Economists Shocked That China Invalidates Their Pet View That Economic Liberalization Producers Political Liberalization

Yves here. As you might imagine, I am stunned to learn that economists actually believed that liberalizing trade would ever and always promote democracy. Anyone who has read Polyani or Kalecki knows that commerce and the social order do not have the same interests on some key matters, like who gets to reap the fruits of productive activity. I thought they understood this was just a talking point for US multinationals, that even though people might have believed this in the immediate post World War II period, they ought to know better by now. The example of the European Union alone, where some of the measures taken to promote economic integration have anti-democratic implications, is one of many examples.

By NewDealdemocrat. Originally published at Angry Bear

Introductory note: this is a very long epistle. But I think my point needs to be made fully and at length. Before you go further, in fairness here is the TL:DR version:

  • Advocates of free trade and globalization were taken aback a week ago by the assumption by China’s President Xi Jinping of rule for life.
  • This was because it runs completely contrary to their theory that free trade leads to economic liberalization, which in turn leads to political liberalization.
  • This theory has been repeatedly and thoroughly repudiated throughout history, most catastrophically be World War I.
  • That’s because autocrats will use the gains of economic trade for their own ends, typically the pursuit of further political and military power.
  • Historically middle classes do not revolt against autocracy when they are prospering, but rather only after a period of rising expectations has been dashed by an economic downturn in which the autocratic elite unfairly forces all of the burden onto them.
  • But since these historical facts are nowhere to be found in the economic models, they are ignored as if they do not exist. We can only hope they do not once again lead to catastrophe.

First, let me pose a thought experiment.  Country A and Country B propose to enter into Agreement X. We have no idea at all what Agreement X is, but we know that the result will be that both Country A and Country B will each be richer by $1 Trillion each and every year thereafter.

Country A, being an egalitarian paradise, is going to share out the proceeds equally among its population of 250 million, with each person getting $4,000 per year.

The dictator of Country B is going to do the same with 1/2 of its $1 Trillion gain, making his population very happy, but — because this is his personal aim — he is going to spend the other $500 Billion each and every year in building up its military so that it can challenge and eventually vanquish Country A, and then keep all of the gains of Agreement X to itself.

Should Country A enter into Agreement X?


A week ago The Economist opined that “The West’s Bet on China has Failed,” stating that:

Last week China stepped from autonomy into dictatorship. That was when Xi Jinping … let it be known that he will change China’s constitution so that he can rule as president for as long as he chooses …. This is not just a big change for China but also strong evidence that the West’s 25 year long bet on China has failed.

After the collapse of the Soviet Union, the West welcomed [China] into the global economic order. Western leaders believed that by giving China a stake in institutions such as the World Trade Organization would bind it into the rules based system … They hoped that economic integration would encourage China to evolve into a market economy and that, as its people grew wealthier, its people would come to yearn for democratic reforms ….

CNN’s Fareed Zakaria recoiled in horror, writing in the Washington Post that:

[W]hat’s happening in China … is huge and consequential. China is making the most significant change to its political system in 35 years.

For decades, China seemed to be getting more institutionalized…. But that trend has now been turned on its head. If term limits are abolished, which is now almost certain, Xi Jinping could stay China’s president, general secretary of the Communist Party and chairman of the Central Military Commission for the rest of his life. And he is just 64.

…. The real danger is that China is eliminating perhaps the central restraint in a system that provides staggering amounts of power to the country’s leaders. What will that do, over time, to the ambitions and appetites of leaders? “Power tends to corrupt,” Lord Acton famously wrote in 1887, “and absolute power corrupts absolutely.” Perhaps China will avoid this tendency, but it has been widespread throughout history.

If Zakaria felt blindsided, he should not have been. Because ten years ago, after he published “The Post-American World,” arguing that because the US had successfully spread the ideals of liberal democracy across the world, other countries were competing for economic, industrial, and  cultural — but not military — power, I confronted him at the former TPM Cafe.

For the truth is, the West’s bet on China, so ruefully mourned by The Economist and Zakaria, was always likely to fail. That free trade leads to economic and political liberalism and to peace —- championed by neoliberal economists and their political retinue — has been a fantasy for over 100 years, and for 100 years it has been a lie. They would have known if their theories and equations could account for the likes of Kaiser Wilhelm II. But since their equations and theories are blind to the pursuit of power, they dismiss it — at horrible cost to the world

In an interview with David Frum, Minxin Pei, who a decade ago dissented, predicting that China would not transition towards true economic and political freedom, said it well:

[M]any people were too dazzled by the superficial changes, especially economic changes, to realize that the Communist Party’s objective is to stay in power, not to reform itself out of existence. Economic reform or, to be more exact, adopting some capitalist practices and embracing market in some areas, is only a means to a political end….

[W]hen China was forced to keep the door [to liberalization] more open, it was in a weaker position relative to the forces outside—the West in general and the U.S. in particular. But when the conservative forces inside China gain strength while the West appears to be in decline, those forces are far more likely and able to close the door again, as is happening right now. So, while the logic of irresistible liberalization appears to be reasonable on the surface, it overlooks the underlying reality of power.

I set set forth the fuller historical context a decade ago in my response to Zakaria,which I am taking the liberty of reposting in full immediately below.

Over at TPM Cafe, this week Fareed Zakaria’s new book, “The Post American World” is being discussed. In it, Zakaria repeats the theory of globalization’s most toxic and unproven claim: that countries which participate in trade together do not make war upon one another. So if you want to prevent war, just participate in deep and interwoven trade with the other country and everything will be hunky-dory.

It’s a lie.

Zakaria claims that We’re Living in Scarily Peaceful Times”:

The new and most dangerous twist to all this is that our great looming danger is Russia, China, and the rising oil dictatorships…. This is a worldview bereft of any historical perspective. Compared with any previous era, there is more economic integration and even comity among the world’s major powers. The imbalance between the West and the rest is large, not complete but large and in most areas increasing. The newly emerging states want to grow within the existing world order, which John Ikenberry has nicely described as “easy to join and hard to overturn.” The world is going our way, slowly and fitfully, with some detours. No great power has an alternative model of modern life that has any real attraction?

This is essentially the same argument that Thomas Friedman made in The Lexus and the Olive Tree’ and reiterated even a short time ago in this liveblog:

You know in Lexus I wrote that no two countries would fight a war so long as they both had McDonald’s. And I was really trying to give an example of how when a country gets a middle class big enough to sustain a McDonald’s network, they generally want to focus on economic development. That is a sort of tipping point, rather than fighting wars.

This argument, repeated over and over on both necoconservative and neoliberal sites, and all over the corporate media, that free trade leads to middle classes leads to democracy leads to kumbayah, is pretty simple, and it is dangerously wrong. Or as Zakaria reviewer David Rieff summarizes:

he reads too much into into two indisputable facts of the current moment — that there are fewer major wars taking place than in living memory and that there is a greater level of global economic integration than at any time in history.

The truth is, the free trade zealots also have spent too much of their careers seduced by neoclassical economics’ favorite mythical beast, Homo economicus, the Rational Man; and not enough time reading history.

For a start, contrary to the free trade zealots, this is not the first period in world history in which there has been relatively “free” trade, nor is it the first time in which there has been “globalization.” For example, as is pointed out in an article entitled European Social Security and Global Politics By Danny Pieters, European Institute for Social Security Conference

Globalisation is not a new phenomena. During the second part of the nineteenth century there was a strong move toward the liberalisation of international transactioins, and international trade expanded rapidly until the beginning of World War I

And just which country in Europe was undergoing the most rapid growth and industrialization during the perioed from 1870-1914? As this essay states, Germany

embarked upon an extensive education program; it specialised in technical ares and so there was a greater push in that direction. It produced more and better scientists, and so Germany began her industrial advance. Also, the French threat, even if it was superficial, spurred the Germans in authority into action, and made them make Germany stronger and superior.

