The Resistance Worked

There is no denying the damage that the four years of Donald Trump’s presidency have done to our institutions, our civic culture and our well-being as a country. Billions of pixels have been devoted to enumerating the seemingly endless ways that our outgoing president has challenged the norms and principles underlying American democracy. Trump’s refusal to acknowledge his electoral loss is the most recent case in point.

Yet from the early days of the Trump presidency, a loose coalition ranging from liberal activists to Republican “Never-Trumpers” joined together under the #Resist hashtag out of a shared sense that democracy must be defended in the face of demagoguery.

As the Trump era nears its end, it is worth appreciating the impressive degree to which the “Resistance” worked. Faced with racially charged rhetoric from a president practiced in the politics of hate and division, millions of Americans took to the streets to defend Muslims, immigrants, victims of police violence and other vulnerable members of our communities. In the process, the Resistance has helped usher in a sea-change in American consciousness of racial injustice.

Trump and his supporters warned of a so-called “deep state” determined to undermine his presidency. Something of the sort did exist, but it consisted of dedicated civil servants – public health workers, postal service employees, environmental scientists and election officials – who doggedly persisted in following the law despite the efforts of Trump appointees to undermine the missions of the agencies they headed.

At great risk, whistleblowers emerged to shed light upon wrongdoing. When pressured to send American soldiers into the streets to confront peaceful protesters, top officers publicly affirmed the military’s apolitical role and its loyalty to the Constitution above all else. Former high officials warned the public about the dysfunction of the Trump White House.

The courts again and again repudiated the Trump administration’s efforts to undermine regulations rooted in law and science. The mainstream media carried out penetrating reporting on corruption. The House of Representatives impeached the president for attempting to enlist a foreign government in falsely discrediting his political opponent. Even the Republican-controlled Senate eventually produced a report that established collusion between Trump’s 2016 campaign and Russian intelligence.

Fact-checkers identified and corrected Trump’s lies. Though far too late, social media networks eventually began flagging the political disinformation that has done so much to poison our politics in the age of Trump.

To be sure, Republican power-brokers failed – with a few exceptions – to call out the president’s misdeeds and tens of millions of Americans twice voted to elect Trump as president. Trumpism is far from spent as a political force. Yet Trump lost the popular vote in both elections and the electoral college vote in 2020. America’s democratic institutions have proven resilient enough to survive the most demagogic presidency of modern times. But the credit for this beleaguered victory goes not only to the system of checks and balances designed by the nation’s founders, but also to the determined efforts of the many people, high and low, who drove the Resistance.

First appeared in the Des Moine Register, November 2020

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Casting for Hope after a Dispiriting Debate

I was trying to be a responsible teacher for our next generation of civic leaders.

As a professor of political science, I asked my students to watch last Tuesday’s presidential debate so we could later discuss policy contrasts between the candidates. But seconds after moderator Chris Wallace broached the first question, the verbal fireworks erupted. I immediately realized my premise was mistaken: There would be no rational discussion of policy.

We convened class the next morning on Zoom, and I invited students to share a word or phrase that described how the debate made them feel. I braced myself as their responses cascaded down the chat window: “disappointed,” “frustrated,” “angry,” “embarrassed,” “disheartened.”

Many of these young people are preparing to cast their first vote. On the whole, they’re a socially conscious generation that pays attention to politics. Some are considering careers in public service. They scrutinize their elders and leaders. Too often they’re uninspired—if not repulsed—by what they see.

I couldn’t let the moment pass without doing something to temper the mood of discouragement. So I told a personal story that I thought might offer some hopeful perspective.

As a 16 year old in the summer of 1974, I was riveted by the televised congressional hearings on the Watergate scandal, which ultimately brought down President Richard Nixon. The revelations of corruption and political skullduggery contradicted the sunny depictions of American democracy I had encountered in civics class. The hearings appeared headed toward a constitutional crisis. My disillusionment felt overpowering.

I sat down and wrote a letter to Lou Frey, the Republican congressman who then represented my hometown of Orlando, Florida. I expressed my dismay to Congressman Frey and asked whether it was possible to put faith in our elected leaders if politics was so dirty?

A couple of weeks later, I was sitting at home at the dinner table snacking on a sandwich when the phone rang. My mom answered, listened a moment, then handed me the phone. “Lou Frey wants to speak with you,” she said. Frey thanked me for my letter and encouraged me not to give up on democracy or public service. His pep talk made an impression. Rather than reject politics, I devoted myself to studying how the system works, in all of its inglorious imperfection.

Frey, who died last year at 85, agonized over taking a stand on Nixon’s fate. Ultimately, he publicly called for Nixon’s impeachment or resignation. Frey served 10 years in Congress. After leaving office, Frey worked tirelessly on behalf of civility and bipartisanship in politics. He and former Florida Gov. Bob Graham, a Democrat, co-sponsored a project to strengthen civics education in the state’s high schools. He also co-hosted a radio show with former Democratic state lawmaker Dick Batchelor that avoided partisan bickering and name-calling, but instead explored ways to find common ground.

I offered Frey’s story as an example to students that a life of public service and political engagement doesn’t necessarily mean abandoning your integrity. But what about the system? After my brief conversation with Frey, Nixon’s resignation under bipartisan pressure offered some confirmation that American democracy was self-correcting. I cast my first presidential vote for Jimmy Carter, who brought ethics back into the center of American political life and has continued to serve as an exemplar of public service well into his 90s.

But today? As troubling as Watergate was in the ’70s, the modern challenges to democracy are far more serious. Our institutions strain under the weight of a norm-breaking president, historic levels of polarization, deep inequality, systemic racism and paralyzing gridlock. Sentimental memories from my own youth offer cold comfort. Calls for civility and bipartisanship ring hollow in the face of present realities.

Now I must draw my hope from my young students and their peers. They’re the energetic idealists taking to the streets. Organizing in defense of democracy. Striving to preserve what decency remains in the public square. It feels reassuring to be so inspired by my students similar to how, when I was their age, I looked up to Frey and Carter.

I only hope my students find that the malfunctioning system my generation bequeathed to them isn’t broken beyond repair.

David Skidmore, Professor of Political Science, Drake University, Des Moines Iowa

Reprinted from the Des Moines Register, October 5, 2020.

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On Terry Branstad’s Resignation: Iowa Nice Only Goes So Far in US-China Relations

If given a Hollywood treatment, the first three decades of former Iowa Governor Terry Branstad’s deep engagement with China would make for a heartening feel-good movie. Unfortunately, the sequel – Branstad’s more than three-year stint as U.S. Ambassador to China – could only be scripted as a tragedy.

The original movie would begin in 1983 with Branstad’s signing of Iowa’s Sister State/Province agreement with Hebei Province, followed by Branstad’s 1984 visit to China, the first of many trade delegations he would lead in the coming years. The film would then trace the ever-expanding array of economic, cultural and academic exchanges that has cemented Iowa’s special relationship to China.

