China: The Superpower

4/1/2012

Overview

The world has changed. There is no denying the prominent role of China in the world today. They are a formidable military presence. Their economy is projected to exceed that of the U.S. within five years. Their political influence reaches every part of the Globe. And nearly 20% of the world lives there. Join Active Minds as we seek to understand a shifting world order and what it means for the United States.

Key Lecture Points

  • In the past 10 years, China has been the fastest growing economy in the world. It is the second largest economy in the world and the fastest modernizing military power. In 2011, China’s GDP grew at a rate of 9.5% as compared to the US at 1.5%.
  • China’s rise, while alarming to many in the US, is not a surprise. Its history stretches over thousands of years with periods of isolation followed by expansion. China has used its population of 1.3 billion people and workforce of over 800 million as a lever to encourage outside companies (including but not limited to American ones) to invest and employ in its burgeoning industrial cities.
  • China’s rise has prompted concern in America on a number of economic issues. The loss of US jobs in the industrial sector has in part been a result of outsourcing to China. The US’ growing trade deficit is largely associated with the flood of inexpensive imports from China (and the US consumer appetite for them). For years, US manufacturers and labor leaders have accused the Chinese central bank of manipulating the Chinese currency, the yuan or RMB, as a means to keep Chinese goods cheaper. In the recent past, concerns with China’s censorship of the Internet and its policy of “indigenous innovation” which targets higher level intellectual property have been added to the list of concerns about the price of doing business in and with China.
  • China’s rapid economic growth has not been without its domestic problems: disparity between rural and urban incomes; environmental damage; and unrest over labor conditions are all issues that the Chinese government faces on its domestic front.
  • China’s continued impressive growth depends on a transition to increased domestic consumption. This strategy is dependent on higher wages for factory workers and the growth of the Chinese middle class. Increased Chinese domestic consumption is also the US’ strategy for economic growth, underlying the mutual dependence of the two countries.
  • China continues its two-decade military buildup with double-digit increases (11.2%) in its 2012-13 budget for defense spending. Vital elements include new nuclear submarines and modern surface vessels armed with supersonic anti-ship missiles, a new J-20 stealth fighter and China’s first aircraft carrier, along with burgeoning cyber-warfare programs and space capabilities.
  • China’s is expanding its global geo-political role as it strengthens its networked position in supra-national institutions (IMF, World Bank, WTO, WHO). Terms such as “post-American world”, “Asian century” and “multi-polar world order” are gaining ground and indicate shifts of global politics. From Asia to Africa, even in some parts of Europe and Latin America, China is becoming the largest trading partner of many countries, including several regional powers. China is also viewed by developing countries in Africa and Latin America as a potential model for their own development from agricultural to modern economies.
  • China’s leadership will change in 2013 when Xi Jinping is expected to become president. After years of intensifying economic and military rivalry, the US hopes this change in leadership will be an opportunity for an improvement in relations between the two countries.

Exploration Questions

  • What are the major political and trade issues in the US/China relationship?
  • What are the major socio-economic issues China will have to address to continue its high growth rate?

Reflective Questions

  • Do you think China can continue to sustain high levels of economic growth? Why? Why not?
  • Name the consumer goods you purchased in the last 30 days that were made in China. Are you surprised at the number?

More to Explore

Books For Further Reading

  • Karabell, Zachary. Superfusion: How China and America Became One Economy and Why the World’s Prosperity Depends on It. Simon & Schuster. 2009. 352 pages. Karabell argues that the US and Chinese economies have fused to become one integrated system. He suggests that how China and the US manage their relationship will determine if the world will have continued prosperity or increased instability.
    Click here to order
  • Menzies, Gavin. 1421: The Year China Discovered America. William Morrow Paperbacks. 2008. 672 pages. The author tells the story of a Chinese fleet that sailed to America 70 years before Columbus.
    Click here to order
  • Biderman, Stan and Kathryn Minette. Bullet Trains to Yaks: Glimpses into Art, Politics, and Culture in China and Tibet. Irony Press, 2011. 144 pages. This travel narrative highlights Chinese art, food and culture.
    Click here to order