A quarterly magazine of urban affairs, published by the Manhattan Institute, edited by Brian C. Anderson.
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An Asian Century? Not So Fast
The first global century is more like it.
22 January 2010
Pundits are proclaiming the beginning of an Asian century. Many think that the next G20 meeting, which will take place in Seoul this autumn, represents a transfer of power from West to East, a decline of Western influence, and a geopolitical tectonic shift. Such a hyperbolic vision of history seems justified, at least on the surface, by a series of recent events. China, for instance, is said to have surpassed Germanys exports and should thus be considered the leading global economic power. Actually, the statistic is irrelevant, because it considers as exports products that are merely assembled in China: the imports that make possible the assemblyand eventual exportingshould be deducted from the measure. Other observers have pointed to the South Korean company Korean Electric, which recently outbid Électricité de France to build three nuclear reactors in Abu Dhabi. Like the Chinese exports, though, this success should not be overstated. The South Koreans will build and manage American-made reactors, using technology from . . . Westinghouse.
Recent Asian breakthroughs do make for a contrast with the pervasive gloom in the West, where the economic crisis is far from over. Governments in the U.S. and Europe seem unable to understand why huge public expenses have failed to stimulate their economies. Neither the Obama administration nor the Nicolas Sarkozy and Gordon Brown governments grasp the fact that public spending and welfare statism may have broken the backs of would-be entrepreneurs. Asian governments didnt make the same mistake. South Korea, for example, has simultaneously helped its poor and deregulated its labor market. Asia has used the crisis to reinforce free-market mechanisms.
But proclaiming the end of the West and the advent of the Asian century would be premature, to say the least. First, what do we mean by Asia? Perhaps South Korea, Japan, Vietnam, and the Eastern China seaboard share some common cultural characteristics. Central and Western China, however, remain mired in the medieval era; Indonesia belongs to an entirely different world; India, too, is wholly different from the rest of Asia. Asia knows no political unity: parts of it are democratic, other parts ruled by despots. There is no Asian economic system as such: Chinas state-run capitalism doesnt belong to the same category as Japanese and Korean private capitalism. India remains by and large an agricultural economy, dotted with an emerging small-business dynamism. Asia has no decision center, no coordinating institutions like NATO and the European Union.
For all its problems, moreover, the West is relatively at peace with itself; Asia is not. The continent is riddled with active conflicts around Pakistan and potential ones all around the China Sea. What guarantees border stability and open communication in Asia is NATO to the West and the Seventh American Fleet in the Pacific Ocean. If the U.S. Army and Navy were to leave, war would threaten the continent; at the very least, trade would suffer heavy disruptions. Asian economic dynamism would not survive the departure of the global cop. Its hard to believe in an Asian century when Asian security depends on non-Asian security forces.
Another of Asias weaknesses has to do with its poor record on innovation. Chinese exports contain little added value beyond cheap manpower. China sells sophisticated objects like smartphones to the rest of the world, but these devices are invented in the West. Though Japan and South Korea are much more creative than China, they, too, mostly improve products and services initially conceived in the West. Asias lagging innovation is probably rooted in its brand of rote education: when they have the opportunity, Asian students flock to North American and European colleges. And the brain drain doesnt run the other way: 80 percent of Chinese students in the United States never return to China.
Asias undoubted progress happens to be related to its conversion to Western values. Capitalism, democracy, individualism, equality of the sexes, and secularism are all Western notions, and theyve been adopted in varying degrees in Asia. Reactions against Westernization have also set in, alongside efforts to promote so-called Asian values, both Buddhist and Confucian, such as the Harmony Principle. Such attempts are weakened, however, by their evident political intentions. Its well known among Asia scholars that China and South Korea manipulate the Harmony Principle to prevent democracy and weaken workers rights, respectively. Such political mangling is regrettable: the classic Harmony Principle, which essentially tells us that personal happiness is rooted in a natural social order and that one cannot be happy alone, is a rich philosophical concept and deserves better than to reappear in Communist or despotic garb. One also regrets that not much is done in India to keep alive the philosophy and spirit of Mahatma Gandhi, one of the very few twentieth-century universal thinkers who rose from Asia.
Though the prophecy of an Asian century is premature, that doesnt mean that Western domination wont eventually subside. Despite its universities, cultural values, entertainment industry, and strong military, the West may not maintain its edge forever. Still, we should note that whenever we compare the relative power of West versus East, we may be clinging to an obsolete vocabulary. Our criteria themselves may belong to the past. Today, geography is a poor framework: there is no such thing as a national economy any longer. All products and services are global. The more sophisticated a product or a service, the more its national identity tends to disappear. There are no Western or Eastern cell phones, to say nothing of financial derivatives. When China buys American Treasury bills, which nation is depending on which? Exchange generates interdependence. When Asia grows, the West doesnt necessarily become poorer. From now on, we rise or fall together. There is no contradiction, either, between West and East when it comes to threats against our global security, like terrorism or nuclear rogue states. Barriers have broken down even in popular culture: Korean rock singers are all the rage in China. Are they Korean or American?
So forget the Asian century; were entering the first global century. Globalization is so new that we dont yet fully understand whats happening to us; we cling to old concepts and lack the language to describe an emerging new world. We can argue about whether it will be a better world; whats certain is that it will be a very different one.
Guy Sorman, a City Journal contributing editor, is the author of numerous books, including Economics Does Not Lie.