Reassessing China: Awaiting Xi Jinping

Click to increase image sizeClick to decrease image size Notes 1. William H. Overholt, The Rise of China: How Economic Reform is Creating a New Superpower (New York: W.W. Norton, 1993). For a recent statement of the parallels between China and the other "miracle economies," see William H. Overholt, "The China Model," Fudan Journal of the Humanities & Social Sciences 5, no. 2 (June, 2011). 2. Along with "scientific development," the concept of "harmonious society" has been the key slogan of the Hu Jintao era. It encompasses harmony between man and environment, between social classes, and between China and foreign countries. Implicit in the concept of harmonious society is a repudiation of the Mao-era emphasis on class struggle as the key dynamic of politics. Implicit also is a move away from the degree of social stress and inequality entailed by the frenetic market reforms of the Zhu Rongji era. For an officially endorsed definition, see "Harmonious Society," People's Daily report on the 17th National Congress of the Communist Party of China, September 29, 2007, http://english.people.com.cn/90002/92169/92211/6274603.html. 3. Pew Global Attitudes Project, "China's Optimism," table on "Satisfaction with National Conditions," November 16, 2005, http://www.pewglobal.org/2005/11/16/chinas-optimism/. 4. For instance, see "Key targets of China's 12th five-year plan," Xinhua, March 5, 2011, http://news.xinhuanet.com/english2010/china/2011-03/05/c_13762230.htm. 5. The most commonly cited study of actual wages is a KPMG study that is not publicly available, but the KPMG website contains an overview by an outside author: James Anderlini, "Has China Reached Its Peak?" originally published in High Growth Markets, April 2011, http://www.kpmg.com/US/en/WhatWeDo/Industries/Japanese-Practice/Pages/2011-issue2-article1.aspx. In October 2011, China's Ministry of Human Resources and Social Security stated that the minimum wage in 21 of 31 provinces had risen by an average of 21.7 percent in the first nine months of 2011 alone. See, for instance, Li Mao, "21 Regions Across China Raise Minimum Wage," People's Daily Online, October 26, 2011, http://english.peopledaily.com.cn/90882/7626697.html. 6. See CIA World Factbook, https://www.cia.gov/library/publications/the-world-factbook/fields/2186.html. 7. One of the most careful studies of local debt is provided by two papers by Ting Lu and T.J. Bond, "LGFV and Local Government Debt: This time is not that different," Bank of America Merrill Lynch, April 8, 2010, and "LGFV: The sub-prime trap for China?" Bank of America Merrill Lynch, March 22, 2010. 8. The saying became omnipresent. For instance, the Brookings Institution held a seminar, "China's New Breed of State Capitalism," with the theme "Known popularly in China as guojin mintui or 'the state advances and the private sector retreats,' this apparent enhancement of state monopolies has in recent months been fiercely debated in Beijing." See http://www.brookings.edu/events/2011/0301_china_capitalism.aspx. 9. See, for instance, "China announces support for SMEs in government purchasing," Xinhua, December 31, 2011, http://news.xinhuanet.com/english/china/2011-12/31/c_131337773.htm. 10. The numbers on interest rates commonly paid by SMEs are from conversations with Chinese business executives. A high proportion of those loans are technically illegal, so they are not openly quoted. On the difficulties of the SMEs, see "SMEs headed for collapse, business lobby warns," China Economic Review, July 22, 2011, http://www.chinaeconomicreview.com/content/smes-headed-collapse-business-lobby-warns; and "China's SMEs face adverse conditions in 2011," Xinhua, September 1, 2011, http://news.xinhuanet.com/english2010/china/2011-09/01/c_131092442.htm. 11. See, for instance, "China reiterates its 'indisputable sovereignty' over Diaoyu Islands," Xinhua, January 3, 2012, http://news.xinhuanet.com/english/china/2012-01/03/c_131340503.htm; and "China Says Its South Sea Claims Are 'Indisputable'," Bloomberg News, July 30, 2010, http://www.bloomberg.com/news/2010-07-30/china-has-indisputable-sovereignty-in-south-china-sea-defense-aide-says.html. 12. The pivot to Asia has become the principal buzz phrase for U.S. national security policy in Asia. See, for instance, Hillary Clinton, "America's Pacific Century," Foreign Policy, November 2011, http://www.foreignpolicy.com/articles/2011/10/11/americas_pacific_century; Barack Obama, "Remarks By President Obama to the Australian Parliament," The White House, November 17, 2011, http://www.whitehouse.gov/the-press-office/2011/11/17/remarks-president-obama-australian-parliament; and Barack Obama, "Remarks by the President on the Defense Strategic Review," The White House, January 5, 2012, http://www.whitehouse.gov/the-press-office/2012/01/05/remarks-president-defense-strategic-review. 13. Author interview, May 2011. I was not given permission to name the individual. 14. Author interview with Tung Chee-hwa, vice-chairman of the 11th National Committee of the Chinese People's Political Consultative Conference (CPPCC), July 1, 2011. 15. For calculations that indicate South Korea's likely surpassing of Japanese average wages, see "Flying Geese No More," The Oriental Economist 78, no. 11 (November 2010). 16. Most of Wang Huiyao's work is available only in Chinese (several books) and in his numerous oral/PowerPoint presentations. Some of his English-language work is available on the Brookings Institution website. See, for instance, "China's National Talent Plan: Key Measures and Objectives," http://www.brookings.edu/~/media/Files/rc/papers/2010/1123_china_talent_wang/1123_china_talent_wang.pdf. 17. These figures and the subsequent figure about Chinese students remaining in the United States are taken from oral/PowerPoint presentations by Wang Huiyao at Harvard in 2010 and at Yale in 2011. He is the author of several books in Chinese on related topics. 18. William H. Overholt, "China's Economy, Resilience and Challenge," Harvard China Review, Spring 2004, http://www.rand.org/content/dam/rand/pubs/reprints/2005/RP1116.pdf. Additional informationNotes on contributorsWilliam H. OverholtWilliam H. Overholt is Senior Research Fellow at Harvard's Kennedy School of Government and is the author of The Rise of China and Asia, America and the Transformation of Geopolitics, among other works