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Why China Matters

Is China a great success, a nation solving its internal divisions and moving from strength to strength? Or is China so overwhelmed by problems that its policy makers are paralyzed and its system so corrupt that everything might fall apart? In either case, China's future is a matter of global consequence. Usually its ascent is imagined as part of a rising Asia, dominated by a democratic Japan, one of the three major regions of the world economy along with a U.S.-centered Americas and a German-based Europe. But Asia's rise is different, with China's role highlighting the continent's distinctness. If the European Union holds, it will be because nationalist passions have been subordinated to shared economic interests. Likewise, the government of Mexico, in opting for membership in the North American Free Trade Agreement, reimagined its nationhood so that it was no longer catalyzed by resistance to the colossus from the North, but instead by the benefits of economic union with the United States. China's future is a matter of global consequence. In Asia, however, nationalist passions are not subordinated to larger economic gain. Japan sees itself as the capital-rich hub of Asia. Other Asian countries should then benefit fiy linking to the Japanese center, as Japan surrenders lesser technologies to followers while it advances to new leading market sectors. First, the four Asian tigers -- South Korea, Taiwan, Hong Kong and Singapore -- benefited from accepting their place in the Japan-led model. Then Thailand, Malaysia and China joined, with more distant hopefuls like Indonesia and Vietnam waiting to link to the Japanese economic hub. But however much Tokyo might prefer Japan as the center, the potent nationalism of Korea, Taiwan, China and other Asian states rejects subordination to Japan. Taiwan, seeking its own destiny, has become one of the world's leaders in foreign-exchange holdings and computer-related exports. Since 1990, Taiwan has invested more in the emerging markets of Asia, that is, China and states within the Association of Southeast Asian Nations (ASEAN), than has the United States or even Japan. Like Taiwan, Korea is similarly driven by powerful nationalist passions, and so is China, which will not accept permanent subordination to Japan. Politicians in China who appear to submit to Japanese leadership are pilloried as traitors. A stronger China would lead Asia. China has experienced the world's most rapid growth since 1979 within a rapidly rising Asia, the most dynamic region of the world for a quarter of a century According to World Bank projections, by the year 2020 five of the seven largest economies in the world will be in Asia, with China number one. The message from China's reform leaders is that the world has nothing to fear. They portray China's rise as a normal event, similar to the prior rise of Britain, the United States or Japan. They hold to an optimistic, patriotic version of China's future. However, people who have been sobered by the eruption of division or chaos elsewhere in the post-communist world cannot help but notice that similarly dangerous dynamics are also prevalent in China. Why then should analysts accept a happy view of the Chinese future so contrary to developments in virtually every other Leninist state? Similar institutions, ideologies and interests call into question optimism for China. Should one, therefore, expect China to be defined by expansionist forces looking to take the island of Taiwan and by the mainland's slighting of the claims on oil and gas deposits in the South China Sea by other Asian nations? Indeed, expansionist nationalism is gaining strength in China. Should other nations respond with a policy of military containment, or with deep and broad mutually beneficial engagement, or with initiatives on behalf of anti-expansionist forces in Chinese politics? In order to make a wise choice, one must understand the nature of China's rise and the forces in China striving to direct that rise in the interests of passionate Chinese nationalism. …