Last night Japan made history; throwing out the LDP and giving Hatoyama’s DPJ an overwhelming majority in the Diet and clear mandate to pursue his policies.
Before the election, while most observers (myself included) believed that the DPJ would be able make government without a coalition partner. But I was surprised that the DPJ took the 300-plus seats which had been projected by the opinion polls, a landslide.
Make no mistake about it; this is a great result for Japan as a whole. If the DPJ had unexpectedly failed to win government somehow, the subsequent administration would have faced a huge legitimacy deficit, big enough indeed to put Japan national debt in the shade. Or, if the DPJ had won government but needed to form a coalition to do so, it is unlikely that it could aggressively pursue its preferred policies. And that is surely the point; this outcome means that the DPJ has the ability aggressively pursue the kinds of policy shifts that Japan needs, for instance in foreign policy.
But this doesn’t mean the DPJ will. In fact, although the DPJ has displayed a preference to lean away from the US towards Asia, the specifics of such an important strategy move are still undecided, suggesting that little will in fact change. Thus, the DPJ is at risk of drifting with Japan’s foreign policy. This risk, when the rise of China, the re-ordering of the US’s Asian priorities and a financial crisis conspire to make decisiveness more than virtue, but a necessity, needs to be faced head on.
For instance, with regard to the DPJ’s potential drift away from the US; during the election the existence of a secret agreement which undercut Japan’s non-nuclear principles (hikaku gensoku) came to light. The DPJ has promised to investigate whether a secret agreement exists, but has not promised necessarily to report the outcome to the Japanese people. Likewise, although the DPJ had promised to reach a trade deal with the US, promises here have also been diluted. Both trade and security aspects of the US relationship might drift.
On the flip side, the DPJ has declared its interests in Asia. But what precisely they intend to do is still a vague and uncertain. The DPJ has indicated its interest in an FTA with South Korea, but at the same time there remain questions about whether the DPJ will have the spine to take on the domestic agricultural lobby. At the same time, Korea has its own concerns about an FTA with Japan, although agriculture is no longer one of them. Interestingly, the DPJ has proposed a new party level bureau to manage CCP-DPJ exchange, that is to say a direct exchange between the Chinese Communist Party and itself. Apart from the dubious utility of such an arrangement, it is uncertain if the Chinese side will accept such a proposal in any case. Indeed, the DPJ may learn that Asia is not willing to embrace Japan, and Japanese initiatives, quite as eagerly as the DPJ believes.
We will see the DPJ do will foreign policy soon enough, for an early indication of Japan’s orientation looking to FTAs seems a good bet as no doubt there will be a declaration about this soon enough.
Monday 31 August 2009
Friday 21 August 2009
Japanese university students and the election; some thoughts channeled.
Being in Japan during this election is an opportunity to write about more than just what is in the papers. Instead, I would like to write about what my Japanese university friends are thinking and feeling about this election. May it be of interest, if not use.
Upfront the results are, DPJ 7, LDP 3, Undecided 3. Survey results not to be extrapolated from as Meiji Uni is noted as left leaning, and disproportionate number surveyed are men (10) and non-scientific methods were used in collection of data (some subjects spoke in the proximity of alcohol). I will talk first about the post-grads, with whom I have more contact and more interesting observations.
Firstly, most post-grads are voting for the DPJ. But despite the fact that most are voting for the DPJ, as expected of young urbanites, none of them are really happy it. Their support for the DPJ is based more on a rejection of the ruling LDP rather than support for the DPJ itself.
This can be seen in how many of them project the outcome of the election. Although recent polling suggests that the DPJ might take as many as 300 of the 480 seats thereby establishing single party government, all post-grad students projected that the DPJ would have to form a coalition. Even those most emotionally interested in the DPJ winning an absolute majority said they could not believe that it would actually occur; this student projecting 220-230 seats for the DPJ. Those declaring an intention to vote for the LDP agreed, believing that the DPJ would win government but fall short of an absolute majority.
I asked what would happen if the DPJ failed to win single party government, one student responded ominously, “if the DPJ forms coalition with the Social Democrats they are finished. If the DPJ forms coalition with the Communists, they are finished. If the DPJ forms coalition with the Kokumin Shin Tou, they are finished. And if they are foolish enough to form coalition with either the LDP or Komeito, then they are finished for good.”
