Harvard’s Niall – pronounced like Neal –  Ferguson is an absolutely prolific writer and a creator of some of the more colorful contemporary metaphors for the evolving world.  A good friend was kind enough to forward me a piece that Niall had penned in the WSJ – “In China’s Orbit“.  The principal thesis of the article is – as the subtext promotes – “After 500 years of Western predominance the world is tilting back to the East.”

One of the dilemma’s for prolific writers such as Ferguson is that they tend to run right into their own earlier position.  Thus in Niall’s case he and a colleague create “Chimerica” the fusion of the the Chinese and American economies  – one export and surplus, the other consumption and deficit – and then in the midst of the meltdown declare it dead.  The problem is that the declaration may yet remain premature.

In this article, the problem presented by his analysis may be that the facts fail to reflect – at least for the time being – this narrative.  Niall suggests that China’s strategy is what he parodies are the Four “Mores”.  By this Niall means: “consume more, import more, invest abroad more and innovate more”.  And while there are elements of this in current Chinese policy, it is not such a clear cut strategy nor outcome.  And certainly it not yet east versus west  as described by Niall – “What we are living through now is the end of 500 years of Western predominance.  This time the Eastern challenger is for real, both economically and geopolitically.”

First on the 4 Mores there remain questions over each element. The fact is China has not really achieved it’s rise on the back of consuming.  Indeed the problem for China is that it remains addicted (see my recent blog post The ‘Drug’ of External Trade)  to exporting and achieving the shift to domestic consumption will not come easily or quickly.  As for more importing, well there is no question that to fuel the manufacturing machine – owned by the way by a variety of folk including the lao wai （老外）  the foreigners, there is significant importation of resources including energy.  But there is a rising chorus of complaint from a number of these countries – (having just returned from Brazil – it is one) that China is only interested in natural resources.  And such disquiet of course spills over from  resources to investments especially by Chinese State-owned enterprises – owned by the government (so much for privatization) – being made in many of these countries.  As for innovation, the final one of the 4 Mores, there is not yet strong evidence of an innovation society.    I might add – since Niall quotes a Chinese Rear Admiral – that the investment strategy justifies, apparently,  ambitious plans for naval expansion and ties it to recent official statements – not public – that raised the temperature on the South China Sea.  But if we want to look at naval strength there is a very long way to go before others – read that the United States – need to start worrying about naval challenges.

The reality is China has made enormous strides and has drawn a greater number of folk out of poverty than any other country in history.  But the development of newly emerging large market countries is not confined to Asia.  And I’m not prepared to conclude that the current primus inter pares – the United States – is now a spent force.  The reality is Asia is rising but the United States is a part of that rising.  It is present in alliances and the US has committed significant military forces in Asia.  As a power that backs on the Pacific it contends along with others in the emergence of this vast region.  So yes, Niall is right in his conclusion –  China is not the master but is no longer the apprentice. But that’s a far cry from some of the more excited assertions about China.