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The Forum > Article Comments > China - playing by the rules? > Comments

China - playing by the rules? : Comments

By Chris Lewis, published 11/2/2010

The West must respond to Chinese mercantilism: to do nothing it is to accept the demise of Western influence and the rise of authoritarian China.

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Yes, I have a book in front of me titled: The Coming China Wars by Peter Navarro.

Altogether it gives a very bleak description of how the Chinese operate on the world stage--in all sorts of ways.

It also describes how horrible life is for the majority of people in China. It is essentially a vast environmental disaster zone.
Posted by Ho Hum, Thursday, 11 February 2010 12:56:46 PM
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Nice piece Chris. Although I've lived in China for quite some time and do have a deep and abiding respect for it, I look at the rise of the current system with both happiness and unease. Happiness for the fact that many people are being lifted out of poverty and unease for, well, you've illuminated that side.

More considerations:

There's the theory China's only being belligerent at the moment to cement the perception that it's opposing foreign requests to revalue the yuan, and soon it will need to or face a dire economic situation.

Ihey may just want to be sure the public don't view them as kowtowing to western requests.

There's other considerations - there's factionalism within the CCP. Hu Jintao faces challenges from a bloc of influential power-brokers from the coast. He's been taking a pretty conservative stand in order to ensure that his succession goals are adhered to.

As for the idea that there are large numbers of educated Chinese circumventing net restrictions, I'd say the number's comparatively small. Political discussion is discouraged in the public sphere, and effectively this leads to very little interest in politics.

Think about it. In Australia, many people's eyes glaze over when the subject is about politics, particularly when people at the table don't know about it.
Add to that the cultural issues associated with losing face if you don't know about the topic, and the fact that it's generally discouraged. Thus you get a large part of the population who know very little about politics or religion. The latter's also concerning, because it makes it easier for religious types to proselytize. Most Chinese don't have the same resistance to being sold ideas in the way people push products.

The lack of interest in politics translates into people being less likely to circumvent internet restrictions - despite the strong push for english education, very few speak it well. Few would actively go online to read english articles, when it's far easier to read them in Chinese. So the vast majority of censored sites are of no interest to the population.
Posted by TurnRightThenLeft, Thursday, 11 February 2010 1:51:07 PM
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TurnRightThenLeft,

I agree with you about the Internet. I was trying to incoporate some optimism in regard to the literature. I am far less optimistic (although hopeful) about the Internet (and other technology) in authoritarian states.
Posted by Chris Lewis, Thursday, 11 February 2010 1:56:36 PM
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In Inner Mongolia the Mongolian population is 17% if only Gengis Khan could seen his people living on the edge in there own nation this must be an example of Chinese rules what? waits in stall for the west lets hope they don't end up like the Mongols
Hill Billy
Posted by hillbilly, Thursday, 11 February 2010 9:53:20 PM
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China has benefited from the globalization aberration.Globalization and free trade are dead - good riddance.

Bring on the trade wars and the subsequent shooting wars.They are about the only only chance we have of correcting the overshoot in population and resource exploitation.Homo Saps is not capable of a rational solution.
Posted by Manorina, Friday, 12 February 2010 7:19:06 AM
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It amazes me is that the West has ever expected China to play by the rules, still does, it seems, despite evidence to the contrary. I am appalled this naivete is such that the Australian government allows Chinese 'companies' to buy Australian property and into Australian resource companies. That there is no such thing as a truly independent Chinese company, and all commerce decisions are ultimately a matter for government, is commonly understood. So what were our Sinophile PM and his ministers thinking when they thought they could pull off a fair FTA with China? Are they so blinded by the bling of Chinese markets that they will sell our golden geese? They will find its as the moral goes, 'all that glisters ....' and such deals will resemble the junk that passes through our harbours and into our rubbish tips - just pretty bait to reel us in.
Personally, I was chilled to the bone watching the Beijing opening ceremony. Has anyone noticed how simple it seems to raise a demonstration by Chinese in Australia over issues China designates, such as Tibet, when our government strays from the line? And what about the huge 24/7 hacking attacks?
I must hasten to add that my concern has nothing to do with the colour of skin or the configuration of features. Its the cultural ethos of compliance with authority, the totalitarian government and the sheer mass power they can summon that scares me.
Posted by Dr Merlyn, Friday, 12 February 2010 4:22:58 PM
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This article on China is so typical of the mindset of the Fairfax / Murdock press, et al, whose ability to analysise / hypothesise current events,leaves much to be desired. Laurie Oakes, Peter Harvey, John Bonjorno etc have a much deeper insight of the issues at stake. Perhaps that is why they are employed ?

