The University of Chicago Magazine

China’s success story has reached a pivotal chapter. What does it mean for the rest of the world?

Wang Guangya, China’s representative to the United Nations, is a small, dignified man, his mild, inoffensive manner perfectly pitched to the reassuring message that China tries to communicate to a world jittery over its growing economic power. “Of all things, nothing is more desirable than harmony and peace,” Wang told a Chicago audience this April, invoking Confucian principles to explain why his country posed a threat to no one. In case anyone doubted his meaning, he went further, predicting an era of “harmony between man and nature and among mankind.”

photo: China on the Rise A Chinese official in America these days finds himself inevitably on the defensive. China’s remarkable growth, now in its third decade, has lifted millions out of poverty, transformed the world economy, and restored pride to a people who just a few decades ago were entrenched in backwardness and poverty. But that rise has also raised hard questions about the country’s future. Can China sustain its growth? Or will internal contradictions, such as a growing gap between rich and poor, cause it to stumble? How will democracy fare in an authoritarian state that has embraced the free market but still crushes political dissent? Most of all, what does China’s growing economic muscle portend for its future on the world stage? In the United States, China’s rise has caused deep anxiety not only about the costs for American jobs and industry but also about the political and military consequences. Will its rise be peaceful or violent? Will it produce closer ties with the United States—or confrontation? Despite Ambassador Wang’s assurances, U.S. officials are not so sure.

“Many Americans, and even many people in Washington, have not made up their minds about what China means,” Christopher Hill, U.S. assistant secretary of state for East Asian and Pacific affairs, told the same Chicago audience. “What is China going to be? People are very curious. China is a bit of a mystery to many Americans, just as Americans are a bit of a mystery for China.”

Wang and Hill were among a score of scholars and government officials who gathered at International House for a two-day conference, organized by the student-run Chicago Society, to help demystify China. If the conference’s title, China and the Future of the World, seemed ambitious, it may not have been ambitious enough. As Ted Fishman, author of China, Inc.: How the Rise of the Next Superpower Challenges America and the World, told the group, he abandoned a book project about the new world economy to write about China, only to discover that the story of China was the story of the world. Such are the vast implications of China’s boom. Fishman divides the planet into those helped by the nation’s rise and those hurt. Spain delights in China’s growth because Latin America sells to China and Spain sells to Latin America. Mexico, in contrast, has lost 2 million manufacturing jobs to China.

Not only nations have gained or lost. Wal-Mart, Fishman said, “figured out China” early on and has thrived; he estimates that Wal-Mart’s reach into China extends to 100,000 factories. Sears took longer to see the possibilities and is struggling to catch up. But for good or ill, China’s growth touches us all. Goods manufactured abroad and sold at “the China price” save the average American $600 a year, Fishman said. But Chinese-led globalization has cost jobs and cut wages, especially in manufacturing states. Illinois’s average wage has declined $6,000 since 2000; Michigan’s, $8,000.

Figuring out China isn’t easy, but here’s a start: With 1.3 billion people, it is the world’s most populous country. One-fifth of humanity is Chinese. For the past quarter century, China’s economy has grown more than nine percent a year. The result is that China today has the world’s fourth largest economy (second if measuring purchasing power). It is the world’s second largest consumer of oil. (The United States leads in both.) China produces two-thirds of the world’s photocopiers, half its DVD players and cement, 40 percent of its socks, one-third of its desktop computers, and 25 percent of its mobile phones. “China is everywhere,” Fishman said, noting that it takes 500,000 workers in Southern California to handle the goods pouring into the United States from China. At its present rate, China will overtake the U.S. economy by 2014.

China’s boom dates to 1978, when Deng Xiaoping succeeded Mao Zedong and began a series of economic reforms. Scholars point out that after Mao’s Great Leap Forward, the Cultural Revolution, and other failures, producing economic growth was the only way left for the Communist Party to prove its legitimacy. Under Deng, China disbanded Mao’s rural communes, reduced centralized economic planning, and embraced development. “Mao buries markets, Deng uses them,” the Chinese say. The party survived, and China thrived.

Calvin Coolidge once said, “The chief business of the American people is business,” but he might have been describing the Chinese as they race to catch up with the industrialized world, cramming two centuries of economic development into a few decades. A dynamic new pragmatism has eclipsed much (though not all) of what remains of Chinese Communist ideology. “Overall, the Chinese are really into making money,” said Dali Yang, professor and chair of political science at Chicago and author of several books on the nation’s transformation. Mao is still revered in China—his massive portrait hangs over Beijing’s Tiananmen Square—but Deng is the hero of China’s rise. He was the Chinese leader most invoked at the Chicago conference, his favorite saying quoted with appreciation: “It doesn’t matter if a cat is black or white, so long as it catches mice.”