This unhappiness with either the LDP or DPJ is at least a little troubling. It suggests that this, the next generation of voters, have neither loyalty to the LDP or to any other party. I asked some of the post-grads if they are not loyal to party, what are they politically loyal to (ideas? money?) - and got mostly uncomfortable silence. One answered honestly that her vote depended mostly on her parents, and that their decision was in turn based mostly on which of the two parties would provide more for them financially (answer: LDP). Another LDP inclined voter, although extremely unhappy about it, noted that he thought that the DPJ would be even more disorderly that the LDP and in particular their ideas about national defense were idealistic (he means, dangerous). He said he valued stability. That seems to be word which came up often as well.
On the other hand, another of the post-grads told me that he will vote for the DPJ just s to see the mythic seiken kotai, he believed that otherwise the two parties were as bad as each other. Another declared DPJ voter was more firm about in his reasons, stating that while the DPJ is a little idealistic, idealism is what Japan needs now. Most others were vague in the reasons for their support of the DPJ, it is possible they may be being influenced by a zeitgeist of change coming from the US. Indeed, DPJ Hatoyama has deliberately used this English word in order I suspect foment such a mood. The point again to be underlined is that the support for the DPJ is fragile, even among this demographic which ought to be supporting them.
The undergraduates that I have talked were also undecided on the whole about which of the two parties to support (none of them mentioned any of the smaller parties). For these undergraduates, this was their first election and making a decision about which party to support was proving difficult. Although they read the newspaper and knew a few things about the parties, they were less informed (as expected) than the older (more mature?) post grad cohort. I asked why had not they decided, and the answer seems to be that they feel that they just do not “know” which is better. One of them reflected that his parents had not decided yet, so how could he. Most agreed that they would decide on the day.
Interestingly, levels of awareness of the two parties policy platforms (manifestos) is unbalanced. Most are aware (and not enthusiastic) about the DPJ’s policies, but they are not so aware of the LDP’s policy – strange given that the LDP ought be considered the default base from which one compares alternate policies. This probably can be chalked up to the media, which has focused on some of the less well thought out DPJ policies. In particular, problems over funding their child support and highway policies while not at the same time raising the consumption tax. This means that for some of the DPJ they are comparing the policies they know that DPJ is promoting with “nothing.” This stand in contrast with the post-grads who were comparing the two parties manifestoes.
In conclusion, talking to the university students has me a little concerned. A lot of newspapers are already calling the election for the DPJ. Some are suggesting a landslide victory the DPJ propelling them into single party government. But my friends and colleagues at university are less sure. This election holds the promise of change, no doubt, but it also holds the potential wreck Japanese self-confidence if the DPJ unable to do anything either due to its own failings or because they are forced into coalition.
Upfront the results are, DPJ 7, LDP 3, Undecided 3. Survey results not to be extrapolated from as Meiji Uni is noted as left leaning, and disproportionate number surveyed are men (10) and non-scientific methods were used in collection of data (some subjects spoke in the proximity of alcohol). I will talk first about the post-grads, with whom I have more contact and more interesting observations.
Firstly, most post-grads are voting for the DPJ. But despite the fact that most are voting for the DPJ, as expected of young urbanites, none of them are really happy it. Their support for the DPJ is based more on a rejection of the ruling LDP rather than support for the DPJ itself.
This can be seen in how many of them project the outcome of the election. Although recent polling suggests that the DPJ might take as many as 300 of the 480 seats thereby establishing single party government, all post-grad students projected that the DPJ would have to form a coalition. Even those most emotionally interested in the DPJ winning an absolute majority said they could not believe that it would actually occur; this student projecting 220-230 seats for the DPJ. Those declaring an intention to vote for the LDP agreed, believing that the DPJ would win government but fall short of an absolute majority.
I asked what would happen if the DPJ failed to win single party government, one student responded ominously, “if the DPJ forms coalition with the Social Democrats they are finished. If the DPJ forms coalition with the Communists, they are finished. If the DPJ forms coalition with the Kokumin Shin Tou, they are finished. And if they are foolish enough to form coalition with either the LDP or Komeito, then they are finished for good.”
This unhappiness with either the LDP or DPJ is at least a little troubling. It suggests that this, the next generation of voters, have neither loyalty to the LDP or to any other party. I asked some of the post-grads if they are not loyal to party, what are they politically loyal to (ideas? money?) - and got mostly uncomfortable silence. One answered honestly that her vote depended mostly on her parents, and that their decision was in turn based mostly on which of the two parties would provide more for them financially (answer: LDP). Another LDP inclined voter, although extremely unhappy about it, noted that he thought that the DPJ would be even more disorderly that the LDP and in particular their ideas about national defense were idealistic (he means, dangerous). He said he valued stability. That seems to be word which came up often as well.
