Monday, 28 November 2016

With the US Presidential Election Over, The Early Official Returns From Beijing Finally Come In

After weeks of international observers speculating about the impact on China of the election of Donald Trump as the next American president, the Communist party’s flagship (and authoritative) newspaper People’s Daily has begun to weigh in on what it means— for the future of the United States, perhaps for Sino-American relations.

The delay in publishing an official reaction is interesting in itself, indicating that consensus on Trump’s victory is proving difficult to achieve in China’s leadership circles. Contrary to the views of many analysts outside China, there’s no preferred view visible yet here, certainly no conclusion reached by China’s leaders about how relations between Beijing and Washington will be impacted. 

Outside China, there are understandable anxieties about how the election of Donald Trump will play out to be sure; but many of the deductions aren’t so much suppositions as projections--people dismayed by the outcome of the American election and thinking that Beijing will surely take advantage of results that the writers themselves find repugnant. Inside China, matters are more complicated--far more complex than many international observers are rendering them.

What’s important where People’s Daily is concerned is that it has an exhaustive vetting process where writers are concerned, seeking out officials and official scholars whose views that can best reflect leadership thinking and unresolved debates. That’s because Chinese commentators remain reluctant to write much that hasn't been approved or at least sponsored by certain authorities. It’s silly to think that President Xi Jinping is overseeing such publications personally, because that’s not how the Chinese political system operates; bureaus and departments, retired officials and various scholars—each and all will seek to have their views aired in print or online instead of simply privately, and they find support far lower in China’s political food chain. But it’s not foolish to assume that the dearth of official essays up to this point about what Trump’s election means for China indicates that there’s simply been no strong consensus about that event’s implications for Beijing’s policy towards the United States.

And it’s that situation which may be shifting with the publication of 4 essays this past Sunday in People’s Daily.

2 scholars and 2 commentators wrote the essays. There’s nothing explicit connecting the authors to any particular part of the Communist party, and so it’s likely that their musings are indicative of what has been agreed on (perhaps just for the moment) before a more authoritative message is fashioned under a more recognizable pseudonym that would indicate unified thinking in the Chinese leadership.

There are some striking commonalities across these commentaries.

First, the authors see the United States as becoming more divided as a society, as a more elitist culture was taking shape, wealth was becoming a more prominent value, and the income gap was becoming sharper. Ye Xicheng of Peking University writes that “from the 1950s and into the '90s, the middle class [in the US] enjoyed the dividends of development...But after the 1990s, this process has changed, a small number of income groups are getting richer…The assets of the middle class have not grown and have fallen sharply over the past two decades.” “Two Americas” have been created, according to Ma Feng, an academician at the Chinese Academy of Social Science--“the elites” and everyone else.[1]

Because they’re good Marxists, the authors of all of these essays see the economic forces of capitalism producing social disunity leading to a distrust of change managed from above. For example, the “insistence on a single and narrow view of the liberal market economy,” as Peng Xiaoyu frames it, aims at wealth rather than equality, and ends up undermining “spiritual support” for the US political system as a whole, as well as socialism as an alternative program. Americans, in this view, had nowhere to turn except to take a chance on Trump.

The result of this economic disparity is cynicism that is, in the view of the various authors’, producing a crisis in governance in the United States. Ye argues that while “America's governance capacity almost peaked in the 1990s…since then, the United States has been making mistakes and losing many good opportunities for development.” Those errors are, at least according to Ye, the result of poor leadership, declining talent in the civil service, and ineffective mechanisms by which to govern what’s become a more complex (i.e., diverse and declining) country. Other authors in this collection echo this assessment, with a co-authored piece by Guo Shuyong and Cheng Yawen insisting that “as the mechanism of wealth creation is weakening, the political operation [of the United States and other similar systems] will inevitably be affected”—that is, Western democracies as a whole are slipping and their economic problems are hampering the capacity of their governments to actually govern.

None of the authors here can resist hitting out at what they see as the decline of American power overseas. For example, Ye contends that Washington has wasted precious resources playing the hegemon unsuccessfully in Iraq, Syria and elsewhere, while Ma writes that Trump’s victory is another example of “radical political ideas and behavior winning social support”, in part because positive views of the United States abroad have largely evaporated. Democracy—or at least its Western version—may not be dead, but according to these Chinese commentators and their colleagues intoning on the pages of People’s Daily, it’s clearly dying.