But what if it does matter? This question looms over China’s transformation. To what extent do economic freedoms lead to political freedoms? China thus far has defied Western expectations that modernization, economic development, and democracy go together. Communism has withered but not the Communist Party, which has relaxed its grip on the economy and other aspects of Chinese society, such as travel and education, but keeps tight control over politics and suppresses political dissent, the free exercise of religion, and whatever else threatens its rule. The issues extend beyond China’s borders. China’s blend of economic liberalization and authoritarian rule, said Fishman, exerts a dangerous attraction for other developing countries, including some former Soviet states. Several speakers at the conference suggested that to survive, the Communist Party needs merely to sustain the economic growth its policies have so far produced—to make sure the cat continues to catch mice. Others argued that the prosperity will falter without democratic reform.

Most Chinese view democratic reform differently from Americans. American officials seldom let an occasion pass without calling on Chinese leaders to grant its citizens greater liberties. On the recent anniversary of the June 4, 1989, crushing of the Tiananmen Square protests, a State Department spokesman in vain urged China to provide a “full accounting” of the thousands killed, detained, or missing. The American media assiduously cover Chinese offenses to human rights, including the jailing of dissidents, suppression of the Falun Gong, and censorship of the Internet.

Chinese leaders, in contrast, speak of democracy as a goal but carefully restrain its progress. President Hu Jintao is “very interested in political reform,” said Cheng Li, a professor of government and Asian studies at Hamilton College. “But these reforms will be incremental over time and manageable in scale.” For many Chinese, stability and economic progress outweigh democratic advances. They worry about unrest and disunity; they want badly to avoid the fate of the Soviet Union. Most of the Chinese scholars and journalists at the conference seemed to accept these priorities and were little inclined to question the pace of reform. Tiananmen Square was barely mentioned. “Democracy is not easy for China,” Li said. “The leaders are scared.”

A quarter century of economic liberalization has nonetheless brought greater political freedom. Li and others described genuine progress toward democracy, including an increasing reliance on the rule of law; growing numbers of nongovernmental organizations; direct elections for village officials; and the emergence of rival factions within the Communist Party. These factions, which Li characterized as elitist versus populist, share power in all important state institutions. The arrangement, he said, is a rudimentary system of “checks and balances” within the party that may “pave the way for the emergence of democracy in China in the not-too-distant future.”

Wang Hui, editor of the influential literary journal Dushu, is a member of China’s “New Left” and a well-known critic of what he calls China’s “crony capitalism.” But at the conference he delivered a more hopeful message, describing the widening sphere of intellectual debate within the country. Bringing previously ignored problems to the attention of party leaders, he said, this debate has influenced decision-making within the Communist Party.

Merle Goldman, professor emerita of history at Boston University and an expert on Chinese dissidents, foresees a political crisis that could force greater democracy. Economic growth has increased Chinese expectations, she said, and with them, the demand for democratic reform: “It’s coming from the middle class, not from the rising rich entrepreneurs. They’ve been co-opted by the party.” She traced the demands for reform to former members of Mao’s Red Guards, who as young people served Mao’s purposes by criticizing party leaders and now “have to make a living.”

Goldman offered a glimpse into China’s one remarkable experiment with democracy—local village elections. These elections began in the 1990s; today 90 percent of Chinese villages choose their own governing committees. Balloting is secret; electioneering takes place on a single day and is taken seriously. Most but not all of the candidates are members of the Communist Party, and it’s not unusual for incumbents to lose. Goldman, who observed the process on an election-monitoring trip, came away impressed: “It was for real.”

Village democracy does have limitations. Despite its success, the Communist Party will not permit direct elections for township, provincial, or national officials. “The party fears that if you vote for township, you have to organize,” Goldman said. “And that means political parties. Any kind of political organization other than the party is going to be repressed.”

But the current political system may be unsustainable, she said. It provides no good way for peasants and the middle class to make their grievances heard at higher levels of government. It lacks a mechanism for representation. This shortcoming not only frustrates democratic aspirations but also hinders economic progress. “In order to maintain their dynamism,” she said, “they may have to change their political system.”

