The Asian Century Is Over

Beset by conflicts, stagnating economies, and political troubles, the region no longer looks set to rule the world -- says Michael Auslin.  It is a most iconoclastic article but clearly makes some important points.

I am inclined to take a middle road on the matter.  Auslin is clearly right that cultural rigidities could hold China back and the failure of Japan to make much progress in the 21st century is a clear warning sign that Asian economies are far from miracle economies once they pass a certain point.  They approach an economic asymptote

The arrival of President Xi in China could well strangle China.  He represents the end of the Dengist era and a return to traditional Chinese authoritarian government.  He is getting close to becoming Emperor Xi.  My Sinophilic friends despair of him.  He is a definite roadblock to China's progress towards becoming a modern developed nation. And, sadly for China, there seems to be an iron law that an authoritarian nation will never be a rich one.  Even the DDR only ever approached midddle-income status, with its GDP per capita being only half the West German figure

ON THE OTHER HAND:  If Maoism ended, might not the same be true of Xi-ism?  How fragile is Xi's position?  He strives mightily to strengthen it but who knows how well he will last?  Could it be that the experience of prosperity and the taste of freedom might make enough forces in China bold enough to overthrow him in favour of a return to Dengism?

Though even Dengism had its limits.  Large State-owned businesses continued and were never very efficient.  And the party never looked even close to relinquishing control.  It could be that even Dengism cannot break the asymptote; it perhaps cannot support the final stages of modernization.

My take on China has been influenced by a positive "law" that is at least as strong as the negative law that authoritarian nations do not prosper economically.  I am referring to the stark correlation between national wealth and national average IQ.  And China has a VERY high national average IQ.  We always thought that once China threw off the dead weight of socialism it would prosper.  And exactly that happened up until recently. But is a high national IQ sufficient to rein in authoritarian rule?  The auguries are not good -- UNLESS China undergoes a significant FALL in living standards.  That would undoubtedly be energizing  -- JR.


The air forces of four of Asia’s leading powers nearly came to blows in the skies over the Sea of Japan, or East Sea, last week. As Russia and China conducted their first joint aerial patrol, South Korean fighters fired more than 300 warning shots at a Russian command and control aircraft that crossed into South Korea’s air defense identification zone. Meanwhile, Japanese fighters scrambled in case Japanese territory came under fire.

The unprecedented encounter was just one more reminder of the risks that threaten peace in the Indo-Pacific—and that the “Asian Century,” once heralded by writers such as Kishore Mahbubani and Martin Jacques, is ending far faster than anyone could have predicted. From a dramatically slowing Chinese economy to showdowns over democracy in Hong Kong and a new cold war between Japan and South Korea, the dynamism that was supposed to propel the region into a glorious future seems to be falling apart.

Asia’s geopolitical turbulence has been long in the making. In fact, the region’s weaknesses were for decades ignored by those certain that China would dominate the world, that the region would begin to manifest a shared sense of “Asian values,” that the United States’ influence was on the wane, and that the global future would be determined more in Beijing and New Delhi than in Washington. But underneath the region’s glittering new cities, the foundations of its rise were already beginning to crack.

Enter an earthquake. U.S. President Donald Trump’s trade war with Beijing, including 25 percent tariffs on nearly half of China’s exports to the United States, accelerated China’s economic decline. The country’s growth rate last quarter was the slowest in nearly three decades, since its economy took off in the early 1990s. Even if the 6.2 percent growth figure can be trusted, it reveals not only the effect of Trump’s trade actions but the general weakness of an economy in which meaningful reform has stalled and inefficiencies are as prevalent as ever.

Chinese exports to America have collapsed. Its exports to the rest of the world have shrunk, too. Meanwhile, dozens of major companies, from Google to Dell, are reducing or eliminating their production in China, exacerbating the slowdown and reshaping global supply chains. Worse for China’s economic future, perhaps, is a recent report that the country’s total debt, from corporations, households, and the government, now tops 300 percent of GDP—and much of it is caught up in opaque and complicated transactions that could become a ticking time bomb.

It isn’t only China that faces economic travails.It isn’t only China that faces economic travails. In developed nations, such as South Korea and Japan, sluggishness continues despite years of reform, while India’s once red-hot growth has halved in recent years, raising questions about how much further it can develop a middle class. Such fears are prevalent throughout Southeast Asia, as well.
Economics are just part of the problem. China’s ongoing attempts to squeeze Hong Kong and Taiwan’s democracies reveal just how tenuous political stability in the region really is. In Hong Kong, seven weeks of anti-China, pro-democracy protests are coming dangerously close to forcing Beijing to decide whether or not to intervene. If it deploys troops to restore order, it could lead to the bloodiest clashes since Tiananmen Square 30 years ago.

Even democracies in Asia are sailing in dangerous waters. Japan and South Korea are perilously close to a complete rupture in relations, thanks to Seoul’s continued pressing of World War II claims through its courts. Tokyo has responded by cutting the supply of chemicals critical for Korea’s electronics industry. In late 2018, Japan claimed that a South Korean naval vessel turned its fire-control radar on a Japanese patrol aircraft, nearly precipitating a military crisis. Meanwhile, Vietnam is facing off against China over oil exploration in the South China Sea, with maritime vessels shadowing and intimidating each other.

Conflicts in the region are also threatening security around the world. Despite three rounds of presidential summits, North Korea remains a nuclear-capable state that is also engaged in online offensives around the world. The global battle over civil liberties is also tilting toward greater state control, in part through China’s perfection of high-tech surveillance systems that it is keen to export, even to Western democracies. Many believe that Huawei, among other Chinese companies, is a security risk for any nation adopting its technology. And the FBI has warned that China is the greatest espionage threat to the United States, on campuses, in Washington, and in major corporations.

U.S. policymakers bet that China’s economic modernization and peaceful rise would lead to an era of global prosperity and cooperation. That was wrong.

U.S. policymakers bet that China’s economic modernization and peaceful rise would lead to an era of global prosperity and cooperation, linking advanced economies in Asia with consumers in the United States, Europe, and elsewhere. That was wrong. Similarly, years of attempts to bring U.S. allies Japan and South Korea closer together have foundered. It is time for a reconsideration of Asia’s future.

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