On the other hand, another of the post-grads told me that he will vote for the DPJ just s to see the mythic seiken kotai, he believed that otherwise the two parties were as bad as each other. Another declared DPJ voter was more firm about in his reasons, stating that while the DPJ is a little idealistic, idealism is what Japan needs now. Most others were vague in the reasons for their support of the DPJ, it is possible they may be being influenced by a zeitgeist of change coming from the US. Indeed, DPJ Hatoyama has deliberately used this English word in order I suspect foment such a mood. The point again to be underlined is that the support for the DPJ is fragile, even among this demographic which ought to be supporting them.
The undergraduates that I have talked were also undecided on the whole about which of the two parties to support (none of them mentioned any of the smaller parties). For these undergraduates, this was their first election and making a decision about which party to support was proving difficult. Although they read the newspaper and knew a few things about the parties, they were less informed (as expected) than the older (more mature?) post grad cohort. I asked why had not they decided, and the answer seems to be that they feel that they just do not “know” which is better. One of them reflected that his parents had not decided yet, so how could he. Most agreed that they would decide on the day.
Interestingly, levels of awareness of the two parties policy platforms (manifestos) is unbalanced. Most are aware (and not enthusiastic) about the DPJ’s policies, but they are not so aware of the LDP’s policy – strange given that the LDP ought be considered the default base from which one compares alternate policies. This probably can be chalked up to the media, which has focused on some of the less well thought out DPJ policies. In particular, problems over funding their child support and highway policies while not at the same time raising the consumption tax. This means that for some of the DPJ they are comparing the policies they know that DPJ is promoting with “nothing.” This stand in contrast with the post-grads who were comparing the two parties manifestoes.
In conclusion, talking to the university students has me a little concerned. A lot of newspapers are already calling the election for the DPJ. Some are suggesting a landslide victory the DPJ propelling them into single party government. But my friends and colleagues at university are less sure. This election holds the promise of change, no doubt, but it also holds the potential wreck Japanese self-confidence if the DPJ unable to do anything either due to its own failings or because they are forced into coalition.
Sunday 16 August 2009
The Ministry of Agriculture, Farming and Fishery; double game.
This is from today’s Sunday Project (Tsuiseki). It is an article of common knowledge that Japanese bureaucracies are able to control indirectly policy output in ways that other governments (such as Australia) simply would not allow. But the Sunday Project today opened my eyes to the extent that one Ministry, the Ministry of Agriculture, Farming and Fishery (MAFF), will go in order to control public discourse (and thus policy) on issues it considers important. Important, that is, to the farm lobby, as the MAFF reports on food self-sufficiency (Jikyuu-ritsu) can not be concerned by a fair and balanced contribution to the public debate.
Anyone who reads the Japanese newspapers regularly would know this term. And some might even remember the number that goes with it, 40%. Jikyuu-ritsu forty percent is almost a mantra for the MAFF, and via their reports it now featured widely in news, commentary and even children’s textbooks (complete with ‘40%, that is low (bad)’ implicit in the text. Indeed, there is a question about whether this figure is indeed low and whether that is ‘bad’, but first a note about the somewhat unusual manner of calculation.
Japan, like Korea (one assumes for similar reasons), uses the calorific method of calculation, rather than the near universal cost-base calculation. This method divides the number of calories an average Japanese consumes by the amount that Japan produces. The reason is simple enough, 40% is lower than 66%, the figure produced if the cost-base calculation were to be used instead. (Another way of saying this would be that the Japanese mostly buy Japanese produce but that the produce bought is mostly low-calorie yielding. Again this is due to the oddity of the calculation method, which factors out meat, milk and eggs that is produced using imported feed.)
But the MAFF has deliberately chosen the calorific method anyhow. Perhaps this is because 66% simply is not sufficiently panic causing. Especially since the MAFF has repeatedly stated that Japan’s self-sufficiently rate is the lowest in the world (they mean lowest in the OECD, but it quickly becomes confused in the media, thanks Chris). This claim would not be true if one were to use the cost method, with the UK scoring much lower in this case. Even the minister in charge, Ishiba noted on the Sunday Project program, that this method of calculation was somehow odd or confusing.
