Back in the summer of 2018, I launched my American Pravda series in earnest, deciding to finally present some of the extremely controversial material that I’d gradually uncovered during the previous five or ten years.
One of my earliest articles focused upon the Jewish role in the Bolshevik Revolution and the resulting ideological aftershocks in America and other Western countries. This was obviously an ultra-touchy subject, including as it did a close examination of Henry Ford’s The International Jew and the notorious Protocols of the Elders of Zion, and I was naturally quite a bit skittish about my candid analysis. I therefore adopted a strategy of deflection, opening my article with a few paragraphs of important but almost totally unrelated material regarding Chinese society.
As I wrote in late July 2018:
America’s Cultur...
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Although I always had a great interest in history, I naively believed what I read in my textbooks, and therefore regarded American history as just too bland and boring to study.
By contrast, one land I found especially fascinating was China, the world’s most populous country and its oldest continuous civilization, with a tangled modern history of revolutionary upheaval, then suddenly reopened to the West during the Nixon Administration and under Deng’s economic reforms starting to reverse decades of Maoist economic failure.
In 1978 I took a UCLA graduate seminar on the rural Chinese political economy, and probably read thirty or forty books during that semester. E.O. Wilson’s seminal Sociobiology: The New Synthesis had just been published a couple of years earlier, reviving that field after decades of harsh ideological suppression, and with his ideas in the back of my mind, I couldn’t help noticing the obvious implications of the material I was reading. The Chinese had always seemed a very smart people, and the structure of China’s traditional rural peasant economy produced Social Darwinist selective pressure so thick that you could cut it with a knife, thus providing a very elegant explanation of how the Chinese got that way. A couple of years later in college, I wrote up my theory while studying under Wilson, and then decades afterward dug it out again, finally publishing my analysis as How Social Darwinism Made Modern China.
With the Chinese people clearly having such tremendous inherent talent and their potential already demonstrated on a much smaller scale in Hong Kong, Taiwan, and Singapore, I believed there was an excellent chance that Deng’s reforms would unleash enormous economic growth, and sure enough, that was exactly what happened. In the late 1970s, China was poorer than Haiti, but I always told my friends that it might come to dominate the world economically within a couple of generations, and although most of them were initially quite skeptical of such an outrageous claim, every few years they became a little less so. For years The Economist had been my favorite magazine, and in 1986 they published an especially long letter of mine emphasizing the tremendous rising potential of China and urging them to expand their coverage with a new Asia Section; the following year, they did exactly that.
These days I feel tremendous humiliation for having spent most of my life being so totally wrong about so many things for so long, and I cling to China as a very welcome exception. I can’t think of a single development during the last forty years that I wouldn’t have generally expected back in the late 1970s, with the only surprise having been the total lack of surprises.
Although I’d closely followed the rising arc of China’s enormous economic success in the decades since my 1983 college graduation, I’d mainly been focused upon other policy issues. But then a dozen years ago in 2012, I published a major cover story in The American Conservative contrasting China’s rapid rise with America’s severe economic problems in the wake of the financial collapse and our disastrous Iraq War, and it attracted considerable favorable attention in elite political and media circles. Now rereading it again a dozen years later, there’s scarcely a single word I would take back or change.
The rise of China surely ranks among the most important world developments of the last 100 years. With America still trapped in its fifth year of economic hardship, and the Chinese economy poised to surpass our own before the end of this decade, China looms very large on the horizon. We are living in the early years of what journalists once dubbed “The Pacific Century,” yet there are worrisome signs it may instead become known as “The Chinese Century.”
By the late 1970s, three decades of Communist central planning had managed to increase China’s production at a respectable rate, but with tremendous fits and starts, and often at a terrible cost: 35 million or more Chinese had starved to death during the disastrous 1959–1961 famine caused by Mao’s forced industrialization policy of the Great Leap Forward.
China’s population had also grown very rapidly during this period, so the typical standard of living had improved only slightly, perhaps 2 percent per year between 1958 and 1978, and this from an extremely low base. Adjusted for purchasing power, most Chinese in 1980 had an income 60–70 percent below that of the citizens in other major Third World countries such as Indonesia, Nigeria, Pakistan, and Kenya, none of which were considered great economic success stories. In those days, even Haitians were far wealthier than Chinese.
All this began to change very rapidly once Deng Xiaoping initiated his free-market reforms in 1978, first throughout the countryside and eventually in the smaller industrial enterprises of the coastal provinces. By 1985, The Economist ran a cover story praising China’s 700,000,000 peasants for having doubled their agricultural production in just seven years, an achievement almost unprecedented in world history. Meanwhile, China’s newly adopted one-child policy, despite its considerable unpopularity, had sharply reduced population growth rates in a country possessing relatively little arable land.