The Author should not believe a word the sexed up CIA Fact Book promulgates. Notorious for obscuring the facts, it's bias against everything non aligned with the Stars and Stripes. Amusingly, it's editors are more obsessed with how many AIDS and HIVs per capita, as about a Nation's Trade deficit ? Who, apart from the RBWH or Mater Hosp, would want to know ?

Fact: The US is a consumer Nation. Like Aust, it consumes more then it produces. Savings are nil, 75% loss in Foreign exchange. Suffers 25 years of inflation - Govt spending, health,household debt, mortgages, CPI, etc rose 59%. Free market economy ? The Fed is printing what it doesn't have.

No Country in the World, not even the dynamic manufacturing powerhouse US, which Delano Roosevelt put to good use WWII, can match C's performance. For all it's faults, it has rocketed ahead at an unprecedented rate. Far outpacing the Industrial giants US, Germany, Japan etc.

Third Largest World Economy; 20 % of the World's growth; $ 9 T GDP. In 1990 the US Economy was enviable, whilst China stagnated. Since then it has surged in great 5 year leaps forward.
Where they lack in technology, they have compensated with blood-sweat-tears-and toil, low wages ( western standards ) and volume productivity. Exports $ 30 B to US alone.

Where the pundits fail dismally, the population are happy with the status quo, relieved they are employed, and appreciate the opportunity to patriotically produce items which are marketable to the World at large. No one is exploited, as CL suggests. More kids and single mums, are exploited by the Tourist / hospitality industries on the glitz Surfers Paradise strip. Believe me.
The fact that numerous Industries have moved off shore reinforces my point
Posted by dalma, Friday, 12 February 2010 7:00:53 PM
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that numerous US, UK, OZ Industries have moved off shore - wages are just too goddam high !

Union demands and intimidation have left thousands unemployed. On the perennial scrap heap, and ultimately on the welfare gravy train. Business establishing in C must be joint ventures to qualify for tax exemptions. Not readily apparent is the lack of transparency as Corporations avoid the impost, but invariably bill the ATO excessive claims under the guise of " start up costs ". Who can forget BHP, and AWB fiasco involving $ 300 M gone missing ?

That the Middle Kingdom has amassed $ 2 T of US Treasury Bonds, and an unimaginable investment portfolio, is a worry to Obama, Congress, G20 etc ! Central to this is the devaluation of the $US, and the threat to shed tyhe Reserve currency.

That Greece,Dubai etc are on the brink of default is a sorry reminder, the US crisis is only just emerging. The Euro has plunged, and the 28 Union members are in a quandary. IMF, World Bank will find their jobs tailored to rescuing Sovereign Debt. Cries from Germany, etc for readjustment solutions which will NOT imperil the Euro. Worst scenario, the white-anting has already begun. G20 is committed to support, and like dominos, the collapse will send the wrong signals, and panic will gain momentum for the greco-apocalypso . IMF and World Bank can ONLY resort to Reserve currency which is recognised throughout the World. Since 1933, the Fed in their wisdom dumped the gold standard, which previously saved the Weimar Reichbank from total collapse 1923. Hyper inflation, and the debauchery of currency ( uncontrolled printing ) was the cause, which precipated Hitler's Mein Kamf, and WWII.
Printed ( monopoly ) paper money eventually returns to it's intrinsc value - zero ! Bugger all.

Quote: Loss of purchasing value of the Dollar, caused by increasing out of thin air, the supply of money and debt by the Financial system of the Day. To control Inflation, one must control money supply - Milton Friedman.

Evidently, we have learnt nothing.
Posted by dalma, Friday, 12 February 2010 8:05:04 PM
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dalma. A few points.

Firstly, I don't think the author is a news ltd journalist. Your point about it being typical Murdoch fare merely stereotypes and categorizes the discussion.

You lambast it for not being balanced, then make a swipe because it doesn't criticise the US as much as you'd like.

Tunnel vision. Get over it.

You actually make the amusing comment: "No one is exploited, as CL suggests."

Uh, *nobody* is exploited? In all of China? Are you serious?

Clearly you've redefined exploitation as something only Americans are capable of. In the same breath, you talk about cheap manufacturing.

And frankly, I find your glib remark: "(the Chinese) appreciate the opportunity to patriotically produce items which are marketable to the World at large" to be about the most condescending attitude I can imagine.

Oh yes. All those Chinese workers just love toiling away night after night.

You also state: ", the population are happy with the status quo,"

Uh huh. All of them? All 1.3 billion? No exceptions?

Are exceptions permitted?

There's the question to ask yourself.