It is clear then that the MAFF is trying to steer Japanese policy toward building up (subsidizing) domestically produced farm produces. While this kind of protectionism might go well over with the agricultural lobby, it is costing Japan – agriculture is after all just 1% of Japan’s GDP (see, Mulgan at the EAF.) Worse still the argument for a high Self-Sufficiency score is itself pretty poor. If one thinks about it, a country only needs high scores on self-sufficiently during a major war. Such a war is not likely any time soon, so Japan should be putting its economic priorities first. Moreover, there is a good argument for liberalizing Japanese agricultural markets for strategic reasons. Signing an FTA with the US, or Australia for that matter, which covered farm products would not just give an Japan’s economy a boost, but would also help to lock-in American (or other 3rd countries) security interests in Japan. While it is true that Chinese farm exports to Japan are growing steeply, if Japan is really worried about this issue as one of national security then supporting domestic farmers is not the answer. Japan is going to have to dependent to some extent on someone for its food security, it will have to make a choice.
Anyone who reads the Japanese newspapers regularly would know this term. And some might even remember the number that goes with it, 40%. Jikyuu-ritsu forty percent is almost a mantra for the MAFF, and via their reports it now featured widely in news, commentary and even children’s textbooks (complete with ‘40%, that is low (bad)’ implicit in the text. Indeed, there is a question about whether this figure is indeed low and whether that is ‘bad’, but first a note about the somewhat unusual manner of calculation.
Japan, like Korea (one assumes for similar reasons), uses the calorific method of calculation, rather than the near universal cost-base calculation. This method divides the number of calories an average Japanese consumes by the amount that Japan produces. The reason is simple enough, 40% is lower than 66%, the figure produced if the cost-base calculation were to be used instead. (Another way of saying this would be that the Japanese mostly buy Japanese produce but that the produce bought is mostly low-calorie yielding. Again this is due to the oddity of the calculation method, which factors out meat, milk and eggs that is produced using imported feed.)
But the MAFF has deliberately chosen the calorific method anyhow. Perhaps this is because 66% simply is not sufficiently panic causing. Especially since the MAFF has repeatedly stated that Japan’s self-sufficiently rate is the lowest in the world (they mean lowest in the OECD, but it quickly becomes confused in the media, thanks Chris). This claim would not be true if one were to use the cost method, with the UK scoring much lower in this case. Even the minister in charge, Ishiba noted on the Sunday Project program, that this method of calculation was somehow odd or confusing.
It is clear then that the MAFF is trying to steer Japanese policy toward building up (subsidizing) domestically produced farm produces. While this kind of protectionism might go well over with the agricultural lobby, it is costing Japan – agriculture is after all just 1% of Japan’s GDP (see, Mulgan at the EAF.) Worse still the argument for a high Self-Sufficiency score is itself pretty poor. If one thinks about it, a country only needs high scores on self-sufficiently during a major war. Such a war is not likely any time soon, so Japan should be putting its economic priorities first. Moreover, there is a good argument for liberalizing Japanese agricultural markets for strategic reasons. Signing an FTA with the US, or Australia for that matter, which covered farm products would not just give an Japan’s economy a boost, but would also help to lock-in American (or other 3rd countries) security interests in Japan. While it is true that Chinese farm exports to Japan are growing steeply, if Japan is really worried about this issue as one of national security then supporting domestic farmers is not the answer. Japan is going to have to dependent to some extent on someone for its food security, it will have to make a choice.
Tuesday 11 August 2009
Japan, the DJP and Regional Financial Arrangements; a preliminary view.
In recent days both the Liberal-Democratic Party (LDP) and the Democratic Party of Japan (DPJ), in addition to trading barbs, have released their respective ‘manifestos’, or policy platforms. Unsurprisingly, the focus in these documents is on domestic political matters almost exclusively with the pension system again taking centre stage.
Despite the preoccupation with internal affairs, Japan will not be able to shut out events in the outside world. The global financial crisis will propel the new government headlong into international affairs, ready or not.
It is increasingly likely that the DPJ will win this election. What are the DPJ’s views on Japan’s role in the international economy?
A central question is whether Japan will throw its weight behind the effort to de-throne the US dollar’s global role. It is worth remembering that in 1999, in the aftermath of the Asian financial crisis, the then PM Obuchi proposed ‘yen internationalisation’ as a means of achieving exactly this. Japan’s intentions are still important because unlike China - the current ‘leader’ (or at least the most vocal member) of the putative movement to replace the dollar, the Japanese yen has the greater ability to replace to some extent the dollar’s role, at least within East Asia.
