Now that I am back from China, I have had time to reflect on what it was all about. Here are my thoughts.

The People

China is an amazing country. As most people know, it is home to over 1 billion citizens.  I found most people to be friendly. There were lots of smiles. As we moved north from Shenzhen to Beijing, the temperament changed. Rather than everyone being friendly, only about half were. Some merchants were nice, some weren’t. It was quite a change from Shenzhen. All in all, people are the same everyplace in the world; a bit apprehensive of strangers, but all in all, most just want to be happy.

The Country

On the bullet train trip from Shanghai to Beijing, I really got a feel for the landscape of China. Between these giant cities of millions of people lie endless identical rice paddies with similar houses and occasional massive power plants. Coming from California, I was surprised at the lack of variety of the terrain. I imagine some from the Midwest, with endless cornfields, wouldn’t be as surprised as I was.

The Food

After about a week, I got sick of eating Chinese food. Upon reflection, I’m not so sure that I was sick of Chinese food as much as I was sick of eating out every meal. When you are traveling, every meal is from a restaurant. I don’t eat out often. I think I wasn’t so much sick of Chinese food as I was sick of eating out. There first meal I ate when I got home was spaghetti and meatballs, which is at least a 50% Chinese dish. Macro Polo brought spaghetti back from the Orient after all.

The Sights

The Great Wall is amazing and boring at the same time. It easily rivals the pyramids in Egypt. It’s hard to imagine a threat so pervasive that it required several centuries to build a barrier. Imagine if America had been at war with England since 1776, what we would have done. It’s seems that some sort of negotiate truce or inter-kingdom marriages would have been far easier solutions.

I feel the same about Tiananmen Square and the Forbidden City. These two things are full of history, yet they are really just a giant empty square. If I return again, I’ll hire a guide who can help me understand them better.

The Hustle

Most of the Chinese people that I met were friendly. I only felt unsafe twice during the trip. Both times was in a hutong. Once was at night, when a group of teenagers began following us down a dark alley. The other was when we were about to be victims of the famous Tea Ceremony scam. I knew something was up, but I didn’t know what. Other than that, I felt safe throughout China. I didn’t use a money or travelers wallet. No one ever got close enough to me to be a pickpocket. I think that sort of danger was overblown. However, I think people should be aware of The Hustle.

In China, in certain markets, bargaining for things is common. In order to not get burned, you really have to know the fair price of item. The “genuine” pearls that I bought at the Silk Market are fake, even though I negotiate a good price.

Because I can understand some Chinese, I believe I noticed the hustle more than other students. Most items do not have price tags on them. I would hear merchants quote one price to a Chinese customer and a different price to us. For example, Tsingtao beers were $3 RMB for Chinese but $10 RMB for us at the same market across the street from our hotel in Beijing.

You really have to have your guard up at all times in China. Near the end of the trip, when I had become comfortable, I got my iPhone stolen. This was a $1000 lesson to always keep your guard up.

At times, I tried to apply what we learned at Cal Poly to the reality of China. At Cal Poly, our Operations class stress Lean Operations. I don’t know how you can be a lean company, when you constantly have to quality check your sources. I wonder if there is a how to run a Lean business in China course?

What I wish I would have done

I wish I would have brought a laptop. In day to day American life, I use a computer every day. Not having one for two weeks was difficult. I was unable to surf the internet to look things up. I feel that as a result, I missed out on many things on this trip. I missed out on Xichong beach in Shenzhen. I never figured out that the Yu Garden temple was right behind the Yu Garden market. Even though we went to the People’s Square, I didn’t’ understand its significance in Nanjing Road. I wish I would have gone to those. I’m probably would have still missed out, but having a laptop would have helped. I thought there would be more internet cafes, but I never saw one.

However, China is too massive and too rich to get it all in one trip. I may have missed out on much of the sightseeing. That will have to be saved for my next trip.

