China's Rise Is Inevitable -- So Deal With It

Forbes Magazine ^ | 6-28-02 | Mark Lewis

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NEW YORK - A decade ago it was Japan that touched off nationalistic fears among Americans who worry about being out-competed by Asian industrialists. Now it is China's turn to generate the scare stories. The reflex cannot be helped, but nor should it be indulged in any policy sense. China's rise is inevitable and should not be viewed as a threat.

Consider this front-page story in today's New York Times: "China Emerges as Rival to U.S. in Asian Trade." That sort of headline will become commonplace in the next few years as China increases its dominance of East Asia's economy. Yet at the same time, U.S. exporters will benefit from the growth of China's internal market, and U.S. consumers will benefit by buying China's low-priced and increasingly high-quality exports.

China's rise does call for an adaptive response from Washington, which must find a graceful way to accommodate itself to the new regional superpower. But in terms of trade, the key policy already is in place--China was last year ushered into the World Trade Organization, under whose auspices this formerly closed society will be fully integrated into the global economy.

Of course, there's still the little matter of Taiwan, which the U.S. is pledged (in vague terms) to defend. The best-case scenario: China's embrace of capitalism forces it to evolve into a full-fledged democracy, as people who gain economic control over their lives insist on political control as well. If that happens, Taiwan will end up clamoring to merge with the mainland in order to avoid the fate of China's other small neighbors, which will find themselves overshadowed by the revitalized Middle Kingdom.

Let's minimize the hand-wringing over this situation. Would anybody seriously prefer that China had remained shackled to the Maoist precepts that kept its economy small and weak? In any case, that's not an option. China's emergence is a fact to be recognized rather than fretted over. And it is also an opportunity, because America with its flexible economic system is well positioned to adapt to new realities and benefit from them.

The supposed threat from Japan generated a lot of concern in the early '90s, yet nowadays the scare headlines are all about Japan's economic decline, which is seen as bad for the United States. If China's economy runs into serious trouble, that too will be bad news for America.

But China, even if it stumbles along the way, is a much better bet than Japan to eventually achieve regional dominance, both politically and economically. This will make some Americans nervous. They may as well start getting used to the idea now--and make plans to take advantage of it.

[AIG]

Sure, moral principles are absolute. They're absolute by definition or else they wouldn't be moral "principles." That's not the issue here. The issue here is that those moral principles guided the Founders in constructing America's system of government which calls for elections as the means to decide important issues of the day. I merely pointed out that economics is often the most important issue in any election. What's wrong with you just admitting this? Can't you both acknowledge moral principles and the fact that economics is often the most important issue in moral principle-inspired elections simultaneously? Economics dictates how Americans live on a daily basis and often determines their happiness. Most Americans hope to achieve the "American Dream," which in most cases means "hitting the jackpot" in one way or another. Most importantly, US Presidential elections often come down to the question, "How are you (the American people) doing economically?" As we speak, Republicans are worried about losing the House because of the economic issue of corporate scandals and the lousy stock market performance. These are simple fact you seem unable to comprehend, but even any teenager knows that Bush Sr. lost because he neglected the economy.

[AIG]

Most Americans acknowledge moral principles, but they also acknowledge America's electoral system. The electoral system is not perfect but it's the system America has, for good reason. They don't say that merely because someone acknowledges that electoral decisions don't go one's way that acknowledging the reality of the electoral system and and that economics plays a big role makes one a "moral relativist."