Ankit Panda, BA
As early as 1941, historian Henry Luce controversially called the 20th century the “American Century.” And today, just 11 years in, many are ready to bestow the 21st century honors to China. In retrospect, one may argue it makes sense to dub the previous century an “American” one because the United States did, in a sense, singlehandedly drive the normative alignment of modern international institutions and norms, albeit only after Luce’s declaration. So China’s impressive growth and greater face on the international stage should cause at least some change, right? Conventional realist wisdom would have us think so, but there is good evidence that the People’s Republic, and the Chinese Communist Party, have neither the interest nor the ability to do so.
Under any regime of international law (institutional or treaty-based), states have options to 1) comply with statutes and norms, 2) create statues and norms, and 3) “evade” statutes and norms. Starting with the leadership of Deng Xiaoping, the PRC has moved more from a rule-evading country towards one more interested in complying with existing institutions. Although conventional wisdom and the media might paint a very different picture of Chinese compliance, a quick look at China’s record at the World Trade Organization and the International Monetary Fund (IMF), in addition to its response to the 2008 financial crisis, provides strong evidence to believe otherwise.
At the IMF, the PRC, once chastised for its stalwart rule-evading (and frankly, rule-ignoring) behavior, has moved towards greater compliance. While the ongoing Article IV consultations on China’s controversial monetary policy and the depreciation of the renminbi remain a source of friction, notably, Chinese rhetoric in defense of this policy emphasizes mutual interests (between the West and China) and demonstrates a real stake in the continued “success” of the global financial system. Similarly, China’s reaction to the financial crisis in 2008 was swift and in line with systematic recommendations from the IMF and the US – a $580 billion asset-relief program similar to TARP in the US. Furthermore, Chinese support of the Eurozone during its sovereign debt woes demonstrates a further willingness to take a stake in the success of the status quo (although this final point may be more politically-motivated than I’m willing to admit in this short post).
The PRC’s short history at the WTO so far also demonstrates a mixed compliance record trending towards greater compliance over the years. Initially, Chinese accession encountered several obstacles, but it ultimately managed to convince the organization that without China, the WTO wasn’t truly a “world” trade organization. The WTO is struggling with China, which, as a mechanically-complex economy based on a particular set of normative principles, refuses in several cases to acquiesce to the exogenous and incompatible norms of the institution. On the other hand, China's victory over the European Union in a December 2010 case demonstrates an example of Chinese rule-taking and compliance with the WTO. Granted, this paints China as a rule-taker when the rules enforce its self-interest. Such victories come at the cost of leverage for the West, but bring with them greater Chinese stakes in the success of the rules-based order. The liberal international order is slowly beginning to accommodate China.
While experts like Robert Kaplan and C. Fred Bergsten may identify the many political and security threats that result from a stronger China, it’s important to consider the less-exciting but equally important economic perspective. It’s difficult to say definitively that there is one lens through which we should view China – frankly that would be an oversimplification – but overall, it’s important to recognize that China has been accommodated into the current system of international political economy and that this accommodation has made it an important stakeholder in the success of that system. Unfortunately for the US, even the liberal international order will move us away from the “American Century” towards a more complex and multi-polar global order.