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Does China’s Success Undermine the Washington Consensus?

Posted By Administration, Wednesday, February 13, 2019
Updated: Wednesday, February 27, 2019

Robin Jourdan evaluates the economic effect of China on Washington Consensus in her second blog post for our Emerging Fellows program. The views expressed are those of the author and not necessarily those of the APF or its other members. 


China. The Red Dragon. Fabled, mysterious, and powerful. It is one of the great civilizations of the world. China has the world’s oldest, surviving culture. To 2009, its relationship with the world’s powers could be summed up best by Den Xiaoping’s advice to build China’s strength while maintaining a low, international profile. Since 2009, its economic and political model, the Beijing Consensus, aka The China Model, has thrived and expanded to other parts of the globe. Its set of policies consists of state-led finances and limited and hybridized property rights under an autocratic framework. The current economic success of China challenges an already weakened Washington Consensus, which makes prominent use of private property and market-based distributions.

China has transformed itself from a closed, planned economy to a financial powerhouse. It has done this at the same time that the Washington Consensus has failed to deliver economic stability and growth to many. Successes of the Beijing Consensus include China itself. Since the late 1970s, China’s economy has grown at an unheard-of rate of 10% annually. Using the One Belt One Road Initiative, smile diplomacy, and checkbook diplomacy, China has provided much-needed infrastructure, like highways and airports, at home and abroad. China has become the land that failed to fail and is on a trajectory to become a viable global superpower. The Chinese economy is moving from an export-driven model to one based on investment and consumer demand. Such a development suggests a more mature economy thriving just as trust in the West, especially with the US, is at an all-time low. This success can’t help but represent a challenge to democracy and capitalism.

Of late, China is dealing with internal challenges: inequality, unstable financial conditions, and environmental sustainability. Since 1980 GDP produced by state companies has fallen while private sector output has risen over 300 times. Private (non-state) sector business is buoying wages and the Chinese economy. Success in the increasingly stratified society correlates to a Chinese (Party) way of living. These come at a time when the Chinese Communist Party’s tactics of political repression, its poor human rights reputation, and regional ambitions cast a dark shadow. Recent years have seen China’s GDP growth rate drop lower than neighboring India’s. Such contradictions in other societies have proven thorny.

China’s economic miracle appears to be ending. Who knows what the Party will choose next? The “what-if’s” are growing.

One question that remains is how can the two couldn’t-be-more-different superpowers (China and the US) co-exist at the end of this century? Turning to history, the co-habitation example of the US and USSR doesn’t warrant repeating. A business-as-usual scenario would be simply an unfinished option. The US and Europe could impose a chill on China, which may well be of small consequence anyhow. If China prevails; a fragile condition might exist, given the contesting resources of the US and the West. Or a new relationship could arise. It is undeniable that China is on its way to becoming a science superpower. Perhaps the language of logic and scientific method could become the building blocks of a China-US Peace, a sort of “East-phalia” situation. Such a peace could build on familiar and successful models: International Space Station and the Antarctica treaties.

However, the high hurdle continues to be inequality. These superpowers need to apply lessons from other societies (Iceland, Sweden, and others) that seem to have made more progress eradicating inequality than anywhere else. Perhaps it’s time to decouple Beijing and Washington’s political systems from economics and move past the “us” -vs- “them” unsustainable scenarios.

© Robin Jourdan 2019

Tags:  China  economics  the US 

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Is the United States still indispensable?

Posted By Administration, Tuesday, November 27, 2018
Updated: Wednesday, February 27, 2019

Craig Perry, a member of our Emerging Fellows program inspects the global influence of the United States of America in his twelfth blog post. The views expressed are those of the author and not necessarily those of the APF or its other members.

“We are the indispensable nation. We stand tall and we see further than other countries into the future, and we see the danger here to all of us.” — Madeleine Albright

International relations have changed substantially in the century since the First World War—and especially after its sequel ended some seven decades ago. Competition between half a dozen or so great powers boiled down to two, then just one as the Cold War culminated in American hegemony. Far from the end of history, however, this uni-polar moment naturally proved unsustainable, and China, Russia, and even some U.S. allies soon began reasserting themselves on the international stage. Should this proliferation of great powers be a cause for concern?

