And Then There Were Three?

Along the lines of Prof. John Ikenberry calling for a American-European alliance that dictates the rules of the game during China’s rise comes a New York Times Magazine article (h/t Rebecca MacKinnon) that envisions a tripolar world divided between the US, Europe, and China in the coming decade.

The author, foreign policy scholar Parag Khanna, offers this slightly awkward sketch of what he calls the “Big Three”:

The Big Three are the ultimate “Frenemies.” Twenty-first-century geopolitics will resemble nothing more than Orwell’s 1984, but instead of three world powers (Oceania, Eurasia and Eastasia), we have three hemispheric pan-regions, longitudinal zones dominated by America, Europe and China. As the early 20th-century European scholars of geopolitics realized, because a vertically organized region contains all climatic zones year-round, each pan-region can be self-sufficient and build a power base from which to intrude in others’ terrain. But in a globalized and shrinking world, no geography is sacrosanct. So in various ways, both overtly and under the radar, China and Europe will meddle in America’s backyard, America and China will compete for African resources in Europe’s southern periphery and America and Europe will seek to profit from the rapid economic growth of countries within China’s growing sphere of influence. Globalization is the weapon of choice. The main battlefield is what I call “the second world.”

And what is the second world? Khanna explains:

Second-world countries are distinguished from the third world by their potential: the likelihood that they will capitalize on a valuable commodity, a charismatic leader or a generous patron. Each and every second-world country matters in its own right, for its economic, strategic or diplomatic weight, and its decision to tilt toward the United States, the E.U. or China has a strong influence on what others in its region decide to do. Will an American nuclear deal with India push Pakistan even deeper into military dependence on China? Will the next set of Arab monarchs lean East or West? The second world will shape the world’s balance of power as much as the superpowers themselves will.

The second world isn’t exactly new terminology, mind you. Recall that the “old” second world was the Soviet Union and Warsaw Pact nations, while “third world” was the term used for the minor powers manipulated by the first world West and second world Soviets. By eliminating the third world from the equation, the author suggests rough parity between the powers at the two tiers. This is problematic because his second world powers are a mix of developing and developed countries, resource-poor and resource-rich countries, and failed states and stable states

Moving on, Khanna seems to be asking the same question as Ikenberrry, can the US dictate the rules of the game in the future, and comes up with a very different answer:

The self-deluding universalism of the American imperium — that the world inherently needs a single leader and that American liberal ideology must be accepted as the basis of global order — has paradoxically resulted in America quickly becoming an ever-lonelier superpower. Just as there is a geopolitical marketplace, there is a marketplace of models of success for the second world to emulate, not least the Chinese model of economic growth without political liberalization (itself an affront to Western modernization theory). As the historian Arnold Toynbee observed half a century ago, Western imperialism united the globe, but it did not assure that the West would dominate forever — materially or morally. Despite the “mirage of immortality” that afflicts global empires, the only reliable rule of history is its cycles of imperial rise and decline, and as Toynbee also pithily noted, the only direction to go from the apogee of power is down.

[…]

I believe that a complex, multicultural landscape filled with transnational challenges from terrorism to global warming is completely unmanageable by a single authority, whether the United States or the United Nations. Globalization resists centralization of almost any kind. Instead, what we see gradually happening in climate-change negotiations (as in Bali in December) — and need to see more of in the areas of preventing nuclear proliferation and rebuilding failed states — is a far greater sense of a division of labor among the Big Three, a concrete burden-sharing among them by which they are judged not by their rhetoric but the responsibilities they fulfill. The arbitrarily composed Security Council is not the place to hash out such a division of labor. Neither are any of the other multilateral bodies bogged down with weighted voting and cacophonously irrelevant voices. The big issues are for the Big Three to sort out among themselves.

Note the essential difference between Khanna and Ikenberry: whereas Ikenberry stresses the importance of international institutions, Khanna takes a more traditionally realist approach, arguing that the three powers themselves will set the agenda and, in Bushisan terms, be the “deciders.” Not surprisingly, the piece downplays the importance of international institutions when Khanna turns to making recommendations for future US policy.

