Great summary. Over here in HK, there seems to be a rapid frenzy to bring Chinese-style consumption, infrastructure, investment, supply chains and international market expansion to Southeast Asia. Chinese people are moving to Indonesia to teach Indonesians how to sell Chinese goods despite not speaking the local language, for example.
Indonesians do not see this as a national security issue. Meanwhile, my father, who's all set to retire from a factory outside Jakarta, remarks that Chinese companies and engineers are trying hard to get them to share his IP on developing dyes so that they can produce them at scale in an environmentally compliant way for the Chinese and Indonesian market.
Altasia - India is the new growth engine and it will likely be dominated by US and Chinese VCs/PEs.
"As of April 2023, the United States was the country with the largest TikTok audience by far, with approximately 117 million users engaging with the popular social video platform. Indonesia followed, with around 113 million TikTok users. Brazil came in third, with almost 85 million users on TikTok watching short-videos."
Sometime this year, Indonesia will take the crown.
"While Beijing has pulled back its overseas BRI lending—and Xi has exhibited some notable reticence toward hosting a third Belt and Road Forum—Indonesia challenges the broader narrative that the BRI is somehow fading away. In the world’s fourth-most populous country, Chinese investment has continued apace, and both governments continue to champion the BRI’s ability to deliver “mutual benefit” and “win-win results.” Still, understanding Indonesia’s experience with the BRI requires closer examination of the history behind China-Indonesia infrastructure cooperation, major projects beyond the oft-discussed Jakarta-Bandung HSR and their impacts on the Indonesian public, and the extent of economic engagement between Jakarta and Beijing."
Indonesia and the Middle East are where Chinese influence and presence will surge this decade, I think.
What blows my mind away is that in 1978, around the time of China's opening to the world, India and China were equal in per capita income terms, and as far as the lives of the average citizen is concerned, the Chinese had it much worse after the horrors of the great leap and cultural revolution. Whatever one's views about China's political system, their exponential dizzying rise is still humanity's greatest achievement!
I am currently reading Frank Dikotter's excellent books on China during/after Mao, and am starting to believe the "dizzying rise" is to some extent due to the economic nosedive that was the Mao era. The book on the "Great Leap Forward" (1958-1962) describes a dystopian system that reduced huge numbers of Chinese to naked, homeless beings. Utterly surreal.
I think George W Bush is the worst president in history…but I think the Bush family might be the Americans that deserve the most credit for expanding the global middle class. To this very day a Bush is on China’s payroll.
Seems Xi has done the impossible and united everyone from Sendai to Sydney to Sindh. Joko Wodowi and Anthony Albanese have met 3 times in the past 12 months.
As someone who lives in Altasia, I'm pretty skeptical of The Economist's prediction.
In the short term, we're in the middle of a manufacturing slump. In Q1 150,000 manufacturing workers were laid off in Vietnam alone and another 300,000 were furloughed. Perhaps another 500,000 have had hours cut. It'll take two or three years for orders to recover and staff to rehired and retrained. Most return to their villages (lower cost of living) which exacerbates the skill loss and rehiring latency.
In the longer term, the entire region suffers from the same issues seen in developed countries around the world: poor state capacity, slow roll out of infrastructure projects, and hamstrung by lack of housing.
As examples just look at how long it has taken Ho Chi Minh City to finish its new metro or new international airport. Look at the recent flooding in Vientiane, the poor transport options to the new airport TIA in Phnom Penh, more delays on Bangkok's HSR linking airports, and Manila and Jakarta continue to be among the least livable cities in the world due to traffic. (The Economist rates Manila #136 out of 173 cities in the world.)
I just don't see the sense of urgency needed for Altasia to actually become a thing.
I think this is right. Concerns about China's rapid rise on the geopolitical stage are warranted; any time there's a rising power like that, there's going to be a huge disruption in the status quo. Everything is being rocked today (still), but it is also evident that China isn't going to like take over the world.
I always go back to crusty ole Charlie Munger's viewpoint, that it would be absolutely stupid if the US and China couldn't figure out how to cooperate in some mutually beneficial way. In fact, in some ways, that's what happening, although the jockeying for power is also very real, and in direct tension with the cooperative "better angels."
the bit about greater altasian cooperation and better transit at the end reminded me of this video i saw recently, dhaka is getting a japanese-style metro and it already has massive ridership https://youtu.be/4Hpic8WMvkk
This is a very thought-provoking essay. I think you point out very well that war may be the single most important factor that could throw us all into disaster. More precisely, conflicts between major powers that escalate into larger conflicts.
