Niall Ferguson is a great historian, author & thinker. His interview with former Australian Dy. PM John Anderson is eye-opening. The deep understanding about China, the West and how things could unfold is discussed with great clarity. I am sharing link to Video Clip (Niall Ferguson | AUKUS, China, Cold War II) Key highlights (28th to 42nd minute) are summarized below:
PART A (China’s Objectives, and its Problems):
- The real objective of the Chinese leadership under Xi Jinping is to consolidate the rule of the Chinese Communist Party (CCP) AND unify Taiwan with China. Everything else is secondary.
- The rest of the world, particularly the West assumes that the continuous rise of China is inevitable. This is as wrong as the thought in the 1960s & 70s about the inevitable rise of the Soviet Union.
- The reality is that China faces many problems. Firstly, its population is shrinking and will decline between 20-50% by the end of the century. It will face the problem of ‘growing old before growing rich‘
- Its business model in the last 20 years has been ‘Apartments for no one’. i.e. Debt fueled expansion without adequate demand. And China has become the biggest contributor to global warming.
- The Chinese economic model had reached its natural limit of growth several years ago and the real sustainable rate is 2-3% rather than 6-7%
- Apart from the ‘Gravity of system pulling itself in’, China also has a huge inequality of incomes. These things worry Xi Jinping and the CCP, which is why you hear the Marxist-Leninist talk in the official media, and this tone in Xi Jinping’s speeches.
- All this portends more trouble for China in the next 20 years than for the USA. The problem for the world is that when regimes like the one in China feel weak and insecure, they take geo-political risk. They feel that the ‘Nationalistic sentiment’ generated by conflict will re-legitimize the regime. ‘A wounded Bear that doesn’t have the strength that others thinks it does is tempted to strike out’
PART B (Why the West’s perceived weakness may encourage misadventures by China):
- The perceived weakness & lack of internal cohesion in Britain in the 1930s emboldened Germany to start a war that snowballed into the Second World War, that it did not have real strength & resources to fight.
- The image of the US has been tarnished in the eyes of the Chinese from the time of the Global Economic Crisis of 2008, to the mishandling of the Covid pandemic, to the disastrous pullout from Afghanistan. China perceives the US as a super-power past its prime.
- USA’s divided political culture, the cult of ‘Wokeism’, the self-hating aspects of phenomena like the ‘Critical Race theory’ are watched closely by the Chinese, who conclude that the US is tearing itself apart and is unlikely to be motivated to fight a war, if required, over the tiny island of Taiwan which most Americans would find hard to find on the map of the world.
PART C (What India should do)
I will write this week & share on next Sunday.
JAI HIND
Gaurav Sarup