I'm not a big fan of the US by any stretch. I just find that people allow their Anti-US attitude to make them overly rosy-eyed about the other major powers.

Just remember that you're permitted to voice your opposition to western led powers.

Liu Xiaobo, the Chinese dissident, simply wrote articles laying out a foundation to move toward a democratic system, and on Christmas day he was sentenced to 11 years in jail. He wrote nothing advocating violence.

But I guess he should have just shut up and gone one toiling, right?
Posted by TurnRightThenLeft, Friday, 12 February 2010 8:22:35 PM
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Sure there is plenty to criticise the US about. It could be argued that the US has indeed the worst example of federalism in the western world given its unequal outcomes.

In the case of communist China, however, I don't see the grey areas as much for good reason. China and the US are light years apart in the example they set to the world. One did use its power to encourage a decent set of principles for the world (although not without contradictions: concept that trade deficits are just as important as trade surpluses to encourage trade, anti-colonialism, and even racial diversity given the multicultural character. And when its own economy got into trouble (1970s), it persisted with free trade even though the reliance on services and debt was always going to cause immense problems. Further, there would not be a more affluent China if it was not for the US.

As for China, where do we get inspiration: from its ability to plan for whatever is the current whim of its policy elites, its crackdown on anyone who gets in its way because it does not have faith in civil society, its treatment of certain minorities, its most polluted cities.

Daima, you have hardly convinced me of anything. Your comments of the West's predicament are heavily biased to what an ideological market economist would say. The real world does not operate according to an economic theory. The west is not about to emulate the example of china (at least i hope), it will not decimate social welfare to the point that its labour costs will be competitive against China.

Sure the answers for the West are difficult, but i have faith that we can make them and not begin a policy path that eliminates many of the societal gains that have been made over many decades as many issues indeed need the allocation of sufficient resources.

Sure the balance between competitiveness and compassion is becoming harder and harder, but it still can be won in a sensible way (the Western way). To hell with China's example.
Posted by Chris Lewis, Saturday, 13 February 2010 6:24:01 AM
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Chris Lewis's article and all of the respondents are all assuming
business as usual.
China as you may have noticed has been running around the world either
buying oil fields and coal mines or failing that are taking out very
long term contracts.
Have you asked yourself why are they doing this ?

Our recent economic crash was not triggered by a credit squeeze and
sub prime mortgage crash, but was triggered by a squeeze on oil supply
and the resulting swift rise in oil prices from 2007 to 2008.
The peak of oil production was July 2008.
The result was high fuel & food prices and mortgages were not paid.
China has been expecting this and has been driving their resources
acquisition policy for some years. Their intention is obvious.
When the next squeeze comes, perhaps later this year or in 2011/2012,
they want to be able to continue their growth while the rest of us
will be left scrambling for what we can obtain on the spot market.

It just shows the difference between our politicians and theirs.
Ours do not want to know about peak oil and indeed there is an
unspoken ban on those two words.
Our politicians should have been planning for a change to alternative
energy sources for at least ten years by now but they have done
absolutely nothing.

No one has even asked the question as why it has become so hard to
get growth going again ?
Tha answer is disarmingly simple;
Growth comes from energy, and the higher the cost of that energy the
less energy available the less growth that is possible.

China will be in the same boat as the rest of us after their buffer
is depleted and international trade will dry up.
That is when we will have to watch China very carefully.
How hungry will the dragon be ?
Posted by Bazz, Tuesday, 16 February 2010 8:59:01 AM
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Chris gave interesting facts and statistics about China. I can't disagree with them. But I feel a little bit hesitant to go to a conclusion that it seems he is leading us to. I am sceptical and I do not hope, either, that sort of thing will happen for the sake of the world and for the sake of China, too. We must wait for a while and see what all that will turn to be.

There is a historical reason for China's enormous sense of self-importance. Chinese society was differnt from European, Islamic, and Indian in that the last three had more or less contact with each other in origin, formation and development. China has its own developmental history. It had had trade with distant lands like India, Arabia, and the West Coast of Africa but this was exceptional, and Chinese leaders took care that China would not be involved in the external affairs of the world. China was made up of itself. It has neighbours but they were all dwarfs like Japan and Korea. It is no wonder that the Chinese have developed an imbalanced sense of ethnic pride.

All this has chaneged. China is no longer an autarkical society as it used to be; it is enormously dependent on the outside world for its own subsistence and prosperity.