We don't know yet whether the current Russo-Ukrainian War can remain localized and be defused.
We don't know yet whether the slow-simmering China-Taiwan-US conflict can also be defused, because if it comes to a boil, it will almost certainly not be containable.
Other than that I think your general optimism is realistic and achievable.
Your analysis is characteristically thoughtful in the most data-driven way. What is the significance of recent US trade data showing Mexico-Canada as No.1 share and China seemingly in retreat (for long term or temporary)? Thank you making us think.
Isn't part of Alt-Asia, ASEAN: the association of South East Asian Nations? I think there's more regional cooperation and integration than you think, and will be more planned in the future.
Would the U.S. and China still be friends instead of at each other’s throats?
If you're going to pick a metaphor from the animal kingdom, it would be far more accurate to say that the US and China are in a chronic threat posture toward each other. In terms of dogs, that means heads lowered, eyes locked, hackles starting to rise, nervous pacing, perhaps an occasional low growl.
That's why I like the way Biden is handling this, to the extent that an outside observer can know what's going on. If we are in a Cold War, we won't stay there forever—we will either move toward hot war or toward detente. As far as I can tell, Biden keeps offering detente, while committed to military strength. This I like.
Not sure what you mean by “detente”. If by “detente”, you mean permanent peace with no threat, if you look at the original Cold War, neither happened. The Cold War kept going until 1 side collapsed. That is the best case scenario in this Cold War as well.
"How much greater would China’s peak have been if Deng Xiaoping had sided with the Tiananmen Square protesters, and liberalized China’s society in addition to its economy?"
I'm not sure "China" would mean the same thing in this sort of alternative history. Deng was, if I recall, most concerned about the prospect of political fragmentation if the force of central government were weakened through the democracy movement(s) that spread to various parts of China in the spring of 1989. China's structure was in many respect like an empire on multiple levels: not only were geographically large regions like Xinjiang and Tibet dominated by ethnic minorities subdued centuries past, but sharp cultural and linguistic divides competed with common history in core regions like the southwest (centered in Sichuan), the Shanghai-dominated middle coast, and the Guangdong-dominated southeast, all with politically powerful local political actors. Periods of weak central government had led to eras of state fragmentation periodically for two millennia, the most recent being in the early 20th century.
Had Deng "sided" with the Tiananmen Square protesters, local governments would likely have seen the central government as vulnerable and the ideological foundation of the Party's dominance as damaged, and if circumstances had been favorable, they could have formed competing centers of power, as was true when Deng was a young man in the period 1912-27. (I understood this to be Deng's primary concern at the time.)
When the Gorbachev "sided" with perestroika and glasnost, the ethnic regions of the Russian empire broke off, and the tensions leading to that were manifest during the Tiananmen demonstrations (which coincided with Gorbachev's visit to China). While the USSR break-up postdated Tiananmen, Deng had reason to worry about that type of dissolution plus a dissolution of the core Han region as well.
So even if the democracy movement had somehow prevailed in 1989, I think it's unclear whether a unified China would have reaped the rewards, or whether the rewards would have been distributed among successor states, or whether the rewards would have been turned to deficits by the type of political chaos and violence that fragmentation had led to three-quarters of a century earlier.
I would add that Deng and Hu had every intention of liberalizing China, but not as quickly as the protesters wanted in 1989. But the liberal economy brought lots of benefits but was also bereft with corruption and wealth inequality. Xi’s ascendancy was no accident. He was reasserting his Marxist ideology by stamping out corruption and focusing on the selfishness of the billionaires. I believe him to be using national goals to pull the people together. Hopefully this is just a stage. Possibly he might find a balance to have a liberal democracy and to balance the wealth disparity.
I think we'll continue to be disappointed by Xi, James. You are certainly right that Xi initially attacked a politically centrifugal danger by clamping down on corruption, but in retrospect the goal of consolidating Party power does not seem to have been linked to any desire to create space for political or social liberalization.
If the long term project involves forging the lasting stability of China's national integration in the face of its dramatic ethnic and cultural fragmentation, the project of depersonalizing local government leadership and enforcing a fully bureacratic relationship to the center is an important tool--Xi's corruption crackdown was, I think, less a principled move than an attempt to make Bo Xilai (the Sichuan challenger to Xi's initial grip) a cautionary lesson. Like corruption, wealth inequality threatened Party power by generating an economic oligarchy: egalitarian income policies are justifiable on many grounds, but I believe their primary goal is, again, to avoid concentrations that can challenge Party control.
After living a short while in China and Taiwan, I came out thinking that the most successful policy of the CCP is the Cultural Revolution. On a cultural level, China put a shotgun in its mouth, and pulled the trigger. It is now a nation without a soul, a zombie country. It is absolutely horrifying.