German expansion was also helped by the expansion of the railway network, so that goods and mail could get from one place to another, and to more places, faster and more efficiently.

Needless to say,much like the mercantilist expanding autocracies now fawned over by so many of the free trade zealots, during this time Germany was a monarchy, ruled by the Kaiser.

Even worse, this isn’t just the first time that economies have experience “globalization”, it also isn’t the first time that this exact same argument has been made. In his 1910 best-seller, “The Great Illusion” Norman Angell wrote that:

the universal assumption that a nation, in order to find outlets for expanding population and increasing industry, or simply to ensure the best conditions possible for its people, is necessarily pushed to territorial expansion and the exercise of political force against others…. It is assumed that a nation’s relative prosperity is broadly determined by its political power; that nations being competing units, advantage in the last resort goes to the possessor of preponderant military force, the weaker goes to the wall, as in the other forms of the struggle for life.

The author challenges this whole doctrine. He attempts to show that it belongs to a stage of development out of which we have passed that the commerce and industry of a people no longer depend upon the expansion of its political frontiers; that a nation’s political and economic frontiers do not now necessarily coincide; that military power is socially and economically futile, and can have no relation to the prosperity of the people exercising it; that it is impossible for one nation to seize by force the wealth or trade of another — to enrich itself by subjugating, or imposing its will by force on another; that in short, war, even when victorious, can no longer achieve those aims for which people strive….

There is quite simply no difference at all between the theses of Angell a century ago, and Friedman and Zakaria now.

And what happened only 4 years after “The Great Illusion” was published? Well, another book that Zakaria and Friedman ought to read is Vera Brittain’s autobiography, “Testament of Youth”. Vera Brittain was a comfortable affuent middle class girl who was accepted to Oxford University shortly before World War I broke out. By the time it was over, her brother, Edward; her fiance Roland Leighton; and every other young man she had been close to, had been killed. Brittain’s book is a searing documentary about the utter destruction of an entire generation of British young men caused by the war.

Just how many people were killed by World War I?  One source puts just the number of military deaths at 10 million. Including the wounded, in some European countries over half of the entire generation of young men were casualties.  Another sourcesays:

the percentage of a country’s population directly afflicted. During the course of World War One, eleven percent (11%) of France’s entire population were killed or wounded! Eight percent (8%) of Great Britain’s population were killed or wounded, and nine percent (9%) of Germany’s pre-war population were killed or wounded! The United States, which did not enter the land war in strength until 1918, suffered one-third of one percent (0.37%) of its population killed or wounded.

Simply put, World War I is a thorough and devastating refutation of the argument that free trade leads to peace and democracy, Quite the contrary, had Zakaria and Friedman bothered to actually study history, they might have found out that revolutions typically do not occur in eras of increasing plenty. Rather, they occur in times where rising expectations have been dashed:

he “J-curve” theory says that when conditions improve for a relatively long period of time, — and this is followed by a short economic reversal — an intolerable gap occurs between the changes that the people expect (dashed line) and what they actually get (solid line). Davies predicts that this is when revolution will occur (arrow).

Support for this theory was found in a 1972 study of 84 nations. Researchers found a clear relationship between indications of political instability and economic frustration. “Frustrated countries” are those that had poor economic conditions — low economic growth, insufficient food, few telephones and physicians — while being acquainted with the higher living standards of industrialized, urbanized countries.

These studies show that frustration is more likely to develop from relative frustration — the gap between their expectations and the reality that does not live up to these expectations. People in poor countries isolated from the outside world do not realize how poor or frustrated they are. Their frustrations are accepted merely as part of living. In contrast, the people in poorer countries exposed to modern standards feel more “frustrated.” To top this off, deprived people who have experienced some recent progress are more frustrated than those who experienced poverty and oppression.

In short, just as Germans were hardly big agitators for democracy during the time the German state was expanding, and autocracy was resulting in greater prosperity, so we should not expect that any autocratic states today that are profiting mightily from economic growth are suddenly going to turn democratic. To the contrary, just like the Kaiser’s Germany, it is much easier to direct aggression elsewhere.

Democratic revolutions occur when previously rising expectations have been dashed, and the populace has no outlet for their anger and frustration. In democracies, governments can be changed (as in 1932); but in autocracies, the ruler’s cronies are protected from the privations, and with no alternative avenue of recourse, and seeing the manifest injustice of the benefits of the system, the populace revolts.

For example, Taiwan’s democratic reforms were sparked by the violence of the “Kaohsiung Incident” of 1979. Similarly, democracy finally came to South Korea in 1987 when workers finally rebelled against artificially low wages:

South Korea is hardly a model of a free economy. The hand of government planners in setting priorities and steering companies has been heavy. The low wages that helped fuel growth did not result from market forces. For 25 years, successive governments deliberately held down pay rates. They virtually barred strikes, jailed militant labor leaders, and decreed tough guidelines for wage increases. To block development of independent unions, companies created their own and installed leaders acceptable to the government. Says a Western diplomat in Seoul: ”Union leaders were practically appointed by the national security police.” With democratic winds sweeping South Korea this summer, workers were emboldened to push for higher pay, independent unions, and the right to strike,

[2018 update: Even the American Revolution had elements of this paradigm, as England reined in the colonist’s rising fortunes following the French and Indian War by taxing them for the costs, expanding the territory of Quebec to include all of what is now the American northern Midwest, and prohibiting expansion beyond the Appalachians.]

It is a disgrace that we see these same discredited theses, this same Great Illusion, embraced by corporate media pundits so often. That free trade inevitably leads to peace and democracy is a Big and Dangerous Lie, to which World War 1 is the most spectacular and unequivocal counter-evidence.< There is no guarantee, alas, that we are not now on that same catastrophic path. ——– In 2015, I reiterated this point more succinctly:

A more fundamental point is about human nature.  In any economic downturn, the powerful elites are going to try to deflect all of the suffering on the powerless masses.  In a representative democracy, eventually the majority will rebel at the ballot box and elect a party which promises to end their suffering.  [Update: It might be a left-wing party, like Syriza in Greece or FDR’s New Deal democrats in the US, or it might be from the right-wing like AfD in Germany or Donald Trump.  ]

In an authoritarian state, however, no such safety valve exists.  That’s why revolutions don’t happen in an era of rising expectations.  They happen when rising expectations are dashed.  So long as China’s economy continues to expand stoutly, expect no meaningful turbulence.  But someday China will have a recession, and then, dear reader, is when world history will get interesting.

So here we are a decade later, and the free-trade economists and their acolytes are gobsmacked by something that was not just predictable, but actually predicted,  because there is no place in their theories for actual human behavior as revealed in history. We can only hope that when the inevitable happens, China will not lash out as Kaiser Wilhelm did a century ago.

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  1. Jason

    Zakaria and Friedman are not economists. They are probably more influenced by end-of-history types such as Fukuyama, who are political scientists.

    1. Yves Smith Post author

      That’s a fair point. They aren’t economists in the sense that they don’t have grad school economics degrees or do equations. But what they are doing is often what would have been political economy before the discipline developed its “we are going to become a science” fetish and that term fell out of use. Yours truly is often mistaken for an economist and I am quick to correct anyone who suggests that.

    2. Marshall Auerback

      Whenever I read Zakaria or Friedman (which is rarely), I feel I’m listening to a London cabbie, who spouts the opinions he just read in his morning newspaper.

