Beijing’s centralized approach is much less impressive than it looks on the surface.
Americans fears of China are at once entirely understandable and altogether misplaced. The understandable part is straightforward enough. China wants very much to displace American hegemony in Asia if not globally. It has a large, well-educated and well-disciplined population with which to do it. It has a powerful economy and an increasingly sophisticated and aggressive military. An age-old question seems appropriate enough: what is not to fear? Other aspects of American fears do, however, miss the mark. In media outlets and elsewhere people frequently make claims that China’s authoritarian government and top-down economic direction gives it more focus and purpose than the seemingly chaotic market system of the United States. But these aspects of China, as the evidence increasingly makes clear, are not strengths at all. They are in fact huge, perhaps mortal weaknesses. China’s economic system, especially as recently hardened under Premier Xi Jinping, has three salient characteristics: The first is how Beijing controls every major aspect of economic development and direction through large-scale interventions frequently through massive state-owned enterprises (SOEs). The second is a seeming openness to foreign investments but only so long as they serve the developmental goals identified by Beijing’s planners. The third element is how the first two characteristics enable Beijing to marshal China’s financial resources to serve the centrally directed goals. On the surface, it is easy to see how this highly concentrated and purposeful approach can impress visiting journalists, government officials, and businesspeople. The planners decide for instance that China will have high-speed rail. These visitors are awed by phalanxes of powerful locomotives set on an impressive array of rails going in all directions from an urban center. Everything looks so much more efficient, clean, and organized than in the west. Port facilities look larger than life. Whole cities rise seemingly overnight in what were once fields, replete with rows of apartment blocs and urban transport systems. These journalists and businesspeople come home and look at the seeming inability of democratic processes to decide even on an economic direction much less conger the means to pursue it.
