Why the West Rules--For Now (88 page)

Every experience suggested that given peace and a united government—both largely lacking since the 1840s—China, too, could prosper within the Western-dominated global economy, but Deng went further still, actively pushing China toward integration. To reduce the pressure on resources, he promoted the notorious One Child Policy, which (in theory) required women who had two babies to be sterilized,
*
and to increase the resources available he embraced the global economy. China joined the World Bank and International Monetary
Fund, opened Special Economic Zones to attract capitalists from Macao, Hong Kong, and Taiwan, and even admitted a Coca-Cola plant to Shanghai.

By 1983 Deng had effectively killed Mao’s communes. Peasants were pursuing “sideline” activities for personal gain and businessmen were keeping some of their profits. Farmland still belonged to collectives but families could now lease plots for thirty years and work them privately. Urban property, on longer leases, could even be mortgaged. Output soared, and although liberalization horrified conservatives, there was no going back. “
During the ‘Cultural Revolution,’
” Deng pronounced,

there was a view that poor communism was preferable to rich capitalism … Because I refuted that view, I was brought down … [but] the main task of socialism is to develop the productive forces, steadily improve the life of the people, and keep increasing the material wealth of the society … To get rich is no sin.

Similar thoughts were also assailing Communists four thousand miles away in Moscow. After the shock of Nixon’s trip to China the 1970s had gone rather well for the Soviet Union. When the Arab states drove up the price of oil, the Soviet Union, a massive exporter, benefited too, and with money rolling in, Moscow funded and won a series of proxy wars and overtook America in nuclear arms in 1978. But that was communism’s high tide. An intervention to prop up a client regime in Afghanistan turned into a draining war that dragged on through the 1980s. Oil prices fell by two-thirds, and the United States sharply increased military spending, especially on high-tech weapons.

The politburo was already worried that ordinary Russians could see their train was standing still. Its state-run economy could churn out tanks and Kalashnikovs but not computers or cars (another Soviet joke—“
How do you double
a Lada’s
*
value?” The answer: “Fill up the tank”). Dissent was simmering everywhere. The thought of a new arms race terrified the Soviet Empire’s rulers.

“
We can’t go on
living like this,” Mikhail Gorbachev confessed to his wife, Raisa, as they paced their garden in 1985. Gorbachev would, in a few hours, be named premier of the Soviet Union, yet the garden was the only place he could escape his own snooping spies. Like Deng, Gorbachev knew he had to face reality. The explosion of an antiquated nuclear reactor at Chernobyl in 1986 revealed that the Soviet Union was not just falling behind but actually falling apart, and Gorbachev threw restructuring (
perestroika
) and transparency (
glasnost’
) into high gear—only to rediscover what Marx and Engels had known a century and a half before: liberalization sweeps away
all
fixed, fast-frozen relations, not just those we dislike.

All that was solid melted into air, and Deng and Gorbachev both learned that economic freedoms merely whetted appetites for political ones. Sometimes Deng found the protesters useful allies against hard-line Communists; sometimes he cracked down on them. Gorbachev, though, suspected that trying to use force could cause the whole regime to collapse. When he allowed open elections to the Congress of People’s Deputies in spring 1989 and the deputies repaid this by jeering him on live television, he declined to suspend Congress. Instead he flew to Beijing, where protestors against one-party rule cheered him. “
In the Soviet Union
they have Gorbachev,” one student poster read. “In China, we have whom?”

Deng, not amused, declared martial law the day after Gorbachev left. By early June 1989 a million protestors were crammed around Tiananmen Square, some dancing and singing, some dying on hunger strike. Deng branded them the “
dregs of society
,” people determined to “establish a bourgeois republic entirely dependent on the West,” and sent in the troops. Pictures flashed around the world of torn bodies, crushed bicycles, and a lone, unknown protestor blocking the path of advancing tanks.

