Is a chastened West that has lost its positive edge doomed to cede innovative impulses for global affairs to China?.
The People’s Republic of China’s celebration of its 70th anniversary
reached its climax in a symbolic parade this past Monday. Not many
Communist states have reached such an august age. No wonder then that
China’s leaders exuded great confidence and people were genuinely happy.
To document the pride, new intercontinental ballistic missiles DF-41
rolled in front of the Forbidden City and Tiananmen Square, which were
later followed by dancing grannies and food delivery drivers on electric
scooters.
The latter got some of the most heartfelt ovations on China’s social networks, “Here comes my daily savior!”
Behind all the jubilation scenes on October 1, 2019, a narrative with
global reach is coming together. At the same time, China is under no
illusion that all is well.
Thinking beyond the trap
The U.S.-China trade dispute might be the initial salvo in this
century’s first and only Thucydides trap. Theorized by realist thinkers
like John Mearsheimer and Graham Allison, that trap sees the incumbent and emerging powers destined for conflict.
We hear about how many points of GDP growth will be shaved off by
less trade, and we are treated to sophisticated analyses about the
geopolitical maneuvering between the United States and China.
More important, however, is the two major powers’ competition for
global affection and cognitive bandwidth that is tied to them
individually. That is, the contest for the 21st century’s grand
narrative.
Disappointed with the West
The West always assumed that a rich China will be “like us.” Only
five years ago, even many Chinese thought so too. Not anymore, but in a
different way than Westerners might expect.
As a matter of fact, most Chinese are now disillusioned not with
their Communist Party, but with the erratic, leader-less and what many
think is the technology-unfriendly, ideology beholden West. There is
also a matter of practicality.
In the not so distant past, Chinese exchange students used to enroll
in Western universities to attain a degree — and possibly a ticket to a
better life — in a more promising country. Many parents must now cajole
their children to study abroad for that foreign education advantage.
However, often the kids can’t wait to return to digital China where
consumer choice is endless and the streets are safe. To many
millennials, social credit has its advantages — high levels are a bonus
for the Taobao shopping experience, and those with past disruptive
behavior will not be in the adjoining seat during ones high-speed train
ride.
But it is not just Chinese disillusionment with the West that ought
to give the West a reason to reconsider its own act. The challenge
about who shapes the global narrative is a fundamental one.
There used to be a time when that global narrative was shaped by the
United States. Sometimes it was brilliant strategizing like at Bretton
Woods, but often that didn’t require a lot of activity as the American
dream begot voluntary adoration. Those times are gone.
It would be a cop-out for the rest of the West, especially Europe,
not to check its own act and relevance in the global context. There is a
sense that Western liberal democracies cannot effectively tackle their
own domestic problems. Policy performance, in the sense of solving
actual problems that people have, is deemed all but exemplar by those
looking at us.
As a result, a valid question has arisen: Whose narrative, style and
quality of operations – theirs or ours – will be deemed best-suited to
tackle the world’s messiest problems like the environment, inequality or
security?
Narratives and economic impact
In Nobel Prize winner Robert Shiller’s narrative, the economics discipline analyzes how stories “go viral” and their worldwide “economic impact.”
An extended version of this view sees impact as abstractions
converting into effective rules (e.g. for commerce or political
competition), and then these into tangible goods (e.g., digital
services, welfare).
To date, the most accomplished global narrative ever devised is
Western liberalism with its rules-based order, democracy, human-rights,
open society and free competitive markets. But since the goods are not
being delivered it is clearly under threat right where the “end of history” was once pronounced, on home turf.
China, the unwilling contestant
China does not proselytize. There is deep awareness of the
extraordinary performance of its pragmatic domestic development
narrative, but China’s focus is China.
Even the Belt and Road Initiative (BRI), the “new Silk Road” array of
projects, parceling out aid and building incipient institutions, is an
experiment whose story line must yet come into its own.
For all the Western nervousness about the Belt and Road Initiative
today, it is important to realize that BRI does not aim to challenge,
but rather seeks to complement the Western narrative.
Part of the reason for the underlying prudence on the Chinese side is
awareness that the road to the top is long and setbacks lurk. Developments in Hong Kong make that plain.
There also is the yet to be resolved anti-corruption campaign, the
dreaded middle-income trap and, of course, geopolitical rivalry.
Faced with these challenges, the Chinese leadership is convinced that
China is the resilient one, a country whose future is bright and whose
narrative will end up seductive, presenting us all with choice.
China aims to win global hearts and minds with larger markets, fairer
e-commerce platforms, cooler fashion, smarter algorithms, more
effective recycling.
The onus is on the West
Whatever China’s drawbacks, which to many Westerners are
self-evident, it looks as if it is only China that presently pursues a
vision of any kind.
The West, meanwhile, either engages in acts of meekness, as Europe
does, or seems hell-bent on engaging, as President Trump does, in a
prolonged period of dismantling the institutions that bind the world to
the Western narrative.
As narrative economists would put it, the loss of global affective
and cognitive bandwidth has economic, technology and geopolitical
consequences.
The open question is whether the West is ready to renew its global
grand narrative for the complex 21st century ahead. That would probably
require it to pursue elements that contradict its present positions and
which do not emanate from its own traditions.
For instance, last month Shanghai implemented a new recycling policy.
Cameras and neighborhood volunteers now check on citizens disposing
trash in public containers and penalties are levied on those who don’t
distinguish between the “dry,” “toxic,” “recyclable” or “wet” — offenses
include throwing a “dry” bone in the “wet” container earmarked for
organic waste.
Is a surveillance state, with cameras on every trash collection
station, tree or production site, the way of effective environmental
protection?
Trying that might on the one hand have the interesting consequence of
diluting what the West is all about, while on the other hand serving
many of the West’s interests.
***Tomas
Casas i Klett is Assistant Professor at the University of St. Gallen’s Research
Institute for International Management (FIM-HSG), Director of the China
Competence Center (CCC) and Director of the Competence Center of Top Teams
(CCTT).Tomas is visiting professor and member of the Academic Council and
advisor to the Dean at the Moscow School of Management SKOLKOVO. He is also
visiting Professor at Shanghai’s Jiaotong University (Antai) and Fudan
University (FDSM).His research interests include free-trade agreements (FTAs),
entrepreneurship and digitalization, top performance teams, the Belt and Road
Initiative (BRI), behavioral economics, narrative economics, cross-cultural
management and Asia innovation models.Tomas was a “Salaryman” in a Japanese
kaisha in Tokyo for 3 years, and an entrepreneur in China for 15 years. He has
developed a variety of high-impact courses drawing from praxis, specializing in
executive education. His approach revolves around strategic transformation with
value deliverable to participants and their organizations. He was a member of
the World Economic Forum’s Global Future Councils (2016-2018) and is a WEF
Expert Network member. His first published book was on Japan’s challenges and
potential titled “Japan’s Open Future: An Agenda for Global Citizenship”
(co-authored with J.P. Lehmann and J. Haffner). His latest work is an edited
book titled “The Life of Russian Business: (Re)cognizing, (Re)activating and
(Re)configuring Institutions.”Tomas holds a BSc from the Wharton School,
University of Pennsylvania, USA, a MSc from Fudan University, China and a PhD
in Economics from the University of St. Gallen, Switzerland.