Time to Step Our Game Up

Much of the coverage of President Obama's visit to China this week has reminded me that many in this country still view China through an outdated prism.  Americans see China as many things: a burgeoning economic titan, a source of cheap labor and manufacturing, a communist dictatorship with a bleak human rights record and a zeal for censorship.

But what is often ignored is how the Chinese people see China.  The majority see their country doing very well, with an economic transformation providing opportunities unthinkable a generation ago.  David Brooks noted this week that "eighty-six percent of Chinese believe their country is headed in the right direction"!  They see that China has a legitimate claim to deserving its traditional name as the "Middle Kingdom", or center of the world.

This is even though China's Communist Party has only provided incremental political liberalization for its people despite an embrace of modernization and globalization.  Far from being a problem, the country's economic success has only emboldened its rulers and entrenched them in their positions.

Anyone who's been hoping since the end of the Cold War that Western-style democracy would come to China should realize that China will continue to go its own way.  To me it's a silly question of semantics whether to drop the prefixes "potential" or "future" in front of "superpower" to describe China.  Just note that the one undisputed superpower, the United States, is a debtor to China.

Anecdotally too, I've walked around the Pudong area of Shanghai and thought to myself "this is what the future looks like".  That assessment, back in 2004, seemed primitive when I spent a week in Hong Kong last year, and was positively staggered at the cleanliness and efficiency of the city, their impressive new airport, the beautiful new bridges, and the sleek, intuitive MTR subway system that blows away the creaky NYC subway and even my beloved DC Metro.  (If there's one pressing need I wish was the top of our country's priority list, it's the infrastructure, stupid!)

Of course, the U.S.'s major economic strengths--the fostering of innovation, commitment to free markets, and the best higher education system in the world--continue to make it the key player on the world stage.  Nonetheless, data about income inequality or our country's struggling public schools, to name just a couple examples, should convince anyone of the need to step our game up.

How to do so is worthy of discussion in a future post.  For now, I'd recommend reading Michael Porter--famous to business school students and consultants everywhere for, among other things, developing the "Porter's Five Forces" framework--who has the best succinct analysis of what we need to do that I've come across: "Why America Needs an Economic Strategy".