I do not think that China can go on indefinitely in the way it has been advancing. The world is beyond China's power to alter or shape.
Posted by Michi, Tuesday, 16 February 2010 1:31:57 PM
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Michie, I think you may be somewhat influenced by a mythology of 'China's' own making. The singular identity 'China' you evoke is as amorphous as Indonesia. China is a Han empire, the same way Indonesia is a Javanese empire. The Chinese - read Han - authorities have been stretched to hold the diverse peoples already under their yoke. Regard its most recent acquisition, Tibet, which they said belonged to them for 100 years, so in the end almost everyone believed them, well, enough to let them get away with a ruthless invasion, occupation and systematic cultural genocide.
And what does China want with Tibet? Its natural resources, its high places where they can locate installations away from international gaze, the water source of so many important rivers, and land, land, land for migration. They've been buying up resources all over the world, where they had to buy, and massively building up their military - China has a few million excess males, courtesy of the 1 child policy, many more than will find wives, so what do you do with all those spare males....?
I may well be spooked unnecessarily, but I don't think that GFC was entirely incidental to China's plans. It has the benefit of long-range strategies, and, whilst we know Wall St and its colleagues were living in a house of cards, the necessary draught that tipped the deck was markets overloaded with absurdly cheap money from China. There are many ways to be invaded other than physically......
Posted by Dr Merlyn, Tuesday, 16 February 2010 3:09:33 PM
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Dr Merlyn, thank you for your comment. I was not clear enough and you have misread me.

Beijing China is a ten-year-old boy, five feet tall. He is growing five inches a year. How tall will he be when he is 100 years old? How old will he be when he is a mile tall? It was as if Chris had asked the questions and have answered them. I would have wished he had not said "the demise of Western influence."

The light of Hellenism shone on Europe, Arabia, and India. It did not shine on China, which was a bad thing. This is what I wanted to mean.

Since China had been for a very long time a self-subsisting society, standing aloof over its petty neighbours and hardly knowing about other great civilizations, it could afford to think that everything good and best was there; the outside world needed China but it could do without it. Though its hubris has not changed, external, unsavory facts hang heavily on it; it has got to chew, savor, and take them in.
Posted by Michi, Wednesday, 17 February 2010 1:17:54 PM
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Sorry to misread you Michi - easy enough to do in this media. I was picking up on that misconception of an aloof China that seems to lull so many into a false confidence that China has never fought a war outside its boundaries. Instead, the Han empire has merely extended its boundaries by subsuming weaker populations......hmmmm?
Do you really think the Chinese government is going to chew over the unsavory facts of its international dealings? These range from factory plants in Vietnam where officials were persuaded on the basis of employment, only to find Beijing brings in its own workers, to the support of the corrupt Sudanese government that is committing genocide amongst those southern peoples incorporated within State borders against their will, the insidious backing of Fiji's military leadership, growing influence in New Guinea, I could go on.....
Oh, to be sure, when making such criticisms, I'm highly conscious of European colonial malpractice and similar bad behaviour. However, times have changed, we have learned to think more internationally, and are now all-too aware of the long term repercussions of such behaviours.
That very Han hubris works against learning from other's mistakes, and I somehow doubt their capacity for such self-reflective chewing whilst juggling the very delicate puffball that is contemporary China. Perhaps China's primary vulnerability also lays within its borders - there are massive problems emerging from such massive, uncoordinated development, with whole towns now polluted with carcinogenic toxins and huge unemployment in regions where business has failed or land has become exhausted.
Either way, I think the West has made a huge mistake hitching its star to a rising China, and we would be well advised to hedge our bets elsewhere - to mix my metaphors.
Posted by Dr Merlyn, Wednesday, 17 February 2010 2:00:33 PM
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It comes to something when you are advised not to take your Blackberry
and laptop with you when you go to China.

http://www.timesonline.co.uk/tol/news/uk/crime/article7009749.ece

Talk about looking gift horses in the mouth.
My very small experience in dealing with Chinese businessmen decided
me against having any dealings with Chinese.
From discussions I had with someone who had had a lot of experience
the best advice seems to be, cross all "t"s and all "i"s and leave
nothing to trust.
I was advised that they come from a different business culture to the
west and consider if you leave an opening they will take even
illegal advantage of it.
Posted by Bazz, Thursday, 18 February 2010 11:52:00 AM
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Dr Merlyn, I wish the Chinese government behaved differntly in Tibet, Xinjiang, China, etc. It acts freely in those parts or within its boundaries. But it has to be a little decent outside them because it needs to interact with other countries; because it is placed in international enviornments, which are not necessarily amenable to its desires. We can put up unsavory enviornmentys without at least biting and chewing which the Chinese government cannot hope to profit itself. I think it has eaten some crusty bread and sour soup; we should treat it to more of it; it will be medicinal.
Posted by Michi, Thursday, 18 February 2010 8:28:34 PM
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