In mainstream U.S. media, it’s always a “safe play” for pundits to sneer at foreign leaders and countries that interfere with American hegemony, thus guiding the public toward unnecessary hostilities, a phenomenon now playing out in the treatment of China and President Xi, writes Dan Steinbock.
By Dan Steinbock
Thanks to misguided stories about Chinese President Xi Jinping’s reforms, America risks losing the opportunity to participate appropriately in China’s massive economic rebalancing and reform drive.
In their Animal Spirits, George A Akerlof and Robert J. Shiller, two Nobel Prize winners, show how human psychology drives the economy and why it matters for global capitalism. In particular, they show how stories move markets and are themselves a real part of how the economy functions.
China’s President Xi Jinping.
The same goes for other economies, including China. What “we” in America know about China is filtered through aggregate stories by Washington’s political pundits, policy wonks, economic analysts, and news oracles. Some stories reflect realities; others don’t. Still others are misguided and flawed, while the rest have self-serving agendas.
As President Xi is in his first official state visit in the U.S., he remains an enigma to most Americans not in spite of these stories, but because of them. After his first year in power, leading media, such as Bloomberg, reported that “Xi amassing most power since Deng raises reform risk.” After two years, the Chinese president was portrayed in the West as “Xi who must be obeyed” as The Economist put it in its cover story, calling him the most powerful Chinese ruler certainly since Deng, and possibly since Mao.
What united these stories, which quickly spread across the world via lesser-tier media channels, was their common denominator: Xi had acquired too much power. More recently, Washington’s stories would like us to believe that the problem with President Xi is not that he has too much power, but that he is increasingly powerless.
The new conventional wisdom came about after Chinese equity market volatility, which the Financial Times thought showed that “Xi’s imperial presidency has its weaknesses.” That wisdom was quickly seconded by the Wall Street Journal, which reported that crises put dents in Xi’s armor as “Chinese president is looking more vulnerable than at any time since taking office in 2012, insiders say.”
Despite the demise of the Cold War, the West’s old imperial inclination to see the world through the glasses of good (“we”) and evil (“they”) permeates the Xi biographies. From Foreign Affairs and Foreign Policy to the Atlantic and the New Yorker, the story starts with an “insider” anecdote, a political recollection or recent event that presumably serves as an intro to the Xi narrative. In reality, it is a Potemkin bridge because of its basic point: If you serve in a Communist Party, you are “Born Red,” as Evan Osnos entitled his Xi story in the New Yorker not one of “us” but “them,” and thus neither credible nor trustworthy.
Xi’s policy stance does not require deeper economic, political, or defense analysis; a quasi-Freudian insight will do. As Osnos puts it: “When Xi was fourteen, Red Guards warned, ‘We can execute you a hundred times.’ He joined the Communist Party at twenty.” With that simple but shrewd overture, President Xi’s entire life story is presented as a case of psychoanalytic identification with the aggressor.
In these “in-depth analyses” key biographical data are almost always explained on the basis of condescending Cold-War like interpretations of Chinese history and leaders.
Accordingly, none and at best, few real insiders or opinion-leaders in China are consulted. Instead, the “real story” is obtained from former U.S. ambassadors, U.S. think-tanks, and a list of shady U.S. “well-informed sources” which usually represent one of the many three-letter abbreviated organizations that have ample reason to remain unidentified.
Xi’s Massive Reform Agenda
Following in Deng’s footprints, President Xi’s leadership is pushing new reform and opening-up policies that seek to transform China into a post-industrial, middle-income society by the late 2020s. The huge agenda focuses on tripartite reforms, eight core sectors and three packages.
The triple reforms comprise the market, government and corporations. Market reforms accelerated after the arrival of the new leadership. Governance reforms permeate the public sector. Neither foreign-owned multinationals nor mighty state-owned enterprises (SOEs) can escape antitrust laws, which are now enforced.
The eight core sectors include finance, taxation, state assets, social welfare, land, foreign investment, innovation, and good governance. Financial and foreign-exchange reforms have been sped up, along with accelerated attempts at capital convertibility to modernize China’s financial markets and to make the renminbi an international currency reserve. The new SOE reform plan has been launched and gradual privatizations will ensue.
The evolving basic social security package is reflected by modest pension, medical insurance and education support. New rules have been introduced for the sales of collectively-owned rural land, while the phasing-out of the old household registration system (hukou) will support Beijing’s new urbanization agenda in mid-size cities of 1-5 million people.
Foreign investment in manufacturing is encouraged in the less-developed provinces, while foreign capital in R&D and business services is favored in the more-developed coastal provinces. The central government is also pushing efforts to increase higher productivity and R&D, which will soon exceed that in Europe.