The Expected and the Unexpected

We travelled over 1,000 miles from Shenzhen to Beijing and the weather was pretty much the same. Coming from California, there is major different between Humboldt and San Diego, just as there is between Dallas and Denver. I expected more variation in weather.

I didn’t’ think I would have difficulty with the food, but after a week, I didn’t want to eat another bowl of fried rice. I wanted a sandwich. Be prepared for this.

Visiting with the former mayor of Mutianyu was amazing. It was a real eye opener and totally unexpected. This was the highlight of the trip for me.

English Corner was a close second. It was very cool. Not what I expected. If you are curious, you should just go a see for yourself. Have a cup of coffee first, because the experience is intense. I also expected never to see Jeff Brown again. I was pleasantly surprised when he arrived safely at the hotel later that evening.

How does China evolve?

People talk about how fast China is moving, but there business processes are slow. Going forward how does China evolve? In this decade, when China becomes the biggest economy in the world, what happens? Will to world adopt China’s slower business practices or while China become more “western.” China is becoming more modern, but what does their future look like. Does China adopt more western business models such as fewer dinners and more honest, posted prices? Do they develop an effective legal system? How does this all change if change is able to grow their domestic market to match their export market?

My hunch is that the old ways will disappear like they have in all other societies. I feel 100 years from now, there will be a global business cultural, with elements of all members, that will look more like how business is done in the west, rather than how business is done in China. In 40 years, when the bulk of China’s population has retired and they are now competing with the other BRICs, is it realistic to think China will follow the traditional ways? I don’t believe so. You can already see it in the youth of English Corner, wanting desperately to be modern and to understand the modern world.

My Advice for Next Year’s Students

I have a few recommendations if one of next year’s China trip students asked me for advice.

1)      Pick your roommate early. That way you two can start planning what you are going to do on your trip. Little hints you find you can share, etc. It’s a good way to get started on the trip.

2)      Bring a laptop. I recommend one per room, you can share. But you are probably not used to life without a computer.

3)      Buying a cellphone in china is difficult. You need a passport. It’s better to get an “unlocked” cheap GSM phone in the US and then just buy a pay as you go China Mobile or China Unicom SIM card.

4)      Bring a map for each city. Annotate it before you leave, it will help you understand where you are.

5)      The subway system is amazing and safe. Take it over cabs. It’s worlds better than BART.

6)      China is safer than you thing, take a chance and be adventurous.

7)      Never let you guard down.

Wrapping it all up

Describing China to friends, I tell them that up is down. It really is a different “world” over there. Every cultural norm that you are accustomed to is different. I had a hard time with the constant spitting everywhere. The really is no need to “huck lugis” every chance you get, but in China, it’s completely acceptable. I even watched people spit on escalators in the Shanghai train station.

For everyone I know who has not been to China, I feel now that I am an ambassador.  I am peppered with questions about all things China. From cultural to political or technological questions, my peers look to me for answers. I did not really think about this before the trip. It’s a natural result of having gone someplace most people have not. Now that I am away of this, I feel compelled to learn more. I have to make sure that my answers are correct and my opinions are valid. I want to pain an accurate picture of China and her people.  The CP China trip is mislabeled as a culminating experience. It real is just a beginning.

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Every five years, China presents a new Five Year plan, which is the development goals the country will follow and try to reach during the next five years. This is in dramatic contrast to the United States, where one party doesn’t want to prepare for anything, other than war.

The latest five year plan (www) is a long document. It’s a difficult read, because it’s translated. If you are going to read it, give yourself plenty of time.

The latest Five Year plan is the 12th. To understand it, it’s best to start by comparing it to the previous Five Year plans.

