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For me, the big event of 2011 was the publication of After America. It was a big bestseller - Top Five in the US, Number One in Canada. But, alas, it did not impact the dreadful trajectory of a corrupt "hyperpower" betraying almost all its founding principles. The Covid launch of 2020 finally exposed China's global dominance to anyone who wished to notice. In this excerpt from my book, here is what I was saying a decade earlier - about China's advance from producer of Wal-Mart crappola to owner of all the stuff that matters. You will note also an early preview of the most salient point. Making China the Number One economy did not endear Peking to western freedoms, but it has endeared western leaders to Chinese-style restraints on freedom. What's now the conventional thinking of the Covid era was a long time percolating:
The intellectual cover for America's structural deformation was provided by "globalization". Some of us have always been in favor of the "global economy". If I want to buy a CD or a sofa, I don't think it's any business of the government whether it comes from Cleveland or Milan or Ougadougou. As Adam Smith and John Stuart Mill will tell you, free trade has been indispensable to economic vitality from the Netherlands to Bengal. But you no longer hear much about "free trade". That humdrum, prosaic supply-and-demand concept yielded to a glittering new coinage: "globalization", less a commercial mechanism than an ideology.
But what does this mysterious metaphysical force called "globalization" actually boil down to? At the end of 2008, a few weeks after Barack Obama's historic election, the media reported on America's Christmas shopping spree. "Retail Sales Plummet," read the headline in The Wall Street Journal. "Sales plunged across most categories on shrinking consumer spending."
That's great news, isn't it? After all, everyone knows Americans consume too much. What was it that then Senator Obama had said on the subject only a few months before? "We can't just keep driving our SUVs, eating whatever we want, keeping our homes at 72 degrees at all times regardless of whether we live in the tundra or the desert and keep consuming 25 per cent of the world's resources with just four per cent of the world's population, and expect the rest of the world to say, 'You just go ahead, we'll be fine...'"
Well, that's globalization. All the stuff that used to be made in America is now made somewhere else. But the people who buy it are still Americans. That part hasn't changed.
So, if Americans don't make any of this stuff, where do they get the money to buy it?
By borrowing it. Once you're paying what citizens of free societies do in taxes, what's left barely covers room and board. So life's little luxuries – or cheap plastic Chinese-made luxuries – have to be paid for through debt. So Americans buy toys that so enrich the Chinese they can afford to lend huge amounts of money to America to grow the government even bigger so that Americans will have to borrow even more money for the next generation of cheap Chinese toys.
Hey, it's globalization. What could go wrong?
Entire countries – not just the Third World assembly plants, but G7 members such as Canada – have economies overwhelmingly dependent on access to the US market. "Globalization", translated out of globaloney, means the American shopping mall is all but singlehandedly propping up living standards from Ontario to Indonesia. In 2010 US consumer debt (that means us: not the spendaholic rulers but the spendaholic subjects) was about $2.5 trillion, or the combined GDP of Canada and India. That seems like a lot of money to borrow in order to buy electronic amusements for a lifestyle we can't afford.
But the Chinese are smart guys. They must know that, right?
Undoubtedly. But the dollar is the global currency and so, unlike Zimbabwe or even Iceland, America gets to borrow money in its own bills, which it has the exclusive right to print as much of as it wants. So, even if there's a decline in value, for foreigners there is perceived to be a limit to the risk: Buying US debt is not like buying Zimbabwe's debt.
Yes, but why is the dollar still the global currency if America's the biggest debtor nation?
That's about perception, too: America is seen as the guarantor of global order.
But, as noted earlier, when money drains, so does power – and very quickly, as the British learned after World War Two. Today, money is draining across the Pacific. China Minmetals is a Fortune 500 company owned and controlled by the People's Republic. By the way, read that sentence again and imagine what an H G Wells time traveler from the early Sixties, from the time of Mao's Cultural Revolution, would make of it. Yet in the Fortune Top Ten there are three Chinese companies against two from the US. And China Minmetals is serious business: They own the Northern Peru Copper Co in Canada, and the Golden Grove copper, lead, zinc, silver and gold mines in Western Australia, and the mining rights to a huge percentage of Jamaican bauxite. Sinopec bought up Calgary's Addax petroleum and nine per cent of the Alberta oil sands business Syncrude, and have massively expanded oil production and development in Sudan and Ethiopia. Sinochem took over Britain's Emerald Energy. You remember all the "No Blood For Oil" chants back in 2003? Relax, it's our blood, their oil. The biggest foreign investor in post-war Iraq is the developer of the Ahdab oil field, the China National Petroleum Corporation.
