China is suing for a return to detente despite its fist-tightening. But “cooperation while respecting differences” with China is a bear hug over rivals abroad. China constantly worms away at global institutions, principles, and populations. This is evident in how China has used the 21st century’s three defining crises to steal economic growth to the detriment of its rivals.
1) The financial crisis. China helped trigger the 2008 financial crisis by pricing imported commodities below market in order to pump Chinese domestic consumer and exporter demand for them. That made China the setter of ever-higher prices on global commodity markets. That, in turn, prompted the global inflation panic behind the sudden interest rate increases that prompted U.S. subprime mortgages to default en masse. Reformers had already allowed me to publish op-eds in China Daily for two years before the crisis (if not in Chinese) denouncing China’s insane price-subsidization — something that the 2009 G-20 Pittsburgh summit singled out for criticism. China’s lack of integration with global financial markets cushioned its own financial system from the crisis. As China now seeks further integration with global financial markets, those markets become less cushioned from a Chinese financial crisis.
2) Climate change. To reduce carbon emissions, China’s rivals take regulatory actions that reduce economic growth. At the same time, China gets to boost economic growth, increasing its GDP by several percent. It does so by becoming the world’s biggest carbon producer and by receiving the proceeds of its rivals’ import of photovoltaics and windmills produced and subsidized by China. Beijing excuses this “tribute” as a form of reparations for colonial imperialism.
3) The COVID-19 pandemic. China’s leadership assumed their authoritarianism would control the spread of the virus in China. They simultaneously assumed that the rest of the world would rely upon China for the medical equipment needed to fight the virus. What China didn’t consider was the power of good vaccines compared to China’s secret quick-and-dirty vaccines. China’s struggle against the delta variant suggests its vaccines aren’t all that good.
In these three defining crises of the 21st century, we see how China has always and shamelessly put itself first.
Robert Blohm, an economist who spent the decade until 2016 in China, has been a frequent contributor to the Nelson Report for East Asia policy. He contributed to the Wall Street Journal editorial page for three decades. Blohm can be reached at [email protected].