The first point is that the DPJ has no declared policy on the role of the yen. At least not yet. But it has ideas, and ideas which in time might morph into policy. Indeed, Yukio Hatoyama, the DPJ’s leader and potential Prime Minister, has commented about currency coordination in East Asia in the Diet. In 2005, Hatoyama said in a Diet session focused on constitutional reform, that ‘it is important now to have a discussion about how to include in our constitution a clause enabling us, Japan, to give up a portion of our sovereignty to regional level governance, like the members of the EU did with the Euro. I believe that such an East Asian Community is necessary.’ While not a comment on ‘yen internationalisation’ per se, these comments suggest that the idea of common currency in Asia (the effect of which would be to displace or reduce the role of the USD) has attraction for him personally.
Others within the DPJ have been more specific. Nakagawa Masaharu, the Nekusuto (shadow) treasurer, hit all the buttons in an interview with Bloomberg in early July, in one sentence alone calling for yen internationalisation, IMF-SDR denominated bonds, and the US to issue some of its bonds in yen (aka Samurai bonds). Taken together, these ideas if they became policy would move Japan from its current position supporting the USD’s role as key currency, to adding Japan’s not inconsiderable weight to those seeking to unseat the USD (or at least its privilege in debt denomination).
Hatoyama’s belief is that the question of the USD’s role (and yen’s role in any new regional financial architecture) is ultimately a political question, as closely tied to the rise of China as to the perceived excesses of the US. Hatoyama recently published a piece called ‘My political philosophy’ in this month’s Voice, a leading news magazine in which he writes, ‘The realisation of regional currency integration (an Asian Common Currency) ought to be our goal, however this ought to occur in the context of building a permanent East Asian security frame-work’. That is a fairly unequivocal statement of support for the Asian Currency Unit (ACU) idea – an idea which has been voiced in Japanese Ministry of Finance and related research bodies, and by influential people such as former PM Nakasone. Taken together with Hatoyama’s earlier statements in the same article about American economic hegemony failing, we can conclude that he is (at the moment, as the leader of the non-governing party) sympathetic to idea of reforming the current financial system in which the USD is the key currency. Hatoyama’s ideas about an Asian Common Currency (presumably including China) were married to the belief that the move (effectively toward China) should be taken in tandem with the development (and progress towards) a regional security framework.
It is still early days, but what is apparent is that the DPJ and Hatayama are more pre-disposed than the LDP toward reaching a new understanding with China. The emphasis on China is clearly signposted in the DPJ manifesto, as is the interest in cooperating with China in regional architecture building, including in the financial arena.
Neither Hatoyama nor Nakagawa have a background in international finance, (graduates of engineering and international politics respectively), so once the DPJ is in government and as the trade offs of moving beyond the dollar become clearer there remains every possibility that the DPJ will back away from taking on the USD, at least initially. But if there were signs already the Japan was tipping away from the US-led Pacific, open regional order towards a more exclusive economic arrangement with its partners in East Asia, the results of this election could accelerate those trends.
Despite the preoccupation with internal affairs, Japan will not be able to shut out events in the outside world. The global financial crisis will propel the new government headlong into international affairs, ready or not.
It is increasingly likely that the DPJ will win this election. What are the DPJ’s views on Japan’s role in the international economy?
A central question is whether Japan will throw its weight behind the effort to de-throne the US dollar’s global role. It is worth remembering that in 1999, in the aftermath of the Asian financial crisis, the then PM Obuchi proposed ‘yen internationalisation’ as a means of achieving exactly this. Japan’s intentions are still important because unlike China - the current ‘leader’ (or at least the most vocal member) of the putative movement to replace the dollar, the Japanese yen has the greater ability to replace to some extent the dollar’s role, at least within East Asia.
The first point is that the DPJ has no declared policy on the role of the yen. At least not yet. But it has ideas, and ideas which in time might morph into policy. Indeed, Yukio Hatoyama, the DPJ’s leader and potential Prime Minister, has commented about currency coordination in East Asia in the Diet. In 2005, Hatoyama said in a Diet session focused on constitutional reform, that ‘it is important now to have a discussion about how to include in our constitution a clause enabling us, Japan, to give up a portion of our sovereignty to regional level governance, like the members of the EU did with the Euro. I believe that such an East Asian Community is necessary.’ While not a comment on ‘yen internationalisation’ per se, these comments suggest that the idea of common currency in Asia (the effect of which would be to displace or reduce the role of the USD) has attraction for him personally.