At the center of the story would be Branstad’s hospitality toward a young provincial agricultural official named Xi Jinping during the latter’s 1985 visit to Iowa. The blossoming friendship between the two would culminate in Xi’s return to Iowa in 2012, now as Vice President and heir apparent to leadership of the Chinese Communist Party. At the dinner in Xi’s honor, the camera would pan the room to capture the assembled guests, many of whom played key roles in crafting a set of mutually beneficial partnerships. The final scene would settle on Branstad and Xi raising their glasses in a toast as Xi offers that “For me, you are America.”

The sequel focusing on Branstad’s ambassadorship would begin happily enough as Beijing officials welcome him as an “old friend of China.” But the story would soon darken. After Branstad announced his pending resignation as ambassador on September 14, a commentary in China’s Global Times newspaper lamented his “embarrassing role” in overseeing “the worst three years of deterioration in Sino-U.S. relations.” 

The reality is less stark. Branstad retains many friends in China. He brought the same folksy, Midwestern charm to China that made him a popular politician back in Iowa. His daughter and grandchildren moved with Branstad and his wife Christine to Beijing. The ambassador visited 26 provinces, demonstrating respect for Chinese culture and building people-to-people relationships. Branstad spoke at the groundbreaking of the China-U.S. Demonstration Farm modeled after Kimberly Farms in Iowa. In announcing his resignation, Branstad declared: “Getting to know the Chinese people, meeting them in their homes and hearing their personal stories, has been one of the great privileges of this job.”

Branstad also sought to calm tensions at key points. Last April, he denied allegations that China deliberately held up shipments of medical equipment to the U.S. and advised that questions about China’s early mishandling of the coronavirus pandemic be set aside until the virus was under control. Branstad also played roles in the reopening of the Chinese market to U.S. beef exports and the successful conclusion of the January 2020 trade deal.

But Branstad’s instincts for problem-solving proved a poor fit in an administration that turned increasingly toward outright confrontation in its dealings with China. Almost plaintively, Branstad once suggested that “the best and most effective way to try and get action here is not to shame them publicly but to meet with them privately.”

Yet he found himself squeezed between an American president given to threatening and bombastic tweets and a China whose diplomats resorted to Wolf Warrior diplomacy at the slightest criticism. It didn’t help that Branstad had little experience across many areas of dispute in U.S.-China relations outside of trade. He was seldom consulted by the White House on policy issues and his friendship with Xi brought few payoffs. Iowa Nice only goes so far.

Despite Branstad’s inability as ambassador to stem the downward spiral in U.S.-China relations, his earlier embrace of citizen diplomacy as a vehicle for building mutually beneficial ties among local governments, businesses, cultural groups and schools remains an impressive part of his legacy. Sadly, these connections have themselves become threatened as the political rivalry between Washington and Beijing has sown distrust and severed relationships. Both sides have cut back on cultural and academic exchanges, reduced access for journalists and diplomats and curtailed various communications media.

Such steps are unwise and dangerous. People-to-people ties are all the more vital at times when state-to-state relations are at their worst. Such relationships serve as ballast that can help stabilize the relationship once conditions permit. Branstad acted upon this understanding as governor but was powerless to prevent the erosion of citizen’s diplomacy as ambassador. Unlike in Hollywood, in the game of nations, a happy ending is far from guaranteed.

Originally published in the Des Moines Register, September 20, 2020

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Trouble on China’s Periphery: Chinese Nationalism and the Stability-Instability Paradox

The transformation of the Chinese Communist Party (CCP) from revolutionary party under Mao Zedong into a Chinese nationalist party beginning in the early nineties has proven a double-edged sword for the CCP and for China. While cementing popular support for the CCP among ordinary Chinese, growing nationalism has also generated resistance along China’s periphery. This stability-instability paradox has driven Beijing to adopt a set of costly and dangerous policies that have sullied China’s international reputation abroad and pushed the dream of a unified China further out of reach.

Chinese nationalism

The concept of nationalism was introduced to China by the West. As traditional China recognized no sovereign equals, the Chinese divided the world into civilized peoples, who observed Chinese culture and tradition under the leadership of the Emperor, and barbarians who could achieve civilization only through assimilation.

By the late nineteenth century, the press of Western imperialism forced Chinese intellectuals and political reformers to embrace nationalism as an element of modernization. As John Fitzgerald notes, however, nationalism in China arose not in the form of a people seeking a state, but in the shape of state-builders defining the Chinese nation in ways that facilitated their own aspirations to rule. This pattern of the state defining the nation rather than vice versa was itself rooted in traditional Confucian thought, which, as an ideology of the state, vested sovereignty with rulers rather than the people.

As a result, the scope and meaning of nationalism in China has varied. Influenced by Western intellectual currents, Sun Yat-sen conceived of the Chinese nation in terms of race, or blood lineage. Reformers associated with the May 4th movement of 1919 embraced civic nationalism with an emphasis on the rights and duties of citizens under a republican state. Under Mao, the nation was defined in terms of class, with China leading a global proletarian revolution.

Nationalism and CCP Legitimation Strategy

Following the chaos of the Cultural Revolution, CCP leader Deng Xiaoping abandoned Maoist dogma in order to save both the nation and the party. Yet the softening of totalitarian controls, combined with market reforms and the opening to the outside world, created an intellectual vacuum into which ideas about liberal democracy gained popularity among young Chinese and intellectuals. This threat to CCP rule was met with violent repression of the 1989 protests in Tiananmen Square and elsewhere.

In the aftermath, Deng faced the puzzle of how to restore stability without capitulating to pressures from hard-liners to abandon economic reform and resurrect Maoism. For Deng and his successor Jiang Zemin, the answer was a reformulated nationalism, or, in the language of the time, patriotism.

The patriotic campaigns of the nineties stretched across education, culture, media, academia and public displays, such as memorials, museums and holidays. Aspects of pre-revolutionary Chinese society – rejected during the Cultural Revolution – were resurrected and reinterpreted to meet the political needs of the CCP. Embracing a politics of grievance and historical victimhood, party propaganda stoked anti-Western and anti-Japanese sentiment by underlining China’s century of national humiliation, brought to an end only by the victory of the CCP in 1949.

More recently, CCP General Secretary Xi Jinping has promoted a forward-looking nationalism that challenges citizens to “achieve the Chinese dream of great rejuvenation of the Chinese nation.” Throughout, Chinese patriotism was equated with loyalty to the CCP as the necessary instrument for overcoming past humiliations and achieving future national greatness. Each year on April 15, for instance, Chinese schools observe “National Security Education Day,” during which students are offered lessons on “political security,” which “concerns the safety of the Community Party and the nation.”

Along with rising living standards, the CCP’s emphasis on patriotism successfully garnered popular legitimacy for the party-state among mainstream Chinese. Opinion surveys, for example, show consistently show high levels of public trust in Chinese political institutions and optimism about the future.

The Problems of the Periphery

Yet this formula for regime legitimacy could not be successfully applied to China’s periphery. Tibet and Xinjiang presented the problem of geographically-clustered non-Han minorities that could plausibly tell their own narratives of colonial victimization at the hands of the CCP itself. Taiwan remained beyond Beijing’s reach entirely while Hong Kong had, under British colonial rule, developed along a distinct political, cultural and economic path.