In fact, neither a Clinton, Obama, McCain, nor Romney administration would set policy based on all of Khanna’s ideas, but some hold promise He argues that America should revitalize her diplomatic corps, taking the Pentagon’s regional organization structure as a model to follow, and greatly increase the number of Foreign Service Officers and Peace Corps volunteers. So far so good. Next up he argues that American private philanthrophy should lead an expansion of American foreign aid, a laudable notion until one considers exactly how the government could bring this about. Khanna also, in true Westphalian style, asks America to shave the moralist edge off of her international politics, something which simply won’t happen. For instance, even though a President Obama would be loath to use military force to “bring democracy” ala Bush in Iraq, that doesn’t mean he will stop using the language of democratization or human rights when dealing with foreign countries.

And like Ikenberry, Khanna has an overly simplistic view of Chinese realpolitik. Consider this passage towards the end of the piece:

Fifth, convene a G-3 of the Big Three. But don’t set the agenda; suggest it. These are the key issues among which to make compromises and trade-offs: climate change, energy security, weapons proliferation and rogue states. Offer more Western clean technology to China in exchange for fewer weapons and lifelines for the Sudanese tyrants and the Burmese junta. And make a joint effort with the Europeans to offer massive, irresistible packages to the people of Iran, Uzbekistan and Venezuela — incentives for eventual regime change rather than fruitless sanctions. A Western change of tone could make China sweat. Superpowers have to learn to behave, too.

China, in his view, would happily take the quid of technology in exchange for the quo of altering its foreign policy. The problem with this concept is that technology exchanges aren’t useful until a country’s industrial and economic base reaches the point where it could actually utilize advanced technology. If we, say, gave China advanced smokestack scrubbing technology, it could be utilized in large-scale manufacturing enterprises in Shanghai and Shenzhen, but wouldn’t make its way into the countryside factories which are seeing the biggest growth in recent years. Similarly, cheap electric cars might make Beijingers thrilled but people in small cities and the countryside are going to stick with gas engines. At the same time, the raw materials China imports from the illiberal regimes it supports have the end effect of fueling the development of the overall industrial superstructure within the country, and China wouldn’t give up access to these resources without resource alternatives. “Clean technology” isn’t enough.

(The above having been said, I think the best way to put pressure on China wouldn’t be to criticize Beijing directly but to widely publicize — in English and in Chinese — the misdeeds of its client states, especially whenever China hosts the head of state of a country like Sudan. China has already shown itself sensitive to the public image of its foreign allies. Consider that a few years ago, when Uzbekistan’s Islam Karimov came to visit Beijing, China temporarily blocked all Internet searches for Uzbekistan to keep curious Chinese in the dark about Karimov’s misdoings.)

Lastly, I’d like to note Khanna overstates, understates, or ignores a few key points during the article:

  • He ignores Western Europe’s demographic crunch, which will necessarily shrink European power and/or radically alter the character of Europe in the next two decades.
  • He understates Russia’s expansion of economic and military power and self-esteem under Putin, who seems likely to call the shots from afar in the decade ahead. It’s hard to imagine a situation where Russia, even a shrinking Russia, willingly subordinates itself to China or the EU.
  • He understates multilateral Europe’s love of multilateral institutions; even if the UN may not be the best way to solve a problem, the first instinct of Europeans will always be to turn to the UN or similar institution.
  • He overstates Chavez’s power in Venezuela; in fact, all mentions of Venezuela have a “pre-referendum” feel to them.
  • He ignores the biggest problem that Africa faces in the long run, namely, the wave of instability that follows as Islam moves south. The creation of two African Unions — one of them Islamic in character — or no workable African Union at all seems far more likely than establishing an EU-style African Union in the near future.

These criticisms aside, Khanna’s article is a strong companion piece to Ikenberry’s and a sobering preview of the challenges America faces in the decades to come.

Update: Khanna’s piece has not surprisingly elicited further reactions from the China blogosphere.