Others within the DPJ have been more specific. Nakagawa Masaharu, the Nekusuto (shadow) treasurer, hit all the buttons in an interview with Bloomberg in early July, in one sentence alone calling for yen internationalisation, IMF-SDR denominated bonds, and the US to issue some of its bonds in yen (aka Samurai bonds). Taken together, these ideas if they became policy would move Japan from its current position supporting the USD’s role as key currency, to adding Japan’s not inconsiderable weight to those seeking to unseat the USD (or at least its privilege in debt denomination).
Hatoyama’s belief is that the question of the USD’s role (and yen’s role in any new regional financial architecture) is ultimately a political question, as closely tied to the rise of China as to the perceived excesses of the US. Hatoyama recently published a piece called ‘My political philosophy’ in this month’s Voice, a leading news magazine in which he writes, ‘The realisation of regional currency integration (an Asian Common Currency) ought to be our goal, however this ought to occur in the context of building a permanent East Asian security frame-work’. That is a fairly unequivocal statement of support for the Asian Currency Unit (ACU) idea – an idea which has been voiced in Japanese Ministry of Finance and related research bodies, and by influential people such as former PM Nakasone. Taken together with Hatoyama’s earlier statements in the same article about American economic hegemony failing, we can conclude that he is (at the moment, as the leader of the non-governing party) sympathetic to idea of reforming the current financial system in which the USD is the key currency. Hatoyama’s ideas about an Asian Common Currency (presumably including China) were married to the belief that the move (effectively toward China) should be taken in tandem with the development (and progress towards) a regional security framework.
It is still early days, but what is apparent is that the DPJ and Hatayama are more pre-disposed than the LDP toward reaching a new understanding with China. The emphasis on China is clearly signposted in the DPJ manifesto, as is the interest in cooperating with China in regional architecture building, including in the financial arena.
Neither Hatoyama nor Nakagawa have a background in international finance, (graduates of engineering and international politics respectively), so once the DPJ is in government and as the trade offs of moving beyond the dollar become clearer there remains every possibility that the DPJ will back away from taking on the USD, at least initially. But if there were signs already the Japan was tipping away from the US-led Pacific, open regional order towards a more exclusive economic arrangement with its partners in East Asia, the results of this election could accelerate those trends.
Tuesday 4 August 2009
what is fair?
Just came back from China, I had hoped to post there but the great wall of fire prevented me from accessing blogspot.
While in China, I watched the CCTV 9 News program (English). It is not bad, I think I might even prefer it to Foxx News, if only because the biases are more cleverly hidden. One of the items that the CCTV News reported on was the Strategic and Economic Talks between the US and China. Rather than getting into the interviewer's questions or the line up of apparently experts, what stuck me was the different senses of what was a fair outcome for the China-US (more broadly China-West) relations.
The CCTV news provided the view that these S&E talks should not allowed to draw China in a G2, and that China should take as little responsibility as possible for fixing the world's current economic problems - including those of America. On the flip side, America are expecting that China will come to table to hammer out a deal that will help the US to recover (and thereby help China too).
The gap between these two going into the discussion seems large. No doubt there are areas of common concern at which an agreement can be made, but it seems to me that there is the potential here that once the crisis ends one or other party will feel "unfairly" done by. Probably China, as it is they who are being asked/forced to fork out more and more for America - (US treasury were bought at a record rate in this month, despite poor trade numbers, and in spite of warning by China about the risk of holding dollars).
If its expects are not met, it might be a wounded China that comes out of this economic crisis, and the possibility that China's disillusionment with the world system and US leadership do not bode well.
While in China, I watched the CCTV 9 News program (English). It is not bad, I think I might even prefer it to Foxx News, if only because the biases are more cleverly hidden. One of the items that the CCTV News reported on was the Strategic and Economic Talks between the US and China. Rather than getting into the interviewer's questions or the line up of apparently experts, what stuck me was the different senses of what was a fair outcome for the China-US (more broadly China-West) relations.
The CCTV news provided the view that these S&E talks should not allowed to draw China in a G2, and that China should take as little responsibility as possible for fixing the world's current economic problems - including those of America. On the flip side, America are expecting that China will come to table to hammer out a deal that will help the US to recover (and thereby help China too).
The gap between these two going into the discussion seems large. No doubt there are areas of common concern at which an agreement can be made, but it seems to me that there is the potential here that once the crisis ends one or other party will feel "unfairly" done by. Probably China, as it is they who are being asked/forced to fork out more and more for America - (US treasury were bought at a record rate in this month, despite poor trade numbers, and in spite of warning by China about the risk of holding dollars).
If its expects are not met, it might be a wounded China that comes out of this economic crisis, and the possibility that China's disillusionment with the world system and US leadership do not bode well.
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