“The US Is as Broke as the Greeks in 2010”

Four experts debate whether China will dominate the 21st century. While Henry Kissinger remains skeptical, Niall Ferguson sees a bankrupt America on the horizon.

Who is afraid of the Chinese? Everyone, one might think: the steadily weakening Europeans, the heavily indebted Americans, the aging society of Japan, and the immediate neighbors of the People’s Republic. Unlike the Americans, however, Europeans have no way to tame their fear.

Anyone trying to understand Europe’s strategy toward Beijing will remain clueless. Economically, Europe regards China as an export market, but politically, it has no opinion. The situation is different in the United States. There, leaders have been wondering for quite some time whether the next century will be a Chinese one and how the West should react. The ideas range from the demand that the U.S. should revive the type of containment policy that George Kennan designed to deal with the Soviet Union to the demand that the U.S. should instead plan for comprehensive cooperation with China.

Each of the Panelists is Right

All of this has been well-known to veteran observers for years. But for those who have neither followed the political discussions on the other side of the Atlantic nor read the often impenetrable studies on the subject, there is now a recorded debate available that features several leading analysts debating their theories. Niall Ferguson, Henry Kissinger, Fareed Zakaria and the Chinese David Li all present the issue in different ways, but only one of them — Niall Ferguson, the economic historian from Harvard — actually believes that Beijing will dominate the 21st century. Oddly enough, each of the panelists that participated in the 2011 discussion in Canada is right. The four stress different aspects of the problem, all of which are true.

Ferguson does not fear the rise of China so much as the decline of the West. “You know as we speak tonight, ladies and gentlemen, the Eurozone is falling apart, an experiment with a single currency is disintegrating mainly because of the insolvency of the cradle of democracy, Greece. As we talk, the public finances of the United States are, if you do the math, which I do, more or less in the same situation as Greece was two years ago. The trajectory of the debt is not different. It may only be a matter of time before a fiscal crisis strikes the United States the magnitude of which we will never have seen before.” Ferguson warns that China will take advantage of America’s weakness to relentlessly pursue its own interests.

24 Million Jobs a Year

Zakaria, however, emphasized the difficulties faced by Beijing. The country must annually create 24 million new jobs just to keep the economy running smoothly. A state with such problems will not be able to rule the world, says Zakaria.

He is joined by Kissinger, who hopes that China will learn the art of self-control. In any case, a conflict between Washington and Beijing has to be prevented, says the former American Secretary of State. Should China threaten to expand, however, Kissinger harkens back to the balance of power principle. There are enough countries in China’s neighborhood that fear Beijing and are seeking an alliance with America.