Repression won in China, but even when Hungary and Poland announced multiparty elections, Gorbachev still resisted Deng’s lead. Following what one minister called the Sinatra Doctrine, he left the Soviet satellites to do it their way. So astonished was the newly elected Polish prime minister that he fainted during his own inauguration. Testing the limits, Hungarian troops rolled up the barbed wire along their border with Austria. Thousands of East Germans “vacationing”
in Hungary abandoned their cars and walked across the border to freedom.

And still Gorbachev did nothing. When he visited Berlin in October, crowds again cheered him and begged him to stay. Over the next few weeks East Germans started dancing on top of the Berlin Wall and chipping at it with hammers and chisels. When no one shot them, thousands crossed into West Berlin. Confused and incompetent, the East German regime disintegrated. Over the next few months Communist dictators all across eastern Europe went the same way and the nations bundled together within the Soviet Union started declaring independence. When even the president of the new Russian Federation announced his intention to quit the union, Gorbachev was left as general secretary of an empire that no longer existed. On Christmas Day, 1991, he bowed to pressure to sign a decree formally dissolving it. The end was almost too perfect: Gorbachev’s Soviet pen would not write and he had to borrow one from a CNN cameraman.

The United States had won the War of the West.

EAST WIND, WEST WIND

When dynastic empires proved unable to cope with total war, almost vanishing from the earth between 1917 and 1922, the United States had shown itself a very reluctant leviathan, but when communism proved equally inadequate between 1989 and 1991, Americans were ready to fill the void. Every two years, the Department of Defense reviews its grand strategy in a report called the Defense Planning Guidance. The first draft of the report due in March 1992, just three months after the fall of the Soviet Union, laid out a bold new vision:

Our first objective
is to prevent the reemergence of a new rival, either on the territory of the former Soviet Union or elsewhere, that poses a threat on the order of that posed formerly by the Soviet Union. This … requires that we endeavor to prevent any hostile power from dominating a region whose resources would, under consolidated control, be sufficient to generate global power. These regions include Western Europe, East Asia, the territory of the former Soviet Union, and Southwest Asia.

When “
an official who believes
this post-cold-war strategy debate should be carried out in the public domain” (as
The New York Times
put it) leaked this draft, the government quickly softened its tone, but something very like the original vision of a world with the United States as its sole superpower came to pass all the same.

The old Soviet Union imploded in a scramble to loot its assets. The breakdown was not as bad as the civil war that had followed the fall of the Romanovs, but Russia, the main successor state, nevertheless saw output fall 40 percent in the 1990s and real wages 45 percent. In 1970 the average Soviet citizen died at sixty-eight, just four years younger than the average western European; by 2000 the average Russian died at sixty-six, twelve years behind residents of the European Union. Russia was still enormous, resource-rich, and the world’s biggest nuclear power, and by 2008 the return of strong government and rising energy prices had emboldened it into bullying the former Soviet republics and blackmailing the European Union. But as the Defense Planning Guidance had hoped, Russia posed nothing like the threat of the old Soviet Union.

Nor did the European Union challenge America’s dominance of the Western core. To some viewers Europe’s lurches toward (then away from) economic and political integration looked like steps toward a mighty subcontinental empire, finally achieving peacefully what the Habsburgs, Bourbons, Napoleon, and Hitler had failed to achieve through violence, but in reality Europe’s continuing divisions, slowing economic growth, aging population, and military weakness left it far from superpower status.

Southwest Asia featured in the 1992 planners’ minds largely because they feared a hostile state seizing the region’s oil fields, as Iraq tried to do in 1990. They ignored the Islamist extremism that had been growing since the 1970s, and (like almost everyone else) were blind-sided by the September 11, 2001, attacks on the United States. But it was in the East that the planners’ assumptions proved most spectacularly wrong. Within weeks of the Defense Planning Guidance being leaked to the press, America’s major Eastern ally, Japan, plunged into recession and its major Eastern rival, China, took off.