Despite China’s economic boom, many of its people remain poor. A quarter century of economic growth has lifted 400 million people out of poverty, but prosperity has bypassed many others, especially in rural areas. A third of all Chinese still live on less than two dollars a day. As Wang Guangya pointed out, China ranks fourth in the world in gross domestic product but lags behind 100 nations in per capita income. Beyond the glittering spires and soaring office towers of Shanghai and other cities lies another China, the dirt floors and meager furnishings of Chinese peasant houses. The gap between rich and poor, city and country, prosperous coast and struggling interior, is China’s most entrenched social division, said Lei Guang, an associate professor of political science at San Diego State University and an expert on rural issues. Chinese peasants, he lamented, “have been left far behind.”

Growing inequality is hardly unique to China. Prasenjit Duara, a Chicago professor of history and East Asian languages & civilizations, argued that greater inequality is a worldwide consequence of global trade. Yet the problem is acute in China. It is a source of growing discontent as well as a measure of how far China has to go to reach the level of Western industrialized nations, Wang said. “It will take several decades, perhaps a century, for our country to achieve a decent standard of living for all citizens.”

Rural poverty is partly a failure of state policy. Farmland is still communally owned, and many peasants lost their fields when local officials deemed the land necessary for some other, more profitable use. Wang Ping, a poet, novelist, and essayist who teaches at Macalester College, showed the audience a snapshot of her aunt and two brothers to illustrate the reach of local land grabs. “They used to be all farmers,” she said angrily. “Now nobody farms because they don’t have any land.”

Rural discontent is only one of many domestic issues troubling China’s economic transformation. There is also widespread corruption, a shortage of health care and other social services, exploitative labor, and side effects of a vast migration to the cities. But provincial frustration may be the most urgent issue facing the Chinese leadership. In response to growing protests, officials recently tried to placate peasants by repealing rural taxes. Many observers were disappointed that they did not go further and privatize farmland.

Preserving the health of rural communities requires still wider measures, Guang argued, including efforts to protect family farms and to improve the countryside’s “livability” so that peasants will want to stay put instead of migrating to the city. China must also close the “organizational deficit” of peasant farmers, he said. Underrepresented in the Communist Party, peasants need “professional organizations” to promote their interests. The government has been wary of allowing independent trade unions, but the problems of the countryside have reached a point where the government realizes “it cannot let these things go on,” Guang said. “It may fear the consequence of rural organization, but it may no longer have any choice.”

Of all the uncertainties that cloud China’s future, none provokes more intense speculation or sharper disagreement than the question of whether a more powerful China will turn out to be peaceful or bellicose. More pointedly for Americans, will a growing China emerge as a rival or a friend?

photo: China on the Rise In some ways, Chinese-American relations have never been better. James Lilley, author of China Hands: Nine Decades of Adventure, Espionage, and Diplomacy in Asia (2004), recounted some rougher patches with which he had personal experience. He took part in CIA clandestine operations in China and elsewhere for 25 years, and he also served as U.S. ambassador to China in the late 1980s, when, he said, U.S.–China relations “hit rock bottom.” His family ties to the country go back farther, to 1916, when his father went there to work for Standard Oil. Lilley described those early days as “the era of gunboats, bible-toting, and oil camps,” when China suffered under foreign domination.

The United States and China have weathered more recent crises, including NATO’s 1999 bombing of the Chinese embassy in Belgrade and the 2001 collision between a U.S. spy plane and a Chinese fighter over the South China Sea. “Things have gotten rocky, but it always comes out in good shape,” Lilley said. Today the two countries cooperate in many areas, including trade, military exchanges, and international diplomacy, where the United States has been counting on Chinese help to confront nuclear regimes in North Korea and Iran. But the relationship generates plenty of friction as well. China distrusts American unilateralism and insists on working through international institutions like the UN and the International Atomic Energy Agency. Meanwhile, the United States worries about its trade deficit with China, now exceeding $200 billion a year; China’s efforts to secure oil and other natural resources in Central Asia, Africa, and South America; and especially the Chinese military buildup.

Peter Rodman, U.S. assistant secretary of defense for international security affairs, gave a sobering glimpse into China’s military expansion. “Everyone knows about China’s phenomenal economic growth,” he said. “But they don’t know about the phenomenal increase in China’s defense budget.” By Rodman’s account, China’s military is weak but modernizing quickly. Its immediate goal is to be capable of fighting short wars on its periphery, especially with Taiwan, and to deter American interference. China has deployed or is developing short-range missiles aimed at Taiwan and long-range ballistic missiles that can reach the United States. It has five modern submarine programs. It is developing 12 types of anti-ship missiles. (“You can be sure the U.S. Navy is paying close attention to this,” he said.) China also is developing a ground-based anti-satellite laser and technology to attack an adversary’s computer networks.