One concern I have about Altasia is that, unless Burma/Myanmar can be politically stabilised enough to run transit links safely through it, India/Bangladesh is effectively an island relative to Thailand/Vietnam/Laos/Cambodia/Malaya/Singapore. Obviously, Indonesia, the Philippines, Taiwan and Japan are island chains anyway, but Japan already has fixed links between the main islands, and I expect one of the great infrastructure projects of the next couple of generations to be to connect the Philippine and Indonesian islands together (and a tunnel under the Strait of Malacca to connect Indonesia to the mainland). The fewer connections that have to be made by sea (for goods) and air (for people) the better, as every transition from one mode to another (ie at a port) is just deadweight loss, and air travel is a terrible environmental idea.
Obviously, no significant numbers of passengers are going to take a train Delhi-Singapore (even a high-speed train running flat out non-stop would take ~20 hours; a more reasonable service stopping in major cities would be more like 30), but that's certainly not going to stop freight moving that way by train (or even by truck). Kolkata-Bangkok would be a very reasonable 8-10 hour overnight trip by high-speed train if it's safe to pass through Myanmar and you can get visas easily.
India (and Bangladesh, Bhutan and Nepal) being trapped between Myanmar to the East, Pakistan/Afghanistan to the West and the Himalayas (and China) to the North means that it lacks the physical links to the rest of Asia that it should have - and which it traditionally did have in early modern times, when it was the connection between the Middle East and South East Asia, when all sorts of goods and ideas flowed through the Mughal Empire in both directions.
One of the U.S.'s cited strengths is its riverways, exploited for transportation of goods. I'm not sure why reliance on ports should be considered a setback because of swaps in transportation mode in itself. A narrow tunnel would have to be faster and more efficient.
Shipping by water still requires goods to be transshipped at a port, which is a fixed cost. For a relatively short journey of 3000 to 5000 km, paying for two transshipments will cost more than what you save by doing those km by sea.
If you're going port to port, then it doesn't matter, but if there's a significant inland section at either end, then a land route is better out to a few thousand km
Good points. Another implication of geo-political land-locking is to cap potential for trade links and growth of Indo-Gangetic plain (extending to including Pakistani Punjab-the dominant core of that country) and reinforces the differential growth advantage of Peninsular India, which is already straining India's politics.
Great Article... very poignant question: "How much greater would China’s peak have been if Deng Xiaoping had sided with the Tiananmen Square protesters, and liberalized China’s society in addition to its economy?" I hope you are right about a slow decline, but I fear that you are not.
The thing that kills totalitarian communist societies are self-inflicted wounds. This is bad enough when you are a country like Russia which at least controls food/energy so there is a somewhat stable bottom. However, there is no stable bottom for China.. it really NEEDS the rest of the world to maintain a baseline society.
On that front, as far as I can tell, the growth for China was based on:
1) Large Debt Cycle (Real Estate and related belt/road): This has led to incredible misallocation of resources. It is now about to burst, and the result will not be good (for China and likely the rest of the world).
2) Dominant position in low-value cost sensitive industries aided by currency manipulation: The world was happy to get "below-market" prices, but now the lack of "pricing power" is coming to roost. The great "decoupling" is happening...look to SE Asia and Mexico. Interestingly, it is led by Chinese companies themselves.
3) Technology catchup through IP "capture" This has run its course. Unfortunately, the key ingredients to play in the IP frontier (freedom, talent attraction, crowdsourcing of talent/ideas) are not available to Xi's China.
Yes.. there are some areas where there is world class leadership ... EVs (highly competitive) and others, but will it be enough... it is hard to believe. Further, we have already entered the realm of the lack of transparency on reality (direct government statistic are suspect), so it is likely that the situation is worse than portrayed. There are going to be ample economic/political triggers which can cause sudden, Soviet style, collapse. This will cause a great deal of pain in China and likely to the rest of world.
Yes.. a really poignant question... what if Deng's decision had been different.
But population declined considerably compared to Roman times. Which means that living standards must have decreased, since birth control was not really a thing.
Less trade also made local population more dependent on unreliable local production instead of more reliable production averaged over the empire.
Re the population, this goes both ways, once the population becomes smaller, the living standards in a pre-industrial economy improve automatically because your median peasant has more land, labour becomes relatively scarce and the returns to labour grow. Think of what happened in the wake of the Black Death in the 14th century.