      1. Carolinian

        Harsh words about The Mustache of All Understanding (TM Atrios).

        If we are going to go back to calling economics political economics perhaps we can go back to calling the Defense Department the War Department. Truth in packaging.

        1. Off The Street

          At least London cabbies have The Knowledge.

          Economists claim to have their own specialized knowledge, however they qualify virtually everything (assume this and that, restrict the other) and ignore what they should see in front of their own face, while shouting down anyone without that so-called specialized knowledge. It is almost as though their little union card gives them some immunity or exalted status, and that does a disservice to any who actually earned a union card. Ego inflation with a Nobel can turn them into pontificating blowhards, as may be seen periodically in the NY Times.

          Meanwhile, heterodox economists and others who have some plausible explanations for what is actually happening in front of their own face are roundly ridiculed when not ignored. Notice that ignorance plays a prominent role throughout. /end rant

          1. drumlin woodchuckles

            Not all of them did, did they? Not all of them do, do they?

            Kenneth Boulding didn’t. Frederick Soddy didn’t. Charles Walters Jr. didn’t. Herman Daly doesn’t. Do they? Did they?

            1. Grebo

              Off The Street did mention heterodox economists.
              Steve Keen estimates that 80% of economists are orthodox neoclassicals.

      2. Mike G

        They’re both examples of the US corporate media sausage machine where everything must be ultimately hopeful and reassuring to fit between commercials for paper towels. Americans want spoonfed pollyanna stories and feel-good national exceptionalism, and everything fitting into tidy little theories; they hate bad news and gloomy historical analysis. Europeans, with their long historical experience of wars, hubris, dirty deeds in the name of power, and the messiness of actual human experience over centuries, are more open to this.

        1. berit

          Nice, but Americans, as Europeans, are not a homogeneous mass. You are blessed with alternative experiences and voices all over the continent – may I respectfully mention lessons still not learnt of the wages of slavery, genocidal conquests of native lands and the long history of oppression and discrimination. The sad situation is that the dominant political class and MSM are not representative of this potentially fruitful diversity. Ruling elites are doing what they can do to hold on to power and its spoils, selecting candidates to positions of power in business, politics, unions, media, gerrymandering of voting districts, restricting voters influence in any way they see fit and can do, as done for a long time in South Korea too. Many here (Norway) had high hopes for the Obama presidency and are loathe to admit that his actions are far removed from hopes, promises, mirages of race, oratory – it’s our shame that he was awarded The Nobel Peace Prize. But the US have so many great voices of reason and sanity – constantly in presence on this excellent site. Thank you all and keep up the good work. Change is coming. I hope.

      3. WJ

        I find London cabbies to have far better informed and more idiosyncratic views than either of them.

    3. Altandmain

      They are more PR type people telling wealthy people what they want to hear. That’s probably why they are rich as well.

      Friedman has been wrong on so many things that it is not funny.

      1. Anarcissie

        It is funny. I was at a dinner party a few years ago and when someone admitted doing some kind of research work for or in conjunction with Friedman, everyone present laughed derisively merely on mention of the name. Of course this was Before Trump.

  2. AbateMagicThinking but Not Money

    on reading this I am doubly disappointed. The first is that anyone would seriously listen to an economist who spouted such nonsense, The second my is that my faint hope that technocracy will come to the fore has been dashed again.

    Economists can never quantify the arrogance of power.


  3. hemeantwell

    A useful article. But his stress on WWI as a refutation of the markets and liberalization thesis would benefit if he introduced the concept of imperialism, talked about the scramble to control markets, etc. “The German state was expanding” in competition with other already expanded European states. Which is to say that he’s talking about economic liberalization without really talking about the history of global capitalism.

    1. SufferinSuccotash

      It seems to me that a longer look at the historical record shows no connection at all between free trade regimes and political liberalization. It was the authoritarian Pussian monarchy that began promoting the lowering trade barriers that led to the creation of the Zollverein in 1834. The most determined opponents of protective tariffs in the US prior to the Civil War were slaveowners while the supporters of protectionism were mainly antislavery Whigs or Republicans. The autocratic Napoleon III favored free trade while the Third Republic that followed him adopted a protectionist policy.
      Do any economics departments actually teach economic history these days? If not, why not?

      1. theories and games

        Do any economics departments actually teach economic history these days? If not, why not?

        No. Most econ grad programs in the US do not require any history or philosophy of economics, and many don’t even offer such courses. They’ve been crowded out by a focus on technical training: mathematical models, statistical tools, etc. Econ departments aren’t hiring professors with a focus on history and philosophy, and they aren’t producing new PhDs with that focus.

        1. Off The Street

          One wonders whether that decline in economic history teaching was in concert with the overall denigration of Western Civ and resulting enstupidation, or was perhaps due just to some endogenous econ department forces?

      2. Louis Fyne

        back in my day at my fancypants alma mater, there was literally only one undergrad econ. history class, “Economic History of the US”. Plenty of everything else, econometrics, game theory, macroeconomics, finance, you name it.

        And I guess the History Dept. thought it was beneath them to pick up the slack.

      3. Grebo

        There is economic history and there is the history of economics. Neither subjects are taught anymore is my impression. This may be because doing so would detract from the force of neoclassical ‘education’.

        1. diptherio

          Yes, a few institutions still offer a “History of Economic Thought” course. Mine still did back in the early aughts, although the only professor who taught the course is now retired, so I don’t know if it’s still on the menu. But while I did get an introduction to economic thought from the physiocrats up to the neoclassicals, we never, ever, were taught any economic history. From my college education, one would be led to believe that the history of the economy is nothing more than the history of economic theory. One of the many reasons I bailed on advanced study in the discipline…

    2. Robin Kash

      I’m reading Michael Hudson’s Superimperialism. Therein he points out that the US as the only creditor nation following WWI hampered European recovery precisely by relentlessly calling for repayment of war debts and by squelching free trade, which would have enabled England and France to earn the wherewithal to pay, by refusing to lower tariffs to admit Europen imports. Since the US was the major world market, England and France ended up reneging on their war debts, partly because of trade and partly because Germany could not pay them outsized reparations. Germany had nowhere to go with any goods it produced. The Europen financial crisis came to a head during the Great Depression as the US turned inward, focusing on domestic recovery. Maybe I’m reading him wrong. I would be glad for correction by those with better understanding of the period.

      1. Off The Street

        Carroll Quigley is another author that discussed the post-WWI issues. He pointed out how much of Germany’s survival during that heavy reparations period was due to loans made by the US, and what happened to impact their economy and to some extent those of France and England, as precarious reparations creditors, when that lending slowed down. Countries going off the gold standard to seek some relief then indulged in competitive devaluations to try to garner some advantage or prevent greater disadvantages.

  4. The Rev Kev

    This is indeed a long article so I will just comment on one part of it and that is China’s President Xi Jinping changing the number of terms that he can serve which seems to have triggered a whole lot of Very Important People. First off, it is not our country. There are 1.4 billion people in China so it is up to them how they order their affairs. And have people forgotten that once there was no limit to the number of terms of service a US President could serve? That only changed to two terms after Roosevelt’s 12 years in power.

    I have read that Economist article that this page mentioned and the complaints amount to this. Western companies want to treat China like they did Russia back in the 90s but China is saying that if you want to work in China, you have to play by their rules. Make a boat-load of money if you can here but China is not yours to pillage and take control of like happened in the 19th century. The Chinese have not forgotten that little episode of their history when it was humiliation after humiliation piled on by by the western powers.

