The Coming end of the Western World may have to be postponed

Review: When China Rules the World, by Martin Jacques

While the decades since the Vietnam War may be most known for their startling technological developments, they have also spawned a chic genre of literature: the ‘America is in Decline' tract. What started most prominently with the work of Paul Kennedy has turned into a veritable cottage industry. Tomes in this category have included Oswald Spengler's Decline of the West, Bruce Horton's Decline and Fall, and, most recently, Fareed Zakaria's The End of America, which Barack Obama was famously photographed holding last summer. Some of these books argue that the decline is inevitable as a result of "cultural decadence," others argue decline is a result of "environmental devastation," and others still attribute the supposed decline to falling birthrates. In the 1980s and early 1990s, many of the more-economically oriented books of the genre argued that the West's decline was partially a result of the rise of Japan. Today, many are devoted to the proposition that western decline is linked to the rise of another Asian tiger: the People's Republic of China. 

Into this presumably lucrative declinist field now enters Martin Jacques, and his new, hefty-looking tome, When China Rules the World: The Rise of the Middle Kingdom and the End of the Western World. Jacques' volume, while obviously the result of serious scholarship (he name drops everyone from Confucius to Barack Obama), and fluidly written, has one grave problem: its persistent refusal to deal with facts that negate its thesis.

Jacques' argument has the benefit of being simple, if unoriginal: China, with its huge population, manufacturing might, and (alleged) technical prowess, is destined to surpass the United States midway through this century to become the world's leading economic power. In so doing, so-called Chinese values - stability, authoritarianism, collectivism - will eclipse the (allegedly now outmoded) "Western values" of human rights, democracy, and individualism. (Jacques et al. always forget to acknowledge that Japan, South Korea, India, and other Asian states have happily adopted the "Western" values of democracy and individual liberty.) The reasons for this shift, Jacques' argues, lie in the numbers.

Jacques opens his chapter, ‘China as an Economic Superpower' with some impressive sounding demographic figures, intended to hit home just how big, very big, in fact quite massive China really is. "When the United States began its take-off in 1870," Jacques notes, "its population was 40 million. By 1913 it had reached 98 million . . . In contrast, China's population was 963 million in 1978 when its take-off started in earnest: that is, twenty-four times that of the United States in 1870." These numbers are intended to wow us with their sheer size. And indeed, Jacques makes much of them: he argues that due to the size of China's population, the Middle Kingdom's domination of the world is all but inevitable.

Jacques makes two fundamental errors here. First, he ignores the fact that there is no evident correlation between population size and economic strength. Consider a few examples. Qatar (population 1,600,000) has a per-capita GDP of over $85,000. Luxembourg (population 493,000) has a per-capita GDP of $82,000, and Norway (population 4,800,000) boasts a per capita GDP of nearly $50,000. (One wonders where the breathless When Oslo Rules the World is.) China has a per capita GDP of less than $6,000, placing it below such economic heavyweights as Angola, Kazakhstan, and El Salvador. So despite the fact that China now has the third largest gross GDP in the world (at about a third the size of the United States), this, like the empty skyscrapers that crowd Shanghai's skyline, is merely an illusion of strength. China has certainly made laudable economic and social progress in the past decades, lifting hundreds of millions of people out of abject levels of poverty. That being said, China remains fundamentally poor. And while its economy continues to grow at a steady clip despite the global recession (though this is illusory as well: the growth is nearly entirely the result of government spending), China is facing a grave problem that will ultimately retard its ascension into the pantheon of truly prosperous countries.

This serious problem, forgotten by Jacques, is simply unavoidable, for it lies in the country's demographics. Simply put: China is growing old - and fast. (Decades of the one-child policy are to blame for this.) At least a third of the population of the Middle Kingdom will be over 60 by the middle of this century. While Shanghai, for example, is widely known as the exciting and dynamic center of capitalist China, it also has one of the oldest populations in the world: more than a fifth of the population is over 60, and by 2030, a full 40% of the population will be at in at least its sixth decade. The Center for Strategic Studies has demonstrated that by 2030, there will be 2.5 Chinese workers to support each retiree - by 2050, there will be a frightening 1.6 workers in that position. So while nattering nabobs in the West fret over aging populations in their countries, don't let's forget that in 2050, a full 438 million Chinese people will be at least 60 years old. For those keeping score, that's more people than the entire population of the United States. This is going to cause crushing - if not catastrophic - problems to the Chinese pension system, sap productivity, and strip the Chinese economy of capital needed for reinvestment.

