[YEDG] 24TH OF NOVEMBER SUNDAY DISCUSSION
jiyoen park
1>Reform in China
Let quite a few flowers bloom
Two proposals buried in a party document could help change Chinese government
2>World trade
The Indian problem
Opposition to a global trade deal risks hurting the very countries India claims it is trying to protect
3>America and the world
The man who used to walk on water
How Barack Obama can get at least some of his credibility back
Reform in China
Let quite a few flowers bloom
Two proposals buried in a party document could help change Chinese government
Nov 23rd 2013 |From the print edition
THE jury is in. After months of speculation and an initial summary last week, the final 22,000-character overview of China’s “third plenum” was published on November 15th. In the economic sphere the document turned out to be bolder than the initial summary suggested. The new party boss, Xi Jinping, wants to push through changes that have stalled over the past decade. As the document itself says: “We should let labour, knowledge, technology, management and capital unleash their dynamism, let all sources of wealth spread and let all people enjoy more fruits of development fairly.” Quite.
It is by no means certain that Mr Xi will be able to do all he wants to (see article), but it is clear he has won the battle so far. Economically, he is proving himself an heir to Deng Xiaoping, China’s great reformer, and not the closet Maoist that some had feared. Conservative forces seeking to stifle reformist voices have been quieted, at least for the time being.
The document’s interest lies not just in the economic reforms, which were anticipated. More striking were some of the social changes the document announced, such as the relaxation of the one-child policy. A couple in which one parent is an only child will be allowed to have two children, and the policy is likely to be loosened even further. In another widely welcomed move, labour camps—in which around 190,000 people, including political and religious activists, are detained—are to be abolished.
But possibly the most important announcements were buried deep in the document and grabbed fewer headlines. Two moves in particular showed that the party is sensitive to the ferment in Chinese society and the demands for greater liberty and accountability that accompany it.
In the past 30 years China has gone from a totalitarian society to one in which people can usually work where they want, marry whom they want, travel where they want (albeit with varying degrees of hassle for those from the countryside and ethnic-minority regions). In ten years internet penetration has gone from minimal to almost universal. Old welfare structures have broken down, with little to take their place. Ordinary people are being empowered by new wealth and participation, through microblogs, and by becoming consumers and property owners. Change is bubbling up from the bottom and the system cannot contain it.
An uNGOvernable state
Society is becoming too complex for the old structures to handle. Hence the government’s decision to allow the development of what it calls “social organisations”. In essence these are NGOs. The party dislikes the idea of anything non-governmental and has long regarded NGOs as a Trojan horse for Western political ideas and subversion, but it is coming to realise that they could solve some of its problems—caring for the sick, elderly and poor, for instance. The growth of civil society is not just important in itself. It is also the bridge to the future, linking today’s economic reforms to whatever putative future political reform might come.
Equally important is the issue of judicial reform. China’s hopelessly corrupt judges are unpopular. The party resolution floats the idea of “judicial jurisdiction systems that are suitably separated from administrative areas”; that is, local judiciaries that are not controlled and paid for by local officials. Though some observers doubt this will happen, if it does it could be the start of a system of basic checks and balances, which would make officials more accountable.
That these two gestures towards reform were mentioned at all is encouraging; that they were barely visible to the untrained eye shows the party’s ambivalence towards liberalisation. But it must push ahead. Its planned economic reforms will surely generate not just wealth, but more pressure for political change. Unless the party responds, there could be an explosion. If Mr Xi is inclined to wobble, he should remember the advice in the plenary document: “Dare to gnaw through even tough bones, dare to ford dangerous rapids, break through the fetters of ideological concepts with even greater resolution.”
From the print edition: Leaders
World trade
The Indian problem
Opposition to a global trade deal risks hurting the very countries India claims it is trying to protect
Nov 23rd 2013 |From the print edition
INDIA, home to a third of the world’s extremely poor people, takes pride in being a champion of the poor. But words are one thing, deeds another. Right now, India stands in the way of a deal that members of the World Trade Organisation (WTO) are hoping to do in less than two weeks’ time—and its stubborn opposition could deliver a serious blow to the poorest countries in the emerging world.
Negotiators meet on the Indonesian island of Bali in early December in a final attempt to salvage the Doha round of world-trade talks. Since its start in 2001 Doha has stumbled from impasse to impasse, then to a collapse in 2008. Revived talks aimed for a slimmed-down deal. It would focus on “trade facilitation”: efforts to ease trade through simplified customs rules, which almost everyone can support. But a fierce disagreement over agriculture is tangling up the talks and threatening a breakdown in Bali. India is mostly to blame.
Its objections are not exactly surprising. Like many other developing economies, India strengthened “food security” policies in response to recent swings in food prices, stepping up subsidies to meet production goals. Those subsidies may soon grow large enough to violate WTO rules. A club of developing economies, led by India, is demanding a rule change. Rich countries are reluctant to give ground.
Domestic politics is part of the problem. Manmohan Singh, India’s prime minister, would like a deal. But his government faces a general election in the first half of next year. The leader of his Congress party, Sonia Gandhi, is sure to resist efforts to weaken the food-security law. India’s truculence is also rooted in its self-image as a torch-bearer for the interests of the world’s poor.
In election season, politicians often object to sensible but unpopular reforms. Yet such short-sightedness can prove costly. And in this case it is India and other developing countries that will pay the highest price. The trade-facilitation measures in the Bali package would add an estimated $68 billion a year to global output, with much of the gain concentrated in poor countries. More important, failure would destroy the credibility of the WTO, a body which boosts the developing world’s bargaining power.
The WTO already has the look of a vestigial institution. Richer countries are pushing forward with ambitious new regional deals—including a Trans-Pacific Partnership and a Trans-Atlantic Trade and Investment Partnership—that exclude the biggest emerging markets. Still poorer economies in Africa and Latin America rely on the WTO to get their voices heard.
Your own special dreams in Bali
India may consent to a temporary expedient: a “peace clause” that would waive WTO rules for a few years. But that would be a shoddy compromise, yet another sign that the global forum cannot deliver meaningful agreements. India should instead bring its law within the trade body’s rules: a hard choice, but one likely to pay dividends over time. Such a deal in Bali would enable the WTO’s new director-general, Roberto Azevêdo from Brazil, to blaze an ambitious path for liberalisation. A post-Bali agenda would almost certainly include a binding schedule for elimination of rich-country farm subsidies—something the developing world has long desired.
Casey Lartigue, Jr.
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