Probably. A consensus has emerged in recent years among international security experts that the potential for great-power conflict is increasing. The 2018 U.S. National Defense Strategy declared the reemergence of long-term, strategic competition by revisionist powers as the central challenge to U.S. prosperity and security, superseding terrorism as the principal threat. In 2016, the National Intelligence Council identified the changing nature of conflict as a global trend with key implications, forecasting that the risk of conflict will increase through 2035 in part due to diverging interests among the major powers. The World Economic Forum reached a similar conclusion in 2016, warning that a major conventional conflict between great powers was possible by 2030.

The reasons for these concerns are obvious. During the Cold War, the United States established a persistent security presence in regions once dominated by China, then expanded the NATO alliance right up to Russia’s borders following the collapse of the Soviet Union, setting each of these regional hegemons up for conflict as they began reasserting power within their traditional spheres of influence. Unlike former U.S. adversaries such as Germany and Japan, who learned to play well with others after embracing democracy several generations ago, China and Russia remain ruled by authoritarian regimes intent on challenging U.S. global leadership. And they are each developing high-end military capabilities designed to neutralize American strengths and project force beyond their borders, shifting the balance of power in much of Europe and Asia. A U.S. congressional commission recently warned that the United States might struggle to win—or perhaps lose—a war against China or Russia.

Still, there is cause for hope. Since the end of the last world war, the United Nations and various regional security institutions have provided useful venues for great powers to address their differences, with international law and shifting social norms gradually marginalizing war as an acceptable dispute-resolution mechanism. Globalization of trade and investment has undoubtedly lowered the risk of war between the United States and China, while Russia has seemingly adopted a strategy of indirect action—competition short of armed conflict—in its interactions with America and its allies. And so long as each great power maintains a credible nuclear deterrent, the promise of mutually assured destruction should continue to temper escalatory impulses.

Even though the risk of great-power conflict is rising, there is nothing inevitable about this outcome. Neither China nor Russia is spoiling for a fight with the U.S. military, which is likely to maintain superiority over each adversary through at least the middle of the century. Although anti-American sentiment has drawn Beijing and Moscow closer together in recent years, it is doubtful they will overcome longstanding mutual suspicions to join forces against the United States anytime soon. However, America could easily be drawn into conflicts between these great powers and U.S. allies such as Taiwan or the Baltic states—presuming, of course, that the U.S. government remains committed to defending its most vulnerable partners.
 
The future of great-power conflict, then, is largely a function of U.S. foreign policy. As a superpower in relative decline, the United States has neither the economic wherewithal nor political will to prevent China and Russia from assuming more prominent roles on the international stage. Washington must now give serious consideration as to which aspects of the liberal world order and its network of alliances—which it built and sustained for the better part of a century—remain vital to U.S. national security an era of renewed great-power competition.

For example, NATO continues to provide obvious security benefits to the United States—including neutralizing the European Union as a potential great-power rival—but it makes little sense to extend alliance membership to former Soviet states like Georgia or Ukraine while Moscow retains the capability and intent to dominate its “near abroad.” Similarly, it’s only a matter of time before Beijing can conquer Taipei while degrading a U.S. military response, which means finding a peaceful solution to the “One China” problem is imperative if America hopes to escape the “Thucydides trap” that has accompanied rising powers for millennia.

Yet even if the United States takes pursues a realist foreign policy approach to China and Russia, it must nevertheless remain true to the liberal principles that underpin its prosperity and global influence. America cannot afford to abandon its steadfast support for democracy, free trade, and the rule of law in favor of isolationism or an “America first” approach that befuddles allies and emboldens enemies. Few other great powers have ever wielded the sort of moral authority and soft-power appeal that the United States enjoyed until recently—and no other nation can claim to be quite so indispensable to world peace.


© Craig Perry 2018


Tags:  China  Russia  the United States 

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