ARTICLE: US's road to recovery runs through Beijing, By Francesco Sisci and David P Goldman, Asia Times Online, Nov 15, 2008
This is a very good but complex description (in the aggregate) of the nature of East-West financial/trade ties over the past years, with a prescription that makes sense regarding the future of U.S.-Chinese strategic cooperation. Without using the same words, its vision matches up nicely with mine in Great Powers--the notion of a "team of rivals" in diplomacy and a coordinated "race to the bottom of the pyramid" as a way to reorder global trade patterns (getting away from just the tremendous treadmill of China selling to us and buying our debt with its surplus) so as to close the Gap by having New Core powers like China integrate Gap economies into their buyer and producer chains and attracting Western competition in the same.
The thing that's always so fascinating about economics is the wide variety of ways people can describe the same problem/solutions. As the better explanations of the current challenge emerge (and it always takes time, which is why I avoid trying to get too smart too fast in the blog), I realize how my vision in Great Powers is not nearly as "down the road" as I might have imagined. My concern with the panic regarding the book was that it would make the book's economic section look hopelessly downstream--as in, "we have to get our own house in order in the Core before we can address the Gap."
But as this piece nicely argues, informing me wonderfully as a result (and I am grateful, because I have been staying up nights on this very notion), the restructuring argument links the "getting the Core's house in order" logic to that of shrinking the Gap.
In effect, what this piece says is that the globalization model of the past quarter century that saw America provide virtually all the global Leviathan services and the lion's share of consumer demand (an implicit Marshall Plan) is broken (I prefer the term, "consummated" or "completed"). But no matter the term you use, it has come to its useful end, this model. We can't take on more debt nor more global security burden--we are tapped. These are my essential arguments in Great Powers.
China's political evolution hasn't progressed to the point where it can rapidly take on those twin burdens: they just don't have the internal deal-making counterparty capacity to gin up the domestic demand via mortgages, credit cards, etc (they can't turn into America-like overnight and thus buttress our recovery, and somebody's got to for globalization to move forward), and they don't have the vision nor wherewithal to step into a junior partnership role on global security. In short, we simply have not done enough, nor have they themselves, to prepare themselves for this moment.
Then again, whoever does in history?
Thus my "optimistic" vision of Chinese-American strategic cooperation now enters into its imperative phase--as in, we have no choice. China must race to the bottom of its own pyramid, and toward the rest of the Gap. It simply cannot proceed further economically on just the basis of selling to the Old Core West. We need them to make this shift--fast. We need to partner with them security--wise to make this shift happen. We need to participate in this shift as well, to improve our own export profile. Whereas China will integrate the Gap more in chains (buyer and producer), our goal is to move technology, thus improving our export-to-import ratio.
Upshot? Sino-American strategic partnership became immediately imperative as a result of this disjuncture in global economics. Those who see that imperative see a way out (see Fareed Zakaria's recent Newsweek column). Those who don't now represent the single greatest threat to global peace and prosperity.
Moreover, my shrink-the-Gap (now repackaged as a diplomatic "team of rivals" approach and a "race to the bottom of the pyramid"--my diplomatic and economic realignments, respectively) now likewise shifts from "visionary" to imperative. Before the argument was based primarily on fear-threat security concerns. Now it is based on the very nature of our future prosperity and the survival of globalization.
Of course, I always considered the latter concepts to be operative. The question was, did the current environment provide me sufficient context for the sale? Because if you try to sell beyond your audience's sense of the plausible, you lose them because they see you as a "nut."
Now I feel completely empowered across the board, and I no longer fear the subprime System Perturbation's play in my model of the future (fear, to me, is always a matter of not knowing how to integrate). Deep down, when you think about alternative global futures, you always know that the big facilitators are going to be scary crises. That's just the way it is. People will not change on the basis of frantic warnings during calm times, but they will change on the basis of calm warnings during frantic times.
Bottom line: if you want to be a grand strategist, you have to welcome the frantic times. No tumult, no play. And no play, no real structural change.
This gives me a column, perhaps the basis of what I write for Esquire to promote the book, and the main hook between the book/brief and the current audience's expectations for answers.
This column was a tipping point for me, coming after countless others moving in this direction. I thank everyone who sends me these things, but especially Craig for this one.
The light bulb just went on. I now know how to organize the new brief.
Having said all that, my sked just so happens to be perfect now for turning from the book to the brief, so I suspect those stars had to align as well.
Old bit from PNM: there'ss the answer, but then there's the timing and the right ear.
(Thanks: Craig Nordin)
Wednesday, December 17, 2008 at 3:12PM 
