China is a big part of the future worth creating

ìDonít Break the Engagement,î by Elizabeth Economy, Foreign Affairs, May/June 2004, pp. 96-109.

ìAs Japan Recovers, An Unlikely Source Gets Credit: China (After Long Seeing Jobs Flee, Tokyo Now Finds Benefits Of Its Neighborís Boom,î by Sebastian Moffett and Phred Dvorak, Wall Street Journal, 4 May, p. A1.

Elizabeth Economy is a keen eye on China and she worries that weíre heading for another period of China-bashing and get-tough talk over human rights, trade, security, etc. She thinks this would be bad, because China is moving along nicely in terms of development, if only we can show some patience.

The economic development does build a middle class, and that middle class increasingly agitates for more protection under the law, which ultimately undermines the rule of the Party. This is an arc of rising expectations that the Party can ride for many more years, but never quite get on top of. We see this in what Economy calls the third great wave of legal reform. The first involved Chinaís opening up to the outside world for trade (regulatory reform) and the second has involved attacking corruption as China joins the WTO and assumes new rule sets. The third will involve subordinating the Party itself to the rule of law, in effect elevating the constitution to the supreme law of the land. This will happen over time, as local direct elections elevate a new class of politicians looking to institute what they call in Russia a ìdictatorship of the lawî to which even the Party must submit.

So Economy advises patience and laying off the China bashing. What may help cool that political tendency in the U.S. is Japanís growing closeness with China, detailed yet again in the WSJ story. China has been the great outsourcing target of Japanese manufacturing firms for years now, but as 40% of that in-China production sells within China, Japanís recovery is not highly tied to Chinaís economic growth. As the article notes, the ìmain worry for Japanese economists these days is that a slowdown in Chinaówhich accounted for 79% of Japanese export growth last yearówill threaten Japanís recovery.î

So as China becomes Japanís friend, the friend of our friend must become our friend too. Thatís security in the context of everything else.