    Veering into tinfoil-hat territory, could it be that the world’s financial elite expected that with the wealth being generated in China the past coupla decades, that they expected there to arise a class of billionaires/oligarchs? And like most people in this class, loyalty to whatever country they grew up in is never a factor. And that they expected that this new class of billionaires could be enlisted to eventually take over China so that it could be run by the ‘right’ people and then sold out piecemeal to western countries?

    Sound unlikely? Take the case of Mikhail Khodorkovsky in Russia. The ‘political prisoner’ who is so into human rights right now. Through Yukos, he owned a series of Siberian oil fields and was about to sell them all to western countries (which would have put a strangle hold on Russia forever) back in 2003 when Putin threw his a** into the slammer. I suspect that this little episode gave warning to China what could happen with its own resources.

    With President Xi Jinping’s rule changes, this has now put the seal on the principle that in China, it is the State that rules, not a bunch of billionaires/oligarchs like in so many western countries. I sometimes wonder if this is not the real western ‘model’ much ballyhooed about. And that is what the pearl-clutching and fainting couches are really all about.

    1. PlutoniumKun

      I think you’ve put your finger on the real reason why there is so much pearl clutching about Xi taking control. The ‘dream’ if you like of the neolibs is that the country would be eventually controlled either by oligarchs or by corporations. Xi has made it very clear that the CCP is in full control. And its also quite clear that the CCP are aware that there are tough times ahead and know well that they will have to deal with an angry populace if and when the economy eventually stops growing fast enough to keep the masses relatively content.

      On a broader point, you don’t even need to have read history to know that opening up to China was not going to lead to that country embracing the existing world order. You just need to talk to regular Chinese people.

      1. JohnnyGL

        Let’s also point out how much of a leap forward has been made since the financial crisis in 2008. China was supposed to have some kind of crisis a couple of years after its fiscal spending binge resulted in a massive hangover. That has yet to bear out. Instead, look what the Chinese have done in the ensuing decade….

        The Chinese are now comfortably moving around a USA sized population on vacation every year. In the USA, we can’t even do disaster relief. A city like Atlanta was brought to its knees a couple of years ago with 1in of snow.

        All we’ve done here in the USA in the last decade is rip up public schools, kill an entire city’s worth of people with opioids, and shovel money at bank balance sheets. We also smashed a few smallish countries for fun and profit so that we can “show resolve”.

        We tried to strangle Russia with sanctions and they’ve basically shrugged it off, bossed our Saudi and Israeli proxies in Syria and basically blunted us in Ukraine. We’re being embarrassed by a country with less than 10% of our GDP and military budget.

        Trying to claim some absurd moral high ground with regard to democracy is just putting the insecurity of our elites on full display. The unipolar moment is coming to a close much sooner than anyone dared to anticipate.

        1. Sid_finster

          Moreover, the nomination of Bloody Gina drives a wooden stake into the heart of the myth that “we’re The Good Guys®” and its dippy cousin “all we gotta do is elect Team D and we can be The Good Guys® once more!”

          We demonize Russia at every opportunity, but I don’t see Russia appointing torturers to high office.

            1. What are the voices saying to you?

              Judging by the Western media it is a purely psychological entity that our ruling neoliberal & neocon sociopaths and sadists are using to blame for everything that is not working according to their fantasies.

          1. Norb

            Whenever I ask one of the rabid Russia haters If they have actually listened to one of Putin’s speeches, invariably, the answer is no. Their impressions and understanding is arrived at solely from the MSM. It is striking to me how the roles have been reversed concerning the former Soviet Union and American politico’s. Where once a case could be made of USSR extremism, Russia, and Putin in particular, seem the most level headed and rational of the bunch concerning important international affairs.

            I imagine this position is possible only when you acknowledge that other nations have the right to pursue their own lawful interests and directions of development. This should be the opening question when discussing international affairs. You can instantly see if the discussion will be a waste of time. Meaningful conversation about the nature of American Empire is impossible when the terminology is obfuscated or misdirected purposfully or ignorantly.

            We live in a time when the role of National and State power is once again being redefined. It is a new Enlightenment. How can technological development be directed toward a long lasting, sustainable, future. Corporate governance doesn’t seem up to the task, regardless of the endless propaganda espousing otherwise. Reality always exerts itself, and continuously pursuing short term monetary interest is in no way a stable, National foundation.

            The elite in the West are showing signs of strain because China and Russia are showing alternatives. TINA can be forsaken, and that drives them to insanity.

        2. Altandmain

          Trying to claim some absurd moral high ground with regard to democracy is just putting the insecurity of our elites on full display. The unipolar moment is coming to a close much sooner than anyone dared to anticipate.

          Not to mention, democracy itself is under the control of the billionaires, corporations that hire lobbyists, and other special interests.

          I’m not saying Putin or the Chinese CCP are perfect. Actually they are quite corrupt. The thing is, both have managed to significantly improve the standard of living of their nations. I don’t think that most Westerners truly understand the economic despair that occurred in the 1990s under the darkest days of neoliberalism. China too – it has as the high speed rail article notes, in some ways, overtaken the West. Perhaps only the European nations like France have comparable high speed rail systems for example.

    2. urd

      While I do agree with you, I would like to point out that one of the bigger issues in China is that the vast majority of 1.4 billion people don’t have a say in their own affairs. However, since those who are clutching pearls the hardest over this issue only care about this when it suits their own agenda it’s hard to take their position seriously.

      I’m not really surprised at this change in Chinese leadership rules, but it appears the inner circle of Chinese government no longer has anyone who was around during the excesses of Mao.

      1. makedoanmend

        “While I do agree with you, I would like to point out that one of the bigger issues in China is that the vast majority of 1.4 billion people don’t have a say in their own affairs.”

        What you say is so true. For people who really care about democracy (including economic democracy and in-job democracy) we would hardly take China as an example of what we want for ourselves, our children or grandchildren.

        On the other hand, how many of us in the supposed lands of democracy actually feel that we have any impact or relevance to what is going on these days?

        The democratic deficit is a reality nearly everywhere.

        I just can’t get that worked up about China when my own Irish government’s only constituency are business people and the rich. The rest of us are just meat by-products.

        (Oh, and up the Irish for taking the Grand Slam today!)

      2. witters

        “I would like to point out that one of the bigger issues in China is that the vast majority of 1.4 billion people don’t have a say in their own affairs.”

        You mean they don’t have the empty ritual of voting? And all they have is the power to decide/determine that a ruler no longer has the Mandate of Heaven?

        1. John k

          And our say, as Bernie has said, is between tweedledum and tweedledee, both of which favor eternal war and neither of which would consider jailing a banker, increasing min wage, or med for all.

        2. animalogic

          Just to pick up on the point of supposed contrast between “autocracies” & “democracies”.

          “Democratic revolutions occur when previously rising expectations have been dashed, and the populace has no outlet for their anger and frustration. In democracies, governments can be changed (as in 1932); but in autocracies, the ruler’s cronies are protected from the privations, and with no alternative avenue of recourse, and seeing the manifest injustice of the benefits of the system, the populace revolts. [my emphasis]

          It has become increasingly clear to many now that “democracy” is in fact little removed in practice from an autocratic form of government. The Stanford [?] Study demonstrated pretty clearly that the US is an Oligarchy. I would hazard to guess that similar studies in “allied” democracies would differ only in degree.
          Yes, governments can be changed. But…nothing changes…except to get worse. Voting is a piece of theater– a pressure valve. The governing Oligarchs, the Elites can NOT be changed…absent a populous driven to forceful revolutionary change.
          Thus, in a sense, democracy is an impediment to meaningful change: democracies today possess the same security state apparatus, the same propaganda agenda — indeed, you could argue that democracies do all this better.
          Perhaps, real change is “easier” in an open autocracy, in the sense that the population is better able to focus, concentrate on their “enemy” because the enemy is obvious. Nor can they waste time in futile attempts at change via the existing system (if Obama & Trump have done one thing, it is to show how simple it is to game the voting public with claims of positive change…)

      3. fajensen

        While I do agree with you, I would like to point out that one of the bigger issues in China is that the vast majority of 1.4 billion people don’t have a say in their own affairs.