In dealing with both sets of problems, Chinese leaders carved out flexible and pragmatic exceptions. Following the Soviet example, the CCP gave non-Han minority groups official recognition and, where they constituted a majority, local autonomy (in principle – the realities were quite different). Minorities enjoyed preferences with respect to family size, university entrance and targeted government support and investment, as well as tolerance of their cultural distinctiveness.

In the cases of Taiwan and Hong Kong, Deng in 1984 announced the “one country, two systems” principle which would allow each wayward territory to retain its own social, economic and legal system following reunification. Although rejected by Taiwan, the formula was applied to Hong Kong following the handover of control from Britain to China in 1997.

This flexibility did not prevent the CCP from diluting the concentration of minority populations in Tibet and Xinjiang by encouraging Han migration (in Xinjiang, the Han share of the population grew from 6.7% in 1949 to 40% in 1980) and imposing state regulation over religious institutions. Nor did it stop the mainland from threatening military force against Taiwan to forestall a formal declaration of independence. Nevertheless, Beijing recognized the distinctive histories, cultures and even political institutions of these peripheral areas.

Yet such expedients failed to offer peripheral peoples a genuine place to belong within the CCP’s vision of the Chinese nation. Indeed, the limited pluralism tolerated along the periphery combined with the fusion of nationalism with CCP rule within the bulk of China led to a growing divergence. Peripheral peoples developed increasingly distinct political, ethnic and national identities out of sync with the CCP’s overall legitimation strategy.

Spooked by the role that local separatisms played in the collapse of the Soviet Union, Xi Jinping has cast aside ethnic and institutional pluralism along China’s periphery, seeking instead to impose Beijing’s will over what the CCP considers rebellious local populations. The result has been the abandonment of “one country, two systems” in Hong Kong, growing coercive pressures on Taiwan and policies of forced assimilation aimed at restive minorities.

Taiwan and Hong Kong

Deng Xiaoping recognized that the imposition of direct CCP rule in either Taiwan or Hong Kong would fail. After all, Taiwan had been ruled for decades by the CCP’s defeated rival, the Kuomintang Party (KMT), while Hong Kong was home to generations of dissidents and refugees. Both developed strongly anti-communist political cultures.

Deng’s “one country, two systems” formula offered a pragmatic exchange – accept Chinese sovereignty in return for a high degree of political autonomy. Yet in the case of Hong Kong, where this blueprint was applied, autonomy was highly circumscribed. Beijing relied upon byzantine electoral rules and influence over local business tycoons to ensure favored outcomes. This strategy finally reached its limits in recent years. As older Pan-Democratic politicians proved ineffectual, they were pushed aside by younger and more militant activists, who took to the streets to demand full democracy and to push back against Bejiing-inspired national security laws, patriotic education and extradition.

Deng’s confidence that Taiwan and Hong Kong could be managed also rested upon the assumption that the peoples of both would be bound to the mainland by a shared attachment to Chinese nationhood. Yet as Taiwanese and Hong Kongers have increasingly embraced liberal democratic values at odds with Beijing’s concept of national patriotism, they have also increasingly questioned their own identities as Chinese.

After more than two decades under PRC sovereignty, over half of Hong Kong residents identify exclusively as Hong Kongers. Trust in the “one country, two systems” formula has plunged, while roughly 40% of young Hong Kongers favor eventual independence.

This identity conflict also cuts through Taiwanese politics. The Republic of China established by the KMT on Taiwan declared itself the legitimate government of all China. The CCP and KMT thus agreed that Taiwan was part of China, but disagreed about which party deserved to rule.

The notion of “one China” lacked appeal, however, for Taiwanese who populated the island prior to 1949 and whose connections to the mainland had been attenuated by five decades of Japanese colonial rule. Tracing back to the 1920s, Taiwanese nationalists found a home in the Democratic Progressive Party (DPP) in the wake of Taiwan’s growing democratization beginning in the 1980s.

Whereas in 1991 less than one fifth of Taiwan residents identified themselves as exclusively Taiwanese, three quarters now identify as Taiwanese only. Less than one quarter of Taiwanese have favorable views toward mainland China, while three quarters would favor Taiwanese independence if this would not trigger military attack by China.

The massive Hong Kong protests of 2019 have driven home these realities, prompting Beijing to abandon the “one country, two systems” formula in all but name. With the imposition of the new national security law, attempts by Hong Kong citizens to exercise political autonomy are now defined by Beijing as unpatriotic, illegitimate and illegal. Arrests of opposition figures have already begun, candidates for local political offices have been ruled ineligible and legislative elections have been postponed. Restrictions on freedoms of speech have tightened and plans to introduce patriotic education into the school curriculum are being readied. Chief Executive Carrie Lam has declared that school children should be taught the message: “I am Chinese.”

It also seems evident that Xi Jinping has given up on luring Taiwan onto a peaceful path toward reunification. Beijing has cut off most official contacts with Taiwan authorities since 2017, when President Tsai Ing-wen of the DPP won office. China has also stepped up pressures through military incursions into Taiwan’s waters and airspace. Xi has remarked that “our country must be reunified, and will surely be reunified” and that the problem of Taiwan “should not be passed down generation after generation.”

In short, Beijing’s previous flexibility in managing ties with Hong Kong and Taiwan has been overtaken by increasingly forceful efforts to assert direct control in the face of centrifugal forces drawing peoples in both places toward identities that are not simply anti-CCP, but also anti-Chinese.

Tibet and Xinjiang

In Tibet and Xinjiang, religious and ethnic minorities have felt increasingly marginalized, leading to significant unrest, including violent clashes in Tibet in 2008 and in Xinjiang in 2009 and 2014. Xi Jinping responded with orders for state security to show “absolutely no mercy” in the “struggle against terrorism, infiltration and separatism.”

According to James Milward, the special rights and formal political recognition accorded minorities by the CCP after 1949 were aimed at the problem of “how to run an empire without looking like colonialists.”  Chinese scholar Ma Rong, however, has argued that the “politicization” of minority status only encouraged separatist sentiment. Instead, he has suggested that ethnicity be “culturalized” – stripped of special political connotation while permitting distinctive ethnic traditions. Influential intellectuals Hu Angang and Hu Lianhe have gone further, advocating thoroughgoing assimilation of minority peoples to the dominant Han culture.

These ideas likely inspired the recent crackdown against Uighurs, Kazakhs and other Muslim minorities in Xinjiang. In 2016, Xi declared that religious communities must “promote Chinese culture, strive to integrate religious belief with Chinese culture.”Minority cultural and religious identities, practices, institutions and language have been repressed in favor of Han culture. Over a million adults have been forcibly detained in reeducation camps alongside hundreds of thousands of political prisoners.  Many others have been involuntarily transported to distant provinces for factory work. Over a half million children have been separated from their parents in boarding schools where they are taught to resist “deviant thinking.” In a December 2017 campaign, one million CCP cadre moved in with Uighur families to teach unity. The CCP is conducting a massive campaign to suppress births among Muslim minorities through mandatory birth control measures and forced sterilizations. Both Xinjiang and Tibet are subject to mass surveillance, ubiquitous police check-points and location tracking through smart phone apps and social media.