9th Five Year Plan Goals:

GDP Growth: Target  8%, Achieved 8.3%

  • Coal: Goal ¥133 billion, Actual ¥73 billion
  • Industrial Waste: Goal Treat 83%, Actual N/A
  • Industrial Gas: Goal Treat 86%, Actual N/A
  • Urban Waste Water: Goal Treat 25%, Actual 34%

10th Five Year Plan Goals:

  • GDP Growth 7%, Achieved 9.48%
  • Major Pollutants: Goal Reduce -10%
    • COD (Chemical Oxygen Demand): Actual -7.35%
    • Ammonia: Actual -27.5%
    • Industrial Dust: Actual -17.1%
    • Smoke: Actual -6%
    • Urban Waste Water: Actual -55%

11th Five Year Plan Goals:

  • GDP Growth 7.5%, Achieved 11.2%
  • Major Pollutants
    • Urban Waste Water: Actual 75%
    • COD (Chemical Oxygen Demand): Actual -12%

Source:  http://www.circleofblue.org/waternews/2011/world/infographic-successes-and-failures-of-chinas-five-year-plans-1996-2010/

As you can see, one of the main goals of the Five Year plans is to grow GDP. For the 12th Plan, the goal is to grow GDP by around 8%, 7% annual growth of per capita income, and spend 2.2% of GDP on research and development. Even at the heights of the dot.com 90s or the housing boom 2000s, GDP in the US never grew up 8%. Yet, this is on the low side of the average for China. In China, in essence, every year is a dot.com boom. Imagine what it feels like to live in an economy that has had 8% growth for over 16 years. In America, the standard of living of the average wage earner has fallen since Reagan took office in 1980. Since 1996, the average Chinese has seen theirs grow 348%.

Understanding the Current 5-Year Plan

There are some strategic changes in the newest 5 Year plan. China wants more foreign investment in modern agriculture.  Currently China has a high demand for bulk agricultural products, Soybeans and cotton. US exports are up 80% to China. If the Chinese government pursues this new path of agricultural development, US exports would likely fall. (http://www.usda.gov/wps/portal/usda/usdahome?contentid=2012/03/0103.xml)

China also wants to move away from being the “world’s factory” to higher quality manufacturing and more research. If China does move its economy this way, that opens the door for the next world’s factory: India or Brazil; most likely India. If I were thinking about building a new factory, I would strongly look at one of the other RBICs, especially if there is some movement towards creating hubs of research and development.

Opportunities

During this explosive growth, there is much opportunity. The current trends in Chinese business, or hot industries are:

  1. Healthcare
  2. Education
  3. Cleantech/Greentech
  4. Food
  5. Software/High Tech

From: http://www.chinalawblog.com/2010/11/five_ways_to_make_money_in_china.html

In addition to the above five things, McKinsey & Associates notes that “private insurance could become cheaper and more accessible” in China, creating a $90 billion market by 2020 and that “regulatory reforms are making it easier for private hospitals to provide publicly-funded care.”

Perhaps this is why Professor Carr keeps telling us to pay attention to the insurance issue in China. China does not have a very effective legal system.  Currently, guanxi (connections) is how business is done. Going forward, guanxi is hard to maintain internationally and electronically. If you don’t have an effective legal system, you can replace guanxi with insurance. After all, what are connections? They are personal insurances. The time spent developing guanxi is mainly just a form of insurance.

Fueling this growth is China’s ravenous appetite for energy. Coal is not without its problems, just ask Al Gore. China has stated that they want to get more and more of their electricity from nuclear power. The big manufacturers of nuclear reactors are:

Keep an eye on them for any developments.

Can You Believe This?

I feel that Chinese culture is essentially dishonest. Given the opportunity to take advantage of someone, Chinese culture says you should. That is why they have fake eggs, contaminated milk, etc. In this culture,  can China’s economic figure be believed, or are they made up? James Chanos of Kynikos Associates (Greek for “cynic”) thinks China is the next Enron — that their reported financial figures are make believe.

Chanos was one of the early investors to doubt Enron’s figures. He made millions shorting Enron. James Chanos would be selling short China stock if it was possible. (I believe it is not possible to ‘borrow’ Chinese stock and then short sell it, the same way you can in America.)