Speaking of the trade, you assume that your median peasant consumes enough goods traded across the the Empire for the breakdown of this trade to matter to him. Are you sure it was the case? If 99% of what he consumes is produced in his household or village, then this becomes completely irrelevant.
This is true, but bears similarity to "if you kill some children, the others get a greater inheritance".
Agricultural productivity resulting from soils&climate+knowledge+institutions created the stable state population for a larger region for most of human history, and if the population was below that level, people lived somewhat better.
But the transition periods from a higher to a lower stable state were simply awful.
Trade and high population density has its value even for almost-subsistence farmers: It somewhat insures against seasonal and regional harvest fluctuations, and can provide goods that are not significant by mass, but raise living quality considerably, e.g. medicine, knowledge, manufactured goods or spices and perhaps ingredients for more diverse nutrition.
Since the Roman road network and the geographical disposition around the Sea made trade easy, significant trade even of staple goods like grain took place.
Yeah, I agree with your points. The transition indeed must have been awful. I don't know know how it happened and to what extent it was a gradual process or a sudden one. It also becomes a question of definitions, do we consider the 6th century with lots of warfare and a terrible plague part of the Dark Ages? If yes, was it dark ages everywhere or not? In the east the Roman Empire was still intact.
Regarding the effect of trade, you describe a plausible mechanism how almost-subsistence farmers can benefit from globalisation. We need actual data though to show that this mechanism actually led to better outcomes for the median inhabitant of the Roman empire, because there are also equally plausible mechanisms which work in the opposite direction.
It is very plausible that the population in a high population equilibrium lives with the same quality or material wealth as a low equilibrium society. Absent of the demographic transition overriding the effects of living standards and black swan events like pandemics, for a large region rising population=good living standards, stable population (at whatever equilibrium)=okish living standards, sinking population=bad living standards.
So the success of Rome was not necessarily income/median capita, but certainly income/median capita*population.
In other words, the Roman time gave okish living standards to many, the dark ages gave okish living conditions to a few.
Look, here's another study, this time from France (n=844), which shows that in the 1st-3rd centuries people's teeth and bones were worse and there was more growth disruption than in the 4-7th centuries, which they interpret as "Gallo-Roman individuals may have been more regularly exposed to infectious pathogens throughout childhood, inhibiting opportunities for catch-up growth, resulting in high rates of DEH and shorter femoral lengths (‘intermittent stress of low lethality’). This could be the result of overcrowding and insalubrious urban environments." To be fair there was one condition which was worse for the post-Roman population, which they attribute to a different diet.
I'm ready to update my beliefs if there are other studies which show a different pattern somewhere.
That’s really interesting. I’m wondering how much of that is 5th-8th century (the supposed dark ages) and how much is later. I was having trouble figuring out dates from the figures alone.
It looks like their "middle ages" data start from the 7th century, right in the middle of the dark ages.
However this is just one indicator and I'm not saying that the peasants definitely lived better in the middle ages. It's easy to imagine a scenario in which they are worse off (due to abandoning fertile coastal land because of the danger of raids, for example).
My point is that Brad's data do not show a decline in general living standards, and therefore he could use some epistemic humility when talking about the dark ages.
However I think that you're looking at this anachronistically. In a society in which most of the people work on land what matters is how much land you have and how much surplus is wringed from you by your owner/lord/state. The trade probably has some impact but I doubt it is a major one.
While the average height may be an imperfect indicator, I would like to see at least some data showing the opposite trend (common people's living standards declining in the early middle ages vs late antiquity).
Great summary. Over here in HK, there seems to be a rapid frenzy to bring Chinese-style consumption, infrastructure, investment, supply chains and international market expansion to Southeast Asia. Chinese people are moving to Indonesia to teach Indonesians how to sell Chinese goods despite not speaking the local language, for example.
https://www.bloomberg.com/news/articles/2023-07-05/tiktok-shop-emerges-as-amazon-rival-powered-by-indonesian-boom
Indonesians do not see this as a national security issue. Meanwhile, my father, who's all set to retire from a factory outside Jakarta, remarks that Chinese companies and engineers are trying hard to get them to share his IP on developing dyes so that they can produce them at scale in an environmentally compliant way for the Chinese and Indonesian market.
Altasia - India is the new growth engine and it will likely be dominated by US and Chinese VCs/PEs.
> Indonesians do not see this as a national security issue.
Based.
"As of April 2023, the United States was the country with the largest TikTok audience by far, with approximately 117 million users engaging with the popular social video platform. Indonesia followed, with around 113 million TikTok users. Brazil came in third, with almost 85 million users on TikTok watching short-videos."
Sometime this year, Indonesia will take the crown.
