Thursday, July 31, 2014
Inquirer Daily News

China's high-stakes struggle

With the U.S. distracted

China's high-stakes struggle

While Washington is transfixed by Gen. Petraeus' girlfriend/s, and speculating why Rep. Eric Kantor (R-Va.) knew the FBI was probing the CIA boss before the Presidential election, but Sen. Dianne Feinstein (D-Calif.) didn't, the world moves on. China, for example:

Some accounts of the China power struggle are nuclear-war scary. "Conservatives appear poised to dominate, [as] reform-minded" leaders have been bypassed, wrote Shi Jiangtao in the South China Morning Post, describing how retired party chief Jiang Zemin, 86, is outman- euvering lame-duck leader Hu Jintao to put his elderly proteges in power.

 "The forces of reaction and economic folly threaten to prevail in China," warned the British newspaper the Telegraph, adding that the gang gaining power wants to put the United States "in an impossible position" by seizing islands and oil zones from U.S. allies in Japan and Taiwan and forcing America toward an abrupt war.

If it's that bad, shouldn't Romney and Obama have been talking about this?

Maybe it's not that bad. "Jiang Zemin was a reformer, in his time," points out Prof. Marshall Meyer, who follows China trade and industry at Penn's Wharton School. Those Communists cut out of power include the "most-retrograde" antireformers.

Yes, Meyer said, "there is a lot of unrest in China, more than is reported." Yes, he believes, "the leadership is still very much up in the air." China suffers suffocating corruption, dangerous food, crushing unpaid loans, a surprising shortage of young industrial workers and too many college grads collecting trash.

And that's why a shooting war looks less likely: "For all the tension that exists, a U.S. military response would completely upset the transition," Meyer told me.

 "I'm a little less alarmist than some of the newspaper reports," agreed Avery Goldstein, a scholar of China politics at the University of Pennsylvania and author of Rising to the Challenge and other works on China foreign policy. (He says reporters at the Financial Times and Wall Street Journal do a good job putting China news in context.)

 "I don't agree they are moving back to the state-planned economy," Goldstein told me. "They are committed to moving toward a more market-driven economy, except a few strategic sectors they want state-owned."

 Things could still fall out of control, fast, fatally. A China-U.S. war, Goldstein said, "is not something the leadership on either side wants." But neither side can "afford to look soft, economically or militarily, either," he adds.

 Be careful what you wish for: A democratic China government could be swayed by nationalist passions that have been fed by decades of Communist education. (See, for example, North Africa and the Arab Spring.) That could make confrontation with the United States more likely, not less. (From my Sunday Philadelphia Inquirer column here.)



Joseph N. DiStefano
About this blog

PhillyDeals posts raw drafts and updates of Joseph N. DiStefano's columns and stories about Philly-area finance, investment, commercial real estate, tech, hiring and public spending, which he's been writing since 1989, mostly for the Philadelphia Inquirer.

DiStefano studied economics, history and a little engineering at Penn, taught writing at St. Joe's, and has written the book Comcasted, more than a thousand columns, and thousands of articles, and raised six children with his wife, who is a saint.

Reach Joseph N. at JoeD@phillynews.com or 215 854 5194.

Joseph N. DiStefano
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