Taken as a whole, these essays don’t provide much evidence of an abrupt shift forthcoming in Beijing’s approach to Washington. Indeed, the eulogy being sung here for United States is the same disharmony we’ve heard chanted about before: that America (where more than a few Chinese officials send their children to study and live, and purchase property) is chaotic, drifting, corrupt, and in decline. For many of China’s official commentaries, these have been the traditional lyrics for some time—and Donald Trump’s election is simply another sign that the United States is finding the wrong rhythm all by by itself. So if the views expressed in these essays turn out to be mainstream thinking in the Chinese leadership, the status quo in Sino-American relations may yet remain so for some time.

[1] This isn’t the first or only moment in these essays when comments and critiques by the authors about the United States could be easily mistaken for (or are used to mask) concerns about China itself.

Wednesday, 23 November 2016

Making America And China Wait Again

United States president-elect Donald Trump is destroying American power in Asia, and China is quickly moving in to take advantage. Whether it’s trade agreements that will be cancelled or climate change accords that will be challenged. The running narrative is that Beijing is already or will soon be the main beneficiary of the just-concluded US election.

If only matters in China were so simple. But they’re not.

To start with, making foreign policy of any sort in China is never easy. Whether it be bilateral economic agreements or arms sales, multiparty treaties or memorandums of understanding, Chinese officials understand what all too many analysts abroad seem to neglect: China is one huge bureaucracy where good ideas often go to die.

There are statements, slogans, admonitions, promises, warnings—and these are all important indicators of what the political consensus is in Beijing at a given moment. But for all of China’s purported economic progress in extending its financial and infrastructure reach overseas, getting foreign policy actually made remains glacially slow at best.

There are a few reasons for that sluggishness.

One is that there’s a divide in China between institutions and bureaus about who’s responsible for making foreign policy. Privately, Chinese officials sputter about the lack of cooperation and coordination—even communication—between departments and agencies in the central government here. Chinese scholars who have a say in advising on policy initiatives scoff at the idea that Beijing has a global strategy.

Even under Chinese president Xi Jinping as The Great Centralizer where policymaking is concerned, there’s been little more than the “China Dream” as a catch-all phrase for what Beijing is supposed to be aiming at overseas. Xi’s overseas visits always get high-profile media coverage (as is currently the case) and perhaps deservedly so for domestic reasons at least. But even much of that coverage remains confined to smiles-styles-and-profiles, with a decided absence of unified policy substance that would enable analysts and advisers alike here and abroad to state with certainty what Chinese foreign policy actually represents. National security for the realm only, or a more robust mission abroad? Extension of territory to encompass various South China Sea island chains? “One Belt, One Road”? Confrontation with independence forces in Taiwan and (possibly) Hong Kong, without regard for regional backlash? All of the above, or just some—and if so, which ones? Beijing can bluster all it wants, condemning purported foes and foreign forces at its daily press conferences; more than a few Chinese officials understand that they need to be careful about trying to punch above their weight, that some of their challenges might just be the byproduct of their own overreaching.

Then there’s the military here—which is anything but a monolithic institution in China to start with, and whose doctrine, operations and command structure are being remade. The older generation of officers was largely rich and fairly happy, until Xi came along and started smashing their rice bowls. Some aren’t displeased with his anticorruption drive but worry about what sort of power China should be. The younger cohort that’s started to make its mark—and largely see Xi as their savior—isn’t nearly so quiescent and have demanded (and received) a set of seats at the foreign policymaking table. Military policy is under review and is the result of many voices. The impact of the armed forces on China’s foreign policy isn’t any different. What mileage the military will have in making diplomacy will vary.