(http://www.nytimes.com/2010/01/08/business/global/08chanos.html?_r=1)

(http://www.bloomberg.com/news/2011-05-24/chanos-says-hedge-fund-may-not-be-bearish-enough-on-chinese-real-estate.html)

Even some of the leaked classified cables from Wikileaks support this view, saying Chinese GDP figures are “man-made”. (http://wikileaks.org/cable/2007/03/07BEIJING1760.html)

The Economy: Not By the Numbers

——————————-

3. (C) Describing some of the challenges he faces as Party Secretary, Li related that despite brisk economic growth of

SIPDIS 12.8 percent in 2006, Liaoning’s income gaps remain severe. Liaoning ranks among the top 10 Chinese provinces in terms of per capita GDP, yet the number of its urban residents on welfare is among the highest in the country and average urban disposable income is below the national average. By contrast, rural disposable incomes are above the national average. Even so, incomes for Liaoning farmers are only half that of urban residents.

4. (C) GDP figures are “man-made” and therefore unreliable, Li said. When evaluating Liaoning’s economy, he focuses on three figures:

1) electricity consumption, which was up 10 percent in Liaoning last year;

2) volume of rail cargo, which is fairly accurate because fees are charged for each unit of weight; and

3) amount of loans disbursed, which also tends to be accurate given the interest fees charged. By looking at these three figures, Li said he can measure with relative accuracy the speed of economic growth. All other figures, especially GDP statistics, are “for reference only,” he said smiling.

The American Way vs China — Keith on a Soap Box

The 2012 5-year plan sets a goal of building 83,000 kilometers of highway. At one time, America did similar things.  Dwight D. Eisenhower signed the The National Interstate and Defense Highways of 1956  authorized  25 billion dollars for the construction of 41,000 miles (66,000 km) of high in America.

In our past, “We choose to go to the moon in this decade and do the other things, not because they are easy, but because they are hard”. By 1973, America spent over $25 billion on the Apollo program, the legacy of John Kennedy.

The last President to attempt a long term plan was Lyndon B. Johnson and the Great Society program. He was able to spread freedom to all Americans, not just white Americans. But other than Civil Rights issues, many of the goals of the Great Society were never enacted. The rise of Barry Goldwater, and “Goldwater Republicans” spelled the end of bi-partisan support in American.

I don’t believe this level of strategic planning is currently possible in the United States. The Republicans current platform is defeat Obama. That’s it. Anything that makes him loose is what they are trying to accomplish. Any sort of planning is out of the questions — Unless it’s unlimited military spending. But that’s not a real plan.

Just look at the Republican response to Obama 2012 state of the Union:

“In three short years, an unprecedented explosion of spending, with borrowed money, has added trillions to an already unaffordable national debt. And yet the president has put us on a course to make it radically worse in the years ahead.”

(http://articles.cnn.com/2012-01-24/politics/politics_sotu-gop-response-transcript_1_mitch-daniels-union-speech-middle-class?_s=PM:POLITICS)

What the Republican’s call “an unprecedented explosion of spending” is actually the lowest growth in federal spending in more than 60 years.  Obama grew the Federal Budget 1.4%, compared to Reagan and Bush’s nearly 8%. But Republican’s don’t want to hear that. (Wall Street Journal: http://www.marketwatch.com/story/obama-spending-binge-never-happened-2012-05-22) They say it best: the “Obama spending Binge Never Happened.”

In light of the complete hostility of the Republican party to any sort of effective governance, I don’t see how any sort of planning, even short term planning could work.

China may not beat us, but we can beat ourselves.

Guanxi

(The art of relationships)

Microsoft, China, and Bill Gate’s Plan to Win the Road Ahead
by
Robert Buderi and Gregory Huang
ISBN-10:0743273222

One day, in the first few weeks of my Chinese 102 class, Winter 2012, Nicole Boudin, who sits next to me, brought in a book she had found at a garage sale, titled Guanxi (The art of relationships): Microsoft, China, and Bill Gates’s Plan to Win the Road Ahead. It was time to select our second book for the China Business trip class. This seemed like great fortune. Even though she had only had it for just a few hours, Nicole let me borrow the book for the remained of the quarter. I asked if I could read this book, which was not on the reading list, for my next book and he approved it. In hindsight, I wish he hadn’t. This is not the book I had hoped it was.

