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July 04, 2005

Democratizing China in the Long Run

Greg Ip and Neil King have thoughts on Wilhelmine China:

Is China's Rapid Economic Development Good for U.S.?: By GREG IP and NEIL KING JR.: Chinese oil company Cnooc Ltd.'s takeover bid for Unocal Corp. has brought into sharp relief two opposing American views on China's rapid economic development. Many in Congress and the Pentagon think it may hasten an inevitable clash between the U.S. and China for economic and political leadership in the world. Many businessmen and academics, however, think China's growing wealth and international economic ties will make it more democratic and a force for global stability. Both have history on their side.

Brad DeLong, an economic historian at the University of California at Berkeley, sees a useful parallel in Britain's policy toward the emerging industrial colossus of the United States in the 19th century.... As late as the 1840s, he notes, the U.S. and Britain -- then the world's sole superpower -- came close to war over territorial disputes in the Pacific Northwest and the lucrative fur trade there. But in subsequent decades Britain chose to accommodate, rather than suppress, the U.S. By 1900, the notion of conflict was widely regarded "as silly, simply because the trade and economic connections were so tight and the political systems so compatible," Mr. DeLong said. Similarly, he argues the world will be safer if the Chinese in time see the U.S. as having aided, rather than hampered, their economic development.

History, though, also offers counterexamples. Germany was catching up to Britain at the same time as was the U.S. but that relationship ended in war. Similarly, Japan was more open to imports and foreign investment before World War II than after, yet its rapid industrialization, especially later under a nationalist military government, ultimately made it a more formidable adversary of the U.S. "There is no deterministic relation" between economic advance and war or peace, said Charles Maier, a Harvard University historian....

During the 1920s, Japan had low import tariffs and its democratic, civilian government encouraged domestic alliances with European and American companies to hasten Japan's technological catch-up, said Hideaki Miyajima, a Japanese economic historian at Waseda University in Tokyo and a visiting scholar at Harvard. General Motors Corp. and Ford Motor Co. operated Japan's only major automobile assembly plants. The heads of Japan's "zaibatsu" -- urban industrial conglomerates -- were pro-Western. Many sent their children to U.S. universities. But these pro-Western elites were too weak to resist the forces of militarism and imperial expansion.... In 1932, military-backed right-wing nationalists assassinated both Japan's prime minister and one of its leading business figures, Takuma Dan, the Massachusetts Institute of Technology-educated manager of the Mitsui Group zaibatsu. In 1936-37, the military completed its takeover....

Germany's rivalry with Britain is similarly complex.... Britain's old-line industrial elites saw Germany as a threat, while its emerging financial elites saw it as an opportunity. Within Germany, Ruhr-based heavy industry favored the army buildup and were more willing to risk conflict with Britain, while Hamburg-based trading interests were more pro-British, though supportive of the German fleet buildup....

The most important point, however, is that both Germany's and Japan's decisions to go to war were catastrophic mistakes. They lost. Moreover, Norman Angell was right: the decision to risk war was overwhelmingly stupid. They would still have been catastrophic decisions even had Germany or Japan won: nothing Germany could have gained from victory in World War I or Japan from victory in World War II would have been worth the suffering.


Later on in the article, Thomas Barnett tells something interesting:

The widely differing views of China were vividly evident in 2001 when military and Wall Street officials came together at the World Trade Center in New York to share thoughts on the impact of China's economic and military rise. The organizer, Thomas Barnett, then a teacher at the U.S. Naval War College, hoped to bring the two constituencies closer together. Instead, their opposing views were reinforced. Mr. Barnett, now a writer and consultant, says the Wall Street participants concluded, "'When I think of the security issues I realize how a strategic partnership with China is all the more imperative,' and the military guys would say, 'Wow, realizing all the economic competition, war with China is that much more inevitable.'"...

Posted by DeLong at July 4, 2005 01:58 PM