Guest Columnist
John Richard Schrock
Understanding China Today
To understand another culture and describe it correctly in another language, requires an author who grew up as a child speaking both languages and living in both cultures. Pearl Buck grew up in China with missionary parents, attending school and playing with Chinese classmates. When her books were made into U.S. movies, Western Chinese exited the theaters stating that Pearl Buck really understood them.
Today, Keyu Jin provides the clearest and most-modern accurate description of modern China’s political and economic system in her book “The New China Playbook” published by Viking Press in 2023. Born and raised in Beijing, she earned her BA, MA and PhD from Harvard University and now works as associate professor of economics at the London School of Economics and Political Science.
Her book is well-written and laden with data that speak clearly to a Western reader. We have U.S. Legislators serving on anti-Communist Party committees that conjure up a modern China of suppression and life-control, but it is not Mao’s China anymore. Deng Xiaoping brought an end to communes and China today has witnessed the greatest rise out of poverty in world history.
Jin describes a modern China where the private sector “accounts for more than 60 percent of national output, 70 percent of the nation’s wealth, and 80 percent of urban employment,” the reverse from 30 years ago.
Unlike vicious American capitalism, Jin describes Chinese values that place family and business relationships above personal self-interest. The World Values Survey shows 93 percent of Chinese value security over freedom, while only 28 percent of Americans do.
In 2001, China became a member of the World Trade Organization (WTO) and China’s real GDP per capita has nearly doubled. From 1978 to 2005, 400 million Chinese moved from low to high productivity jobs and farming dropped from a 70 to 30 percent share of labor.
But when it comes to world trade and tariffs, the U.S. is now the outlaw violating WTO policies. “Since 2001, there have been forty-seven WTO complaints lodged against China, but more than twice that number against the U.S. in the same period. And only two out of the forty-seven saw a second filing, indicating noncompliance, compared to fifteen ignored by the U.S.”
The U.S. continues to assert that China advances due to “forced technology transfer” and stealing of Western intellectual property (IP). Jin documents how this is no longer the case, and this is well-supported by China exceeding the U.S. in international patents. This is especially true of EV’s, hybrid vehicles, solar panels, etc. where China’s technology is now the cutting edge. “Tesla has opted to use the cobalt-free battery produced by the innovate Chinese company CATL.”
But Xi Jinping has curtailed kickbacks and bribery of officials. Jin describes how “Some 2.3 million officials at various levels have been punished for violating party rules or state laws.” She documents how the “government has set in place a system of substantial penalties, implemented by IP protection centers around the country, and is working on changing the culture around ideas, beginning in primary school. China has also been building a comprehensive legal framework that promises to be the fastest in the world to investigate and handle IP violations.”
This book provides data on Chinese students returning to China, indicating how “living in America, Europe, or Australia is no longer the object of every young Chinese person’s desire. Now the dreams that those places once represented can be realized in China. The concept of “common prosperity” is a genuine goal and most Chinese recognize how disproportionate wealth prevents social harmony. It is no longer enough that a company contributes to the economy, but Chinese firms must be “lawful, reasonable, and empathetic” to the people—properties that the U.S. system cannot control nor even promote.
American manufacturing was in decline long before China was up and running. The U.S. decline began in 1979 when we outsourced labor to Mexico and Japan. Some U.S. factories also adopted robotics and other labor-saving technology. And “European governments did a much better job of retraining their workers and finding them new jobs.” Today, modern Chinese imports provide Americans with more affordable and high-quality clothes, furniture, etc. If trade were shut off, it would be the poorest Americans who would suffer the most.