Guanxi (The art of relationships) is the story of the creation of the Microsoft Research Center (MSRC) in China[1]. It starts with Bill Gates’ initial forays into China and his stumbles there and ends with the star of novel, Kai-Fu Lee (李開復) departure to Microsoft’s main rival Google, to repeat the success. The book is a mainstream novel for anyone interested in the history of Microsoft. It is not about guanxi, its about Microsoft.

I had hoped the book was a book strictly about guanxi: how to create it, how to nurture it, how to grow it and how to use it, but it’s not. Guanxi is the novelization of the recent history of Microsoft. It tells the story of how Microsoft opened their research lab in Beijing and later their Advanced Technology Center. It’s a well written novel, easy to read, but the title is very misleading. It is not about guanxi, it’s about Microsoft.

The material in the book could have been written by a PR flack at Microsoft. Everything is positive. The only “bad guy” is Juliet Wu, an early Microsoft China executive who leaves before the novel begins. Everyone else is a “good guy”.

When the book refers to guanxi, most often it’s simply to reinforce the title. When you invite your business partner to dinner, that’s not guanxi, it’s just doing business. We do the same thing in the west. Having cake with your employees on their birthday likewise is not guanxi. We do that here too.

In China, you need a permit to move and change cities. Microsoft was hiring many people at their center in Beijing, receiving over 20,000 job applications. So many, that they were having a hard time get the necessary permits for their new hires. Because the had a developed a relationship with the local officials, Microsoft was able to get the permit official to come to there Beijing office and do all the paper work for the new employees, rather than having each employee go to the government office. That’s guanxi.

Guanxi is mutual beneficial relationships. Microsoft couldn’t jsut take, they also had to give. In America, a post-doctoral appointment is just a research position. In China, there is a post-doctoral degree. Microsoft Research China became the first non-government run institution to offer post-doc degrees in China. They gave back to the community. That’s guanxi.

There are a few more examples, in the book. Buderi and Huanghe take the time to explain how Microsoft was always reaching out to government officials. Inviting them to dinners, technology demonstrations and other functions. In the west, we simply don’t do this. But in China, it’s required. That’s guanxi.

The last chapter tells the story of how Kai-Fu Lee became disillusioned with Microsoft and reached out to Google . He betrayed Microsoft, but he is still portrayed in a positive light. This is bad guanxi, but the book glosses over it. Kai-Fu Lee later left Google after four years to start his own company in China.

What I found most interesting about the book, was how it missed mark when predicting the future. Written in 2006, Guanxi hypes all the upcoming Microsoft products. Their tablet version of Windows, Windows Media Center Edition and especially Windows Mobile 5.0. The book gets it wrong. None of these technologies were terrible successfully. Looking back, it’s obvious how the iPhone destroyed Windows Mobile 5.0 and Symbian (Nokia) and Palm and the Blackberry (RIM). At the time, these were the heavy hitters of the phone world. Now their just relics. The technology just wasn’t good enough.

I believe that Microsoft has always been a “features” company. Just add new features to the product. They really don’t have a total vision. That’s why their products seem so disjointed. Different interfaces, different qualities between different parts. Guanxi reinforces my perception. In it, Microsoft creates the Advanced Technology Center to product-ize their research. MSRC does pure research. ATC was created to takes research from MSRC and figure out how to add it as features to upcoming Microsoft products.

The book does have it merits, though. Kai-Fu Lee details Six Challenges for doing business in China. Since he’s Computer Science PhD, he also has Six Formulas for meeting those challenges.[2]

6 Challenges and Formulas for Success in China

Challenge 1: Unique Protocols and Relationships

“China’s Culture is Built on Trust, Relationships and Mutual Respect. Trust takes a long time to build, but there are many ways to break trust: by showing disrespect, by failing to provide favors in exchange for favors received, by not following the protocols, by condescending, coercion, or by dwelling on controversial issues.”