        There is some liberation in that too – a Chinese citizen can rightly claim “The CCP decided this, they know what is the best for everyone” and not be further engaged. Whereas in a democracy, “They” can always rub into ones face that one somehow helped electing the bastards – even though it is the political party-machines who sets the candidates and there is no “none of the above”-option on the voting papers (this has been proposed several times in Denmark)

        For example, as a Danish person it is with great concern and shame one sees that “my” current government is dead-set on out-STASI’ing STASI (and probably the DDR regime too) on mass-surveillance and “interventions” into peoples lives driven by machine learning algorithms pointing out problem-people (the machine-nanny is so nobody will ever be personally responsible for the inevitable mess). China is going even more STASI, but, Hey, nobody *really* voted for this in China. In Denmark – someone did or it can at least be construed that “it was a democratic decision” smearing the guilt onto the hapless populace.

        So we have the freedom to write many futile rants on FaceBook, Twitter and maybe in the newspaper, even getting lots of responses; Whereas had we lived in China, we would not need to expend nor experience any mental anxiety on politics because it is not our responsibility unless we are on of the few specialists on the relevant CCP political committees. Maybe this is not all bad?

    3. ObjectiveFunction

      Great piece, very central. A couple of add-on thoughts fwtw:

      1. The analogs between Mercantile China and Wilhelmine Germany are indeed disturbing:
      -Two highly industrial, socially mobile, high talent societies Winning(TM) under conditions of rapid technological and commercial globalization (steamships, cars, electricity, telegraphs, industrial combines, plantations, etc.)
      – Two societies historically, and with some justification, resentful of past invasions by foreign powers
      – Two societies (in their own minds) late to the Great Game, the race for overseas territory, markets and resources, and feeling ‘cheated by history’.

      Side note: Certain pan-Chinese nationalists of my acquaintance aver that China would have settled Siberia, Australia and possibly Western North America had the perfidious Europeans (plus their wannabe, Japan) not bent all efforts to keep them prostrate starting in the late 18th century. More crudely, 1/4 of the world’s population by rights should control 1/4 of its landmass, rather than an insignificant sliver of Anglo Saxons and Russians (with those ((((homeless cosmopolitans)))) pulling their strings; it’s amazing how much Asian nationalists have picked up from what we now call alt right)

      2. More hopefully for the planet, the prewar Germany – new China analogy breaks down in that neither China nor its rivals (ex-North Korea) shows any serious social inclination towards the social militarization necessary to deliver a non-nuclear challenge to the Western order, or to delude itself into thinking it can.

      One less famous but very distinctive driver of WWI was the fashion of middle class militarization that took place throughout the West from about 1875 onwards. The reasons for it are too complex to relate here, but by 1910 every town had its armoury and every county its reservist battalion, filled with weekend banker hussars and shopkeeper artillerists. So in effect a large part of the European (and American and Japanese) bourgeoisie was not just ready but eager to answer the call in 1914, deliver a Waterloo style thrashing to the [Other] and be home by Christmas to regale sweethearts and grandchildren with stirring tales of valour and national elan. Gott mit uns!

      I just don’t see this occurring in China, among Chinese friends, etc., or indeed anywhere in the world save North Korea. They despise whitey, sure enough, mostly by reading our own media and attending our intellectually infantile universities, but people to people, they don’t truly fear us, or anybody else, any more. They are busy gathering in the fruits of a globalizing order that has voluntarily invited them to become the world’s workshop and dominate at will any industry they choose to be in.

      The hardy veterans of 8th Route Army are dead. Chinese society has again reverted to the traditional view of soldiers as little better than bandits, and a military career is not seen as honorable for the precious children of the elites. “Good iron is not used to make nails, nor good men to make soldiers.”

      And for all the technical modernization, some of which is real (but exaggerated by our own MIC for scare value at budget time), the Central Military Commission is no Prussian Generalstabs. The core competency of all Asian officer corps for 2 generations now has been golf course development and real estate (s)peculation. The career NCO cadre, which is the core of any effective armed force since Assyria, is even worse off, underpaid and neglected.

      1. fajensen

        … the fashion of middle class militarisation that took place throughout the West ….

        China is only one half of a possible major war, there is that other country where everyone are deeply infatuated with all things military and the idea of using military solutions for all of lifes little problems.

  5. Louis Fyne

    As much as I’m a fan of Thom. Jefferson and the Western Enlightenment, here’s some shocking news to pundits and the intelligensia….Greco-Western Enlightenment political theory isn’t the only pony in the show.

    It wouldn’t hurt the intelligentsia to discuss Confucius or Asoka over their next wine mixer. Maybe walk a half-mile in someone else’s shoes.

    But I guess full-spectrum-global-dominance applies to American political theory too.

  6. Whiskey Bob

    UpThe article was an interesting read. I would be more worried about the US then the Chinese to be honest. It is the US that has a waning empire due to its neoliberalism that’s hanging itself by its own petard. In the face of a rising Chinese superpower, the US is going to do whatever it can to maintain their number one status.

    The Chinese are more autocratic, but that offers them a degree of interventionism into their in affairs that the quagmire of bureaucracy in American cannot do. America is essentially the ruling class plugging their fingers into their ears and hoping everything will carry on as normal while giving small concessions to the middle class and maybe even working class. China is also repressing the working class, but the middle class now is in acension.

    There may be something that may dash those expectations in the future but right now in the US, expections are already being dashed and people are becoming more aware of the heavily political nature behind the unfair circumstances stacked against them. It can be seen that the US ruling elite is readying and priming for warmongering especially with the rhetorics of Donald Trump.

    The Chinese appear to be enarmored (or not) of their own “Putin” where a strong man takes autocratic control to fix things up, and such a figure comes to power in response to a decay, notably a decay caused by unchecked liberalization, like in the waning years/fall of the USSR and the Deng Xiaoping days, where standards of living and decency fell. Though Putin became comfortable with expressing nationalist interests militarily and China is going to follow down the same path.

    China began opening up military bases in Africa to protect their investments there and it will be almost assured that they will launch military operations at some point. Capitalism (China after Deng is included as they are pretty much state capitalism) leads to imperialism and then leads to a cold war that could possibly turn hot.

    The Russians are defending their historical territories or their former allies against US imperialism. The Chinese are expanding and trying to defend their expansions, taking advantage of the Western exploitation of Africa by trying to appear as a better business partner. The US/Western imperialism is being nipped away and their ruling class are threatening back against them using whatever they have at their disposal. Democrats are going crazy against Russia and the Republicans are scared stiff about China and Iran. The US is in decline and let’s hope that their entrenched bureaucratic ruling class, more aristocratic and autocratic than egaltarian and democratic, do not lash out in a violent militaristic fashion and bring the planet into another world war.

    (There is the concept of Soviet imperialism that can be an interesting related topic to study but that’s for another article. Pretty much it’s the USSR having to play the game of state capitalism to advance forward society to what was hopefully socialism but became stuck in the bureaucracy that was created in the process.)