"While Beijing has pulled back its overseas BRI lending—and Xi has exhibited some notable reticence toward hosting a third Belt and Road Forum—Indonesia challenges the broader narrative that the BRI is somehow fading away. In the world’s fourth-most populous country, Chinese investment has continued apace, and both governments continue to champion the BRI’s ability to deliver “mutual benefit” and “win-win results.” Still, understanding Indonesia’s experience with the BRI requires closer examination of the history behind China-Indonesia infrastructure cooperation, major projects beyond the oft-discussed Jakarta-Bandung HSR and their impacts on the Indonesian public, and the extent of economic engagement between Jakarta and Beijing."
Indonesia and the Middle East are where Chinese influence and presence will surge this decade, I think.
Thank you, a more serious response than my one-word quip deserved!
What blows my mind away is that in 1978, around the time of China's opening to the world, India and China were equal in per capita income terms, and as far as the lives of the average citizen is concerned, the Chinese had it much worse after the horrors of the great leap and cultural revolution. Whatever one's views about China's political system, their exponential dizzying rise is still humanity's greatest achievement!
I am currently reading Frank Dikotter's excellent books on China during/after Mao, and am starting to believe the "dizzying rise" is to some extent due to the economic nosedive that was the Mao era. The book on the "Great Leap Forward" (1958-1962) describes a dystopian system that reduced huge numbers of Chinese to naked, homeless beings. Utterly surreal.
I think George W Bush is the worst president in history…but I think the Bush family might be the Americans that deserve the most credit for expanding the global middle class. To this very day a Bush is on China’s payroll.
Seems Xi has done the impossible and united everyone from Sendai to Sydney to Sindh. Joko Wodowi and Anthony Albanese have met 3 times in the past 12 months.
TBF, due to simple geography and weight of population/resources, Indonesia is always one of Australia’s main foreign policy concerns.
As someone who lives in Altasia, I'm pretty skeptical of The Economist's prediction.
In the short term, we're in the middle of a manufacturing slump. In Q1 150,000 manufacturing workers were laid off in Vietnam alone and another 300,000 were furloughed. Perhaps another 500,000 have had hours cut. It'll take two or three years for orders to recover and staff to rehired and retrained. Most return to their villages (lower cost of living) which exacerbates the skill loss and rehiring latency.
In the longer term, the entire region suffers from the same issues seen in developed countries around the world: poor state capacity, slow roll out of infrastructure projects, and hamstrung by lack of housing.
As examples just look at how long it has taken Ho Chi Minh City to finish its new metro or new international airport. Look at the recent flooding in Vientiane, the poor transport options to the new airport TIA in Phnom Penh, more delays on Bangkok's HSR linking airports, and Manila and Jakarta continue to be among the least livable cities in the world due to traffic. (The Economist rates Manila #136 out of 173 cities in the world.)
I just don't see the sense of urgency needed for Altasia to actually become a thing.
I do think infrastructure development will be a big issue, but I think India's example is very encouraging.
I think this is right. Concerns about China's rapid rise on the geopolitical stage are warranted; any time there's a rising power like that, there's going to be a huge disruption in the status quo. Everything is being rocked today (still), but it is also evident that China isn't going to like take over the world.
I always go back to crusty ole Charlie Munger's viewpoint, that it would be absolutely stupid if the US and China couldn't figure out how to cooperate in some mutually beneficial way. In fact, in some ways, that's what happening, although the jockeying for power is also very real, and in direct tension with the cooperative "better angels."
Thought provoking and well done, Noah!
the bit about greater altasian cooperation and better transit at the end reminded me of this video i saw recently, dhaka is getting a japanese-style metro and it already has massive ridership https://youtu.be/4Hpic8WMvkk
Oh that's awesome! Thanks for sending me that!!
I could do a series of posts just about inter-Altasian linkages!
This is a very thought-provoking essay. I think you point out very well that war may be the single most important factor that could throw us all into disaster. More precisely, conflicts between major powers that escalate into larger conflicts.
We don't know yet whether the current Russo-Ukrainian War can remain localized and be defused.
We don't know yet whether the slow-simmering China-Taiwan-US conflict can also be defused, because if it comes to a boil, it will almost certainly not be containable.
Other than that I think your general optimism is realistic and achievable.
Your analysis is characteristically thoughtful in the most data-driven way. What is the significance of recent US trade data showing Mexico-Canada as No.1 share and China seemingly in retreat (for long term or temporary)? Thank you making us think.
Isn't part of Alt-Asia, ASEAN: the association of South East Asian Nations? I think there's more regional cooperation and integration than you think, and will be more planned in the future.