Formula 1:  Learn the Protocols and Forge Trusting Relationship.

It’s is critical to building relationship with government at all levels from the start, even if it means seeking advice when advice isn’t really needed.[3]  Lee’s best example of this is during the SARS scare, Motorola sent its CEO to China for meetings. Beijing was on a two month lock down, and over 1,000 people had died. The prudent thing would be to stay away. But Motorola showed how high it valued its relationship with China by sending its CEO to Beijing for meetings.

Challenge 2: Contribute First and Benefit Later.

The Chinese look kindly on firms there to help China succeed, as opposed to simply trying to tap its vast potential market

Formula 2: Establish a Strategy for Long-Term Commitment.

It took six years to build Microsoft Research China, into the dominant force that it was. Do not expect instant gratification. Access to technology is far more important to China than money. They don’t need your money, they need your expertise and you know it. IF you look at China, and see a giant pool of resources and money, your will be unsuccessful and the Chinese will resent you, like they have all the Western invades for the previous centuries.

Challenge 3: Hire Senior Leaders and Nurture Local People.

The Key to winning favor and building lasting relationship in China is [to create] good leadership models that also develop Chinese citizens into leaders. You need to encourage ex-pats to return to China to serve as role-models for your local hires. Training local talent is critical to success.

Formula 3: Nurture Local Talent and Leadership. China has a motivated, energetic and smart workforce, but it is inexperienced in business processes and leadership skills. Lee believes it is vital for foreign firms to provide in-depth, on the job training, in management and leadership to their local employees.

Challenge 4: Play By China’s Market Rules. “The Chinese decide for their own reasons what rules to apply and who they would like to do business with The government feels no obligation to provide access to its vast and rapidly growing market simply because a foreign firm offers great products of possesses a sterling reputation.”

Formula 4: Be Flexible and Open to Local Needs and Practices

Robert Buderi and Gregory Huang cites two examples of business in China: Microsoft and Coke. In China, Coke lowered the price of it’s products so that the average Chinese person could purchase them. As a results, there is effectively no piracy of Coke products in China. Microsoft has held the line on the prices of it’s software, pricing them out of reach of most Chinese. It’s no big secret that Microsoft products are widely pirated throughout China.

Challenge 5: The Local Economy Gets Tops Priority

“China expects multinationals to help nurture [the] local economy in exchange for access to the China market.”

Formula 5: Help Build the Local Business Ecosystem China’s prime goal is to develop a strong economy where domestic companies can thrive. That means going beyond providing cheap labor and low-cost manufacturing to developing high-tech exports in areas such as computing and services.

Challenge 6: Good Image Can Be Elusive

Press freedom is limited and the media is more easily manipulated than the Western press—leaving firms vulnerable to wide swings in public sentiment.

Formula 6: Build Trust from a Unified, Humble Organization.

Public relations is virtually meaningless unless it is built on a long-lasting framework of trust and strong relationships. Keep a consistent corporate message and low PR profile. Don’t engage in PR campaigns, instead concentrate on winning trust from government and local partners.

These Challenges and Formulas are useful for anyone trying to do business in China. The clarify what a western company needs to do in order to be successful.

The western way of doing business, paying for the results that you want now, is simple not how it’s done in China. If you decided to do business in China, it’s like your brother getting another brother. You are now partnered with that firm or government official. You are expected to invite them to special events and treat them with respect. And because of this, they will do the same for you.

If you are interested  in guanxi, there are some better books to read. I suggest:

The China Dream: The Quest for the Last Great Untapped Market on Earth

and

Social Connections in China: Institutions, Culture, and the Changing Nature of Guanxi (Structural Analysis in the Social Sciences)

The first chapter is available for free. (PDF warning)

Note

I edited this paper on Microsoft Word 2010. Since Office 2003, Word has underlined words that are misspelled in red, and words that are used incorrectly in green. This technology was one of the first products to come out of Microsoft Research China.


