In the 1970s, the most coveted consumer goods in China included a radio, bicycle, sewing machine, and wristwatch—the “four big items.” These were replaced in the 1980’s with color TVs, refrigerators, cameras, electric fans, washing machines, and tape recorders—“six big items.” Today, many urban households are more concerned with private apartments, private cars, computers, and other luxury items. This rapid change in everyday life in China is a result of the nation’s massive economic development that has resulted in increased consumption, high GDP growth rates and—to the concern of many Western observers—rapid growth in military expenditure.
As a result, there is an increasingly popular meme in academic and popular discourse—that of a “rising China.” But what, precisely, do we mean when we say that China is rising? Surely, it cannot be denied that China is bigger and better than it was thirty years ago, nor can it be denied that China’s rise has brought on new challenges for the United States. However, it is too early to announce China’s rise as a new hegemon, or to say that China’s rise is fundamentally transforming the international order. Rather, as China continues to “rise,” it is more likely to seek increased influence in the existing international order than to seriously revise it.
Many Americans worry about China’s rapid economic growth and its impact on the U.S. economy. A Pew Research Center survey shows that 32 percent of Americans name China as the world’s top economy, and 46 percent believe China either already has or will overtake the United States as the world’s top economy.
Where do these perceptions come from? A likely source is the comparison of annual GDP growth rates. While U.S. GDP grew 3.1 percent year-on-year in the second quarter of 2017, China’s grew 6.8 percent. In the past, the difference between the countries’ growth rates has been even starker. Following the 2008 recession, the United States’ annual GDP growth rate dipped as low as negative 4.1 percent in one quarter of 2009. China achieved an eight percent annual growth rate during that same quarter. With China’s staggering rate of growth and the ubiquity of goods labelled “Made in China” in the United States, it’s understandable why many Americans worry about losing in an economic competition with China.
There is also a growing perception of China as a security threat to the United States—36 percent of American’s believe that China is more of a military threat than an economic one. In 2015, 47 percent of Americans rated China’s growing military power as a very serious problem, while an additional 35 percent rated it as a somewhat serious problem.
It is difficult to arrive at an accurate estimate of China’s military expenditures given Beijing’s opaqueness on its defense budget and the likelihood that additional defense expenditures are hidden in seemingly non-military portions of the budget, such as research and development. However, it is clear to any casual observer that Beijing is committed to expanding and modernizing the Chinese military. Until 2016, China’s defense spending increased by an almost unbroken chain of double digit rates each year for nearly two decades, outstripping the annual growth of GDP. This year, the proposed increase in defense spending is seven percent, which is the lowest increase since 2010 and closer to the expected annual GDP growth rate of 6.5 percent.
The Reality behind the Myth
Despite popular perception, China has not yet overtaken the United States as the world’s top economy. Not only is China’s GDP growth slowing, but China’s GDP is still about 7 trillion dollars short of the U.S. GDP. That being said, China’s economic takeover of the United States in terms of GDP “almost surely will come, simply by the scope of the population, the scope of production in China and the level of investment in China,” according to Harvard professor William Kirby. However, Kirby also pointed to a couple of ways that GDP fails to tell the entire story of a country’s economic development.
First, Kirby noted that “GDP is a very crude measure of growth, in the sense that it measures production more than consumption, even wasteful production.” In terms of China’s production, Kirby explained that since local and regional political officials are rated on the level of GDP growth in the area they supervise, there is incentive for wasteful expenditures. For example, “GDP growth can happen in a number of ways, but construction is an easy way to expand GDP, and in China there has been no shortage of wasteful construction.” While wasteful spending does not account for the entirety of China’s rapid growth rate, it does mean that not every dollar of GDP truly reflects productive economic activity.
China’s per capita GDP also lags behind at $6,894.50, compared to the United States’ $52,194.90. The average American continues to enjoy a much higher income and standard of living than the average Chinese citizen. It must not be forgotten that while China has experienced rather rapid economic development, it is still a developing country with a large population and faces the rather serious challenge of providing services to care for its rapidly aging population.
Second, Kirby highlighted the regional differences in economic growth in China. “China is one country, but it isn’t one economy. There’s nothing like 6.9 percent economic growth in Northeastern China,” said Kirby, “It’s much more interesting to look at this as a series of linked and powerful regional economies as well as a national economy.”
In terms of China’s military, its growth has brought new challenges, yet it has not surpassed the U.S. military in quality. Focusing on the important competition over naval power, Professor Robert Ross of Boston College discussed the disadvantages of the Chinese navy in an interview with the HPR. “In terms of capabilities and technology, China has much catching up to do.” While the size of the Chinese military and its rate of growth do present challenges to the United States, these challenges are not insurmountable as long as the United States maintains advantages in technology.
Besides these concrete measures of military strength, there is also the issue of combat experience, which the Chinese military currently lacks. China’s military has not seen major combat since the Vietnam War in 1979, and even Chinese military strategists point to this lack of actual combat experience as a point of concern. “The military has no real experience fighting,” said Professor Alastair Iain Johnston of Harvard. He explained that “The United States has been fighting wars continuously since at least 2003. It is a very experienced, tested military.” This may impact China’s ability to employ its military effectively, even if the quantity and quality of its military equipment has advanced. “There is this big question mark of how they would actually operate in an actual war,” said Johnston.
Additionally, there is a debate to be had over whether China will continue to prioritize military expansion as the country is confronted with other costly social issues. “You’re going to have more and more demand for services for elderly people. The question is whether that will put pressure on the guns versus butter trade off,” said Johnston, referring to the trade-off between military and social spending.
Dispelling the Myth
While it is a myth that China has unambiguously surpassed the United States and become the new world hegemon, China’s economic and military growth certainly has changed the world. However, China’s growth is not necessarily a threat to the United States, and in some respects is quite positive.
China’s economic growth in particular may be beneficial overall for the United States. “I think the history of the last 40 years would indicate that the world, including the United States, is much better off, broadly speaking, with a growing China than with a poor or less well-off China,” said Kirby. While some manufacturing jobs may have been lost to China, these jobs would have been lost to other nations anyway, and there are tremendous opportunities for U.S. investment in a growing China, according to Kirby.
China’s military growth may be less ambiguously positive. A stronger China that is more willing to defend its interests poses a challenge to the United States in defending its own interests. China’s military growth may make it costlier for the United States to assert its interests in areas such as the South China Sea and the Taiwan Strait.
However, China’s rise doesn’t necessarily make it a new world hegemon. “Hegemony, even in the 21st century, is still a question of physically showing up, and China doesn’t have the capacity to sustain a military security presence around the world the way the United States does,” said Johnston. China has only a single formal ally—the unstable and unpredictable North Korea—while the United States enjoys defense alliances with over 50 countries. While China’s growing capabilities have allowed the country to pose a challenge to the United States in nearby conflicts, the further away from China the conflict gets, the more clear the United States’ advantage becomes.
Since China will continue to develop its economy and military in ways that create new challenges for U.S.-China relations, the United States must begin to think of how to manage this new relationship in a productive way. Rather than assuming ill-intent or the impossibility of cooperation with China, it is important to pay attention to ways in which China’s newfound influence can be harnessed in ways that are beneficial to both parties. Otherwise, the current discourse on China’s dire threat and ultimate danger to the United States may become less of a myth and more of a self-fulfilling prophecy.
Image credit: Luo Shaoyang/Flickr