by Frank Li
This is the eighth article of the series: “Towards An Ideal Form of Government”.
In my 3/2/2012 post (America: What is China, Anyway?), I stated:
“For the top-10 American misconceptions about China, wait for my article next week.”
Here is that article! You will have a better understanding if you read the following three articles as a lead-in:
Misconception 1: China is a communist country
China is no longer a communist country! China was a communist country from 1949 to 1976. China embraced capitalism after Mao died in 1976. Forging her own way of success, China is now poised to become the largest economy on earth by 2030.
The political system in China is a one-party system. The ruling party is called the CPC (Communist Party of China). This inconvenient name has given the American media-political complex a good excuse to keep calling China a communist country whenever it sees necessary. That is, however, a disservice to America, because it’s misleading and it’s brainwashing! For a good understanding of today’s CPC, read this. Here are three excerpts:
(1) The party was established in 1921 in the name of people like him [a peddler]. But today it is widely seen as representing the entrenched interests of the wealthy elite – the kind of people who spend more on a single meal in Xintiandi than a peddler would make in an entire year.
(2) With more than 80 million members, it is the world’s largest political organization. In spite of its insistence that it remains true to its Marxist-Leninist, Maoist heritage, though, it is perhaps better described as the world’s largest chamber of commerce.
(3) The first sentence of the manifesto of the CPC states that the party “is the vanguard of the Chinese working class”. Yet today, fewer than 9% of its members are classified as “workers” while more than 70% are recruited from the ranks of government officials, businessmen, professionals, college graduates and military.
To make it easiest to understand for my fellow Americans, let me give you two simple analogies:
(1) Yesterday’s CPC (1949-1976): Consider it to be the Democratic Party in America today, with the most extreme left part only. Hell?
(2) Today’s CPC: Equate it to the Republican Party in America today, without the most extreme right part (i.e. neo-cons). Heaven?
Bottom line: Do not be fooled by the word “communist” in CPC!
Misconception 2: China is a threat to America
Economically, China is a competitor, not an enemy, to America. The use of the word “threat” is malicious and un-American!
Militarily, China has never been a threat to America! China’s military budget in 2011 was $91B, while America’s military budget in 2010 was $664B! China did increase its military spending in 2012 by 11%, which has been characterized by the U.S. media as a “ballooning military budget”. Where else on earth could this kind of talk and the misconception have been possible other than in America? All thanks to brainwashing in America!
Today, America’s military spending is bigger than the next 16 biggest spending countries combined! Why is it so big? Because of that, America has been, since the Cold War ended in 1989, a major source of instability around the world, especially in the Middle East. Yes, Ron Paul has got this one right (Ron Paul on 9/11: Ask the right questions and face the truth)!
Misconception 3: China steals America’s jobs
Capitalism is global by definition, from the resources (e.g. oil) to the markets (e.g. Buick is the most popular American car in China)! Two facts:
(1) Over the past two decades, America lost more jobs to automation than to outsourcing.
(2) The primary reason behind America’s outsourcing is that America’s cost structure is too high. The jobs that America “lost to China” would have gone to other places, such as the other emerging economies (i.e. India, Brazil, Russia, and South Africa), had China not developed over the past three decades!
Bottom line: America, do we still know what capitalism is. If yes, do we still want it?
Misconception 4: China trades unfairly with America
Free trades are fair trades!
The simple fact is America has trade deficits with more than 90 countries. Are we going to argue with each and every one of them about “fairness”? Or, simply face the truth: Our cost structure is way too high!
Misconception 5: China is a currency manipulator
Every country has the right to defend its own currency for its best interests! Here is the latest example: Brazil declared new ‘currency war’ against the U.S. and Europe.
Now, will further appreciation of RMB reduce the U.S. trade deficit with China in a meaningful way? Impossibly unlikely! Here are two sets of hard data, showing that “America’s manipulation” of the exchange rate has worked with neither Japan nor China:
Bottom line: The only way to increase global competitiveness is through innovation (e.g. Apple) and hard work (e.g. lowering the cost structure), not the repeated use of steroids (i.e. stimulus packages like QE1 and QE2). Oh, by the way, QE1 and QE2 are also known as “printing money”, which is the worst form of currency manipulation, by any definition!