Think of it as the first settlers did vis a vis the Indians: The ChiComs sell us trinkets in exchange for our resources. Lenin boasted that "the capitalists will sell us the rope with which we will hang them". His fellow Communists in Beijing inverted the strategy to lethal effect: They sell us the rope, and sit back to watch us hang ourselves.
And, where money flows, power follows. Having turned resource nations in Africa into de facto protectorates, China has moved on to the developed world, and bailed out Portugal for $100 billion in exchange for significant stakes in their national utility companies. Beijing is also the biggest foreign investor in post-bailout General Motors: They bought 18 per cent of the Obama Administration's IPO in 2010. If the Obama-approved Chevy Volt isn't environmentally friendly enough for you, wait for the new Chevy Rickshaw. Can you still, as Dinah Shore sang, see the USA in your Chevrolet? The Chinese can.
Like America, China has structural defects. It's a dictatorship whose authoritarian policies have crippled its human capital: It has too many oldsters and not enough youth, and among its youth it has millions of surplus boys and no girls for them to marry. If China were the inevitable successor to America as global hegemon, that would be one thing. But the fact that it is incapable of playing that role is likely to make things even messier, more unpredictable, and far more destabilizing.
They have our souls who have our bonds. In their decadence, much of the western elite now think the answer to our worsening problems is not merely Chinese money but Chinese government. If you support Bush's "Patriot Act", you're suppressing dissent. But, if you support eco-totalitarianism, it's totally groovy. In 2008, David Suzuki, Canada's most famous environmentalist, suggested that "denialist" politicians should be thrown in jail. "When the chips are down I think democracy is a less important goal than is the protection of the planet from the death of life, the end of life on it," agrees Mayer Hillman, senior fellow at the Policy Studies Institute in London. "This has got to be imposed on people whether they like it or not." If the people are too foolish to vote as their betters instruct, then it will have to be "imposed". The earth is your fuhrer. James Hansen, head of Nasa's Goddard Institute, agrees on the inadequacy of America's "democracy" (his scare quotes) and argues that (to quote the article he wrote for The South China Morning Post) "Chinese Leadership Needed To Save Humanity".
The New York Times' Great Thinker Thomas Friedman regularly channels his inner Walter Duranty: "What if we could just be China for a day?" he fantasized. "Where we could actually, you know, authorize the right solutions..." Ah, yes. "Authorize" the "right" solutions without all that messy multi-party democracy getting in the way: Why, in Beijing, where they don't suffer the disadvantages of free elections, they banned the environmentally destructive plastic bag! In one day! Just like that! "One-party autocracy certainly has its drawbacks," wrote Friedman. "But when it is led by a reasonably enlightened group of people, as China is today, it can also have great advantages. That one party can just impose the politically difficult but critically important policies needed to move a society forward in the 21st century."
Ooooo-kay. But, pardon my asking, forward to where?
When The New York Times' most prominent writer comes out in favor of dictatorship, and no one else in the smart set calls him on it, you get a glimpse at the very least of the scale of elite contempt for popular sovereignty and the republic's animating principles. In breaking faith with the American idea, the political class got everything wrong: They exported millions of low-skilled jobs but imported millions of low-skilled workers; they fund both sides of the war on terror out of a wanton hostility to domestic energy production that leaves us dependent on noxious oil dictatorships that use their profits to wage civilizational warfare. And, having gotten us into this mess, the way to get us out is "China for a day". This is the logical endpoint of a cocooned Conformocracy: Big Government having "imposed" the problems in the first place, only Even Bigger Government can "impose" the solutions.
Never underestimate the totalitarian temptations of the smart set. We'll hear a lot more of that in the years ahead.
~excerpted from After America, personally signed copies of which are exclusively available from the SteynOnline bookstore.
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