Journal of Political Risk, Vol. 6, No. 2, February 2018

Graffiti image of Mao alongside the McDonalds logo, 2012. Source: Steve Wiley via Flickr.

Ho-fung Hung, Ph.D.

Johns Hopkins University

Obama era officials Kurt M. Campbell and Ely Ratner recently published “The China Reckoning: How Beijing Defied American Expectations” in Foreign Affairs, arguing US’ assumption underlying its China Policy over the past several decades has been wrong. They admit that China has not changed in the direction most China hands in the US had expected. Rather than becoming more liberal and democratic, it became more authoritarian; rather than more opening to trade, it became more protectionist. They call for a reorientation of Washington’s approach to China. This article has triggered some internal debate and soul searching in the China watchers’ community.

It is understandable that many who expect China to embrace liberal democracy and more economic openness have been disappointed. What is missing in the discussion is that even many realists and corporations who do not care too much about the ideals and principles of economic and political liberalism are frustrated with China too. Over the last few years, another China reckoning is that China is unable, or never intended, to deliver and keep its promises even on many economic and geopolitical issues that are unrelated to the sensitive areas of political reform and change.

China is surely becoming much more important economically and geopolitically than many of us expected three decades ago. But China is not as strong and as important as most media portray, or as many China watchers wish to project. Beijing is making good use of this misconception, even helping perpetuate it. Too many of us assume that we are all dependent on China’s market and geopolitical influence now, without realizing that China is also very dependent on the US and the world too. Very often we are just fearing and submitting ourselves to an enlarged shadow of China.

For example, many in the UK suppose that China is a new lifeline with all its investments, so the UK must do whatever it takes to please the new overlord. But as we start to find out now, many of the Chinese investments in the UK are just pledges that never materialize.[1] Of course, politicians and the corporate elite who might have their personal vested interest in China would tell you those Chinese investments do not materialize because you have not bowed enough. But this mismatch between pledges and actual money happens in many other places too. An example is that the amount of Chinese aid to Africa that is actually delivered can be no larger than three percent of what China pledged.[2] But it is often those exaggerated pledges that are widely reported by the media and think tank reports. A vastly exaggerated perception of China’s super influence in Africa and elsewhere ensued.

Likewise, there are many cases in which companies doing business in China yield to the demand of their Chinese partners in very concrete ways in exchange for vague pledges of something that never comes. Many politicians and business leaders are undermining their own bargaining leverage, betraying their principles, and giving in voluntarily for some fantasy about once in a lifetime golden opportunities in China that are never there.

I have recently been researching the 1990s China trade policy debate in the US. I am surprised to find that many well-known US companies that took the lead to lobby for unconditional renewal of China’s Most Favored Nation status in 1993-4, which would grant Chinese exports low tariff access to the US market, later got burnt badly in China and were unfairly squeezed out from the Chinese market empty-handed. Many foreign policy makers and experts back then were advocating the line of “give whatever Beijing wants economically and forget about human rights, and Beijing will help us solve the North Korea problem.”[3]  As we recently found out, Beijing has always been unable or unwilling to deliver on North Korea, though it managed to extract all benefits from Washington’s fantasy that China is the panacea of North Korea’s nuclear crisis.

Unfortunately, humans are prone to making the same mistake over and over. Despite the many cautionary tales about Beijing’s trick of issuing bad checks to pay for what it badly wants, many will continue to be blinded by the big dollar amount on the check and fall for this trick. My cynical eyes are seeing the next victim in the Vatican, which reportedly is about to strike a deal with Beijing on the selection of Chinese bishops. The underground Catholics in China are not as rebellious as the Tibetans and the Muslims in China. If Beijing can afford not talking to the Dalai Lama despite the continuous unrest in the Tibetan area, why would it need the Vatican’s help in governing the Catholics? What Beijing really and only wants from the Vatican is that it would eventually cut its diplomatic relations with Taipei to humiliate the incumbent DPP government there. Once Vatican delivers on this, I bet that the Vatican will get little in return. The argument that the Vatican compromise will lead to an enlargement of the cage in which Chinese Catholics are living now will be proven delusional. Beijing will have no reason to loosen the screws on the Catholic community in any way. As such, the biggest risk that the Vatican is facing is not that it will be seen as a betrayer of the faithful and persecuted down the road, as many critics of the Vatican-Beijing deal contend. Rather, I worry that the Vatican will turn out to be another fool who gives in for nothing.

Leaving this sideshow of Celestial (or Faustian, depending on your perspective) bargain between the Holy See and the Chinese Communist Party aside, a new approach to China is overdue for Washington and for other secular governments around the world. We need a new approach even if we only care about pragmatic national and business interests and do not really care too much about human rights and free trade.

Ho-fung Hung is Henry M. & Elizabeth P. Wiesenfeld Professor in Political Economy at the Department of Sociology & School of Advanced International Studies, The Johns Hopkins University. JPR Status: Opinion.

[1] For example, see Andy Bounds and Tom Mitchells, “Chinese investments in UK fail to materialise”, Financial Times, 1/2/2018, https://www.ft.com/content/2e03578e-072f-11e8-9650-9c0ad2d7c5b5.

[2]  Deborah Brautigam. “5 Myths about Chinese Investment in Africa”, Foreign Policy, 4/12/2015, http://foreignpolicy.com/2015/12/04/5-myths-about-chinese-investment-in-africa/.

[3] For example, see James A. Baker, “China Plays its China Card: N. Korea or Human Rights?”, Los Angeles Times, 4/10/1994, http://articles.latimes.com/1994-04-10/opinion/op-44220_1_north-korea.