With information about Tibet and Xinjiang heavily censored in other parts of China, many ordinary Chinese support coercive assimilation, as reflected in the remark offered by one elderly woman to reporter Isobel Yeung: “Uyghurs should be the same as Han people, I don’t feel sorry for them.”

The Stability-Instability Paradox

In seeking domestic legitimacy, China’s rulers have promoted a top-down and increasingly narrow brand of nationalism centered around loyalty to the CCP and attachment to Han culture and identity. In the process, the CCP has largely abandoned policies toward the periphery – “one country, two systems” in the cases of Taiwan and Hong Kong and ethnic-pluralism in the cases of Tibet and Xinjiang – that, if far from perfect, at least included significant elements of flexibility and pragmatism.

Whether this insistence upon assimilation to a singular Chinese identity will bring the stability and unity that Beijing craves seems doubtful.  Minxin Pei warns that such policies have “greatly strengthened the local identities, sharpened the sense of alienation and grievance felt by the targeted groups, and radicalized the activists among them.”

The CCP continues to face a paradox: the nationalism that has brought relative support and stability among the Han majority has been purchased at the price of instability along China’s periphery. The challenge of fashioning a basis for regime legitimacy that is inclusive of all of China’s people remains unmet.

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How Can the United States Help Hong Kong?

Two years ago, I led a group of sixteen members of Drake University’s Ray Society – a continuing education program for seniors – on a three-week trip to China. Our last stop was the beautiful and vibrant port city of Hong Kong. A highlight of our tour was a visit to Hong Kong’s new Legislative Council building.

Our escort was former legislator Cyd Ho, a long-time leader of the city’s pro-democracy movement. Cyd spoke eloquently about the challenges facing Hong Kongers as Beijing increasingly narrowed the autonomy promised to the city as part of the 1997 handover from Britain to China. Cyd was troubled by these pressures, but determined and hopeful that the city she loved would succeed in defending its civil liberties, rule of law and democratic culture.

Today, Cyd Ho is among more than a dozen long-time pro-democracy politicians and activists awaiting trial on charges of attending an illegal demonstration – one that attracted one million participants – in August, 2019. The Legislative Council building is closed, having been torn asunder by protesters last summer.

The city itself is reeling. Much of 2019 was consumed with massive and sometimes violent demonstrations against a feared extradition law. Despite Hong Kong’s successful containment of the coronavirus, its economy has nevertheless taken a big hit.

Now China’s Communist Party is on the cusp of unilaterally imposing a so-called national security law upon Hong Kong, one so vague and sweeping that ordinary acts of political speech or protest could result in arrest.

How should the United States respond? Back on November 27, 2019, President Donald Trump signed the bipartisan Hong Kong and Democracy Act, passed by Congress in response to calls from Hong Kong activists.

The Act directs the State Department to annually assess whether Hong Kong continues to enjoy local autonomy from Beijing. Should the Secretary of State conclude that Hong Kong is no longer autonomous, the Act empowers the President to withdraw special privileges the United States extends to Hong Kong with respect to trade, technology and other matters.

In response to pending passage of the above-mentioned national security law, Secretary of State Mike Pompeo has declared that the United States no longer recognizes Hong Kong as autonomous.

In other words, the Human Rights and Democracy Act failed to dissuade Beijing from further encroaching upon Hong Kong’s dwindling freedoms. Xi Jinping is prepared to accept international condemnation and even the loss Hong Kong’s significant role as a financial intermediary between China and the world in order to avert the threat that political instability may spread from Hong Kong to the mainland.

The Human Rights and Democracy Act was from the start a flawed vehicle for assisting Hong Kong’s beleaguered pro-democracy movement. By invoking U.S. intervention, Hong Kong democracy activists heightened erroneous Chinese perceptions that the protests were foreign-controlled. The American flags often spotted at demonstrators only deepened such perceptions. For many Chinese, the “Free Hong Kong” slogan combined with appeals for Western help are justification enough for the new law’s prohibitions on treason and sedition.

Moreover, if the sanctions allowed under the Act are fully implemented, then the already significant trickle of multinational firms making plans to exit Hong Kong will expand into a mighty stream. This will no doubt hurt China, in some degree, but the chief losers will be the Hong Kong people, whose jobs will disappear and incomes will shrink.

The goal, it must be remembered, is not to assist Beijing in placing the final nail in the coffin of Hong Kong’s autonomy, but to increase the costs to Beijing for actions that further erode the limited but still significant rights that remain to Hong Kongers.

The modest leverage the U.S. possesses should focus on how the new law is implemented. Beijing could use it sparingly and with restraint, or not. Rather than withdrawing all of Hong Kong’s special privileges at once, the U.S. should take selective and targeted actions designed to encourage restraint on Beijing’s part. This means gradually ratcheting up sanctions on responsible individuals and entities involved with serious infringements on civil liberties while avoiding measures that unintentionally inflict pain on ordinary people.

The Hong Kong of today is not the Hong Kong that I and my travel companions experienced as recently as two years ago. The coming months will bring more turmoil as the Hong Kong people seek to preserve those rights still left to them. As Americans, our ability to affect events is limited. Above all, however, we should make sure that, out of a desire to help, we do not make things worse.

David Skidmore is a Professor of Political Science at Drake University. He spent the 2010-11 academic year as at Fulbright Scholar in Hong Kong.

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From the Great Pandemic to the Great Leveling?

Could the Great Pandemic of 2020 and the severe economic downturn it has already spawned serve as a macabre cure for the staggering economic inequalities that have arisen in the United States? After all, Stanford University historian Walter Scheidel, in his 2017 book The Great Leveler, identified pandemics as one of four major types of events that have through history served to reduce the gap between the rich and the poor, with the others being mass-mobilization warfare, revolution and state collapse. French economist Thomas Piketty, whose 2017 book Capital in the Twenty-First Century helped spur greater public awareness of inequality, has pointed to deep economic downturns as a fifth type of leveling event.

Piketty famously argued that the rate of investment returns to the owners of capital typically exceed overall rates of economic growth. As a result, periods of business-as-usual produce growing concentrations of wealth. Incremental reforms, while far preferable to the calamitous leveling forces identified by Scheidel and Piketty, do not appear sufficient to halt, much less reverse, this inexorable tendency toward wealth concentration. Only major disruptions of the status quo (and only certain types of those) serve to redistribute wealth and income in significant measure.

But how does disruption lead to leveling? And what sorts of disruption might challenge this era’s great concentrations of wealth?

Pandemics, according to Scheidel, sometimes produce such severe drops in population as to create labor scarcities. Workers who survive gain greater bargaining power, with which they bid up wages or other sorts of remuneration.

Deep economic downturns can also have a leveling effect. The assets in which the rich place their wealth, including stocks, bonds and precious metals, decline in value. To avert political instability, governments may raise taxes on the wealthy in order to fund an expanded social safety net.