When President Xi launched his far-reaching campaign against corruption, it was portrayed in Washington as “Xi’s effort to consolidate his own power” because, as the Atlantic put it, Chinese politics represents “a pervasive culture of patronage, factionalism, and cronyism.” However, to Xi and his anti-graft tsar, Wang Qishan, former key negotiator in the U.S.-China Strategic & Economic Dialogue, any real anti-corruption struggle must crack down on “both tigers and flies,” both petty civil servants and high-level officials alike.
Curiously, after decades of criticism against Chinese corruption, Washington has begun to argue that, actually, anti-corruption struggle can be bad for the Chinese economy. Such double standards cast a dark shadow over U.S. credibility in Beijing and Chinese popular opinion.
New Terrain of Bilateral Relations
For three decades, bilateral economic ties were overshadowed by China’s role as exporter and U.S. capital in China. While mainstream Washington continues to blame China for “taking our jobs,” the new normal is reflected by rapidly-increasing U.S. exports to China and Chinese capital in the U.S. Meanwhile, Beijing and Washington are completing the highly-anticipated U.S.-China bilateral investment treaty (BIT).
In the Asia Pacific, the White House has done whatever it could to deter China’s free-trade plans, while seeking to complete the Trans-Pacific Partnership (TPP) agreement, which leaves out China, India, and Indonesia the three largest and most consequential economies of Asia.
In Washington’s stories, President Xi’s foreign policy is typically portrayed as more “assertive.” An alternative view is that it is largely a defensive posture, which was deemed vital in Beijing, due to NSA’s controversial cyber activities and Washington’s “pivot to Asia”; that is, Cold-War like containment policies that seeks to encircle and suppress China’s economic, political, and security ties with its regional neighborhood. In contrast, President Xi’s historical “One Road, One Belt” initiatives are likely to defuse military distractions and to optimize economic development regionally.
Along with other large emerging economies, China has also pushed for the BRICS New Development Bank (NDB) and the Asian Infrastructure Investment Bank (AIIB) that are each vital to desperately needed infrastructure projects in Asia, Africa, Latin America, and elsewhere but the White House fought until it found itself alone, even amid its closest security allies.
Thanks to these ongoing reforms, the very environment of Chinese-U.S. bilateral relations is under drastic transformation. And yet, Washington has too often than not embraced old Cold War policy stances rather than embraced the new opportunities inherent in Xi’s reform agenda. The Cold War ended a quarter of a century ago. It is time to be on the right side of history.
What Washington needs are, well, new stories.
Dan Steinbock is the research director of international business at the India, China and America Institute (USA) and a visiting fellow at the Shanghai Institutes for International Studies (China) and EU Center (Singapore). For more, see http://www.differencegroup.net [This commentary was initially published by China-US Focus]
I’m not entirely sure what purpose it serves to dredge up that tiresome “commie-red” hype…this only incites CONSORTIUMNEWS readers into outrage and on top of it, mentioning Evan Osnos with his attendant, distorted and rather skewed, political opinions. Readers need to re-evaluate these “true believers”, their long term, hidden agendas and sophistries. Looking through the lens of the way back machine, we see the supreme capitalist, Carnegie and his familiars making every effort to steer our world into a single collectivized amalgam of east and west economies. The facts are written down, for all to see and adopted in 1908 (to wit- the Carnegie Foundation papers). A grand scale effort by a few billionaires to diffuse the wealth and regional control of disparate peoples of our Nation(s). A plan that is now active and well under way; to collectivize sovereign nations via constant warfare. Build-ups that are militaristic in nature and create a financial tapeworm, deliberately injected, to impoverish those participating economies. This article provokes one to recall the political rift between the Alger Hiss clan (including Henry Morgenthau, Jr.) versus the pure fascists, headed up by the Dulles Brothers. We all know who won that “family feud” and the results were not, in any way, promoted to benefit small business enterprise(s) or for that matter, promote middle class existence among Western Occident countries!! Further, not to stray too far off the substance of this article, Xi could have formed an alliance with Venezuela for ALL it’s imported oil requirements but five will ya getcha ten- that the deep state in the US forbade such a treaty bound or business partnership. Thus, this political U.S. blunder not only provokes a regional nuclear war in the Pacific (Japan/China Spratley Island’s issue) but denies our country a financial “piece of the action” for the guaranteeing of an uninterrupted and steady flow of oil-tankers thru the Canal zone and cross the Pacific to China.
… . “the pure fascists, headed up by the Dulles Brothers.”