A combination of slowing population growth and rapidly accelerating economic output has obvious implications for national prosperity. During the three decades to 2010, China achieved perhaps the most rapid sustained rate of economic development in the history of the human species, with its real economy growing almost 40-fold between 1978 and 2010. In 1978, America’s economy was 15 times larger, but according to most international estimates, China is now set to surpass America’s total economic output within just another few years.
Furthermore, the vast majority of China’s newly created economic wealth has flowed to ordinary Chinese workers, who have moved from oxen and bicycles to the verge of automobiles in just a single generation. While median American incomes have been stagnant for almost forty years, those in China have nearly doubled every decade, with the real wages of workers outside the farm-sector rising about 150 percent over the last ten years alone. The Chinese of 1980 were desperately poor compared to Pakistanis, Nigerians, or Kenyans; but today, they are several times wealthier, representing more than a tenfold shift in relative income.
A World Bank report recently highlighted the huge drop in global poverty rates from 1980 to 2008, but critics noted that over 100 percent of that decline came from China alone: the number of Chinese living in dire poverty fell by a remarkable 662 million, while the impoverished population in the rest of the world actually rose by 13 million. And although India is often paired with China in the Western media, a large fraction of Indians have actually grown poorer over time. The bottom half of India’s still rapidly growing population has seen its daily caloric intake steadily decline for the last 30 years, with half of all children under five now being malnourished.
China’s economic progress is especially impressive when matched against historical parallels. Between 1870 and 1900, America enjoyed unprecedented industrial expansion, such that even Karl Marx and his followers began to doubt that a Communist revolution would be necessary or even possible in a country whose people were achieving such widely shared prosperity through capitalistic expansion. During those 30 years America’s real per capita income grew by 100 percent. But over the last 30 years, real per capita income in China has grown by more than 1,300 percent.
Over the last decade alone, China quadrupled its industrial output, which is now comparable to that of the U.S. In the crucial sector of automobiles, China raised its production ninefold, from 2 million cars in 2000 to 18 million in 2010, a figure now greater than the combined totals for America and Japan. China accounted for fully 85 percent of the total world increase in auto manufacturing during that decade.
I emphasized that China’s economic rise had actually been very beneficial for most of the rest of the world.
The War on the West
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Does China’s rise necessarily imply America’s decline? Not at all: human economic progress is not a zero-sum game. Under the right circumstances, the rapid development of one large country should tend to improve living standards for the rest of the world.
This is most obvious for those nations whose economic strengths directly complement those of a growing China. Massive industrial expansion clearly requires a similar increase in raw-material consumption, and China is now the world’s largest producer and user of electricity, concrete, steel, and many other basic materials, with its iron-ore imports surging by a factor of ten between 2000 and 2011. This has driven huge increases in the costs of most commodities; for example, copper’s world price rose more than eightfold during the last decade. As a direct consequence, these years have generally been very good ones for the economies of countries that heavily rely upon the export of natural resources—Australia, Russia, Brazil, Saudi Arabia, and parts of Africa.
Meanwhile, as China’s growth gradually doubles total world industrial production, the resulting “China price” reduces the cost of manufactured goods, making them much more easily affordable to everyone, and thereby greatly increases the global standard of living. While this process may negatively impact those particular industries and countries directly competing with China, it provides enormous opportunities as well, not merely to the aforementioned raw-material suppliers but also to countries like Germany, whose advanced equipment and machine tools have found a huge Chinese market, thereby helping to reduce German unemployment to the lowest level in 20 years.
And as ordinary Chinese grow wealthier, they provide a larger market as well for the goods and services of leading Western companies, ranging from fast-food chains to consumer products to luxury goods. Chinese workers not only assemble Apple’s iPhones and iPads, but are also very eager to purchase them, and China has now become that company’s second largest market, with nearly all of the extravagant profit margins flowing back to its American owners and employees. In 2011 General Motors sold more cars in China than in the U.S., and that rapidly growing market became a crucial factor in the survival of an iconic American corporation. China has become the third largest market in the world for McDonald’s, and the main driver of global profits for the American parent company of Pizza Hut, Taco Bell, and KFC.
Although my overall appraisal of China’s achievements was extremely favorable, I hardly airbrushed away the very serious problems that country still faced, but I argued that these had often been greatly exaggerated in the Western media.