A hundred and fifty years had passed since the West began turning the old Eastern core into a periphery, and the lessons were clear to all who had eyes to see. Given peace, responsible government, and willingness to bend to Western power, Easterners could turn the capitalist world economy to their own ends, converting the huge populations and learned elites that had struck nineteenth-century Westerners as evidence of Eastern backwardness into engines of economic growth. Since the 1840s China had had precious little peace, responsibility, or flexibility, but in the 1990s it began to take its rightful place in the global order.

From the unlikely podium of the back of a golf cart in the middle of a theme park, Deng announced that economic reform would no longer “
proceed slowly
like women with bound feet, but … [would] blaze a trail and press forward boldly.” The obstacles to red capitalism crumbled. When Mao and Nixon met in the early 1970s the typical American worker was nearly twenty times as productive as the typical undercapitalized Chinese laborer and the United States created 22 percent of the world’s goods compared with China’s 5 percent. Across the next thirty years American productivity continued to rise, but investment drove China’s up three times as fast. By 2000, American workers were less than seven times as productive as Chinese. The United States’ share of world production had barely changed, at 21 percent, but China’s had nearly tripled, to 14 percent.

China paid a terrible price for this growth. Virtually unregulated factories dumped waste at will, poisoning major rivers. Cancer rates along these waterways were often double the national average. Other rivers, tapped for equally unregulated agriculture, dried up altogether. Logging ran wild and deserts expanded twice as fast as before the 1970s. Protests against government incompetence and endemic corruption became increasingly violent; most years since 2000 the police have recorded around 25,000 “mass incidents” and far more small riots.

In return, though, Deng’s program headed off starvation and delivered big income gains. Country folk, who still make up two-thirds of China’s population, saw real wages rise about 6 percent per year. The gains, however, were concentrated along the eastern seaboard, and in dirt-poor inland villages the decline of Mao’s rudimentary but free
education and health care often canceled them out. One result was the biggest migration in history: since the 1990s 150 million people have moved to the cities, creating the equivalent of a new Chicago every year. Relocating to a city typically raised a farmer’s income by 50 percent while simultaneously providing manufacturers with labor at a fraction of its cost in rich countries.

Between 1992 and 2007 China’s exports increased a dozen-fold and its trade surplus with the United States ballooned from $18 billion to $233 billion. In American discount stores such as Wal-Mart, Chinese-made goods typically filled 90 percent of the shelf space by 2008; rare was the American who did not don at least one piece of made-in-China clothing every morning.
Business Week
magazine observed that “
the China price
” had become “the three scariest words in U.S. industry.” Companies that could not match it went under.

Like nineteenth-century Britain and twentieth-century America, China became the workshop to the world. The financial journalist James Kynge describes overhearing a conversation on a train in Italy between two Chinese businessmen, sounding for all the world like a couple of Gradgrinds wrenched from the pages of Dickens:

The boss remarked
that they had been traveling for an hour and a half and had hardly seen a single factory. “Foreigners like looking at scenery,” the young man offered. The boss paused for thought, then asked, “Scenery or production, which is more important?” … The boss’s curiosity ranged over many subjects … Why were foreigners so lazy? What was Europe going to do when it did not have much industry left? Could you really run an economy on services alone? Did European cows really consume two dollars a day in farm subsidies?

Half a century earlier, Mao had claimed, “
The direction of the wind
in the world has changed … At present, it is not the west wind that prevails over the east wind but the east wind that prevails over the west.” At the time, he was fooling himself; the 1950s East was very much under the West’s wing, divided between Soviet and American spheres. But by 2000 Mao’s words were coming true, albeit not in ways he had intended. Western social development was further ahead of Eastern—over three hundred points—than ever before, but whereas the ratio between the Western and Eastern score had been almost 2.4:1 in 1900, by 2000 it was only a little over 1.6:1. The twentieth century was both the high point of the Western age and the beginning of its end.