Platt Perspective on Business and Technology

Perceiving China – East and West 4

Posted in in the News, macroeconomics by Timothy Platt on May 27, 2012

This is my fourth installment in a series where I discuss China as that country is perceived, and both from within and by the outside world (see Macroeconomics and Business, postings 78, 80 and 82 for Postings 1-3.) I put this series in a directory that focuses upon macroeconomics and business, and for a reason. How China perceives itself as a people and as a nation, and how China and its leadership perceive the world around it shapes their policies and both internally and as they reach out to participate in the larger world community. How the rest of the world perceives China, and the how the West does in particular at least for the focus of this series, shapes that outside world’s engagement with China and both for proactive and reactive policy and action. And friction and potential for friction in all of this arise where there are fundamental mismatches as to what is assumed and what is perceived on both sides.

China as Zhōngguó, the Middle Kingdom has in a fundamental sense seen itself as the center of the world and as holding special place for that. This name in one variation or other goes back in China’s history at least as far as approximately 1000 BCE when it designated the Zhou Empire, now thought of in later historic context as the Zhou Dynasty, located in what is now known as the North China Plain. The people of the Zhou Dynasty – Zhōngguó saw themselves as the sole holders of culture and civilization, surrounded by barbarians. China has long since learned of other cultures and civilizations, but as with many peoples and cultures this sense of special place in the world has still held, and as an underlying assumption when not as a matter of conscious policy and perspective. And for purposes of this series and my writings on China in general that means China holding special and uniquely Chinese problems and opportunities and I stress both sides of that. How they see themselves as a people shape both their actions and their understandings as to what is appropriate and what is even possible and this underlies everything.

In Part 3 I noted a developing scandal that is erupting from Chongqing and that is embroiling China as a whole, centered around Bo Xilai and his wife Gu Kailai and an increasing number of others. And as I noted in Part 3, Bo was a leading contender for joining their Politburo Standing Committee. Bo Xilai can only be seen as a member of China’s aristocracy, its Crown Prince Party as the son of one of the People’s Republic’s founding heroes, Bo Yibo. And all of this with its still unfolding details is coming out in the age of the internet and in public view, and both within China and across the world – and at a time when China is facing its first internet-age major transfer of power and for both Party and Government leadership.

I have been writing on and off for several years now about the challenges that China faces and about its approaches to addressing them (see Part 1 for a list of reference links.) I would contend that much of the conflict and friction that arises in the international context for China comes from its understanding of its issues as being uniquely Chinese and from its attempts to control the conversation – the flow of knowledge, rumor and opinion through tools such as its Golden Shield Project (its Great Firewall) – and at a time and in a context in which hundreds of millions of Chinese citizens have cell phones and internet access, and when it has proven increasingly difficult and even impossible to control that flood of conversation and information sharing. Now it comes out that Bo Xilai and his provincial and local Party and Government apparatus were using surreptitious approaches to bug phone lines and spy upon other Party and Government officials. And in fact one of the reasons why this scandal first erupted as being so problematical was that this was being used upon national Party and Government leadership. And with this I turn to the core issues that I would address in this posting.

I have stated several times in this series that:

• I would propose taking a more business-like operational and hands-on practical approach and look at China and its challenges much as if nations were businesses. What are the policies taken and what are their practical implications and consequences?
• I would argue and with much less general disagreement perhaps, that there are more universally applicable business best practices and that decisions made and actions taken can have predictable consequences and results – in a business setting and even across industries and marketplaces.
• The same applies here, and certainly where a country – here China, is developing and enforcing socioeconomic and business policies.

First and foremost I would argue that while China is unique as a country and people, it and its people are also a part of the larger global community and experience. That is becoming increasingly necessary to acknowledge – and because of the way we are all becoming interdependent and real-time interconnected and both economically and culturally, and in the way that we are so increasingly and ubiquitously communicating about that and everything else as well. Every nation and I add every business has and holds confidential and proprietary information and knowledge and this must be held in confidence and protected as such. But nations and businesses alike need to be built and run from a foundation of process transparency and accountability. And ultimately, no nation faces entirely unique problems or challenges – and both because others face the same types of problems and challenges, and because problems and challenges that arise in one place do not respect or stay confined within any single nation’s borders.

• I have written about China’s developing population demographics time bomb (see for example my supplemental posting The China Conundrum and its Implications for International Cyber-Security – 17.5.) The implications and impact of this will be felt globally as China is closely integrated into the world community and our overall global economy.
• I have written about China’s environmental challenges, citing gray and black market rare earth mineral mining with their chemical and radioactive waste products (see for example The China Conundrum and its Implications for International Cyber-Security – 15, and the postings I cite there that also successively discussed this story.) Environmental pollution crosses borders. And for an issue such as rare earth minerals and their sales – these are considered strategic minerals by many countries, essential for key manufacturing industries and for national defense and China is the primary producer for most of them.

So what happens in China directly affects the global economy, and in every corner of the world. What happens in China is not just happening in or impacting upon China. If China’s current leadership is struggling with the internal-to-China scandal of Bo Xilai, and I add the other “China sourced” issues I write of – every one of them washes across all national boundaries and borders and problems initiating outside of China flow into China too.

Transparency and accountability have to be the first, initial steps for making any nation, or any business work more effectively and both internally and as they participate in larger contexts.

I am going to continue this discussion in my next series installment, considering Bo Xilai and the actions he is accused of as a potential watershed event – depending on how this is understood and resolved in China. And as a foretaste of that I ask a question:

• Will Bo Xilai and his group be treated as an exception and as a rogue group, or as more symptomatic of a widespread problem, and if the later what lessons will be learned and by whom, and what fundamental changes will be enacted to limit if not prevent a recurrence?

This is a situation that could develop into an easily forgotten show trial that would simply reinforce business as usual, or it could become a springboard for change and more according to the example that Deng Xiaoping offered both China and the world.

You can find this and related postings at Macroeconomics and Business and also see Ubiquitous Computing and Communications – everywhere all the time.

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