In societies where the political balance between capital and labor is already highly skewed in favor of the former, however, leveling is not guaranteed. The U.S. government, for instance, responded to the 2008 financial crisis by bailing out banks, hedge funds and automobile firms while offering relatively little relief to middle class homeowners who fell underwater on their mortgages. As a result, inequality actually rose, fueling political polarization in the form of the Occupy Movement on the left and the Tea Party Movement on the right.

As economic historians Peter H. Lindert and Jeffrey G. Williamson document, the last era of leveling in American history came between 1917 and 1945. Prior to World War I, inequalities in wealth and income reached levels not seen before and only rivaled since in recent years. This so-called Gilded Age did not last. The three decades from 1917 onward encompassed the influenza pandemic of 1918, two world wars and the Great Depression. In combination, these events greatly eroded the fortunes of the rich and created the political and economic conditions necessary for a mass middle class to emerge during the fifties and sixties.

So what consequences might the current crisis have for inequality in contemporary American society? The direct labor force effects of the pandemic are unlikely to improve the bargaining power of surviving workers. While Scheidel finds that the Black Death of 15th century Europe generated strong leveling forces, it took a population decline of roughly one third to produce this result.

Deaths from the 1918 influenza pandemic amounted to 675,000 Americans. Adjusting for population, deaths from COVID-19 would have to reach more than two million before matching the proportional scale of the 1918 losses. Current projections are far lower. Even if these forecasts prove too optimistic, however, pandemic deaths would be nowhere near the level necessary to create labor shortages large enough to bid up wages in a workforce of 164 million. This is especially true as the current coronavirus targets mainly the elderly and the infirm, rather than those who make up the core of the American labor force.

What about the indirect effects of the pandemic in the form of a dramatic economic downturn? The scale of the economic destruction new unfolding is not yet certain. Much depends upon how quickly or slowly efforts to contain the virus succeed and when Americans can return to something resembling normal patterns of work and consumption.

Already, however, the speed and ferocity of the economic contraction produced by limitations on mobility have been unprecedented. The number of new claims for unemployment benefits in the three weeks prior to April 9, 2020 exceeded 16 million. The previous single-week record was 695,000 in 1982. Even before the current crisis, corporate and consumer debt stood at precarious levels. With reduced cash flow, bankruptcies and home foreclosures will likely skyrocket. Even once the pandemic eases, insecure consumers are likely to spend cautiously. The fact that all three major regional sources of global demand – North America, Europe and East Asia – are experiencing downturns at the same time will make it all the more difficult to jump-start recovery.

With regard to the global economy, noted economist and financial historian Kenneth Rogoff warns: “there is a good chance it will look as bad as anything over the last century and half.”

Whether the current economic crisis leads to leveling, as during the Great Depression, or to greater inequality, as in the 2008 financial crisis, will depend upon three factors.

First, who gets bailed out? If the emphasis is on propping up stock prices and restoring the balance sheets of large corporations, then Americans will face a more rather than less unequal society on the other end of the crisis. But if, as during the Great Depression, a bottom-up approach is taken, then the benefits of recovery will be more broadly spread.

Second, significant leveling will depend upon whether the crisis strengthens the countervailing power of government and labor at the expense of capital. The 1917-1945 period witnessed an enormous expansion of activist government, funded largely by increasingly progressive taxation, and a greatly strengthened union movement capable of bargaining more effectively on behalf of workers. The particular form that such countervailing forces take in today’s context may be different, but unless the power of capital is balanced in some fashion, then no significant leveling will be possible.

Third, and most importantly, the New Deal was more than a series of government programs. It was a product of a profound rethinking of much prior political and economic orthodoxy. Laissez faire capitalism was abandoned in favor of the Keynesian revolution. An analogous refashioning of intellectual and popular ideas about the political economy of inequality will be required today. As the presidential campaigns of Bernie Sanders and Elizabeth Warren illustrate, the intellectual and political basis for transformative change already exists, even if Sanders and Warren themselves will not appear at the head of the presidential ticket in November.

Disruptive and painful crises can sometimes spur needed change. In retrospect, the series of traumatic events that made up the 1917-1945 period in American history ignited profound reforms leading to a golden age of reduced economic inequality following World II.

Perhaps recent events of our time – from the evident failures of government capacity in the face of Hurricane Katrina, to the near-collapse of America’s financial system in 2008, to the humbling inadequacies of our public health system to cope with the current pandemic – will one day be understood as alarm bells that alerted us to the necessity of reversing the concentrations of wealth and power that, however impressive on the surface, serve to hollow out the essential pillars of American political and economic life.

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Civility

Context matters when it comes to evaluating civility. Civility is a highly valued norm in academic life precisely because the university is a place where the search for truth leads to the airing of diverse and often contentious points of view. Vigorous  and reasoned argument is expected, but so too is the willingness to consider alternative ideas in a spirit of openness and respect. Without this common agreement on certain rules of engagement, the underlying purposes of an academic community cannot be realized.

Alas, life beyond the classroom is more complicated. Even in a mature democracy such as the United States, political discourse is often marked by incivility. We are daily bombarded by rude and angry voices via talk radio, cable news shows, political advertisements and social media. Although the normal clash of interests and values that makes up political life stirs up passions, the debasement of public discourse is often a matter of calculation. Personal attacks, appeals to emotion and distortions of fact often work to the advantage of those who employ them. Among the consequences are increased political polarization, stalemate on key issues and general public disaffection from political life. Greater awareness of the cynical uses of incivility can help to inoculate us against such influences. Only when uncivil tactics and discourse cease to work will greater civility return to our politics.

Yet not all forms of incivility are cynical and some can be constructive. Civility is a conservative force. It plays a constructive role when embedded in a community based upon some minimal degree of fairness and justice. In a context where the basic rules of political and social life are too heavily tilted in favor of a narrow group of elites, however, the insistence upon civility can serve as a tool for discouraging dissent. When people rise up to contest injustice, decorum often naturally gives way to a degree of constructive unruliness – witness the Arab Spring or the Occupy Movement. Speaking truth to power may require a kind of candidness not welcome at dinner parties.

The roles of civility and incivility in public life, then, depend upon both context and purpose. Understanding these subtleties in the form and nature of public discourse is part of developing political maturity.

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What the Next Democratic President Can Learn from Jimmy Carter’s Foreign Policy Record

President Donald Trump has pursued a foreign policy path strewn with discarded treaties, alienated allies, broken norms and the tattered remnants of America’s global reputation. Should a Democrat win the White House next November, where can they look for ideas about how to begin repairing the damage done?

Based upon my own research, I submit that a good place to start is with the foreign policy approach President Jimmy Carter pursued for restoring America’s global image and leadership. After all, the circumstances Carter faced bear an uncanny resemblance to those a Democratic president will confront should he or she win office next November. These include recent presidential scandal, the after-effects of a long and unsuccessful war and a sense, at home and abroad, that Americans lack a uniting sense of purpose.