Meanwhile, a recent report from the Rotman School of Management at the University of Toronto predicts that China's huge labor force will begin to shrink in 2020. The very reason for China's tremendous success in the past few decades - its seemingly endless supply of teeming masses yearning to breathe factory air - is set to begin evaporating. At the same time, labor in China will become increasingly expensive, dissuading foreign companies from investing here. Little wonder that it has become a truism among more sensible academics and Sinowatchers that, "China is going to grow old before it grows rich." It is more of a curiosity that Jacques chooses to simply gloss over these inconvenient truths, so eager is he to trumpet China's rise and America's decline.

Jacques also spends much energy - both his, and his increasingly exasperated readers' - pushing back against the notion that as China becomes richer, it will become more "westernized." Yet there is much evidence on the ground here in China to refute his thesis. To begin on the surface level, China, like most countries in the world, has a healthy (or perhaps, unhealthy) share of McDonalds, KFC, and Burger King restaurants. It also has a voracious appetite for American movies, music, and sports figures. (Kobe Bryant is probably more popular in China than in the United States.) Meanwhile, women have entered the workforce in unprecedented numbers, the country is rapidly urbanizing, and citizens are demanding an increased amount of accountability from their government. All of there are classic examples of ‘westernization.'  Indeed, Jacques' depressing and downright insulting insistence that Chinese people don't care about individualism, human rights, and fair representation is belied by recent developments such as the demands for government accountability by citizens groups in Sichuan province following the earthquake there last year, and the founding of the Charter 08 group.

Moreover, despite the increase in Mandarin-learners in the western, the global supremacy of English continues apace: when I worked for a business magazine in China earlier this year, I attended many business seminars, workgroups, and conferences in Shanghai. Even if the crowd was nearly exclusively Chinese, the meetings were held in English. I even witnessed groups of Chinese businesspeople, all obviously native Chinese speakers, speaking to each other in broken English at networking events. (This can be a truly painful experience.) English remains the dominant language of commerce, even in roaring China.

But Jacques ignores these facts, choosing instead to bang the drum of American declinism, and the alleged rise of China. Brushed aside throughout the book are China's demographic crisis, its steady "westernization," and its persistent poverty.

China may one day rule the world, but, to paraphrase Keynes, when China rules the world . . . we'll all be dead.

Ethan Epstein is a business writer based in Portland, Oregon. His work has appeared in the Weekly Standard, the New York Press, Spiked Online, and others.
Review: When China Rules the World, by Martin Jacques

While the decades since the Vietnam War may be most known for their startling technological developments, they have also spawned a chic genre of literature: the ‘America is in Decline' tract. What started most prominently with the work of Paul Kennedy has turned into a veritable cottage industry. Tomes in this category have included Oswald Spengler's Decline of the West, Bruce Horton's Decline and Fall, and, most recently, Fareed Zakaria's The End of America, which Barack Obama was famously photographed holding last summer. Some of these books argue that the decline is inevitable as a result of "cultural decadence," others argue decline is a result of "environmental devastation," and others still attribute the supposed decline to falling birthrates. In the 1980s and early 1990s, many of the more-economically oriented books of the genre argued that the West's decline was partially a result of the rise of Japan. Today, many are devoted to the proposition that western decline is linked to the rise of another Asian tiger: the People's Republic of China. 

Into this presumably lucrative declinist field now enters Martin Jacques, and his new, hefty-looking tome, When China Rules the World: The Rise of the Middle Kingdom and the End of the Western World. Jacques' volume, while obviously the result of serious scholarship (he name drops everyone from Confucius to Barack Obama), and fluidly written, has one grave problem: its persistent refusal to deal with facts that negate its thesis.

Jacques' argument has the benefit of being simple, if unoriginal: China, with its huge population, manufacturing might, and (alleged) technical prowess, is destined to surpass the United States midway through this century to become the world's leading economic power. In so doing, so-called Chinese values - stability, authoritarianism, collectivism - will eclipse the (allegedly now outmoded) "Western values" of human rights, democracy, and individualism. (Jacques et al. always forget to acknowledge that Japan, South Korea, India, and other Asian states have happily adopted the "Western" values of democracy and individual liberty.) The reasons for this shift, Jacques' argues, lie in the numbers.

Jacques opens his chapter, ‘China as an Economic Superpower' with some impressive sounding demographic figures, intended to hit home just how big, very big, in fact quite massive China really is. "When the United States began its take-off in 1870," Jacques notes, "its population was 40 million. By 1913 it had reached 98 million . . . In contrast, China's population was 963 million in 1978 when its take-off started in earnest: that is, twenty-four times that of the United States in 1870." These numbers are intended to wow us with their sheer size. And indeed, Jacques makes much of them: he argues that due to the size of China's population, the Middle Kingdom's domination of the world is all but inevitable.

