China gazes into an American mirror

A commentator on my recent post on the China threat spoke of the "deliberate contamination of pet food," suggesting some kind of plot hatched in Beijing to flood the world market with dangerous goods. In other words, China's liberalization is a kind of trojan horse project by which China will undermine the global order and win without a fight.

Stepping back into reality, I found Joseph Kahn's article in the New York Times' Week in Review on Chinese regulatory reform interesting, because Kahn explicitly notes an idea that I have mentioned here before, namely that the best parallel for China's rise may in fact by the rise of the United States in the late nineteenth century.

To wit:

Phony fertilizer destroys crops. Stores shelves are filled with deodorized rotten eggs, and chemical glucose is passed off as honey. Exports slump when European regulators find dangerous bacteria in packaged meat.

More product safety scandals in China? Not this time. These quality problems prompted a sluggish United States government to tighten food and drug regulation 101 years ago, when President Theodore Roosevelt signed the act that created the Food and Drug Administration.

Like America’s industrializing economy a century ago, China’s is powered by zealous entrepreneurs who sometimes act like pirates. Both countries suffered epidemics of fatal fakes, and both have had regulators who were too inept, corrupt or hamstrung to do much about it.

While Americans and others are right to be concerned about products imported from China, it is not as if Chinese are not suffering from a woefully inadequate regulatory environment. Take the recent explosion at a karaoke bar that killed twenty-five people, another in a string of man-made catastrophes that has plagued China of late.

China is belatedly discovering that a liberal market economy is not simply a function of the state's stepping back and letting the market do its thing. The state must use its power not to pick winners and losers, but to ensure transparency and enforce proper conduct within the marketplace — punishing transgressions as necessary. The rule of law is, of course, an essential tool for fulfilling these roles. The question is whether the regulatory state outlined in Kahn's article is possible in a market in which all actors are not, in fact, equal: privileges of CCP membership and outright corruption by minor party officials are substantial obstacles standing in the way of an economy grounded in the rule of law.

Nevertheless, in domestic governance as in international affairs, China has much to learn from the rise of the superpower across the Pacific, and considerably less time in which to figure it all out.

Keating in China

Admiral Timothy Keating, newly minted chief of US Pacific Command, is currently visiting China to meet with PLA brass. As documented by Dana Priest and Robert Kaplan, among others, the heads of the US Military's unified combatant commands wield tremendous military power, of course, but also diplomatic power (America's "proconsuls," to use the imperial metaphor that has perhaps gone out of favor in recent years).

As powerful as Keating is, though, his PLA interlocutors may very well wield power that puts his to shame. As Bates Gill and Martin Kleiber write in Foreign Affairs regarding China's ASAT test, "Put bluntly, Beijing's right hand may not have known what its left hand was doing. The People's Liberation Army (PLA) and its strategic rocket forces most likely proceeded with the ASAT testing program without consulting other key parts of the Chinese security and foreign policy bureaucracy -- at least not those parts with which most foreigners are familiar."

Keating, in fact, pressed General Guo Boxiong, vice chairman of the Central Military Commission, on the test, insisting that it sent a confusing signal and demanding an explanation.

While signs of the PLA's predominance are worrying, Keating's trip in general is encouraging, ensuring that the two militaries have, at the very least, cordial relations.

I also found comments by Guo reported by the People's Daily interesting: "Guo said both China and the United States shoulder responsibilities of safeguarding world peace and stability and promoting common development. The two countries are both stake holders and constructive partners who share strategic interests, and China attaches great importance to China-U.S. relations." While one cannot put too much stock in China's rhetoric, it is interesting that they are accommodating the US government's "responsible stakeholder" ideas. China certainly has nothing to lose from presenting itself as a responsible stakeholder — hence the "peaceful rise" rhetoric — and will no doubt continue to do so until it finds something else to be more beneficial.

In any case, China is not going away, and the US (and Japan) might as well figure out how to ensure stable relations with Beijing instead of making things up as they go along.

Does the PLA run China?

Back in January, in the aftermath of revelations about China's ASAT test, I wrote that the test, which contrasted sharply with cooperative overtures by China at approximately the same time, might have been the product of the PLA's over-sized role in policy debates in Beijing.

Now, over at China Confidential, Confidential Reporter asks whether "China may actually be a military dictatorship posing as a party-ruled, authoritarian (formerly totalitarian) state." (Hat tip: China Digital Times)

This is a hugely important question, but one that may not be answerable, due to the opacity of the Chinese state. But if the PLA is truly ruling China, can any of China's neighbors trust conciliatory words spoken by Premier Wen and the Chinese Foreign Ministry? Are the social changes supposedly at work in China all subject to reversal by a PLA "counterrevolution"? Or, on the contrary, can the PLA, not to mention the party, govern China at all?

On that point, I have strong doubts about the ability of any central authority to govern a nation of more than one billion people, hence the reason for having more confidence in the sustainability of India's rise — Indian federalism seems to provide a more durable system of governance for a megastate than China's klepto-constructo-developmental authoritarianism. After all, the law of diminishing marginal returns surely must apply to population: beyond a certain level, every additional million (or hundred million) provides more problems than benefits for a central government.

Presumably, though, if significant authority can be devolved to the state and municipal levels — and if that authority can be held accountable by the people — the threshold after which the law of diminishing marginal returns kicks in can be pushed up. Consider that federalism enables Delhi to share responsibility for the governance of the populous but poor state of Uttar Pradesh with state authorities in Lucknow. So perhaps when considering India's comparative advantages relative to China it is necessary to mention its federalist political system.

All of which means that the CCP — or the CCP's PLA masters — cannot be thrilled about reports that China's population is set to rise.