For Americans, 2008 is an important election year. But for much of the world, it is likely to be seen as the year that China moved to center stage, with the Olympics serving as the country's long-awaited coming-out party. The much-heralded advent of China as a global power is no longer a forecast but a reality. On issue after issue, China has become the second most important country on the planet. Consider what's happened already this past year. In 2007 China contributed more to global growth than the United States, the first time another country had done so since at least the 1930s. It also became the world's largest consumer, eclipsing the United States in four of the five basic food, energy and industrial commodities. And a few months ago China surpassed the United States to become the world's leading emitter of CO2. Whether it's trade, global warming, Darfur or North Korea, China has become the new x factor, without which no durable solution is possible.
And yet the Chinese do not quite see themselves this way. Susan Shirk, the author of a recent book about the country, "The Fragile Superpower," tells a revealing tale. Whenever she mentions her title in America, people say to her, "Fragile? China doesn't seem fragile." But in China people say, "Superpower? China isn't a superpower."
In fact it's both, and China's fragility is directly related to its extraordinary rise. Lawrence Summers has recently pointed out that during the Industrial Revolution the average European's living standards rose about 50 percent over the course of his lifetime (then about 40 years). In Asia, principally China, he calculates, the average person's living standards are set to rise by 10,000 percent in one lifetime! The scale and pace of growth in China has been staggering, utterly unprecedented in history—and it has produced equally staggering change. In two decades China has experienced the same degree of industrialization, urbanization and social transformation as Europe did in two centuries.
Recall what China looked like only 30 years ago. It was a devastated country, one of the world's poorest, with a totalitarian state. It was just emerging from Mao Zedong's Cultural Revolution, which had destroyed universities, schools and factories, all to revitalize the revolution. Since then 400 million people have been lifted out of poverty in China—about 75 percent of the world's total poverty reduction over the last century. The country has built new cities and towns, roads and ports, and is planning for the future in impressive detail.
So far Beijing has managed to balance economic growth and social stability in a highly fluid environment. Given their challenges, China's political leaders stand out for their governing skills. The regime remains a dictatorship, with a monopoly on power. But it has expanded personal liberty in ways that would be recognizable to John Locke or Thomas Jefferson. People in China can now work, travel, own property and increasingly worship as they please. This is not enough, but it is not insignificant, either.
But whether this forward movement—economic and political—will continue has become the crucial question for China. It is a question that is being asked not just in the West but in China, and for practical reasons. The regime's main problem is not that it's incurably evil but that it is losing control over its own country. Growth has empowered localities and regions to the point that decentralization is now the defining reality of Chinese life. Central tax collection is lower than in most countries, a key indicator of Beijing's weakness. On almost every issue—slowing down lending, curbing greenhouse-gas emissions—the central government issues edicts that are ignored by the provinces. As China moves up the value chain, so the gap between rich and poor grows dramatically. Large sectors of the economy and society are simply outside the grip of the Communist Party, which has become an elite technocracy, sitting above the 1.3 billion people it leads.
Political reform is part of the solution to this problem. China needs a more open, accountable and responsive form of government, one that can exercise control in what has become a more chaotic and empowered society. What such reform would look like remains an open question, but one that is being debated within the seniormost levels of the regime. In the current issue of Foreign Affairs, John Thornton, an investment banker turned China expert, traces how Beijing is taking hesitant but clear steps toward greater rule of law and accountability.
China's sense of its own weakness casts a shadow over its foreign policy. It is unique as a world power, the first in modern history to be at once rich (in aggregate terms) and poor (in per capita terms). It still sees itself as a developing country, with hundreds of millions of peasants to worry about. It views many of the issues on which it is pressed—global warming, human rights—as rich-country problems. (When it comes to pushing regimes to open up, Beijing also worries about the implications for its own undemocratic structure.) But this is changing. From North Korea to Darfur to Iran, China has been slowly showing that it wants to be a responsible "stakeholder" in the international system.
Some scholars and policy intellectuals (and a few generals in the Pentagon) look at the rise of China and see the seeds of inevitable great-power conflict and perhaps even war. Look at history, they say. When a new power rises it inevitably disturbs the balance of power, unsettles the international order and seeks a place in the sun. This makes it bump up against the established great power of the day (that would be us). So, Sino-U.S. conflict is inevitable.
But some great powers have been like Nazi Germany and others like modern-day Germany and Japan. The United States moved up the global totem pole and replaced Britain as the No. 1 country without a war between the two nations. Conflict and competition—particularly in the economic realm—between China and the United States is inevitable. But whether this turns ugly depends largely on policy choices that will be made in Washington and Beijing over the next decade.
In another Foreign Affairs essay, Princeton's John Ikenberry makes the crucially important point that the current world order is extremely conducive to China's peaceful rise. That order, he argues, is integrated, rule-based, with wide and deep foundations—and there are massive economic benefits for China to work within this system. Meanwhile, nuclear weapons make it suicidal to risk a great-power war. "Today's Western order, in short, is hard to overturn and easy to join," writes Ikenberry.
The Chinese show many signs of understanding these conditions. Their chief strategist, Zheng Bijian, coined the term "peaceful rise" to describe just such an effort on Beijing's part to enter into the existing order rather than overturn it. The Chinese government has tried to educate its public on these issues, releasing a 12-part documentary last year, "The Rise of Great Nations," whose central lesson is that markets and not empire determine the long-run success of a great global power.
But while the conditions exist for peace and cooperation, there are also many factors pointing in the other direction. As China grows in strength, it grows in pride and nationalist feeling—which will be on full display at the Summer Olympic Games. Beijing's mandarin class is convinced that the United States wishes it ill. Washington, meanwhile—sitting atop a unipolar order—is unused to the idea of sharing power or accommodating another great power's interests. Flashpoints like human rights, Taiwan or some unforeseen incident could spiral badly in an atmosphere of mistrust and with domestic constituencies—on both sides—eager to sound tough. Two thousand eight is the year of China. It should also be the year we craft a serious long-term China policy.