Professor Michael Pettis of the China Financial Markets blog posted a negative critique of Khanna’s article that is a bit snarky but definitely solid. Most importantly, he expands upon the critical issue of demography in Europe — and China:

… If we assume that the six great or potential powers of the world are China, Europe, India, Japan, Russia and the US, it seems that all of them with the exception of India and the US have very serious demographic problems that will seriously undermine their future growth. Take Europe for example. I don’t have the figures in front of me, but today Europe’s population is, I think, about 15% greater than the US. By the middle of the century it will be about 15% smaller, and its median age will have risen from a couple of years more than the US to about 12-16 years more. Projecting the differential per capita growth rates over the past few decades into the future (I know, I know, but what is a more plausible alternative?), Europe’s GDP, which is today larger than that of the US, is likely to be only two-thirds or less than that of the US – and when I ran these projections a few years ago I did them on a per-capita basis, not on a per-worker basis, which would have been much worse..

Khanna will argue (and nearly does) that Europe has an almost unlimited supply of countries eager to join and, by adding them to the European stew willy-nilly Europe can keep its population and economy growing for a long time. This would require that Europe keep adding North African and Asian states to the European Union without domestic opposition, fully integrating them immediately in the Europe political and economic system, and without in any way diluting the cohesiveness and decision-making ability of the European elite. Khanna may have spent several months of those two Starbucks years visiting European countries, but I was born in Spain of a French mother and grew up primarily in Europe, and I think this is, to put it politely, highly implausible.

Read the rest.

For his part, Richard at The Peking Duck recommends the article to readers, and saves most of his criticism not for Khanna but for Hu Jintao.

Daniel Drezner’s response includes this painfully funny line:

I will heap praise on Khanna’s agent for getting the excerpt placed into the Magazine. There’s less demand than there used to be for prose stylings that read like Benjamin Barber after a three-day coke bender in Macao.

Ouch. He goes on to make the point that Khanna’s article — and I think perhaps even Khanna’s book — noticeably lacks data to back up its assertions.

Meanwhile, Kevin Drum is channeling Khanna’s article when musing a new Democratic foreign policy approach. To wit:

[M]ake an appeal to national chauvinism. In the Parag Khanna piece I mentioned below, there’s a bit of discussion about how China interacts with the world, and none of it has to do with projecting military power. So what would happen if you played off that? China isn’t fighting foreign wars, they’re doing X, Y, and Z instead. And they’re winning. So we’d better get on the stick and start doing what they’re doing. [Italics in original.]

I really, really hope Mr. Drum only means we should copy China’s policy of military non-interventionism and not all of China’s foreign policy strategies.

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The NYT’s Choking on Growth Series

Starting this summer, and continuing this month, The New York Times has produced “Choking on Growth,” a series of multimedia-enhanced articles on the environmental costs of China’s development. The first article in the series , written by Joseph Kahn and Jim Yardley and released in late August, covered the usual topics, such as the desertification of the Hebei-Beijing region, provincial groundwater pollution, air quality in Beijing, and corruption. Though a few months old, some of the information in the article ties in with my previous posting on the potential advantages of “green subsidies” in China by raising the issue of Chinese energy efficiency:

Its [China’s] energy needs are compounded because even some of its newest heavy industry plants do not operate as efficiently, or control pollution as effectively, as factories in other parts of the world, a recent World Bank report said.

Chinese steel makers, on average, use one-fifth more energy per ton than the international average. Cement manufacturers need 45 percent more power, and ethylene producers need 70 percent more than producers elsewhere, the World Bank says.

China’s aluminum industry alone consumes as much energy as the country’s commercial sector — all the hotels, restaurants, banks and shopping malls combined, Mr. Rosen and Mr. Houser reported.

Considering that these industries obtain heavy subsidies from the state, it would seem a good guess that subsidization — aimed at production targets — is actually encouraging inefficiency. The writers continue,

Moreover, the boom is not limited to heavy industry. Each year for the past few years, China has built about 7.5 billion square feet of commercial and residential space, more than the combined floor space of all the malls and strip malls in the United States, according to data collected by the United States Energy Information Administration.

Chinese buildings rarely have thermal insulation. They require, on average, twice as much energy to heat and cool as those in similar climates in the United States and Europe, according to the World Bank. A vast majority of new buildings — 95 percent, the bank says — do not meet China’s own codes for energy efficiency.

In fairness, the new 8-to-10,000RMB/sq. meter apartments popping up in Tianjin and Beijing utilize such things as geothermal heating systems and Western-style insulated windows, and actually use this as a selling point, but, given the price, most city dwellers aren’t going to live in them. Instead, most people in big cities live in apartment blocks constructed in the 1990s and early 2000s, most which have the design flaws mentioned in the article. For instance, the apartment I live in, which was completed circa 2000, bleeds heat throughout winter and does little to keep the heat out in summer.

