What are the most important issues China and the US should cooperate on?

Anniversary Q&A Part 2

Hi folks, thanks for the very strong response to Part 1 of this Q&A series. In this second and final part, I will try to answer all questions directed at me regarding China. The questions will be grouped into 4 sections:

1. China and the world: how to envision China’s rise? What’s my hopes and fears?

2. US-China relations

3. China’s economy

4. Deeper stuff, such as religion, history, national character.

One HUGE caveat before you read: I believe some of the questions are too huge for me to answer. What do I know? But since I promise to answer all questions, I will hold my side of the bargain and try my best here.

On China and the World

Question: As China continues its rise as a world power and global influencer, (1) what are your greatest hopes for how China can be a positive influence (culturally, materially, ethically, spiritually, scientifically, etc.? and (2) what are your greatest fears or concerns for how China’s influence in the same respects could be negative or detrimental?

Response:

My biggest hope is a peaceful rise to the world’s largest economy. As long as it’s peaceful, everything else is secondary matter. So my worst fear is war.

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Question: A bit of a devil’s advocate question: Why when I read Chinese talking about “westernisation” or “western incidences” do they focus on issues such as democracy, human rights and the spread of Christianity but I rarely if ever see them consider Marxist Leninism as a Western influence?

Response:

Marxist-Leninism was indeed a Western influence. If you read early CPC history you would be amazed at how much of the power that USSR’s Comintern and Stalin had over Chinese communists. For many years until Mao came to power, CPC was but a China subsidiary of a multinational firm called Comintern.

I think today people don’t see it so much as “western value” because this line of thought has been fully indigenalized. The name “Marx” and “Lenin” only appear very occasionally. It was almost like how Buddhism was spread in China. Today when people talk about Buddism, nobody would think of it as a religion originating from India. In fact Buddhism has been extinct in India long time ago.

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Question: What do you think China's role in the world should be? How do you think different types of people in China would answer that question? For example, would a farmer, a businessman, a student, and a government officially have meaningfully different ideas about how China should relate to the rest of the world? I'm specifically thinking of this in the context of America's increasingly overextended hegemony, and the way that, for so many of us, the idea of America being number one is deeply embedded in our sense of self. Even Americans who are opposed to interventionism still tend to implicitly believe that whatever America wants it should get, they just think we should put our focus on internal problems (which would, of course, have to be solved using America's central position in the world economic system, itself a product of hegemony). There will eventually come a time when America is no longer the "essential nation," and China stands as the most obvious successor. But I don't think China would play that role the way America has. I don't know that the Chinese, on the whole, really even want that kind of thing. It seems that maybe people in different classes would have different views. I'd be curious to hear what you think.

Response:

Again, if China ever becomes as powerful as (or more powerful than) the US of today, I believe it will be a very different global power from the US. It will be far less interested in projecting power and values overseas. Compared with most people in the West, we are remarkably indifferent as to how the outside world operates. (Although indifference does not mean lack of curiosity. We will still be very interested in learning about the world, because we will still want to make money through trade.)

I believe it’s a common position shared by all major constituencies of our society.

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On US-China relations

Question: How can America (both parties) get past their demonization of China, and view it more as a partner and friendly rival, rather than as a challenger and enemy?

Response:

“Friendly rival” is a great word. It’s indeed what I hope the US-China relationship should be.

An important factor that impedes this rivalry from being friendly is our lack of understanding of each other. And here I have to say the weight of responsibility lies with the US side. Far, far more Chinese in all walks of life (both in absolute and relative numbers) learn about the US and are curious about the US than the other way around. Videos and articles about US elections can easily garner views of millions even hundreds of millions. I am not sure if even only 100,000 Americans care about the 20 Party Congress.

If there is one thing the Americans need to understand about China, it’s this: China does not care about preaching its own way of life to the outside world.

The West has a long tradition of proselytism. The Western conquest of the world was at the same time a conquest by trade and military power, but also a conquest by faith. Conquistadors and priests travel on the same warship. Yet, if you look closely at China’s history, you almost never see this kind of thing. “Minding your own business不要多管闲事” is an admonition we heard again and again while growing up.

I believe recognizing this key fact can lead to the conclusion that China’s so-called “rise” only means China wants its citizens to attain a high standard of living and gain the respect that it rightly deserves, but does not mean everyone else can’t live according to their preferred way of life.

This is a key topic that I have yet to fully explore in my Master Plan.

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Question: What are concessions you believe China AND the US should make for each other in order to foster a more cooperative relationship?

Response:

The US side should recognize and fully welcome China’s inevitable rise to the world’s largest economy, while China should also pledge and learn there is necessary responsibility associated with this status.

Once you become No.1, it’s no longer just about you. It’s no longer about a rejuvenation of your millenia-long civilization. Things are expected from you. And you shouldn’t blink to provide global public goods.