Jacques makes two fundamental errors here. First, he ignores the fact that there is no evident correlation between population size and economic strength. Consider a few examples. Qatar (population 1,600,000) has a per-capita GDP of over $85,000. Luxembourg (population 493,000) has a per-capita GDP of $82,000, and Norway (population 4,800,000) boasts a per capita GDP of nearly $50,000. (One wonders where the breathless When Oslo Rules the World is.) China has a per capita GDP of less than $6,000, placing it below such economic heavyweights as Angola, Kazakhstan, and El Salvador. So despite the fact that China now has the third largest gross GDP in the world (at about a third the size of the United States), this, like the empty skyscrapers that crowd Shanghai's skyline, is merely an illusion of strength. China has certainly made laudable economic and social progress in the past decades, lifting hundreds of millions of people out of abject levels of poverty. That being said, China remains fundamentally poor. And while its economy continues to grow at a steady clip despite the global recession (though this is illusory as well: the growth is nearly entirely the result of government spending), China is facing a grave problem that will ultimately retard its ascension into the pantheon of truly prosperous countries.

This serious problem, forgotten by Jacques, is simply unavoidable, for it lies in the country's demographics. Simply put: China is growing old - and fast. (Decades of the one-child policy are to blame for this.) At least a third of the population of the Middle Kingdom will be over 60 by the middle of this century. While Shanghai, for example, is widely known as the exciting and dynamic center of capitalist China, it also has one of the oldest populations in the world: more than a fifth of the population is over 60, and by 2030, a full 40% of the population will be at in at least its sixth decade. The Center for Strategic Studies has demonstrated that by 2030, there will be 2.5 Chinese workers to support each retiree - by 2050, there will be a frightening 1.6 workers in that position. So while nattering nabobs in the West fret over aging populations in their countries, don't let's forget that in 2050, a full 438 million Chinese people will be at least 60 years old. For those keeping score, that's more people than the entire population of the United States. This is going to cause crushing - if not catastrophic - problems to the Chinese pension system, sap productivity, and strip the Chinese economy of capital needed for reinvestment.

Meanwhile, a recent report from the Rotman School of Management at the University of Toronto predicts that China's huge labor force will begin to shrink in 2020. The very reason for China's tremendous success in the past few decades - its seemingly endless supply of teeming masses yearning to breathe factory air - is set to begin evaporating. At the same time, labor in China will become increasingly expensive, dissuading foreign companies from investing here. Little wonder that it has become a truism among more sensible academics and Sinowatchers that, "China is going to grow old before it grows rich." It is more of a curiosity that Jacques chooses to simply gloss over these inconvenient truths, so eager is he to trumpet China's rise and America's decline.

Jacques also spends much energy - both his, and his increasingly exasperated readers' - pushing back against the notion that as China becomes richer, it will become more "westernized." Yet there is much evidence on the ground here in China to refute his thesis. To begin on the surface level, China, like most countries in the world, has a healthy (or perhaps, unhealthy) share of McDonalds, KFC, and Burger King restaurants. It also has a voracious appetite for American movies, music, and sports figures. (Kobe Bryant is probably more popular in China than in the United States.) Meanwhile, women have entered the workforce in unprecedented numbers, the country is rapidly urbanizing, and citizens are demanding an increased amount of accountability from their government. All of there are classic examples of ‘westernization.'  Indeed, Jacques' depressing and downright insulting insistence that Chinese people don't care about individualism, human rights, and fair representation is belied by recent developments such as the demands for government accountability by citizens groups in Sichuan province following the earthquake there last year, and the founding of the Charter 08 group.

Moreover, despite the increase in Mandarin-learners in the western, the global supremacy of English continues apace: when I worked for a business magazine in China earlier this year, I attended many business seminars, workgroups, and conferences in Shanghai. Even if the crowd was nearly exclusively Chinese, the meetings were held in English. I even witnessed groups of Chinese businesspeople, all obviously native Chinese speakers, speaking to each other in broken English at networking events. (This can be a truly painful experience.) English remains the dominant language of commerce, even in roaring China.

But Jacques ignores these facts, choosing instead to bang the drum of American declinism, and the alleged rise of China. Brushed aside throughout the book are China's demographic crisis, its steady "westernization," and its persistent poverty.

China may one day rule the world, but, to paraphrase Keynes, when China rules the world . . . we'll all be dead.

Ethan Epstein is a business writer based in Portland, Oregon. His work has appeared in the Weekly Standard, the New York Press, Spiked Online, and others.