per day, but that will begin to moderate once an empowered citizenry worries about dirty air, back backs, inadequate housing, and poor health care.”

Jack Wheeler points out there were over 60,000 riots, disturbances and public protests throughout China in 2004.

"People can see how corrupt the government is while they barely have enough to eat," Wheeler quotes a demonstration leader as saying. "Oursociety has a short fuse, just waiting for a spark."

Part of that spark could be caused by the bleak economic outlook that feeds discontent among China's 1.3 billion people.

I think our most likely strategy would be economic and hope for internal fracturing and uprising. Since Internet dissidents and religious believers are being thrown in jail, families (and women) are being persecuted for violating the nations policy of only one child per household, forced abortions and sterilzations taking place, a growing economic divide between the coastal regions and the inland peasants, and increasing civil unrest (over 60,000 incidents in 2004), we might very well choose the “passive method of attack”.

There will be ups and downs in our relationship with China in the next decade. But I do agree that it is very unlikely that China will do anything to lessen "their standing" until the 2008 Olympics (which they will be hosting) are over. The world has a critical stake in making sure that "China's rising power is channeled into productive directions and away from the threat of a revolutionary impact that would wreak havoc on the international system in which its presence and influence will steadily increase."

We can hope that they continue their economic expansion AND continue their move, albeit slow, away from Communism. "The most beneficent outcome can best be ensured by an increasingly democratic and cooperative China, one in which its dynamism and stability are in balance, and one that is prepared to accept broad responsibilities commensurate with its increasing power."