A Musing Bean

On Dambisa Moyo On Is China the new Idol for Emerging Economies?


I just finished watching Dambisa Moyo’s TED talk. It's one of the best I've seen that neatly articulates a global view of China's economic rise. It's also a great complement to Eric Li's talk.

The main value is that this is not a familiar view to most people living in the West. Yet it is a critical perspective to have in understanding global events.

It's an injustice to sum up the talk in one sentence, but here's the key point: “People care more about economic prosperity than ideology.”

I think that in our hearts, we know this to be true. The difficult part is realizing that “ideology" also includes the particular one that we happen to hold ourselves.

Money Talks, Ideology Walks

To be clear, no one including the speaker is suggesting that they would prefer to live in a non-democratic system of government. Quite the contrary.

However, the “just focus on democracy, and economic growth will come” argument is losing traction with the rest of the world.

For several apparent reasons:
  • Many democracies don't provide substantially better lives for their people.
  • China, clearly not a democracy, is doing amazing economic things
  • The U.S., paragon of democracy, seems to be in a slow economic decline

So presenting “Democracy" (tm) alone as the solution isn't going to cut it anymore.

Prosperity is the Real Goal

It's important to remember that the particular form and flavor of government is only the means to an end: So people can have “life, liberty, and the pursuit of happiness.” Prosperity is universal concept.

Instead of “spreading democracy”, the mission of human justice should be centered around “spreading prosperity”.

Dambisa discussed a fascinating study of the correlation between per-capita income and the years a democracy survives. It seems that you need at least $6,000 of per-capita GDP to sustain one forever.

I'm guessing this may be true regardless of what form of government it is. If my life sucks sufficiently, I would be prone to revolt.

So What Happens Next?


Anyone who cares at all about geo-politics is wondering what will happen if/when China surpasses the U.S. as the world's largest economy, projected to be sometime in the next 5-10 years.

While the actual “title" is a bit of a red herring (China has 3x the population of the U.S. for one thing, and it's after all already “merely" the 2nd largest economy in the world today), this will come as a big psychological shock to many.

There are a few paths this could take:

Not Much Changes

No fundamental policy changes in China or the West happen. It's just an economic milestone in a much longer cycle.

Even in this scenario, the greatly increased prestige will encourage more “Third World” (yes, it's an outdated term, not sure what the new one is) countries to follow in the “China Model”, at least as an excuse for increased authoritarianism.

A More Politically Aggressive China Emerges

If you look at the last 30 years, China has certainly played her cards right: While the U.S. has almost bankrupted itself in crippling wars “spreading democracy”, China has been incredibly restrained on the political front, quietly building its economy and its allies.

China has never promoted its form of government or ideology to other countries in any direct way. There isn't even an easy way to refer to it! “Communism with Chinese Characteristics” is the technical term. Doesn't exactly make for a catchy slogan.

Will this change soon?

Probably not for economic reasons: As long as it's cheaper to buy something than to try to take it by force, the market wins.

Virtually all major wars can be traced down to economic forces. As long as the global trading markets remain healthy, the economy won't be a reason for conflict.

That however does not rule out conflict for “strategic" reasons.

No one outside of the inner Chinese circle can know what the strategic planning might look like, but it's a reasonable bet that China would continue to mainly rely on its economy to win hearts and minds (or “buy them” if you want to be more cynical).

In a scenario where it has the upper economic hand, it make sense to leverage that as much as possible.

Cold War 2?

Could this lead to a situation like the U.S. and U.S.S.R., but with China playing the part of the U.S. with the stronger economy? (Ironic right?)

China might embark on a path of military buildup in an effort to bankrupt the U.S., a similar gambit to what happened in the 80s with nuclear weapons.

Perhaps space defense might be this next frontier, or cyber warfare.

To some extent, this is already happening, and will continue to escalate. The question is, will the U.S. choose to play the game?

China Reforms

There are also some more hopeful scenarios. In the most optimistic one, China may progressively become more democratic, once its citizenry have achieved a standard of living comparable to the West. Parts of this change might be centrally planned, and some might be driven by the more wealthy and powerful middle-class.

At least goes the thesis of the most optimistic liberal watchers. Perhaps there will be a Glasnost-style peaceful transformation.

My take is that if transformation happens, it is because it is part of the central strategic plan. It makes sense that increased openness and transparency (in a relative sense) would serve the Party’s interests along with the interests of the Chinese people. There's likely a gradual timetable for this. Some things may take much, much longer than we might hope, but other orchestrated changes could well take everyone by surprise.

What To Do?


My main concern is the most people living in the West aren't remotely aware that this shift is already underway. There isn't anything sufficient in the intellectual zeitgeist to prepare folks for the shock that might happen, if and when it happens.

The most important thing is to update our collective understanding of “China”, and explore different ways to bridge the gap. China after all has 1.3 billion people. You can't sum it all up from any one angle.

East and West

In the broader sense, this is a truly historic milestone in human history: A prosperous East and a prosperous West. If we can bridge the ideological gap, that bridge can become a path towards a prosperous world.

Related: TED, Society.

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