Another factor to consider are local governments here in China, which have been playing a more active role in foreign policy for some time. Many provinces have been quick to conclude memorandums of agreement with their overseas counterparts (especially on investment and the environment) and then negotiate with Beijing about details after much of the deal is in place. Chinese Foreign Ministry officials complain about that tendency but admit that a growing number of policies are made locally and only authorized by Beijing afterwards. (Those same officials acknowledge that China doesn’t have an overarching strategy, but a set of disparate foreign policies, which rarely cohere, aren’t always coherent, and didn’t emerge in a coordinated fashion anyway.) There will be provinces that see the disappearance of the policies of the Obama administration to be a terrible thing, and a Trump presidency nothing to look forward to. 

And yet every time Trump speaks and Washington stumbles, we’re told by some commentators that it’s Beijing who benefits—apparently because Chinese leaders know what they’re doing, even if the American electorate didn’t. But there’s precious little evidence to suggest that the Chinese leadership sees matters that way, or that there’s even a consensus that Trump’s election is going to help China’s interests at home and abroad. If there’s a sense of triumphalism in Beijing, then the State-directed media in China isn’t showing much sign of that to the officials and citizens it’s designed to communicate with. It should be. The fact that we don’t have a major editorial or commentary about the impact of the US presidential election now 2 weeks after its conclusion is telling: Chinese leaders are still wondering what it all means for China. How do you take advantage when you don’t even know there is an advantage?

It’s entirely possible that the sort of foreign policy that ends up emerging from a Trump administration will end up doing enormous damage to Sino-American ties, regional and strategic security architecture, and the image of the United States overseas. But these are early days, and given the nature of Chinese foreign policymaking, uncertainty and indecisiveness might combine to allow both countries time to figure out for the first time in a while just what they want from each other and how to achieve it. That would be a good thing. Until then, some calm contemplation—and a moratorium on quick conclusions--is probably called for.

Saturday, 12 November 2016

China Doesn't Know What To Think About Donald Trump

There’s a rather large problem with the notion that China is the main beneficiary of the just-concluded America presidential election.

There’s no evidence thus far that the Chinese leadership thinks so.

Indeed, just as the results of Donald Trump’s stunning victory are still being digested and debated in the United States, something of the same sort of searching about seems to be occurring here in China. While President Xi Jinping made the obligatory phone call to his soon-to-be counterpart in Washington, he’s made no public speeches or statements about the American election. China’s Foreign Ministry spokesman had a boilerplate response to the results the day that those became official. Neither reaction is surprising, but they’re revealing.

Meanwhile, Chinese state media is currently all over the place when it comes to the choice made by the American electorate. Television news broadcasts here have focused primarily on what they see as the chaotic and corrupt process by which leaders are elected in the United States, as well as accounts about various protests in the aftermath of Trump’s victory. Otherwise, there’s reluctance to adopt a particular line. In one instance, a noted American expert on US-China relations was interviewed about the impact of the presidential elections on ties between Beijing and Washington, but only his comments about why Trump was elected were run for broadcast. If the Chinese leadership had made any hard and fast conclusions, there would have been a different result in that editing.

Social media has been lit up by various posts, to be sure, but that’s to be expected; Chinese citizen cyberspace is active and interesting anyway, though it almost always reflects individual views rather than speaking for Chinese officials. And Chinese society is far too diverse to have personal comments to be seen as somehow representative of the nation as a whole—an error all too often made by some analysts outside China who pull and pick at various postings that support preconceptions about “what Chinese think”. Interviews with local residents reveal that there may well be distinct notions in urban areas here about what Trump’s election actually means for China, as opposed to those who haven’t been all that attentive. 

Most importantly—and most revealingly--State media has been cautious, careful and largely quiet. Communist party newspapers, which always reveal and reflect debates and deliberations about major issues, haven’t taken on Trump’s election with any consistency, preferring to largely run carefully selected reports from international media. Those outtakes might reflect an emerging view out of Beijing, but we’ll only know that in hindsight.

There’s a lot of useful analysis out there, to be sure (an excellent list of links has been compiled here). It’s good that some international commentators have talked about what Trump’s election might mean for relations and the region. It’s certainly crucial to consider scenarios about Beijing’s reactions. And a few analysts are rightly concerned about the implications of Trump’s ascension to the American presidency where trade and economic challenges are concerned.