That said, I’ve also seen some progress during my nearly four years in China. The main building of the old campus of the university I work at, which was finished around 2003, has terrible insulation, whereas the buildings at the new campus, completed in late 2006 and fitted with insulated walls and window glass, are properly warm in winter and cool in summer. Unfortunately, the main downside of the new campus’ design is that the buildings utilize “modern” central air for heating and cooling instead of steam radiators and ceiling fans, a design choice that might render moot the effects of insulation improvements.

Returning to the articles themselves, one innovative thing about them is that each article features a Mandarin translation (in PDF) and a recording of someone reading the article in Mandarin. While I have doubts about whether Chinese people need to hear the articles for themselves to believe it — after all, they can see the effects with their own eyes — they nonetheless represent a form of outreach, and might also make the articles interesting as classroom discussion materials.

However, after reading through most of “Choking on Growth,” I’m left with a question. Are these articles and others like them in the Western press just intended as 2008 Olympics raspberries, or will the media keep up the scrutiny on China’s development after the Beijing Olympics?

CFLs in Developing Countries

cfl-bulb.jpgI went lightbulb shopping over the weekend and wound up looking through the stock of bulbs in the local Wal-Mart. Like Wal-Mart in America, Chinese Wal-Marts are pushing the compact fluorescent (CFL) bulbs big time. And, given the environmental and economic benefits of switching to CFL or LED bulbs, we can all applaud Wal-Mart’s stance. (An aside: I really ought to check out other retailers and see if they’re also stocking CFLs in bulk.) The only problem is, as far as I can tell from looking at what’s on the shelf, Chinese customers aren’t buying CFLs in large numbers.

The reason may be simple: price. Good-quality Chinese incandescent bulbs can be bought for as little as 25 cents apiece, while CFL bulbs sell for $4-$5. While a Westerner might absorb the costs of getting a CFL because it pays for itself in the long run, for Chinese consumers, a single CFL is the same as the price of 3-4 homecooked meals or one nice dinner out. Assuming they have twelve bulb sockets in their home, if they replaced all of the bulbs in their home with CFLs, it would cost more than a month’s heating bill in an average house here in Tianjin.

This got me to thinking: of all the developing countries in the world, China, with its huge, rapidly urbanizing population, conspicuous coal pollution, and relatively low energy efficiency, is the country which stands to benefit the most from CFLs. (India would be a close second.) Yet the costs of buying CFLs make them prohibitive for the average working-class Chinese, and also deter all but the most green-minded middle- and upper-class consumers. So how to get Chinese people to buy them? Since the price of the bulbs is unlikely to drop in the short run, one answer may be to reduce the price CFLs for Chinese consumers through a government subsidy.

While many subsidies in the world today are anachronistic (Western farm subsidies) or ill-advised (infant industry protection), subsidies aren’t always a bad policy in the short run.* (See Malawi’s recent history of fertilizer subsidies as evidence of this.) Subsidizing lower CFL prices and other “green” purchases — cleaner cars, homes with proper insulation, recycled consumer goods — would also help to offset the massive environmental damage China has suffered while maintaining a growth-first economic policy. Since China is on record as being opposed to sacrificing economic growth in its production centers in order to improve the environment, promoting greener consumption could reduce the overall environmental impact of the Chinese economy as the government implements policies aimed at stimulating China’s service and retail sectors.

* The obvious caveat being that subsidies left in place over the long run can outlive their usefulness and even become perverse. China provides many examples of this, such as its overflowing steel reserves, which are the result of from relentless subsidization from 2000 on, and have produced many undesirable economic and environmental effects.

Update: After poking around in some local Tianjin shops, I’ve come to the conclusion that Chris Waugh (in comments) is right about CFLs being more common than my post suggests, though they’re still uncommon in some schools and larger businesses here in Tianjin. Strangely, most of the CFLs I’ve seen in shops and markets have had an ugly yellow tint like a cheap incandescent bulb. Chinese companies are probably churning out cut-rate CFLs to compete with the high-quality foreign brand CFLs.