The U.S. Department of Defense estimates that China will spend $70 to $105 billion a year on defense, two to three times the figure it officially admits, said Rodman, who criticized China for this lack of “transparency”—hiding its true budget and the purpose of its buildup: “Over the years, China’s military has put a premium on what we could call denial and deception.” The response of American military forces has been to “hedge against the worst” while promoting cooperation and mutual understanding through initiatives like the exchange of mid-level military officers.

“We don’t see conflict as inevitable,” Rodman said. “But we have to be realistic. We have to see the possibilities there.”

Later, Ambassador Wang politely defended his country against Rodman’s charges. “The doubt can easily be dispelled,” he said. “China spends much less on defense than the other countries.” He cited a figure of $30 billion, an amount that “pales in comparison” to the U.S. defense budget of $441 billion. “China has no intention to engage in an arms race,” he said. A more pointed challenge to Rodman came from the largely Chinese audience. One man criticized America’s “double-standard.” When another asked, “Is it possible that China feels a great threat from the United States?” the audience applauded.

For John Mearsheimer, a leading proponent of the realist school of international relations, China’s future holds little uncertainty—so long as you gaze far enough into the future. Mearsheimer, Chicago’s R. Wendell Harrison distinguished service professor of political science, sees nations as engaged in a perpetual struggle for survival in an anarchic world, where the best way to succeed is to dominate other nations. China may find peaceful cooperation useful now, when it is weak and still developing its economy, he said. But once it grows strong it is almost certain to clash with the United States.

“The Chinese are going to try to dominate Eastern Asia the way the United States did the Western Hemisphere—and they’d be foolish if they didn’t,” Mearsheimer said. “This makes eminent good sense. Will China be happy with American ships and aircraft patrolling its shores? If China gets to be very powerful, it will have a powerful incentive not only to dominate Asia but to push America out. In short, it will try to look like the United States.”

Despite vows of cooperation, Mearsheimer said, “you can see the balancing coalition start to form.” The United States has been strengthening alliances in Central Asia and with India, he said, the latter friendship based in part on the fact “that India and the United States both fear China.”

The Chinese ambassador missed Mearsheimer’s talk but not the argument—Mearsheimer’s views are well-known in China. Wang referred to the “misgivings and anxiety of China repeating the past mistakes of large powers” and offered a detailed response to Mearsheimer and to many oft-raised questions about China. Acknowledging the economic challenges still facing his country, he argued that it could not continue to prosper without peace. He downplayed the prospect of economic, political, and military rivalries, declaring that the world is entering an era of economic cooperation in which “peace will make winners of us all—conflict, losers of us all.” He argued that Confucianism distinguished China from more aggressive nations. “For Chinese philosophy, there is never any effort to seek hegemony,” Wang said. “Not now, not before, not in the future.”

He left some things unsaid. He passed over some inconvenient history, including China’s 1962 invasion of India over a disputed border; its 1974 seizure of the Paracel Islands, which belonged to Vietnam; its 1979 invasion of Vietnam; and its threat to attack Taiwan if it tries to declare independence. Still, China clearly wants to cultivate good relations with the United States. By that measure President Hu’s goodwill trip in April, a week before the Chicago conference, was a rousing success—especially his visit to Seattle, where he donned a baseball cap, told workers at Boeing how much the Chinese people liked their planes, and afterward dined with Bill Gates. Wang also did not point out, although others did, that if the world has reason to be anxious about China, China has reason to be anxious about the world. During the 19th century and into the early 20th, it suffered the domination of Britain and other Western powers, including the United States. The Opium Wars (1839–42 and 1856–60), when the British attacked and forced trade concessions from China, remain a humiliating memory. It was a time, said Wu Jianmin, president of China Foreign Affairs University, when his country learned the price of weakness.

Is there no middle ground between the cheerful assurances of the Chinese and the gloomy predictions of the realists? Bruce Cumings, a Chicago history professor and expert on Korea, saw one. It seemed to him that the modern principle of nuclear deterrence made all-out war between the United States and China unlikely. Neither nation would wish to risk annihilation, he argued. At the same time, drawing a comparison to the Mediterranean civilization of antiquity as well as the Atlantic civilization that has characterized the modern era, Cumings foresaw the 21st-century emergence of “a real Pacific civilization” as China grows and the United States turns increasingly westward.

“Isn’t it possible,” he asked, “that a Pacific civilization might be peaceful rather than warlike?”

Only time will tell.

Richard Mertens is a freelance writer and a student in the Committee on Social Thought.