    1. Jamie

      Apologies in advance for the pedantry…

      hanging itself by its own petard

      The ‘petard’ that in the usual turn of phrase “hoists” the user of it, is an explosive meant to breach the wall, not a pole from which one can be hanged.

      : )

      More seriously, I appreciate the distinction you make between a defensive Russia and an aggressive China. “We” (our news media in particular) have a bad habit of omitting the context whenever we speak of China or Russia. “The context” in this case, being ourselves and our own imperial adventures. But seeing the expansion of China into Africa strengthens the analogy between China and pre-war Germany, and so strengthens the argument presented above.

    2. animalogic

      “China began opening up military bases in Africa to protect their investments there and it will be almost assured that they will launch military operations at some point. ”
      The only Chinese (singular) base I know of is in Djibouti: are there others ?
      Your conclusion that the Chinese will “assure[dly]” launch military operations in the future is, to say the least, contentious: it requires some compelling evidence.

      1. albert

        “…Your conclusion that the Chinese will “assure[dly]” launch military operations in the future is, to say the least, contentious: it requires some compelling evidence….”

        Perhaps, but I believe China is responding to US intervention in the region. China is making serious investments in Africa, whereas the US policy seems to require military intervention first, then taking any economic benefits later. I’ll predict that any Chinese military operations will be a direct result of US military operations, or those of US-backed surrogates.

        . .. . .. — ….

  7. a different chris

    I don’t think the above was really clear enough, or maybe they didn’t mean what I think… but what I think they were trying to outline was:

    1) Country is loosely run at some baseline political structure
    2) Prosperity increases (for whatever reason, generally nothing to do with politics)
    3) As people get more comfortable, they thru inattention allow authoritarian types to gather (more) power
    4) When the inevitable downturn happens, the authoritarians aren’t really smart but…
    5) A scapegoating of “the other” and a good war (or wars!) can maybe divert attention from said authoritarians shortcomings
    6) And as a bonus said wars centralize power even more

    And now you are stuck looping between 4 and 6 until the increasing feedback causes the entire country to simply cease to exist. Prussia, anybody? That was before nukes, of course.

    Here’s the thing: Did I just describe China, or the US? I don’t see China involved in a lot of wars at the moment. Compare the difference in presidential power between Nixon and Trump, or worse what Clinton would have been able to pull off with her deep connections.

  8. Richard Smith

    Well, it’s possible that the Economist and market-happy economists actually believed their propaganda back in the 1980s when they were pushing the capitalism-to-democracy thesis. But it’s just as likely that they weren’t so dumb, that they never really believed their propaganda. It was just a handy cover for their criminal support of capitalism based on neo-slave labor in China’s export zones: “Oh it’s awful now, but capitalism will promote democracy and then it will get better.” That at any rate is what businessmen told me when I was researching in China in the early 1990s: They knew this democracy pitch was nonsense but we’re happy to use it to help them sleep at night, to tell their wives and children back home why they were exploiting children in China and so on.

    1. JohnnyGL

      I think you’re right. It’s prob a combination of
      1) breathing their own propaganda fumes because the lure of cheap labor and cheap resources was too tempting and 2) hubris that Russia and China would NEVER be able to challenge the West.

      By 2000 when Clinton did PNTR with China, Russia had been getting trashed for a decade and looked like it was depopulating and turning into a bigger version of Albania. Post-Asian Crisis, western elites probably thought they could turn China into something like Indonesia, — a source of cheap labor that never really moved up the value chain.

      I think the leadership in both countries was greatly underestimated in the west. Both countries look radically different than they did almost 20 years ago.

      1. visitor

        I will always remember the article “Russia is finished” by Jeffrey Tayler, published in 2001 in the Atlantic Monthly.

        Historically speaking, it took so little time for Russia to regain significant strength.

    2. funemployed

      “just as likely…they never believed their own propaganda”

      I wonder if this doesn’t indicate a major shift over the past decades in more than just econ. I think of LBJ and Nixon (and a lot of others in the know), who were clearly aware that Vietnam was hopeless and awful and at least a little immoral, but feared the political consequences of saying so in public (and pretty much always chose personal ambition over doing right).

      I compare that to today’s crop of hegemons who think losing wars is winning and literally cannot grasp that it is best (most of the time), to disguise one’s belief that proles are inherently far too dense and gross to grasp just how noble and brilliant their rulers are.

      Is it better to be ruled by a competent evil or an incompetent one? I’m honestly not sure.

  9. JohnnyGL

    I wonder if we’re underestimating the role of USA’s interventionism and provocations over the past decade and a half.

    I suspect that many in the political class greatly fear what they see as an irrational USA, drunk on its own military dominance.

    How much has this helped to build domestic consensus within Russia and China to consolidate power in a trusted group of insiders who’ve established a solid track record of building capacity to resist US imperialism???

    Russian and Chinese elites to uppity workers: “You can’t have nice things because we need to make sure we can land hard punches on the USA if they cross the line. Look what they did to Iraq and Libya! They want Syria, Iran, and N. Korea next, then we’ll be surrounded!!!”

    1. Sid_finster

      After Iraq, Syria and Libya, anyone would have to be a fool to trust the West. The United States and its “allies” have consistently acted in bad faith since the time America became a hegemon.

      And speaking of Russia at least, living standards for the average frustrated Russian have risen dramatically since 1997.

    2. albert

      “…I wonder if we’re underestimating the role of USA’s interventionism and provocations over the past decade and a half….”

      I admire your skill at understatement.

      . .. . .. — ….

  10. Mark

    The article mixes two questions which ought not be mixed up. First: Are increased trade relations likely to reduce the likelyhood of war between countries? And second: Is increased economic development and material wealth likely to further democracy within a given country?
    Ad1. The example of WW1 is a rather poor argument against a reduction of war by trade relations if one takes a closer look. The nationalistic tensions in the Balkans would have happened with or without trade between the western European powers. Both Russia and Austria—Hungary are backwards powers at the time in a struggle for local dominance and I am not able to see how trade affected the eastern front. In the west three colonial powers struggle for their place in the sun. With France already way past its peak the rivalry between the German and British Empires is for prestigious colonial possessions. Not the incredibe industrialisation of the German Empire but the massive expansion of the imperial navy for colonial purposes brings it in conflict with Britain at the turn of the century. This struggle for dominance should be familiar for anyone who has spend some time with the last two thousand years of European history — from slave taking Romans over petty feudal Lords to early capitalist empires. The deadlines of the conflict is determined by the level of technology and the strict alliances which forced every great power into the war. Free trade in the 19th century did not matter. If the last 70 years can be taken as a significant amount of time increased integration was successful in finally delivering peace between countries in western Europe, which was acknowledged by the Nobel Peace Prize.
    Ad2. The idea of increased democracy being induced by more development could be linked to the early struggle of capitalism to extract itself from feudal stranglehold. When we read historical accounts it becomes clear that the interests of the fledgling bourgeoisie remind one indeed of a liberal democracy in the modern sense. Right of private property, freedom of movement and occupation and a balance of power between the branches of government in contrast to servedom and total power in the person of the feudal Lord are typical of both bourgeois and democratic movements and often they are difficult to differentiate, see the American and French revolutions as well as the many revolutionary movements in the 19th century. Unfortunately in modern times it is quite well established that autocratic or totalitarian government combined with capitalism works quite well. The state may be total and dominating but must not suffocate capital to achieve this. As an additional example to the ones in the article would serve the Third Reich before the war (1933 – more or less 1938) which combined a total state with a vibrant capitalist economy.
    To sum up it is no surprise that China did not become a western liberal democracy by increased wealth but the question of peace between nations is different and the article did not produce enough evidence to contradict this hypothesis.
    PS: Mrs. Merkel was just elected for her fourth term as chancellor and could serve for the rest of her life as long as parliament keeps electing her. I am yet to read the same flood of news pieces about it.