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Question: What are the most important issues China and the US should cooperate on?

Reponse:

1. Ending poverty, at a sustainable cost to the environment. Poverty is the root of all evil. CPC did one thing really right: make people not worry about food and shelter.

2. To help end poverty, trade is fundamental. But as the US power wanes, it’s inevitable the world will become more and more chaotic. In some ways, the wars in Ukraine and Gaza are but symptoms of a world adjusting to a stage when no single power can call the shots. There is a common interest for both US and China to safeguard global trade and collaborate on maintaining global conflicts below a reasonable level.

3. Ending poverty also has to happen with a more environmentally sustainable path than the powers that had gone through full industrialization before. If every country of the Global South was to have the same experience of severe pollution and smog that China or Britain had experienced, I do not know if our world can be livable at all. But solving the climate and environmental crisis undoubtedly has to be a global, concerted effort with the full blessing of both powers.

   (By the way, I always think Game of Thrones is a great analogy of our time. While the dragon army (China) fights the Westerosi kings and queens (the West), it’s the long winter that’s really creeping on all of us.)

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Chinese economy

Question: Here's an interesting question: What do you see China as being like in 50 or even 100 years in terms of the relation between the state and private economy? In particular, as an entrepreneur yourself, do you ever worry that China might swing back around to being more hostile to entrepreneurs in the long term?

Response:

I have an unequivocal answer here: market economy is decidedly a foundational feature of today’s China. There will always be some pendulum swings here and there, but the big picture has been set. After several generations, it has been a core consensus for Chinese people that market is good, no market is bad.

Market economy is one of the “3 pillars” of modern China that I referred to and will expand on in the Master Plan.

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Deeper stuff

Question: For me, there is something on my mind and I have talked a lot about it recently with my (Chinese and non-Chinese) friends. Yes, China has a long history but what can I notice in my daily (business) life while roughly 65% have no roots anymore as they arrived from the village to an apartment in the big city where they even don't know their own neighbors? Interestingly many of my Chinese friends also can't give a clear answer on it. It's not an attack but a search to make it give any sense to say always yes but we have a 5,000-year history. Yes but what does this mean in daily life? 

Answer:

That history does not live in “the village”, but in our mind.

There are so many manifestations of this, that I will dedicate a whole article to it too according to my Master Plan.

I will just name 1 example here.

Do you know how China’s provinces are delineated? Why provinces like Jiangsu and Zhejiang and Guangdong have the “borders” that they had? China’s current provincial borders were more or less solidified during the Yuan Dynasty, the mongol empire (around 800 years ago). A key principle was “犬牙交错dog-teeth-style interlocking”, meaning carving apart regions of similar cultural background and merging it with other regions.

For example, southern Jiangsu Province, Nanjing, and northern Jiangsu Province belong to very different linguistic and cultural cohorts. Southern Jiangsu (Suzhou, Wuxi, etc.) people speak similar Wu dialect like people in Shanghai and Zhejiang. Nanjing, the capital of Jiangsu, has similar culture and dialect with the neighboring Anhui Province. Northern Jiangsu however, aligns culturally with Northern Plains provinces like Shandong and Henan.

Every province in China is like that.

The reasoning was simple. Historical experience of various civil wars tells generations of Chinese rulers that distinct cultural identity breeds secessionism, and secessionism breeds chaos. So we’d better have “regional chaos” (culturally speaking) rather than a general chaos.

Such body of knowledge passes down through generations and shapes our behaviors today.

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Question: Spiritually, how do you see China developing over time: will traditional Confucian (and other indigenous) thought exert a stronger influence? Materialistic philosophies such as socialism, communism and capitalism? How about the role of Christianity in China in the future?

Response:

Both ancient and contemporary China is decidedly materialisitc. It’s very hard for an average Chinese person to imagine God or God-like being (such as a platonic world governed purely by rule of law). Such national character has its obvious limitations. But there is one benefit, which is tied to the previous response related to “preaching”, is that we also won’t try to convert you into our way of life.

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Question: What are your views on nationalism?

Response:

This question is too vague to answer. Maybe I can share one section of my previous article on how a small country can survive and prosper amid great-power competition. I single out nationalism, or a keen sense of national identity, as an far under-rated source of success.

I am fully aware of the dangers of ultra-nationalism. But we also need to recognize that the excesses do not mean it’s something that should be diminished.

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Questions that I have overlooked in Part 1

Question: How would you describe your company's organizational culture to professional managers in the USA? And how would you describe it to professional managers in China?

Response: Hard to say. But I won’t say it will be too different. Some of my favorite business books (Hard Things about Hard Things, Shoedog, etc) are equally popular in the West. I think there is more similarity than differences when it comes to business management.