But its nonetheless a bit baffling as to why far too many others have jumped to conclusions about what Xi, his comrades and his advisers, see as the implications of the American presidential election for Sino-American relations—especially why they would be gleeful. How can these commentaries possibly know such information, given the closed nature of China’s political system? What sources do they have? Where are their references to Chinese media--that is where such views are usually found? How is that many of those writing about Chinese views are themselves based outside of China, and don’t have access to even the Chinese street here to make such determinations, never mind Chinese officials? Who speaks for “China” anyway?

What’s likely happening here is the all-too-usual projection of preconceptions about what China’s leaders and Chinese citizens should think into conclusions about what China’s leaders and Chinese citizens actually do believe. Just as we’ve seen analysts assuming that Beijing is fully behind far-reaching financial reforms when the party media hardly ever refers to anything of the kind, the same sort of tendency for others to speak for China seems to be happening here. That isn’t happenstance; it’s hubris. One would have hoped that the recent American presidential election would have caused some pause and ponder before they spoke about what people really think. Apparently at least where China and especially the Chinese leadership are concerned, that was too much to hope for.

Monday, 7 November 2016

The Exit of China's Finance Minister Won't Leave Everyone Gloomy

The sudden transfer of Lou Jiwei from his position as China’s Finance Minister to overseer of the country’s pension system comes as a complete surprise to many commentators—or it should be. It might well have been a shock to Lou himself, given that he’s only just approaching the semi-official retirement age of 65 (and current Central Bank governor Zhou Xiaochuan is already past that point) and he’s currently part of Premier Li Keqiang’s high-level trade and finance delegation to Europe. In fact, the front page of Monday’s edition of People’s Daily has Lou sitting behind Li, and the paper spends a lot of space on the various economic agreements signed between Beijing and various East European countries during this trip. Lou wasn’t airbrushed but he was certainly given an abrupt brushoff.

There are those analysts who will no doubt insist that Lou’s removal is part of Xi consolidating his power—apparently a never-ending process because that’s what they tell us that Xi’s been doing whenever some high-level minister or provincial officials gets shunted aside. One can only wonder what Xi does, according to this school of thinking, when he’s not strengthening his political position or engaging in power struggles in the run-up to the 19th Party Congress. Perhaps trying to run China’s Communist party? Perchance even endeavouring to govern the country?

Of course it’s possible that Lou asked to be replaced, and went on the previously scheduled high-level trip so as not to roil China’s markets, or its relations with its East European partners. Perhaps it’s simply a matter of health, overwork and strain for him. Maybe Lou jumped instead of being pushed.

Maybe. Maybe.

No one outside elite political circles can know for sure at this moment precisely what happened and why Lou was relieved of his portfolio—at the beginning of the week, not the end after markets are largely closed. What is known is that there has been more than a fair amount of tension between provincial and lower-level officials and Beijing about just how the former is supposed to generate local growth in a period of economic sluggishness. Property prices go up, land revenue increases--and Beijing reaches in to slap-down local governments for creating a real estate bubble. Provincial officials have been told for months to make the restructuring of local debt their policy priority—and suddenly the Ministry of Finance that Lou was then running announces that the central government would not be liable for debts incurred by special financing vehicles set up by local authorities to do just that.

None of that created a lot of goodwill between Beijing and its local brethren.

Nor was Lou helped by Premier Li’s agenda--streamlining administration, investing in innovation instead of infrastructure, and reforming China’s financial and fiscal sector. That strategy is popular among China’s technocrats and scholars (and consequently the international visitors who swing by the country to seek the odd insight by speaking only with them and the expat crowd) and probably makes good sense for China in the long-term. But that approach wins no plaudits from local politicians here, who deal with the daily, and dislike being told how to run their backyard—especially when what they say they see from Beijing are instructions to focus on the economy one week, and are then told to emphasize ideology the following one—and perhaps the one after that. Some local officials, especially in major cities, were already relieved that Xi was designated “core”, because they wanted some consistency and clarity from the capitol about what they’re supposed to be doing. 

Financial managers and stock traders may be shaken by Lou’s departure, but many China’s lower-level officials will sleep well this evening knowing that Lou Jiwei won’t be around to curtail them.