    1. JBird

      Whatever the reasons for it, the continent put all the wealth it had accumulated into a big pile, set fire to it, and then threw all the lives of several generations with their hopes, dreams, abilities, and possibilities into it. There was no good reason for it and they didn’t have to fight. But they did.

  11. John Wright

    I do not understand the emphasis on the importance of “democracy” and “democratic reforms” as I view most USAians as overwhelmingly concerned about their important economic/lifestyle affairs first (a job, a safe place to live, enough food, staying on the good side of the law and good schools for their kids).

    If USA’s democracy happens to provide this, that is OK with them.

    It is not a stretch to say the form of a nation’s government is overwhelmingly important to those in power, and not the hoi polloi, who are most concerned about “tangible benefits” mentioned on NC.

    I doubt if many Americans view their family, church, school, or job as democratically run institutions.

    And the USA’s alleged instrument for spreading democracy around the world, the USA’s military, is not run as a democracy.

    Maybe the big promotion of democracy as a desired goal began with Woodrow Wilson.

    “On April 2, 1917, President Woodrow Wilson went before a joint session of Congress to seek a Declaration of War against Germany in order that the world “be made safe for democracy.”

    A day earlier would have been an ironic choice.

    And we are living with the consequences.

  12. Summer

    Can you blame China for their protectionism when it was barely a century ago that the West was trying to carve it up like the Mid East, Africa, and Latin America?

    1. drumlin woodchuckles

      No, I can’t and I don’t. I do blame the Free Trade hasbarists for their Free Trade hasbarafication. I do blame our ruling elites for pursuing Free Trade with China in order to create export production platforms in China to use against our own production platforms here, in order to exterminate industrial unions through the extermination of their industries. And I blame our elites for doing the same with Free Trade from elsewhere for the same reasons.

  13. kareninca

    It seems true that historically revolutions have occurred in times when rising expectations have been dashed, but is there a historical precedent for China’s demographic situation? It is aging like crazy, and is heavily populated by seriously overweight, spoiled only sons, who have no-one to marry. Who have grown up in a pool of estrogen-rich pollutants, breathing lung-destroying air. Are they going to fight??? And those young men who are in shape to fight – if they manage to marry – will have four parents to support (their own and their wife’s). If they die four old people will starve, along with their one kid (still a boy, from what I can see); that will dissuade them.

    I’m sure things will go south when the Party can’t provide a good economy, but it’s hard to picture just how. I suppose the answer is that if you have 1.4 billion people, you can get enough rebels, even if a higher percentage than usual are not available.

    1. cbu

      China is not aging crazily. It’s West Europe and Japan that are aging crazily. See below:,_EU-28,_2016-80_(%25_of_total_population).png

      As for excessive Chinese male, “we find that during times of high marriage competition, young men
      are more likely to become entrepreneurs, work longer hours, save more, and amass more assets. The findings highlight the important role of biological forces in shaping human economic behavior.”

      Furthermore, high marriage competition probably will produce a more competitive next generation. Finally, as China’s economy continue to develop, she will attract more foreign brides, which will partially alleviate the problem.

      Do not believe everything you see in the Western main stream media.

      As for things go south, Chinese have 80% home ownership and $27 trillion domestic savings. The majority of Chinese are stack holders who will hate to see their life-time efforts destroyed in social instability.

      1. Sam Adams

        Essentially too many males competing for too few females go Viking. No norsemen this time going after Lindisfram gospel covers and candlesticks.

        1. Harold

          I think the problem with Scandinavia (from reading McNeill) is that it never had enough arable land, not that it didn’t have enough females.

          1. berit

            Emigration from Norway to USA and Canada started with Quakers and other dissenters seeking religious freedom. But poor economic and social conditions drove more people to emigrate, and the US Homestead Act certainly pulled many young people from large families on small farms. With a population average of around 2 millions in the period of mass emigration totaling nearly 800 000, it took several regions 100 years to grow back to the proportion of the population they had had before the mass exodus. Today there is netto surplus due to immigration – without which the population would be aging and in

    2. Jamie

      It seems true that historically revolutions have occurred in times when rising expectations have been dashed

      This does not seem to be the case to me. David Hackett Fisher wrote an exhaustive book on the subject of the correlation between revolution and the price of grain. His conclusion was that, in at least four significant revolutionary periods, famine due to high food prices (in turn due to one or more years of lost harvest) were the root cause of revolution. This could correspond to the “hopes being dashed” part of the above formula, but he found no evidence that a period of rising expectations necessarily precedes the catastrophe. In fact, he notes that during the worst of the crises, people do not revolt, because they are too weak from hunger and too preoccupied with trying to survive. It is only with the recovery of more “normal” conditions (i.e. the return of expectations) that the anger of the people is codified into new laws and institutions.

  14. Scott1

    I myself used to believe that nations that did business with each other were more likely out of self interest, to care for the well being of their business partners.

    In the book Classic Readings of International Relations was Grotius, whom I remember as Greek saying in 525 BC that one is more likely to go to war with a nation with whom you do business with, than not.

    It is unfortunate that I do not have the book in my library. I did attempt to find the contents page. Now I have to look up Hugo Grotius, or is it Grottus?

    At any rate the idea becomes the Cold War worked because the US & Russia were not trading partners.

    It was a big deal for me to discover that I was wrong. I have attempted to continue to justify the concept of peace through trade on the basis that belief in it is missing, and that is the reason for the fallacy.

    I am aware that it is true that nothing works in government that is not believed in. If you believe in Democracy, then you can make it work.

    Oligarchs don’t believe in Democracy in the US or in Russia, so it doesn’t work.

    The Revolution has been the end of Democracy in the US as it is replaced with an Oligarchy. Those that believe in Democracy have become not Revolutionaries but Counter Revolutionaries.

    The use of the US Treasury is denied to the American People by the Oligarchs who can simply buy legislators and have them do their bidding. For them the useful Big Lie is that the US Treasury hasn’t got enough money for Guns and butter.

    When & Where did the Chinese believe in Democracy?

    I had predicted that when Hong Kong reverted back to ownership by the Chinese, that 99 year lease of the British ending, that Hong Kong would take over China, not China taking over Hong Kong.

    To the degree China has become a State Capitalist society with the Maker Movement replicating the theft of technologies practiced by the Americans who thereby built textile mills & that industry, it has happened. All of China simply doing what Hong Kong did became the case.

    It happened that the stamp Made in the USA, was supplanted by Made in China. This was led by Made in Hong Kong.

    Trump got our US Post Office Building in DC and after that or concurrently his ambition was to see his name big in Moscow. Trump wants to do Business in Russia. It is the micro becoming macro in that Trump became the US President during Economic War between the US & Russia.

    Since you are stupid to believe in Utopia, everyone is normal who believes in Distopia. There is enough of competition that a technocratic mediocrity arises.

    Trade between Germany & France prior to WWI was great. Trade between Japan & the US prior to WWII was great.

    Sanctions are the Economic Warfare that leads to War which is how debts are written down or written off when the Capitalist System disallows the write down of debts. Trump’s debts mean he personally is a slave to Russia.

    It is a Whacky ole World. To prevent war with Russia? should Trump be given the infinite money of the US Treasury to pay his personal debts to Russians close to Putin?

