Tuesday, September 24, 2013

 

Is China smarter than the U.S.?

That is essentially the question Chet asks:
On the one hand, the China organism would appear to be engaging in various self-improvement exercises, while the US organism spends most of its energy running up and down the street barking at cars, knocking small children off bikes, and chasing its ideological tail.

I've written a great deal about the fallibility of Chinese leaders, and, by extension, the limits of the Chinese system. But, as is often the case, the real focus of Chet's argument about Chinese acumen is American shortcomings, not Chinese brilliance. Often, op-eds use China as a measuring stick to highlight American shortcomings that the author wishes to see fixed (Friedman is famous for this).

This can be a useful rhetorical device, but it has three major limitations.

First, it can blind us to the very real challenges China faces. For example, Michael Pettis argues that China needs to seriously re-balance in order to sustain growth over the long term, and that re-balancing requires growth to slow. From that perspective, the recent bump in the PMI is a bad thing because it is a step away from moderating growth rates, which are necessary to re-balance in an orderly manner. High growth rates in the short-term, therefore, are counter-intuitively a bad sign for long-term growth since they likely perpetuate the export and investment-led model from which China is trying to wean itself. I worry that excessive use of China as a motivating factor for adapting American domestic policy will undermine our ability to rationally understand China on its own terms, with all of its strengths and weaknesses.

Second, the rhetorical device of invoking China's superiority has another risk: it could cause us to lose focus on what we need to fix if China stumbles. If China experiences an economic setback over the next few years, then we'll likely see many people criticizing its leaders for not managing its economy better. If that happens, the U.S. would look better relative to China, but the challenges faced in American domestic politics wouldn't have gone away. I worry that too much use of China as our measuring stick could lead to complacency if China faces a setback.

Finally, using China as a point of comparison can lead some to seek to emulate China's autocratic system in the drive to emulate China's economic growth rates (Chet's post doesn't do this, but others do). America has challenges to overcome, but thinking that we need to become more authoritarian to overcome them is a misdiagnosis.

This is my personal blog. All opinions expressed are mine and do not reflect the position of any other person or organization

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