From what I researched there is increased regional cooperation in alt-Asia. Especially with ASEAN +3 (South Korea, Japan, China) or ASEAN+6 (India, Australia,NZ) https://open.substack.com/pub/yawboadu/p/regionalization-in-global-trade?r=garki&utm_campaign=post&utm_medium=web
Excellent analysis!
Would the U.S. and China still be friends instead of at each other’s throats?
If you're going to pick a metaphor from the animal kingdom, it would be far more accurate to say that the US and China are in a chronic threat posture toward each other. In terms of dogs, that means heads lowered, eyes locked, hackles starting to rise, nervous pacing, perhaps an occasional low growl.
"At each other's throats" means full-out combat.
Let's not let our rhetoric run wild.
I will take this zoological insight under advisement.
Seeing how hostile rhetoric has been poisoning American politics, I'd like to avoid excessive heat in China rhetoric.
The U.S. and China are now engaged in Cold War 2, so I'm afraid that ship sailed long ago.
https://www.noahpinion.blog/p/you-are-now-living-through-cold-war
That's why I like the way Biden is handling this, to the extent that an outside observer can know what's going on. If we are in a Cold War, we won't stay there forever—we will either move toward hot war or toward detente. As far as I can tell, Biden keeps offering detente, while committed to military strength. This I like.
Detente is consistent with cold war...during Cold War 1 we had two periods of detente with the USSR.
Not sure what you mean by “detente”. If by “detente”, you mean permanent peace with no threat, if you look at the original Cold War, neither happened. The Cold War kept going until 1 side collapsed. That is the best case scenario in this Cold War as well.
"How much greater would China’s peak have been if Deng Xiaoping had sided with the Tiananmen Square protesters, and liberalized China’s society in addition to its economy?"
I'm not sure "China" would mean the same thing in this sort of alternative history. Deng was, if I recall, most concerned about the prospect of political fragmentation if the force of central government were weakened through the democracy movement(s) that spread to various parts of China in the spring of 1989. China's structure was in many respect like an empire on multiple levels: not only were geographically large regions like Xinjiang and Tibet dominated by ethnic minorities subdued centuries past, but sharp cultural and linguistic divides competed with common history in core regions like the southwest (centered in Sichuan), the Shanghai-dominated middle coast, and the Guangdong-dominated southeast, all with politically powerful local political actors. Periods of weak central government had led to eras of state fragmentation periodically for two millennia, the most recent being in the early 20th century.
Had Deng "sided" with the Tiananmen Square protesters, local governments would likely have seen the central government as vulnerable and the ideological foundation of the Party's dominance as damaged, and if circumstances had been favorable, they could have formed competing centers of power, as was true when Deng was a young man in the period 1912-27. (I understood this to be Deng's primary concern at the time.)
When the Gorbachev "sided" with perestroika and glasnost, the ethnic regions of the Russian empire broke off, and the tensions leading to that were manifest during the Tiananmen demonstrations (which coincided with Gorbachev's visit to China). While the USSR break-up postdated Tiananmen, Deng had reason to worry about that type of dissolution plus a dissolution of the core Han region as well.
So even if the democracy movement had somehow prevailed in 1989, I think it's unclear whether a unified China would have reaped the rewards, or whether the rewards would have been distributed among successor states, or whether the rewards would have been turned to deficits by the type of political chaos and violence that fragmentation had led to three-quarters of a century earlier.
I would add that Deng and Hu had every intention of liberalizing China, but not as quickly as the protesters wanted in 1989. But the liberal economy brought lots of benefits but was also bereft with corruption and wealth inequality. Xi’s ascendancy was no accident. He was reasserting his Marxist ideology by stamping out corruption and focusing on the selfishness of the billionaires. I believe him to be using national goals to pull the people together. Hopefully this is just a stage. Possibly he might find a balance to have a liberal democracy and to balance the wealth disparity.
I think we'll continue to be disappointed by Xi, James. You are certainly right that Xi initially attacked a politically centrifugal danger by clamping down on corruption, but in retrospect the goal of consolidating Party power does not seem to have been linked to any desire to create space for political or social liberalization.
If the long term project involves forging the lasting stability of China's national integration in the face of its dramatic ethnic and cultural fragmentation, the project of depersonalizing local government leadership and enforcing a fully bureacratic relationship to the center is an important tool--Xi's corruption crackdown was, I think, less a principled move than an attempt to make Bo Xilai (the Sichuan challenger to Xi's initial grip) a cautionary lesson. Like corruption, wealth inequality threatened Party power by generating an economic oligarchy: egalitarian income policies are justifiable on many grounds, but I believe their primary goal is, again, to avoid concentrations that can challenge Party control.