    The Times have made the Great Man in the Form of Trump. In so much as Trump is in reality the anthesis of a Great Man however he makes our history is characterized by his own Reign of Terror practiced upon the weakest segment of labor living in the country that is simply a marker of the oppression of all of the members of the nation that are labor, captured by neoliberal feudalists and the financial institutions of FIRE, Finance, Insurance & Real Estate.

    Economic Warfare precedes real artillery war usages. Sanctions inspire the sneak attack.

  15. susan the other

    Thank you for this post. It is the crux of the matter. Because capitalism cannot survive without its profits… hence the moniker “capitalism”. No? And in a long reset, a recession, the profits driving politics to expand whether by war and territory or by trade surpluses or whatever, evaporate. And without profits its hard to maintain popular support. So China will be very interesting. China has come to power in a time without precedent – a time of global environmental destruction and competition for resources. It is no longer a question of populism and nationalism – it’s more like we all have to hang together or we will surely hang separately. The essay is right – peace has nothing whatsoever to do with free trade – it now depends on sustainable living. And sustainable living, almost by definition, precludes capitalism. And military power. And war. It is time to repurpose the idea of “capital” into something that sustains us all. I think it is entirely possible. But we have to surmount our need for profits and expansion – we’ve simply gotta lose that little fantasy. The new “underlying reality of power” is a rational, and achievable, approach to survival.

  16. ebbflows

    Just as no physicist would claim that “water runs uphill,” no self-respecting economist would claim that increases in the minimum wage increase employment. Such a claim, if seriously advanced, becomes equivalent to a denial that there is even minimal scientific content in economics, and that, in consequence, economists can do nothing but write as advocates for ideological interests. Fortunately, only a handful of economists are willing to throw over the teaching of two centuries; we have not yet become a bevy of camp-following whores.

    James M. Buchanan in Wall Street Journal (April 25, 1996)

    This is why in the past I’ve used the phrase ‘creative class writers’ WRT the vast majority of PR marketing front men that are passed off to the public as – the smart guys – in the room. Zakaria and Friedman fall into this category, largely due starting off with the answer ex ante and then fleshing out reality with whatever seemingly conforms, even if its out of greater context.

    As far as elites go I think its a mixed bag, you have the Koch sorts et al and then those that not unlike the unwashed, that fall befoul of various environmental group think factors.

    The one thing I find curious is the fear that underpins the whole thing, from individual to group[s. In trying to abate this fear it ends up manufacturing more potential [stored] down the road. Which when it eventually reaches a tipping point the doom prophets are marched out to say, I told you so, with much head nodding. Being as such only these prophets know the path back to righteousness, after a brief bit of pain, self evident due to forecasting abilities as it were.

  17. George Phillies

    Readers may also find of interest Corelli Barnett’s Pride and Fall series on the trajectory of English history over the last two centuries.. The first volume is perhaps the most relevant here.

  18. audrey jr

    I am amazed, frankly, that any sentient being gives credence to anything that Fareed Zakaria has ever said. I remember his opining on MENA wars in the op-ed pages of Newsweek, back in the 1990’s, and the absolute nonsense he spouted. That was at a point in time when I was coming to my senses and Zakaria and his ‘expertise’ on the Middle East region was one of the factors in my canceling my subscription to that periodical.
    Thanks, Yves, for an interesting read.

  19. Darthbobber

    I recommend Giovanni Arrighi’s Adam Smith in Beijing for a world systems theory perspective on developments in China.

    BTW, wasn’t the shock therapy extreme liberalization program for the former ussr and eastern block supposed to bring about all that awesome political liberalization? Didn’t the jury come in on that awhile back?

    Who believes that a formerly harmonically convergent China suddenly morphed into a personal dictatorship due to the abolition of formal term limits? Xi is as removable as he ever was.

    The economic/political convergence fable has been floated for a very long time. Actually a much better case could be made that pushing through Friedmanite/Hayekian doctrine can only be done by authoritarian regimes.

    I think Bill C. put the US on board with this pretend belief as applied to China as a way of justifying his “engagement” policy.

  20. Craig H.

    Everyone should read Machiavelli. He was a gifted analyst and his writing style is fantastic and his books are fun to read. Also a lot of ridiculous politics makes some sense if you ask yourself “what would Machiavelli say?”

    I bet the Chinese read Machiavelli close or there is some close Chinese equivalent that they study.

    Fun fact: Machiavelli was imprisoned for treason for a month in 1513 and tortured and then they said “oops our mistake” and let him out.

    1. Harold

      Machiavelli says “the voice of the people is like the voice of God”. Yes, I agree, everyone should read him. But I don’t see what this has do do with the Chinese.

  21. JBird

    2018 update: Even the American Revolution had elements of this paradigm, as England reined in the colonist’s rising fortunes following the French and Indian War by taxing them for the costs, expanding the territory of Quebec to include all of what is now the American northern Midwest, and prohibiting expansion beyond the Appalachians.]

    All true and there was also the previously unenforced ban on affordable molasses imports from the Caribbean being enforced with the only other source being unaffordable British molasses; the American Colonies used the rum it made from out it to pay for its imports. No molasses, no rum. No rum, no imports. No imports, no economy. The British Parliament would not reduce the costs of British molasses as that would reduce both revenues for British rum makers and the income from the taxes that made it expensive.

    The run up to the war is just a fascinating mix of greed, arrogance, stupidity, self-centeredness, and folly; almost nobody really expected, wanted or planned for the war that they got. It just sorta happened.

    Reminds me of the current ruling elites. I can not wait to see what new war(s) they blunder into.

    1. animalogic

      “I can not wait to see what new war(s) they blunder into.”
      Although I understand your sentiment (idiocy in others can be amusing), I must say that I can wait…hopefully a very long time….

      1. JBird

        I would not mind waited a very long time either but I will use the entertainment to distract me from my fear.

    2. Jamie

      Yes, the story of U.S. independence does follow along nicely, but, although we call it “the revolutionary war”, colonial wars of independence are not really the same as “revolutions” in which the existing ruling class is overthrown. Breaking away and overturning are two different things. Confounding the two in order to bolster the argument is a mistake in my opinion. I do not believe the conditions necessary for a war of independence are the same as those needed for a revolution.

      1. JBird

        I do not believe the conditions necessary for a war of independence are the same as those needed for a revolution.

        They often co-mingle. Was there a war because of a desire for Independence, or was there a war because of what the government was made and was doing? The colonial leadership did like the idea that they would be the ruling class, if they won the war, and everyone, even the loyalists, was unhappy with the British government’s heavy-handed, lack-brained, incompetence.

  22. Lambert Strether

    The headline gave me a chuckle. So my sense of humor has not atrophied entirely.

  23. Roland

    I agree that liberal capitalism and global trade guarantee neither democracy at home nor peace abroad. This theory has already been tested, and it has failed.

    Another failed theory, not mentioned in the post, but implicit in the attitude of the neoliberal pundits, is that a world in which all societies have similar systems of political economy would tend to be a peaceful world. Experience shows that violent conflict often occurs even among groups with like beliefs and similar social structures. Ideological clashes can cause bloody strife, but ideological homogeneity can also end up in bloody strife. People can fight wars over ideas, but they don’t need Big Ideas to wage a Big War.

    However, another world-historical experiment is already under way, and the results should prove interesting. The question is whether demographically moribund societies are capable of embarking on major wars against one another.

    Today, all of the developed countries exhibit sub-replacement fertility and a median age rising well beyond youthfulness. In contrast, the most powerful countries of a century ago exhibited expansionary demographics.

    Will our contemporary world’s different demographics produce a fundamentally different sort of power-political outcome? There can be no satisfactory a priori conclusion. Wait for the data!

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