365) China's development model: book

China’s New Development Model
By Laurence Brahm
The Globalist, Tuesday, January 26, 2010

Globalist Bookshelf:
This is an excerpt from:
The Anti-Globalization Breakfast Club
By Laurence Brahm
John Wiley & Sons (2009)

Will this be China’s century — or the era of its collapse? Laurence Brahm describes how Beijing think tanks are working overtime to create a new kind of development model for China's overtaxed environment and social system. He explores the challenges in a conversation with Huang Ping, director-general of the American Studies Institute at the Chinese Academy of Social Sciences.

Will this be China’s century — or the era of its collapse? Or will it be the era when China becomes a global threat?

Pessimists among certain Western think-tanks and academic institutions predict an imminent end to China’s mega-growth cycle.

Some Beijing think-tanks believe that the pressure is on to find a practical road forward — and not to get lost in the illusion that rapid GDP growth is sustainable.

These views may be extreme and represent protectionist fears expressed in wishful doomsday scenarios. Cold War thinking has resurfaced in theories and books.

The optimists, usually business analysts who point to another decade of sustained hyper-growth, counter these views.

China has always bent with the winds of change, they argue. So why should the future be any different? The truth and what transpires in the future may fall somewhere in between these two opposing views.

The “China threat” may not be in the form of military expansion or the flooding of world markets with cheap exports. It may instead take the form of environmental desecration, stimulating the acceleration of global warming that would indeed menace humanity. Or perhaps there will be a combination of all these factors in different degrees.

Another view emerging within some Beijing think-tanks is that the pressure is on to find a practical road forward and not to get lost in the illusion that the growth experienced in the past two decades is sustainable. But can China’s current leaders think outside the box and formulate new agendas to cope with the future?

Much of the work of coming up with new development blueprints and ideological platforms is being thrown to the Beijing think-tanks. They are talking about these issues openly — even in the local press — which has never before occurred.

Admittedly, even if a problem is not completely solvable, identifying and discussing it is a first step toward addressing it. At least it is better than smearing it over with dogma, as was done in the past.

The real problem probably lies in the excesses of privilege imbued with the Communist party, which has created an almost-surreal Orwellian- Dickensian system.

Huang Ping, director-general of the American Studies Institute at the Chinese Academy of Social Sciences (CASS), noted that Beijing think-tanks are even going so far as to question “whether we have followed the Western model too closely without consciousness of its negative effects.”

Such think-tanks are challenging the consumption-driven, materialism-based model China has adopted and are instead calling for a new paradigm of development. But will they find them?

“China has enjoyed three decades of high economic growth by whatever indicator, and without domestic violence,” explained Huang Ping.

His argument glosses over the brutal crackdown against protests in 1989, and the fact that — despite the draconian police system — in recent years the number of violent demonstrations by farmers, factory workers and dissatisfied urbanites has been running as high as 80,000 incidents a year, often involving as many as 20,000 rioters.

Many of the protests have targeted government and police brutality, sometimes resulting in the burning of police cars and the destruction of government offices.

Huang Ping has an intimate knowledge of the Washington Consensus development models, since it has been his job to research them. Moreover, he is considered the nation’s leading specialist on social harmony. Unlike many other Chinese think-tank specialists, he dares to espouse new ideas that challenge head-on the past models that see GDP growth as a panacea.

"The Americanization of the world runs counter not only to China’s political and economic structure, but to its historic culture."

“Despite all of our problems, 200 million people have emerged into a new middle class, while another 300 million have been lifted out of poverty,” Huang noted. “What has happened is probably the world’s largest-scale development miracle since Britain’s Industrial Revolution.”

At the same time, Huang is aware of the problems that have accompanied that growth. “It has led to growing income gaps, social governance problems and environmental desecration as the costs of such development and transformation.”

Whether these costs are an acceptable tradeoff is currently the subject of intense debate among Chinese state officials and future planners.

“Globalization is a misnomer,” said Huang Ping. “All nations want globalization in technology trade. So, a better phrase would be ‘global integration of technology and science.’”

“But when this means the Americanization of the world, it runs counter not only to China’s political and economic structure, but to its historic culture and sociological structure as well.”

Huang noted that an “us-vs.-them, black-vs.-white” attitude was the main problem in Western thinking. In China, however, during the reform years of the 1990s, the curtain on ideology went down and a brief era of enormous flexibility prevailed. This happened under Deng’s notion that "it doesn’t matter if a cat is white or black as long as it catches mice” — in other words, whatever works economically is good.

Even if a problem is not completely solvable, identifying and discussing it is a first step. This is better than smearing it over with dogma, as was done in the past.

During this brief window of open thinking, an inherent flexibility in responding to changing conditions made it possible to fuse various approaches to economic development — capitalist and socialist, marker and planning — which has led to the country’s current economic boom and prosperity.

Now, despite this boom, China’s development model is being tested. For Beijing’s leaders during the 1990s, achieving a market economy was the overarching goal.

For its current leadership, the hypermarket economy poses new burdens: The country does not have the energy to support its own growth, the environment has been degraded and the social order has been frayed. As a consequence, Beijing’s economic think-tanks are asking if a better model can be developed.

Actually, the real problem probably lies in corruption and excesses of privilege imbued with the Communist party, which has created an almost-surreal Orwellian-Dickensian system. Culture and ethical values — the mainstays of Chinese society for two millennia — were bulldozed as infrastructure and property projects went ahead.

The antithesis of this can be seen in pockets of community rebuilding efforts among ethnic minorities and the rural poor, involving more than the usual infrastructure and road development.

Huang commented, “It involves trying to understand how people communicate and share values, cope with problems and identify issues of security and solidarity.”

China has always bent with the winds of change. So why should the future be any different?

Places such as Lijiang and Zhongdian, in Yunnan province, are going against the national development trend. Rather than emphasizing infrastructure and the growth of CDI, their long-term interest is the preservation of culture and the environment.

A new national ideology is necessary in order to plan for the next 20 years. Globalization, and models associated with it, is neither a goal nor a panacea where ideologies are concerned.

Neo-liberalism and neo-conservatism offer nothing of value to China or the developing world. At the same time, it isn’t practical to go back to Marxism, which China has already shed.

It is also unlikely that many other nations would embrace it. And Confucian thinking is one of the Chinese Communist Party’s biggest problems — the party is more a classical Confucian bureaucracy than an egalitarian body.

Read Part I here.