Additional Readings

There is an online lecture with the authors, hosted at Microsoft Research: http://research.microsoft.com/apps/video/default.aspx?id=104327

and one at MIT: http://mitworld.mit.edu/video/367


[1] Microsoft Research China is now Microsoft Research Asia, but for consistency, I’ll refer to it at Microsoft Research China. Just remember that MSRC is now MSRA.

[2] They begin on page 263 of the paper novel.

[3] Page 264

Barack Obama casually carries The Post American World.

The Post American World

Fareed Zakaria

2008
ISBN-13: 978-0393062359

Fareed Zakaria provocatively titled his book “The Post American World,” but the title masks the true nature of the book. The premise of the book is that since the end of the Cold War, the United State has enjoyed a long period as the lone superpower in the world. She was involved in decisions that really didn’t affect her, by default, because what other country could. Now with the rise of China, and the RBIC countries, America status as the lone superpower is changing. The future will be led by a coalition of countries. It will be a period post-American dominance, but not post-America. America will still have the major part in the world; she just won’t have it alone.

It’s difficult to understand who this book is for. It’s clear and well written, it can appeal to everyone. Zakaria makes some mistakes. The first is the title, a post-American world. The book, in it’s essence, is a forward looking historically based analysis. The sleep giant — China — is now awake, and we’re not sure what will happen. Something will happen, but what is the question. What will happen when China becomes the dominant economy in the world. In addition to those seeking to understand China, American Exceptionalists and Neo-conservatives would seemed the target audience. But by titling the book as such, he immediately turns these readers off.  If you judge a book by its cover title, then this book must talk about the decline of America. In fact there’s even an Internet meme (http://www.snopes.com/politics/obama/postamerican.asp) describing it as “a Muslim’s view of a defeated America.” A less provocative and more accurate title would help dilute these claims.

The book is well written and easy to digest. In fact, most reviews mention this.(Amazon Reviews) Fareed Zakaria divides his book into seven parts, but it has four main themes: the history of China, the rise of China, what about India and what can and should America do?

The first main segment about the history of China, is very readable. It’s a great introduction to China for the Anglophile. By using comparisons between Western history and Chinese history, Zakaria carries the reader through an enlightening past. Like the early European explorers, there were great Chinese fleets that explored the eastern world. I found this section the most poignant.

Using facts and figures, Zakaria largely skips over the rise of China, he talks about GDP and the cost of living, but he does not address the cultural changes happening in detail. The failure of the great leap forward scarcely mentioned. He does not go into the logic behind China’s five year plans or the impact of the one child per family rule. He never mentions that China has yet to have their successful worker rebellion, like most western countries. His discussion begins and ends with numbers. China has $2 trillion in foreign reserves (Post American World, forward, page xviii) and the largest population in the world, therefore their a world power. The rest is fluffy numbers that reinforce this. A more nuanced discussion would have been more enlightening.

The longest chapter in book is about India, America’s natural ally. Zakaria does a fine job of comparing and contrasting India versus China, and why he believes China will dominate. India is a much poorer country, and China’s growth rates are already larger than India’s. It would take exceptional growth for India to overtake China. It’s my personal feeling that India’s story will be told in another book by Zakaria.

The final section of the book concerns what America should do, going forward. Zakaria lays out a coherent plan for the superpower(pages 235-250) America should (1) Choose what it’s priorities are on the world stage, going forward. She should (2) Build broad rules, not narrow interests with her foreign policy. (3) Be Bismarck no Britain. The United States should engage with all the great powers of the world, and be better friends with them then they are to each other. (4) She should embrace ad-hoc multilateral negotiations and order the a la carte, per se. (5) The United Sates needs to think asymmetrically when it comes to the use of it’s military. As Iraq proved, being the biggest does not always equate to success. And lastly, being (6) Legitimate is power. Going alone will not by wise in a multipolar world. Compare the success in Libya vs the failure in Iraq. The US needs allies and cohorts when it uses military might.

