Dear csteele,

Unless we are careful we could face a clash of extremes
in these early days of the 21st century. We've become
rightly afraid of the potential catastrophes of severe
weather events due to climate change. We have the threat
of over-population, some are telling us to consume,
consume, consume, and that "greed is good." What we need
to recognise is our - ecological, social, and economic
reality. Only the idea of sustainable development
based on the golden rule ("the mean" - otherwise known as
moderation in all things), and a steady-state economy
will offer us hope.

Csteele wrote:

>>It is an interesting proposition that economic liberalisation leads to a democratisation of the political process.>>

It may be an interesting proposition but it's not one I put or even subscribe to.

I simply pointed out that in some cases what appeared to be quite dreadful and even ruthless governments laid the foundations for economic "lift off" and subsequent prosperity. Once prosperity had been achieved they morphed into democracies. Three notable examples are South Korea under Park Chun Hee, Taiwan under Chiang Kaishek and Chile under Pinochet.

In none of these cases was prosperity achieved through helter skelter economic liberalisation. Instead there was a carefully controlled liberalisation.

And in all these cases the paths to prosperity were not smooth. There were many bumps in the road.

You mention the US Gini coefficient.

The economist, Simon Kuznets, theorised that as countries underwent a phase of rapid growth income inequality grew. Once the societies matured things evened out. Most Western economists thought Kuznets had it right and in most Western countries that it true until around 1980. After that we witnessed a surge of inequality.

So was Kuznets wrong? Or was it some nefarious plot by Reagan and Thatcher?

A more likely answer is that Kuznets was wrong to think in terms of national economies. We need to take a global view. Since the late 1970s the world has undergone a massive growth spurt unlike any that has ever been witnessed before in history. Perhaps that is why we are witnessing such huge jumps in inequality.

However there are no more China's and India's to be absorbed into the global economy. Once that process is complete and given the rapid decline in human fertility the world may look very different in 2030.

The main point I wanted to make in this thread is that I'm not at all sure China will become the global hegemon everyone imagines. It may of course. And the USA may commit suicide. But I'm moderately sceptical on both counts for reasons I've outlined in this and other threads.

Dear Steven,

Sorry for the previous diversion.

You wrote;

“However there are no more China's and India's to be absorbed into the global economy.”

You seem to be ignoring a rather large land mass with a rather large population – Africa.

Don't worry, many in the West do the same.

Speaking recently to some Aid workers working in different areas within Africa it appears the Chinese presence is not not a new thing and it is strong and growing. The big experiment will be to see if America can wean its self off its current, horrendously expensive military budget which it utilises to project power and influence, and in some cases to secure markets. Or will take the virtually self funding 'business model' route that seems to be the preferred method of the Chinese?

Both approaches serve the business interests of each respective country but the Chinese model is by far the more sustainable.

In 2009 China overtook the US as a investor in Africa. Its huge diaspora, well over half a million strong, have provided a ready path for securing markets, mining leases, construction contracts etc.

To me the answer to your question will will be determined by how well China can resist diverting capital, resources, and manpower into trying to match the US military power.

I think they are a pragmatic and patient people.

csteele

No I am definitely not ignoring Africa. I come from there.

Call me racist if you like but I am deeply sceptical of Africa's ability to play a major role in world affairs. I would be delighted to be proved wrong.

I agree the present Chinese government is pragmatic. But they are also nervous. They know major reforms are needed but the Chinese Communist Party (CCP) seems almost paralysed by fear.

The question in my mind is this. Will the CCP be prepared to countenance a diminution of their power in which case China, like other countries before it, may morph into a stable democracy.

Or the CCP may try to cling to power precipitating unrest and damaging their economy.

The CCP may also decide to play the nationalist card in which case we may be in for a rough time.

On the whole though I do not expect the Chinese government to be too aggressive. Their aging population makes military adventurism unlikely though they may still be very assertive and that could scare their neighbours into the arms of the US.

Dear Steven,

I will leave Africa alone for another discussion since this is about China.

I'm not sure I would agree that the CCP is paralysed by fear. I get the sense that there is a long term vision for China far more substantial at least than the election cycles and political corruption afford the US.

The ingredient I find fascinating is the role of fundamentalist Christianity, especially in an emerging economy such as China. Its adherents now well outnumber the Communist Party membership and the faith's natural fit to raw capitalism (forged and honed in the US) leads me to think they are going to be a real force within China.

That the CCP has let them flourish without the significant oppression often dealt to other groups is also interesting. Perhaps it is purely pragmatic. A decade ago a writer for the journal Foreign Affairs wrote; “A similar pattern can be seen in China today, where there may be more than 60 million Protestant Christians (compared with 700,000 in 1949). Some Chinese sociologists have noted the "coincidence" that the most significantly Christianized city, Wenzhou, where some 14 percent of the population is now Christian, is also one of China's top performers in domestic commerce and foreign trade.”

Perhaps the leadership saw economic benefit in not reining them in.

But the explosion of China's so called 'house churches', which largely go undocumented since as soon as a group get to a reportable size they split, shows the cat may well be out of the bag.

If anything is designed to strip away pragmatism it is fundamentalist Christianity.

Just the other day there was news about an planned Asian tour by Lady Gaga had run into problems in Indonesia and South Korea. Different faiths, same fundamentalists.

Perhaps FC had a role in creating the South Korean success story or perhaps it just comes with the territory.

However I don't think it can be dismissed as a future factor in the Chinese story.

Well csteele, here's the bottom line

To me the CCP leadership look like any other power elite concerned first and foremost with maintaining their own power and privileges. That doesn't mean I think they're stupid or inherently evil in the way, say, Stalin was. On the contrary since Deng I think they've proved themselves to be reasonably smart.

They're authoritarian rather than totalitarian. Think Second Reich rather than Third Reich except they're probably smarter than the Kaiser.

But neither do I think they're especially benign or in some way super-smart or super-wise. Their treatment of Chen Guangcheng fits in with my way of thinking. I don't think it's some kind of aberration. Nor do I buy that it's a "Western plot."

And for the rest I think they have as much muddle as in any Western democracy only they're better at keeping it under wraps. I have little doubt the infighting in the CCP is as fierce as that in the ALP but it's invisible to us. After all the consequences of leaking to the media in Australia are not the same as leaking in China.

To my way of thinking the best possible outcome for China and the world is that the CCP leadership have the sense to allow the country to morph into a democracy as happened in South Korea and Taiwan.

You on the other hand seem to see them as a group of benevolent and wise leaders guiding the country onto the right path.

From my perspective the evidence supports my point of view.

You seem convinced your point of view is correct.

Neither of us at this stage has any chance of convincing the other that they are right.

We've both stated our positions and all that's left is to sit back and watch the show. If we're still around in 20 years or so we can have a "post mortem" on the game.