A one term president who left office with low approval ratings, Carter’s presidential performance is often dismissed as a failure. The widespread admiration Carter has gained over the years is associated with his post-presidency, which he has devoted to fighting tropical disease, monitoring elections, promoting human rights and extolling the power of dialogue as a path to peace.

Yet there is, in fact, much that the next president could learn from Carter’s White House record. These lessons begin with the need to restore a positive agenda for America’s global role, in contrast with the amoral, Realpolitik philosophies that drove both Richard Nixon and Donald Trump. Nixon’s brutal calculus of power produced devastating humanitarian catastrophes in Bangladesh, Cambodia, Chile and Southern Africa. Similarly, Trump has shown an appalling preference for authoritarian rulers over traditional democratic allies.

With America’s global reputation in tatters following the Vietnam War and Watergate, Carter recognized the urgency of restoring a moral foundation for American foreign policy. To be sure, the pursuit of power and profit are both unavoidable aspects of the foreign policy of any great power. Yet the willingness of many countries and peoples to accept American leadership after World War II rested in part upon the moral vision at the heart of the American-shaped liberal international order.

The same sense of moral purpose was essential to domestic support for an expansive American role abroad. The amoralism of Nixon and Trump endangered support for American leadership and fueled isolationist sentiment.

Carter’s embrace of human rights must be understood in this light. Carter was mindful of the practical need to balance human rights considerations against other interests. Yet by placing a spotlight on human rights abuses and devoting American influence to curbing them, Carter sought to restore the perception abroad that the United States stood for values of universal scope. Coupled with his promises to bring honesty and integrity back to the White House, Carter’s human rights agenda helped to revive domestic pride and confidence in America’s role in the world.

The practical consequences of Carter’s human rights policies were also significant. By throwing American support behind human rights, Carter provided added legitimacy and weight to the growing efforts of non-governmental organizations and international organizations. Authoritarian governments on both the right and the left came to realize that egregious human rights violations brought real costs. Arguably, the global spread of human rights norms contributed to the later fall of the Soviet-controlled communist bloc and to the spread of color revolutions in various countries.

The next Democratic president will face a similar challenge as Carter: how to rebuild confidence that American leadership represents broadly shared values deeper than simple calculations of power and profit. The need for such a vision is especially acute given the profound weaknesses recently exposed in the liberal international order.

Another important lesson from Carter’s experience is that diplomacy based in the pursuit of shared interest works.

Nixon and Trump, of course, both pursued vigorous diplomatic agendas. For each, however, diplomacy was an appendage of power. Diplomacy served to capture the concessions forced upon others following a campaign of threats, military force or economic sanctions. While this sort of browbeating can sometimes work, it just as often forces the other party into a posture of defiance, as Nixon learned in his failed efforts to force North Vietnam into submission. Donald Trump is currently learning the limits of coercive diplomacy in relation to Iran.

Carter’s style of diplomacy was based instead upon the search for common interests among parties initially at odds. He perceived diplomacy as a tool for both resolving insipient conflicts before they spin out of control and, where escalation has already take place, finding a path toward peace and reconciliation.

Carter’s approach paid major dividends. The SALT II agreement with the Soviet Union capped a dangerous and costly nuclear arms race (while never ratified by the Senate, both countries abided by the terms of the accord). The Panama Canal Treaty removed potential threats to the Canal’s security, while eliminating a constant irritant in U.S. relations with Latin America. The full normalization of relations with China set the stage for China’s growing integration with the existing global political and economic order.

The Camp David Accords removed Egypt and Jordan as military threats to Israel’s security while the transition to majority black-rule in Zimbabwe, brokered by the United States and Great Britain, brought to an end to a bloody civil war there. The successful conclusion of the Tokyo Round trade negotiations sustained progress toward a more open global economy. It is difficult to think of another president who used diplomacy to better effect in serving major American interests.

The next Democratic president can also take a negative lesson from Carter’s experience. Carter faced massive, well organized and heavily funded campaigns against both the Panama Canal and SALT II treaties, as well as a drum-beat of right-wing accusations that his policies left America unprepared to meet a (mostly mythical) Soviet military buildup. The Iranian revolution and the ensuring hostage crisis sullied Carter’s reputation and may have cost him his presidency, despite the fact that the hostages were safely returned.

Over time, Carter increasingly responded to domestic political pressures by trying to prove his toughness. Defense spending rose again. Military force was attempted, unsuccessfully, in an effort to rescue the American hostages in Iran. Carter greatly overreacted to the Soviet invasion of Afghanistan, treating it as a precursor to a Soviet move on the Persian Gulf rather than the limited response to instability along the Soviet border that it was.

These efforts to shore up his flank against right-wing attacks did little to improve Carter’s political position but did disrupt the momentum of success that Carter had established in other areas of U.S. foreign policy. The appropriate lessons are to avoid overreacting to occasional setbacks and recognize that no amount of pandering to hard-liners will alleviate the political attacks from that quarter.

Carter’s record during a period that bears similarities with our own provides fertile ground from which the next Democratic president can draw useful lessons. A foreign policy that prioritizes diplomacy and broadly-shared values cannot solve all problems. But such an approach served American interests remarkably well during Jimmy Carter’s brief presidency. All the more puzzling then that our memories of the Carter years are so distorted and his diplomatic achievements have gone so undervalued.

 

 

 

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China can still salvage ‘one country, two systems’ in Hong Kong – here’s how

Authorities in Hong Kong may have hoped to start 2020 by putting a turbulent period of sustained, often violent protests behind them.

Instead hundreds of thousands of protesters ushered in the new year by taking to the streets. Around 400 were arrested as protesters continued their push for political reform on the densely populated island.

The clash between the government and demonstrators is now seven months long and has served to further erode Hong Kongers’ trust in China’s commitment to the “one country, two systems” formula.

Under that principle, the region was granted a degree of autonomy over its own matters in 1997. But a perception that Beijing is increasingly imposing its authority has led not only to a more militant protest movement, but one that is eyeing separation from the mainland.

As a political scientist who has closely followed political developments in Hong Kong over the last decade, I have watched trust in Beijing ebb away during the sustained unrest.

If China wants to correct this course and convince Hong Kongers that their best hope lies in autonomy rather than independence, then I believe it must permit genuine democracy in the region.

Cycle of unrest

The people of Hong Kong have not had much of a say in their own destiny.

Not only did they lack political power as a colony of the British, but they also weren’t consulted in the drafting of the 1984 Sino-British Joint Declaration that set the terms for the 1997 handover of the territory from the United Kingdom to the People’s Republic of China. Nevertheless, that agreement offered an implicit bargain to Hong Kongers: They would submit to Beijing’s sovereignty in return for the promise of a “high degree of autonomy” on the basis of “one country, two systems.”

