It looks like Michelle Bachmann isn’t the only person who thinks America should be more like China. Former president of the Service Employees International Union Andy Stern thinks so too. In a recent op-ed on the Wall Street Journal, he waxes lyrical over China’s “superior economic model” which he witnessed first-hand during a recent trip here. Stern argues that the ability to plan — something he thinks America has lost — is what makes China tick:
I was part of a U.S.-China dialogue—a trip organized by the China-United States Exchange Foundation and the Center for American Progress—with high-ranking Chinese government officials, both past and present. For me, the tension resulting from the chorus of American criticism paled in significance compared to reading the emerging outline of China’s 12th five-year plan. The aims: a 7% annual economic growth rate; a $640 billion investment in renewable energy; construction of six million homes; and expanding next-generation IT, clean-energy vehicles, biotechnology, high-end manufacturing and environmental protection—all while promoting social equity and rural development.
Some Americans are drawing lessons from this. Last month, the China Daily quoted Orville Schell, who directs the Center on U.S.-China Relations at the Asia Society, as saying: “I think we have come to realize the ability to plan is exactly what is missing in America.” The article also noted that Robert Engle, who won a Nobel Prize in 2003 for economics, has said that while China is making five-year plans for the next generation, Americans are planning only for the next election.
The world has been made “flat” by the technological miracles of Andy Grove, Steve Jobs and Bill Gates. This has forced all institutions to confront what is clearly the third economic revolution in world history. The Agricultural Revolution was a roughly 3,000-year transition, the Industrial Revolution lasted 300 years, and this technology-led Global Revolution will take only 30-odd years. No single generation has witnessed so much change in a single lifetime.
The current debates about China’s currency, the trade imbalance, our debt and China’s excessive use of pirated American intellectual property are evidence that the Global Revolution—coupled with Deng Xiaoping’s government-led, growth-oriented reforms—has created the planet’s second-largest economy. It’s on a clear trajectory to knock America off its perch by 2025.
As Andy Grove so presciently articulated in the July 1, 2010, issue of Businessweek, the economies of China, Singapore, Germany, Brazil and India have demonstrated “that a plan for job creation must be the number-one objective of state economic policy; and that the government must play a strategic role in setting the priorities and arraying the forces of organization necessary to achieve this goal.”
The conservative-preferred, free-market fundamentalist, shareholder-only model—so successful in the 20th century—is being thrown onto the trash heap of history in the 21st century. In an era when countries need to become economic teams, Team USA’s results—a jobless decade, 30 years of flat median wages, a trade deficit, a shrinking middle class and phenomenal gains in wealth but only for the top 1%—are pathetic.
Jonah Goldberg, editor-at-large of National Review Online, is not impressed. He responds:
Mr. Stern sees the Chinese government’s allegedly keen ability to “plan” its way to prosperity as the new model for America. It is an argument of profound asininity. China had five-year plans before it started getting rich. Under the old five-year plans, China killed tens of millions of its own people and remained mired in poverty. What made China rich wasn’t planning, it was the decision to switch to markets (albeit corrupt ones). The planners were merely in charge of distributing the wealth that markets created.
Indeed, rapid economic growth always makes government planners look like geniuses when the reality is that the planners are more like self-proclaimed rainmakers who started dancing only after it started raining. When the rain stops, which it will, they’ll have much to answer for.
Oh, and what about labor? There’s one labor union in China, and it’s run by the government. (The Nazis had pretty much the same system.) Mr. Stern doesn’t seem to care.
Alain Sherter of CBS News wonders:
Is this model — a dictatorship that perpetuates its power by exploiting workers — what Stern has in mind when he exhorts the U.S. to “study the ingredients of its competitors’ success”? Let’s hope not. Yet in omitting any mention of labor conditions in China, Stern sounds uncannily like the profit-crazed CEOs he once routinely attacked for their indifference to labor. Economic theories may change, but a buck is a buck.
Worse, Stern implicitly endorses the underlying political principle that has long guided the Chinese economy — that fast growth justifies everything. Under this philosophy, which is enshrined in the technocratic blueprints Stern thinks so highly of, China has for years justified denying workers the basic rights and protections that he espoused as head of the SEIU.
Whether he recognizes it or not, Stern is instructing us to reject one “extremism” and embrace another. But instead of evangelizing the free market, this one comes cloaked in turgid homilies about the inherent virtues of planned economies. Team China rolls on. Why can’t we? Growth is good. And nothing must stand in its way.