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China is setting the example: will we jump, or must we be pushed?

March 1, 2011

The Guardian today reports “China to slow GDP growth in bid to curb emissions: China has set an annual growth target of 7% to ensure sustainable development during its new five-year plan.”

So it appears that China is setting an example to the rest of the world, recognising that the fabled ‘growth’ so beloved of free-marketeers, may in fact not only be unlikely, but unsustainable. Reading the article, I wondered how the world must look to the Chinese administration, and in particular how it views recent changes in the US administration and the backward looking, reactionary policies that the Republicans seem so keen to bring about.

Perhaps the most important difference between China and the US is that China is embracing change, while America is trying to resist it. It is our complacency they would do well to resist emulating, for in the west we have, until now, been very successful in many respects. One hopes that China can take the best of our examples, while rejecting the worst.

But they do have to sort out the monumental corruption and petty feudalism that seems endemic throughout this huge country. As the article points out, central diktat doesn’t necessarily induce regional compliance and previous attempts to slow growth have been thwarted by factionalism. China may need to ensure that provinces understand why business as usual is not a sustainable option, and that unrestrained growth is more problematic than the benefits accrued from it.

I also wonder if there is a more pragmatic reason to announce a reduced target. Between climate change and peak oil (with a bit of general instability in the ME thrown in for good measure), a hostile Republican administration hell-bent on doing the right thing only after they’ve tried everything else, severe water supply problems in China and elsewhere, and a sense that capitalism is suffering a terminal decline in potential, perhaps China sees that its export markets cannot be taken for granted.

As the Chinese poster Qingyou points out in the thread below the Guardian article, it is in China’s interest to develop the domestic market – over which it can exercise some control and induce some stability – rather than continue to count on the US and Europe as primary revenue sources. The more obstinate and foolish the US becomes, the less attractive it will be to China as a sustained source of income.

On the course that the US now seems bound to follow – dragging us with it through their wilful stupidity in respect of the environment – it also seems likely that China’s investment in US debt may be subject to volatility that the Chinese would obviously like to avoid. They may end up having to manage the US economy from a distance, given how much they’ve invested in it.

(Even as I’m writing this, I’m thinking “Christ, how many unknowns are there? How much uncertainty pervades pretty much every aspect of this issue?” That’s the real point, I think: between population growth, the environment, resource restrictions and distribution, and unrealistic ambitions for global market growth when in reality it is stalling and cannot be maintained, pretty much everything we have taken for granted, everything we’ve counted on for so long, all of it is becoming chaotic, unstable, untrustworthy).

The struggle is not to enact good plans, but to make any realistic plans at all. When I went into business many years back, it was routine for commercial operations to draw up five year business plans. These days, I think most board officers would laugh at such a prognosis, so unrealistic would it appear. We’ve sped everything up to the extent that society and the economy on which is is based has become so volatile, nobody can seriously make long term plans. If China is the exception, we need to understand why. If China is not an exception that proves the rule, the sooner they realise this, the better off we will all be. Someone has to lead, and I’d rather be shown the way by a realistic Chinese dictatorship than deceived yet again by a stupid, recalcitrant and venal bunch of bastards in Washington.

2 Comments leave one →
  1. Watching the Deniers permalink
    March 3, 2011 1:59 am

    ..while the US descends into “former” great power status.

  2. Graham Wayne permalink*
    March 3, 2011 7:18 am

    Watching the Deniers – after Iraq, and considering the growing militancy of the right wing, the most alarming prospect is what the US will be prepared to do in a vain attempt to maintain their pre-eminence. The bigger they are…

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