Despite Hong Kong being promised more than a seat on the bus in 1997, Beijing remains behind the wheel. AP Photo/Mike Fiala

Over the past two decades, major outbreaks of unrest in Hong Kong have followed attempts by Beijing to impose unwanted measures that violate this bargain. Large-scale protests beat back Beijing-directed legislative proposals dealing with sedition in 2003, national education in 2012 and extradition last year. The Umbrella Movement protests of 2014 succeeded in stymieing Beijing’s proposed revisions to Hong Kong’s system for selecting its chief executive, but protesters’ demands for universal suffrage and an open nomination process were rejected.

Many Hong Kongers consider this interference a violation of the promised autonomy built into the terms of the Joint Declaration and the Basic Law, Hong Kong’s mini-constitution. This interference reinforces fears that the city will lose its autonomy entirely after 2047, the end point of commitments made under the Joint Declaration.

With only limited and inadequate democratic mechanisms at their disposal, Hong Kongers have developed a vibrant and increasingly militant protest culture as a primary means for exercising political influence.

Autonomy or independence?

Efforts to steer Hong Kong toward greater integration with the mainland have backfired, undermining trust in Beijing’s promise of a “high degree of autonomy.”

The result is an ongoing cycle of radicalization. The focal point for many protesters has moved away from any one particular issue to focus on the fundamental status of Hong Kong’s relationship to China.

Growing numbers of people are questioning why they should keep their side of the bargain – accepting Beijing’s sovereignty over Hong Kong. According to a recent Reuters poll, 17% of Hong Kongers express outright support for independence from China, while another 20% express dissatisfaction with the “one country, two systems” model. Moreover, 59% of respondents said they supported the recent protests and over one-third had themselves attended a protest.

According to a separate survey, support for eventual independence among young people approaches 40%. Many young people have also come to reject any “Chinese” identity in favor of a “Hong Kong” identity.

The depth of discontent among Hong Kongers was reflected in the District Council elections held on Nov. 24. These low-level posts have traditionally been dominated by pro-Beijing political parties. The recent elections, however, brought a record turnout with pro-democratic parties winning close to 90% of contested positions.

Beijing’s miscalculation

To blunt the growth of separatist sentiment in Hong Kong, Beijing must tackle what social scientists call a “commitment problem.” In any negotiation, each side will cooperate only if they believe that the other side is both willing and able to carry out any commitments made as part of the bargain. If either side believes the other side’s commitments lack credibility, then cooperation fails.

What China needs to do now is show that it is committed to respecting the autonomy promises embodied in the Joint Declaration and the Basic Law.

I believe the best way to do that is for Beijing to stop manipulating governance of the city. As long as selection of the chief executive and a majority of the Legislative Council lies in Beijing’s hands, it will be difficult for the mainland to resist meddling in Hong Kong’s affairs and for Hong Kongers to feel that autonomy offers them any real say over their fate.

In other words, Beijing could undercut calls for independence and interrupt the cycle of mass protests by offering Hong Kongers the ability to select their leaders through free and fair elections.

Beijing badly miscalculated in 2014 when it proposed electoral reforms that fell far short of the demands of Hong Kong’s pan-democratic camp, a coalition of parties that advocate universal suffrage. As a consequence, older, mainstream leaders lost control of the protest movement to younger, more militant activists. By 2019, young radicals resorted to violent street actions coupled with harsh anti-Beijing rhetoric. Yet a move toward democracy could still calm the waters provided the process allowed for genuine and effective local participation.

This proposal may be far-fetched. Indeed, some accounts suggest that leaders in Beijing are laying plans to move in the opposite direction by taking more direct control over Hong Kong’s political and legal institutions. Moreover, Beijing worries that full democracy in Hong Kong might lead to demands for the same elsewhere in China.

If a democratic solution to China’s Hong Kong problem appears unattractive to Beijing, the alternatives may be worse. The current cycle of provocation, protest, radicalization and rising separatism can lead to only one eventual result: a violent crackdown that would damage China’s reputation and leave it in costly occupation of a sullen and defiant population for a generation or more.

Originally published in The Conversation, January 6, 2020.

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Does BRI Provide a Pathway toward Replicating China’s Development Successes?

China’s top leadership have recently begun to tout China’s own development success as an example for others to replicate. Former Chinese Vice-Minister for Foreign Affairs has claimed that “the success of the ‘Chinese model’ … offers other developing countries an option different from the ‘American model’ for economic development.” In his address to the 19th Chinese Communist Party Congress in October 2017, President Xi Jinping argued that China’s successful development experience was “blazing a new trail for other developing countries to achieve modernization.”

China’s Belt and Road Initiative (BRI), launched in 2013, is commonly viewed as the primary vehicle for promoting a China model of development. Encompassing 123 countries, the BRI commits China to provide $1 trillion in financing over the next decade for hundreds of infrastructure projects – roads, railways, ports, pipelines, electrical grids and energy plants – designed to connect both land and maritime networks stretching from Southeast Asia to Europe.

But will it work? Can other developing countries emulate China’s own economic success by riding the BRI train?

Probably not. This is because the development path promoted through the BRI is fundamentally different from China’s own experience. And where there is overlap, the BRI emulates the most problematic aspects of Chinese political economy by externalizing opaque, crony-like relations among policy banks, large state-owned construction firms and local politicians. The following comparisons underline these conclusions.

While the BRI promotes an infrastructure-first model, China’s heaviest period of infrastructure investment followed rather than preceded its most rapid era of growth.

BRI boosters view scarce infrastructure as a key bottleneck that holds back rapid development. China is offered as an example of how an infrastructure-first approach can release the genies of economic growth. In fact, however, China’s heaviest period of infrastructure spending followed, rather than preceded, rapid growth and was only possible due to earlier development successes.

To be sure, China has massively invested in network of roads, rails, airports, seaports, electrical grids, dams and pipelines. Yet state-controlled infrastructure has been less central to China’s development than the private sector, which, economist Nicholas Lardy describes as playing “a dominant role in China’s economic transformation.” As Yasheng Huang has documented, rural entrepreneurship fueled economic growth during the 1980s, well before later waves of infrastructure spending began to swell. If there was a China model during the first decades of reform, it lay in a localized, constantly evolving and experimental process that Yuen Yuen Ang has labeled “directed improvisation.”

The heaviest infrastructure spending in China has come over the past decade, during a period of declining economic growth. Beginning with the global financial crisis of 2008, Chinese leaders have relied upon construction as a prop for employment. But this overinvestment has led to diminishing returns – the incremental capital-output ratio fell by half in the decade after 2007 – as infrastructure approaches a point of saturation. Indeed, a major motivation for the BRI is to put China’s construction assets to work abroad as the need for new projects recedes at home.

A study conducted by Oxford economists recently concluded that China “is headed for an infrastructure-led national financial and economic crisis” as a result of wasteful and inefficient infrastructure spending. They also warned: “China is not a model to follow for other economies – emerging or developed – as regards infrastructure investing, but a model to avoid.”

In sum, the narrative that state-led infrastructure provided the special sauce of Chinese growth – and one that can be exported abroad – is flawed.

In contrast with the BRI model, Chinese growth was fueled be internal savings rather than external borrowing.