Misconception 6: China steals America’s IP (Intellectual Property)
Many countries have succeeded by copying first and then using their success for innovation! This applies to America 200 years ago as well as to China today!
No doubt, the laws must be obeyed. Having said that, I would like to seek an “understanding” (not to defend IP theft) as follows: China invented, among many things, papermaking and gunpowder. What if the Chinese, 2,000 years ago, had set up a patent system that required that each and every one of us pay, for 5,000 years, the Chinese 1% of the price for each and every piece of paper we use and each and every bullet we shoot?
Another perspective: Japan “copied” a lot from China for thousands of years, from the language to the culture. I knew that before landing in Japan in 1982. However, it was not until I started writing my first academic paper in English that I realized the depth of the “copy culture” in Japan: as I was struggling with English (and Japanese), my Japanese professor advised me to “借文”, which literally means “to copy text in the name of borrowing”. “借文” are two Chinese characters in Japanese, but they are not Chinese!
Case in point? “Copy” is how human civilization works! People look up to the leaders by “copying” them. Copy is an essential part of learning!
Misconception 7: The Chinese are not free
Today’s China is much freer than yesterday’s China! So China is moving in the right direction. Remember: China was communism from 1949 to 1976. So China has come a long way to part from the communist past, and will only get better from now on. With more prosperity comes more freedom, and vice versa.
Money is not everything. But having money is often a good thing, thanks to capitalism! With money, you can buy not only candies, bus also freedoms! The Chinese understand it very well.
On the other hand, America will lose more freedoms, as its economy falters more. Here is a quote from Abraham Lincoln:
“America will never be destroyed from the outside. If we falter and lose our freedoms, it will be because we destroyed ourselves.”
Case in point? Prosperity is, generally speaking, proportional to freedom, and vice versa! The key is to strike a balance between the two, country by country, people by people.
Misconception 8: China has problems with human rights
The West must not apply the same standards to the East and vice versa! Here are two excerpts from my two previous writings:
(1) What is America, Anyway?: If you are an idealist (e.g. a true human rights activist or a real democracy proponent) and if you are an American, you must denounce your American citizenship first before passionately pursuing your cause. Why? Because America, as a country, is totally illegitimate - America was built on occupied land appropriated from its rightful owners, the American Indians.
(2) America: What is China, Anyway?: Both (i.e. not blindly embracing democracy and the one-child policy) were highly controversial, not only at home, but also in the West. However, they proved to be the right things to do for China at the time for one simple reason: survival! Any doubt? Recall this: All 33 Chilean miners rescued after 69 days. The miners were ready to eat the dead for their own survival right before the rescue team reached them! It’s human nature to survive by any means, idealistic human rights notwithstanding!
Bottom line: Given America’s declining status, we Americans no longer have any right to lecture the Chinese on anything! Culturally, they have a far longer history than we do. Economically, we owe them money, a lot of it!
Aside from minding our own business, read: 10 Lessons the U.S. Can Learn from China.
Misconception 9: China has issues with Taiwan and Tibet
Neither Taiwan nor Tibet is as big an issue today (i.e. China is prosperous) as they were 30 years ago (i.e. China was dirt poor). They will become non-issues within 20 years (i.e. China will be more prosperous). Meanwhile, no American intervention, no problem!
Misconception 10: The Chinese can’t play basketball
Jeremy Lin is real! Although Jeremy was born in America and his parents came to America from Taiwan, I am sure he enjoys his enormous popularity in China, whose market is 1,000 times bigger than Taiwan’s! I can guarantee you that Jeremy will have a mega endorsement deal from China before the 2012-2013 season starts!
Making money and being rich may no longer be fashionable in America, but they are still great in China! Should America sue China for copying capitalism from us?
About the Author
Frank Li is the Founder and President of W.E.I. (West-East International), a Chicago-based import & export company. Frank received his B.E. from Zhejiang University (China) in 1982, M.E. from the University of Tokyo in 1985, and Ph.D. from Vanderbilt University in 1988, all in Electrical Engineering. He worked for several companies until 2004, when he founded his own company W.E.I. Today, W.E.I. is a leader in the weighing industry not only in products & services, but also in thought and action.