After living a short while in China and Taiwan, I came out thinking that the most successful policy of the CCP is the Cultural Revolution. On a cultural level, China put a shotgun in its mouth, and pulled the trigger. It is now a nation without a soul, a zombie country. It is absolutely horrifying.
Sad. When at one time it was the cultural center, now common courtesy is difficult to come by.
One concern I have about Altasia is that, unless Burma/Myanmar can be politically stabilised enough to run transit links safely through it, India/Bangladesh is effectively an island relative to Thailand/Vietnam/Laos/Cambodia/Malaya/Singapore. Obviously, Indonesia, the Philippines, Taiwan and Japan are island chains anyway, but Japan already has fixed links between the main islands, and I expect one of the great infrastructure projects of the next couple of generations to be to connect the Philippine and Indonesian islands together (and a tunnel under the Strait of Malacca to connect Indonesia to the mainland). The fewer connections that have to be made by sea (for goods) and air (for people) the better, as every transition from one mode to another (ie at a port) is just deadweight loss, and air travel is a terrible environmental idea.
Obviously, no significant numbers of passengers are going to take a train Delhi-Singapore (even a high-speed train running flat out non-stop would take ~20 hours; a more reasonable service stopping in major cities would be more like 30), but that's certainly not going to stop freight moving that way by train (or even by truck). Kolkata-Bangkok would be a very reasonable 8-10 hour overnight trip by high-speed train if it's safe to pass through Myanmar and you can get visas easily.
India (and Bangladesh, Bhutan and Nepal) being trapped between Myanmar to the East, Pakistan/Afghanistan to the West and the Himalayas (and China) to the North means that it lacks the physical links to the rest of Asia that it should have - and which it traditionally did have in early modern times, when it was the connection between the Middle East and South East Asia, when all sorts of goods and ideas flowed through the Mughal Empire in both directions.
One of the U.S.'s cited strengths is its riverways, exploited for transportation of goods. I'm not sure why reliance on ports should be considered a setback because of swaps in transportation mode in itself. A narrow tunnel would have to be faster and more efficient.
Oceans exist and shipping by water is the cheapest mode of shipping anyway.
Shipping by water still requires goods to be transshipped at a port, which is a fixed cost. For a relatively short journey of 3000 to 5000 km, paying for two transshipments will cost more than what you save by doing those km by sea.
If you're going port to port, then it doesn't matter, but if there's a significant inland section at either end, then a land route is better out to a few thousand km
Good points. Another implication of geo-political land-locking is to cap potential for trade links and growth of Indo-Gangetic plain (extending to including Pakistani Punjab-the dominant core of that country) and reinforces the differential growth advantage of Peninsular India, which is already straining India's politics.
Great Article... very poignant question: "How much greater would China’s peak have been if Deng Xiaoping had sided with the Tiananmen Square protesters, and liberalized China’s society in addition to its economy?" I hope you are right about a slow decline, but I fear that you are not.
The thing that kills totalitarian communist societies are self-inflicted wounds. This is bad enough when you are a country like Russia which at least controls food/energy so there is a somewhat stable bottom. However, there is no stable bottom for China.. it really NEEDS the rest of the world to maintain a baseline society.
On that front, as far as I can tell, the growth for China was based on:
1) Large Debt Cycle (Real Estate and related belt/road): This has led to incredible misallocation of resources. It is now about to burst, and the result will not be good (for China and likely the rest of the world).
2) Dominant position in low-value cost sensitive industries aided by currency manipulation: The world was happy to get "below-market" prices, but now the lack of "pricing power" is coming to roost. The great "decoupling" is happening...look to SE Asia and Mexico. Interestingly, it is led by Chinese companies themselves.
3) Technology catchup through IP "capture" This has run its course. Unfortunately, the key ingredients to play in the IP frontier (freedom, talent attraction, crowdsourcing of talent/ideas) are not available to Xi's China.
Yes.. there are some areas where there is world class leadership ... EVs (highly competitive) and others, but will it be enough... it is hard to believe. Further, we have already entered the realm of the lack of transparency on reality (direct government statistic are suspect), so it is likely that the situation is worse than portrayed. There are going to be ample economic/political triggers which can cause sudden, Soviet style, collapse. This will cause a great deal of pain in China and likely to the rest of world.
Yes.. a really poignant question... what if Deng's decision had been different.