China’s extraordinarily high savings rate, accounting for close to half of GDP in recent years, has financed high levels of investment in industry and infrastructure. In contrast, infrastructure investment under BRI is explicitly linked to high levels of external borrowing. As in Latin America and Africa during the eighties and nineties, the current buildup of international debt by many developing countries may prove unsustainable.

In 2017, Bloomberg reported that of 68 countries listed as BRI partners, the sovereign debt of 27 were rated as junk or below while another 14 were not rated by the top three international rating firms or had withdrawn requests for ratings. The Center for Global Development has identified eight countries whose high level of debt distress is directly tied to Chinese lending. And two dozen countries owe China an amount exceeding 10% of their GDP.

BRI loans from the China Development Bank or the China Export-Import Bank typically carry tougher terms than those from the World Bank or other international financial institutions. Interest rates are higher and payback periods are shorter. Contracts are withheld from public view. Loans are typically tied to no-bid contracts with Chinese SEOs, which rely principally upon Chinese inputs and workers. Borrowers are required to pledge existing assets as collateral and to place significant sums in escrow accounts located within China.  Disputes must be taken to Chinese arbitration courts that apply Chinese law.

Since 2000, Chinese banks have restructured or written off 140 loans to developing countries. As the grace periods on many of the large loans of recent years expire, the need for debt restructuring will likely grow. Some recipient governments, including those in Tanzania, Malaysia, Nepal and Pakistan, have pushed back against the tough terms demanded by China by canceling or renegotiating contracts. Recipient governments have also become bolder in demanding concessions as they realize that China has, few means to compel payments from reluctant borrowers.

In short, debt-fueled development is not only risky, but also the opposite of China’s own path.

The political conditions that support infrastructure development in China do not exist in many BRI countries.

Dams, ports, highways and the like run up debt, displace people, damage the natural environment and invite corruption. For these reasons, infrastructure projects often produce popular resistance despite potential economic payoffs down the road.

An authoritarian, single-party state has certain advantages in managing such resistance. Lee Chih-horng, a research fellow at the Longus Institute in Singapore, observes that Chinese officials “can easily stifle public debate and concerns about infrastructure projects.” Legal challenges are limited by the Communist Party’s ultimate control over the court system. The state owns major media outlets and both traditional and new media are subject to various forms of censorship. Non-governmental organizations are limited in size and scope, heavily regulated and incapable of directly challenging state priorities. Grassroots protests mounted by those negatively impacted by infrastructure development are managed through a combination of repression and cooptation.

Political conditions are very different in many of the countries hosting BRI projects. Few developing country governments possess such extensive capacities to control the political risks of infrastructure development. As a result, many BRI projects have become embroiled in controversy, resistance and delay.

Popular protest has hindered BRI some projects, as in Indonesia and Myanmar and Bangladesh, perhaps due in part to the fact that, as journalist Tom Miller notes, “Chinese firms … are happy working with local elites and unelected officials, but much less adept at dealing with civil society.” In other cases, such as Kenya, courts have suspended projects for inadequate social and environmental assessment. In Pakistan, the $54 billion China-Pakistan Economic Corridor (CPEC) has been threatened by Baluchi separatists, who have blown up gas pipelines, assaulted Chinese engineers and attacked the Chinese consulate in Karachi. The Pakistan army has deployed 10,000 troops to protect CPEC projects.

Given this track record, it is perhaps not surprising that one survey of Chinese firms found that the number one concern about investing abroad – cited by 71% of respondents – was political risk. Yin Yili, Vice President of China Communication Construction Company, has remarked that Chinese firms  “lack the ability to discern where to invest or effectively manage overseas risks.” An American Enterprise Institute study of unsuccessful overseas Chinese investment projects found that one quarter failed due to political factors. The state-owned China Export & Credit Insurance Corporation that covers government seizures, nationalization, political violence and other risks has paid out $1.73 billion on claims related to BRI investments and exports since 2013.

As projects struggle in areas of strategic interest, China will be tempted to intervene in order to safeguard its investments, its people and its political influence. The People’s Liberation Army has been instructed to develop options for protecting “overseas interests.” In some cases, China may seek to shore up repressive regimes or bypass democratic institutions in order to avert lost investments and influence. In general, China’s oft-touted foreign policy principle of non-interference in the political affairs of other countries has become increasingly untenable.

Rather than boosting developmental states, the BRI is strengthening rentier states.

Like its East Asian neighbors, China pursued rapid, export-led growth built around increasingly diverse and sophisticated manufacturing sectors grounded in close public-private partnerships led by a  “developmental state.” In China’s case, state industrial policies and the persistence of a highly concentrated state-owned sector, combined with a competitive private sector, significant foreign-owned enterprises and growth-oriented local governments.

The design of the BRI, by contrast, supports a very different model: the rentier state. Rentier state elites profit by using state resources to siphon riches from narrow flows of commodity exports. Rentier states are typically authoritarian or semi-authoritarian, rife with corruption and spend little on the supply of public goods.

A recent study released by the United Nations Conference on Trade and Development found that two thirds of developing countries remain heavily dependent upon commodity exports, including agricultural goods, energy and minerals. Rather than helping these countries to escape the economic and political burdens of dependence upon extractive industries, the BRI is serving to more deeply entrench rentier states that enrich elites via profits from commodity exports while providing few incentives for economic innovation or diversification.

Despite widespread expectations that the BRI would allow China to export labor-intensive light manufacturing to recipient countries as wages rise in China itself, this effect has mostly been limited to a few Southeast Asian countries. In Africa, by contrast, one study finds that: “few African countries have been able to benefit from large-scale Chinese investment outside the resource sector.”

This rentier state model is unlikely to yield the rapid, diversified growth that China’s developmental state achieved.

Where the BRI Model Does Replicate Aspects of Chinese Political Economy

The BRI has served as a transmission belt for the export of a particular and relatively recently consolidated fragment of China’s political economy. According to Andrew Batson, China research director for Gavekal: “The Belt and Road is really the expansion of a specific part of China’s domestic political economy to the rest of the world. That is the nexus between state-owned contractors and state-owned banks, which formed in the domestic infrastructure building spree construction that began after the 2008 global financial crisis …..”

According to Batson, the local governments that borrowed heavily for internal Chinese infrastructure development are mirrored within the BRI by developing country recipients, which play a similar role. China’s large policy banks, such as the China Export-Import Bank and the China Development Bank, are under enormous pressure to maintain growth at home by juicing credit and to recycle China’s dollar surplus by lending abroad. Meanwhile, China’s enormous state-owned enterprises need a constant stream of infrastructure orders both at home and abroad in order to avoid mass layoffs.

Lee Jones and Zizheng Zou have argued that the BRI is less a grand strategic gambit than a response to SEO pressures as they attempt to overcome overcapacity, resource constraints and declining profits at home. As a result, central authorities struggle to exert control over banks, SEOs and local governments or to lessen the gap between broad policy pronouncements and on-the-ground realities.

The result is that the unbalanced and excessively infrastructure-heavy patterns of investment that have distorted China’s own economy over the past decade are being promoted abroad through the BRI. That is not exporting success, but replicating risk.

 

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