CommentsWEST VERSUS EAST - There is a hypocrisy at the heart of the West’s attitude to China: although we’re constantly warned about the threat from Beijing, our political and corporate elites seem intent on making this century a Chinese one.
Unlike in the Thirties, this appeasement isn’t driven by fear and ignorance; it is motivated largely by greed.
And that greed could prove fatal. China’s “civilisation state”, deeply rooted in thousands of years of history, represents the most profound philosophical challenge to liberal values since the end of the Cold War. But our oligarchs choose to ignore this, preferring instead to genuflect to Beijing for financial gain.
The cost of such avarice is slowly coming into focus: China’s economy may surpass the US by as early as 2028, and by some measurements already has. Of course, China deserves credit for its remarkable performance, which is mostly thanks to the efforts of its citizens, in particular its rural migrants, the key fodder for the country’s dominant manufacturing base.
But the Middle Kingdom’s ascendency would not seem as inexorable if not for the efforts of the West’s ‘kowtow crowd’, a group of self-interested cheerleaders and enablers of China’s autocratic state. At the height of the Cold War, Soviet leader Nikita Khrushchev threatened that the USSR would “bury” the West. China’s President Xi can count on the West burying itself.
Some of this can be traced to naivety and an underestimation of Chinese capabilities. Rather than recognising a potential threat, our political and financial elites saw a potential economic partner and huge market. China was still a poor, developing country; when welcomed into the World Trade Organisation 20 years ago, it dutifully supplied cheap products to a welcoming market. In the meantime, it was hoped that exposure to the West would create an increasingly liberal China.
Yet for at least a decade, particularly since Xi Jinping assumed control of the Communist Party, these assumptions have been proven fatally wrong. Xi and the Party have clearly made clear that their ambition is not any old seat at the table, but the one at its head.
Given what seems a clear and present danger to the West and its East Asian allies, one would expect our ruling class to seek ways to fight back. Donald Trump may have been a blustering fool but at least he saw, and identified, the threat. President Biden, to his credit, has also proposed some steps to reinforce US competitiveness, and there is rare bipartisan consensus, including on the Left, to resist China’s hegemony.
Yet prospects for standing up to China from the White House are limited. As recently as 2019 Biden, a stalwart cog in the Washington consensus, minimised the Chinese threat to our economy, recently claiming, incredibly, that: “you know, they’re not bad folks, folks. But guess what? They’re not competition for us.” More worrisome still has been the Biden family’s close business ties with Beijing. The somewhat dissolute Hunter, in particular, has profited hugely and gained expensive gifts working for the Chinese. Most recently, he helped a Chinese firm to corner the cobalt market, a key component in the administration’s green energy strategy.
But kowtowing is hardly a partisan phenomenon. Prominent figures from both parties, including former GOP Speaker John Boehner, and many connected Washington think tanks receive funding from Beijing. Even members of the Bush family have cosied up to CCP apparatchiks, including one with strong ties to that country’s rising military.
Europe’s leaders, if anything, are even less committed to confronting the Chinese challenge. Some, including Angela Merkel and Emmanuel Macron, seek to play the US against the Chinese civilisational challenge by treating them as moral equivalents of their long-time American allies. Meanwhile, Beijing is busily extending its presence on the continent with infrastructure investment to weak European countries such Greece, Hungary, and Romania.
Nowhere is the ineptitude of the Western policy towards China more evident than in climate change. Like its human rights record, China’s environmental footprint should be a source of embarrassment and condemnation. While the West hamstrings itself with its eco-commitments, China, not mandated to reduce its carbon emissions till 2030, continues to build coal plants to maintain its industrial engine. By 2030, when China will be able to shift to nuclear and other alternatives, the West will be effectively de-industrialised, and hopelessly dependent.
But such dependency is nothing new. For decades American companies have been handing Beijing the basis for economic hegemony: since 1990 US deficit in trade goods with China has ballooned from under $10 billion annually to $419 billion last year. China’s ratio of imports to exports was four to one in 2018. This has enriched many of our leading manufacturing companies — notably Apple — while costing an estimated 3.4 million job losses in the US since 2001.
Meanwhile, these corporate kowtowers actively promote China’s model. Apple, for instance, props up and profits from China’s ever-expanding surveillance state. Acting as if it were its own country, Apple has essentially negotiated its own $275 billion deal with China, promising to keep production there while assisting with the country’s unhidden goal is to supplant the West as a tech leader.
For its part, Wall Street, even amid the threat of government interference, plays its part the kowtow crowd. Ray Dalio, founder of giant Bridgewater Associates hedge fund and self-promoting author, has dismissed China’s repression of its Uighur population as the result of a “sacrosanct” desire for sovereignty. Even powerful figures such as Jamie Dimon of J.P. Morgan have decided to publicly apologise after upsetting the CCP. It’s in their interest, after all. Xi knows fully well that Western investment bankers and tech companies will do his bidding, as long as they get what Mafia dons may call “a taste”. China may be miffed if US diplomats boycott the 2022 winter games, but they can be sure that the corporations and investment bankers will likely be there, heads bowed on the floor.
All of this is made even more humiliating by the fact that China’s rise may not be as unstoppable as its Western admirers believe. China’s economic growth rate is slowing, its bloated real estate markets are showing signs of implosion, and industrial production has slowed to the lowest level since 2004. Meanwhile, its tech and innovation sector is being pummelled by continued government crackdowns.
More serious still are demographic forces. By 2050, China is projected to have 60 million fewer people under age fifteen, a loss approximately the size of Italy’s total population. The ratio of retirees to working people is expected to have more than tripled by then, one of the most rapid demographic shifts in history. By 2050 it will be roughly 20% higher than that of the US; 15 years after that, according to the South China Morning Post, China’s population will be very old and about half its current size.
None of this suggests resisting China will be easy, particularly given the disposition of our rulers. But it does mean it’s possible.
That is the real tragedy of the kowtow crowd. Just as in the Thirties, their prostration only makes their adversary stronger and more confident. Inevitably, it will be the rest of us, and future generations, who pay the price.
(Joel Kotkin is the Presidential Fellow in Urban Futures at Chapman University and executive director of the Urban Reform Institute. His new book, The Coming of Neo-Feudalism, is now out from Encounter.)