Sorry for going off tangent but I think it's misleading to say that the Roman Empire got poorer as it declines. The indicators Brad de Long lists indeed show the decreased elite consumption and state capacity (hence less long-distance trade and less shipwrecks, less lead to build pipes, less monumental construction). However it doesn't mean that the median (or even average) person was poorer. In fact the average height was greater in the middle ages than in antiquity https://www.semanticscholar.org/paper/Stature-in-archeological-samples-from-central-and-Giannecchini-Moggi-Cecchi/31b02c6e6e758e8d731da56dca305d2ac3724be0/figure/4
But population declined considerably compared to Roman times. Which means that living standards must have decreased, since birth control was not really a thing.
Less trade also made local population more dependent on unreliable local production instead of more reliable production averaged over the empire.
Re the population, this goes both ways, once the population becomes smaller, the living standards in a pre-industrial economy improve automatically because your median peasant has more land, labour becomes relatively scarce and the returns to labour grow. Think of what happened in the wake of the Black Death in the 14th century.
Speaking of the trade, you assume that your median peasant consumes enough goods traded across the the Empire for the breakdown of this trade to matter to him. Are you sure it was the case? If 99% of what he consumes is produced in his household or village, then this becomes completely irrelevant.
This is true, but bears similarity to "if you kill some children, the others get a greater inheritance".
Agricultural productivity resulting from soils&climate+knowledge+institutions created the stable state population for a larger region for most of human history, and if the population was below that level, people lived somewhat better.
But the transition periods from a higher to a lower stable state were simply awful.
Regarding trade, here is a good post that also deals with population equilibrium and trade: https://acoup.blog/2020/08/21/collections-bread-how-did-they-make-it-part-iv-markets-and-non-farmers/
Trade and high population density has its value even for almost-subsistence farmers: It somewhat insures against seasonal and regional harvest fluctuations, and can provide goods that are not significant by mass, but raise living quality considerably, e.g. medicine, knowledge, manufactured goods or spices and perhaps ingredients for more diverse nutrition.
Since the Roman road network and the geographical disposition around the Sea made trade easy, significant trade even of staple goods like grain took place.
Yeah, I agree with your points. The transition indeed must have been awful. I don't know know how it happened and to what extent it was a gradual process or a sudden one. It also becomes a question of definitions, do we consider the 6th century with lots of warfare and a terrible plague part of the Dark Ages? If yes, was it dark ages everywhere or not? In the east the Roman Empire was still intact.
Regarding the effect of trade, you describe a plausible mechanism how almost-subsistence farmers can benefit from globalisation. We need actual data though to show that this mechanism actually led to better outcomes for the median inhabitant of the Roman empire, because there are also equally plausible mechanisms which work in the opposite direction.
It is very plausible that the population in a high population equilibrium lives with the same quality or material wealth as a low equilibrium society. Absent of the demographic transition overriding the effects of living standards and black swan events like pandemics, for a large region rising population=good living standards, stable population (at whatever equilibrium)=okish living standards, sinking population=bad living standards.
So the success of Rome was not necessarily income/median capita, but certainly income/median capita*population.
In other words, the Roman time gave okish living standards to many, the dark ages gave okish living conditions to a few.
Look, here's another study, this time from France (n=844), which shows that in the 1st-3rd centuries people's teeth and bones were worse and there was more growth disruption than in the 4-7th centuries, which they interpret as "Gallo-Roman individuals may have been more regularly exposed to infectious pathogens throughout childhood, inhibiting opportunities for catch-up growth, resulting in high rates of DEH and shorter femoral lengths (‘intermittent stress of low lethality’). This could be the result of overcrowding and insalubrious urban environments." To be fair there was one condition which was worse for the post-Roman population, which they attribute to a different diet.
I'm ready to update my beliefs if there are other studies which show a different pattern somewhere.
That’s really interesting. I’m wondering how much of that is 5th-8th century (the supposed dark ages) and how much is later. I was having trouble figuring out dates from the figures alone.
It looks like their "middle ages" data start from the 7th century, right in the middle of the dark ages.
However this is just one indicator and I'm not saying that the peasants definitely lived better in the middle ages. It's easy to imagine a scenario in which they are worse off (due to abandoning fertile coastal land because of the danger of raids, for example).
My point is that Brad's data do not show a decline in general living standards, and therefore he could use some epistemic humility when talking about the dark ages.
Interesting, I didn't know it.
However I think that you're looking at this anachronistically. In a society in which most of the people work on land what matters is how much land you have and how much surplus is wringed from you by your owner/lord/state. The trade probably has some impact but I doubt it is a major one.
While the average height may be an imperfect indicator, I would like to see at least some data showing the opposite trend (common people's living standards declining in the early middle ages vs late antiquity).