Zakaria constrains this analysis with a discussion of the current state of political system in America. He describes it as broken and do nothing. It has only gotten worse since the book was published. If America cannot fix this, then truly a post-American world is inevitable.

I also have a few complaints with the book: First, Zakaria completely fails to see an view of the world except free market democracy. American style business enterprise. and his view is still largely America-centric. Secondly, natural disasters are not mention. The looming threat of famine doesn’t appear, despite the important historical perspective to China. And third, he completely glossy over the concept of war.

Free Market Only

The Post American World overall is a disucssion of what the future will look like. “The issue that non-Western reformers were struggling with in the twentieth century has returned as a central quesion for the future: Can you be modern without being Western?” (p73)  Zarakia cites many examples of non-westerners adopting western styles and cultural elements as they become more modern, even “dispensing with formal dress altogether [and] adopting a casual jeans and T-shirt style.” (p77)

If Zarakia did not view the world through his western lens, he may have come to a different conclusion. For example, in China, guanxi, (關係)or “connections” is central to doing business. As China becomes the largest economy in the world, it’s natural that their economic customs will become much more common. Guanxi exists because China has a flawed legal system. “In a nation that has traditionally had little use for laws, personal power has always been the key to getting things accomplished.”#Furthermore, “even when they live in countries where the legal system is well developed and the law impartially enforced, Chinese still rely heavily on their guanxi networks.” (Scott Seligman, Chinese Business Ettiquette, p185)

Forgetting Famine

During the Great Leap Forward, Chinese farmers followed Mao’s direction for their crops. Plow very deep and bury the top soil. Plant seedlings very close together and you’ll get a higher yield. The pseudo-sceince techniques led to wide spread famine. During this man-made catastrophy from 1958-1961, though estimates vary, between 15 and 45 million Chinese starved to death. (http://www.nytimes.com/2010/12/16/opinion/16iht-eddikotter16.html)  Zakaria touches on this, but he doesn’t mention that it can happen again. All of the RBIC countries have growing populations. During the past few years, we witnessed food riots in Africa and rice rationing in Asia. The threat of famine is really. Going forward, China and India are growing on the world stage at the same time the world is growing from 7 to 8 billion people. The earth only has so much aridable-land. A some point we may meet the carrying capacity of the earth. Some say we are already there. (http://dieoff.org/page28.htm)  Though people have been making this claim for over 200 years. (http://science.howstuffworks.com/environmental/green-science/earth-carrying-capacity.htm)

What about War

With hardship and unrest comes war. Should the Chinese suffer a terrible famine, the chances for conflict increase. Zakaria has a state-centric view. Because China, Russia and the United States have nuclear weapons, Zakaria spends some time discussion India’s lack of nuclear weapons. He believes they deserve them. Under the guise that nuclear-armed countries do not fight wars, Zakaria rules out war in the post-american world. He states that the world is getting safer all the time. Early in the book, he states “It feels like a dangerous world but it isn’t. Your chances of dying as a consequence of organized violence of any kind are low and getting lower.”# Going further, he adds “I don’t believe that war has become obsolete or any such fooliness. Human nature remains what it is and international politics what it is…Still, if we are to understand the times we are living in, we must first accurately describe them. And they are, for now, in historical context, unusually calm.”

Since the American hedgemony began, most world conflict has been regional in nature. Zakaria does not address this. Backlash in China may develop against this new multipolar world. Zakaria does not even mention the Boxer rebellion at the turn of the last century. Tiennamen Square is not in his book. By neglecting this, Zakaria fails to complete his analysis of the post-American world.

Even though they are nuclear powers, the United States and Russia fought proxy wars against each other from the 1960s, until the 1990s. First in Vietnam, then Afghanistan. Likewise, the Iran-Iraq war of the 1970s and 1980s took the place of American involvement in the middle east during this period. Zakaria does think this will happen going forward. He thinks “we’ll all just get along.” I believe he is naïve.