FYI – – –
http://www.dailymail.co.uk/news/article-2530447/The-spying-Scotsman-hunted-Nazis-New-York-The-amazing-story-Britains-clandestine-war-Hitlers-agents-big-money-backers-US.html#ixzz2oqI9CPou
Consecutive meetings with the Pope, Xi and Putin -with the upcoming General Assembly Meeting at the United Nations to be followed by an In-Your-Face Government Shutdown?
Is Obama looking in the face of conspiratorial humiliation?
Caesar stabbed to death by Brutus?
With farewell tears from Boehner?
Are we in camouflage mode here… ?
I understand that stock market crash in China was a government created mess, but that merely suggested that they tried to learn too much from USA. Causing a bubble and a crash by misguided changes in regulations? Perhaps this is a badge of “member of a super-club”. A minor power cannot make its markets over-confident. By the way, this is the problem of Euro in my opinion: regulators got enormous power, but that does not confer a similar increase in wisdom. For examples, instead of wracking their brains if lending to Greece is a good idea, banks could just follow the guidelines of the central bank of the Euro zone.
So far, given how much power they have, Chinese leaders committed remarkably few errors. The picture is not all rosy, for example they do not overly care about health and environment, which can be a correct cynical calculation, but there were signs that they will do something about it.
My conclusion is that the record of authoritarian regimes seems to be best in Confucian countries.
That said, every big nation has to prove to its population that it can project power and command respect. Chinese properly analyzed American experience, where the least questionable triumph of the recent era was in Grenada. Appropriately, they embarked on creating islands to conquer. That creates a whole class of manageable conflicts allowing USA and all countries in China seas to flex muscles and exercise national pride, but I would worry that the Chinese government can get overly distracted by all those maritime diversions.
Accordingly, none – and at best, few – real insiders or opinion-leaders in China are consulted. Instead, the “real story†is obtained from former U.S. ambassadors, U.S. think-tanks, and a list of shady U.S. “well-informed sources†– which usually represent one of the many three-letter abbreviated organizations that have ample reason to remain unidentified.
And it’s the same here in Australia. We also wheel out various American “experts” for commentary – even on public radio with an astonishingly large number from the Brookings Institute with little or no background as to what this outfit is or its extreme ideological outlook.
Who are these masters of power? Can they not forego a margin of profit, and share with diverse cultures the earth’s resources? Must they always have it all, to themselves? Who ever had it all, and was able to keep it?
I have felt for a very long time, how the U.S. was sanctioning itself in isolationism. This is considering we don’t blow up the whole world first. Washington would be wise to realize the rest of the world is tired of the Banker/Militaristic Land of the Free Bully stuff, and they are moving on without us. A real American Patriot would change this Warmongering Nature of ours, while we still can. Do it for the children. This should be easy, and why not, isn’t that why we submit to a TSA line? Instead of America separating itself from the whole wide world, we should join it. Quit enforcing lob sided trade agreements. Stop, bombing nations into the Stone Age… and someone tell the chickenhawks to get a new going to war tag line….Stone Age! We can do better than this.
Fletcher Prouty describes The Cabal in the book; “Understanding Special Operations”
Find this and gads more info @ http://www.ratical.org
After reading Webster Tarpley’s detailed analysis on America’s Deep State or Invisible State today, I’d say the new story will be one of “convergence”; or how very large Nations are actually “run”, regardless of lip-service to any particular ideology. These oligarchies seem immovable and impervious to any influence from outside of the oligarchy. One can perhaps hope their own short-sightedness and general incompetence will “do them in”.
There is no perhaps or hoping. Oligarchy becomes to stupid to exist as soon as the central plan cuts off real democracy and the focus of distributed human intelligence, which is entangled with big still banging.
Just came off the Guardian’s little ”hatchet job” which makes one wonder if both articles were written about the same man.
Have a read and compare…
http://www.theguardian.com/world/2015/sep/24/chinese-president-xi-jinping-us-visit-barack-obama#comment-60152975
Spot the, (not to well hidden), bias?…
whoops! …”too”
Spelling… ”too”. Whoops.
The Graun is a ghost of its former glorious self.It is now Zionist occupied territory,like everywhere else.
Nyts East.
‘as the Atlantic put it, Chinese politics represents “a pervasive culture of patronage, factionalism, and cronyism.‒
That sounds very much like US politics, since… well, actually, since about 1800. Indeed, it has often been cogently argued that politics must take such forms in any sufficiently large and diverse nation. The presence or absence of democracy has very little to do with patronage, factionalism, and cronyism – those ineradicable aspects of human nature are extremely persistent and ubiquitous in any society. They can be more or less well concealed, but they cannot be prevented.