Youth, Politics, China & the Future of Freedom

In this two-part interview, Niall Ferguson and Grégoire Roos exchange on how the Millenials are about to disrupt politics in the West, discuss the current crisis of the Atlantic community, and address the challenges of the rise of China.

Niall Ferguson is the Milbank Family Senior Fellow at the Hoover Institution, Stanford University, and a senior faculty fellow of the Belfer Center for Science and International Affairs at Harvard, where he served for twelve years as the Laurence A. Tisch Professor of History. He is also a visiting professor at Tsinghua University, Beijing. His most recent book, The Square and the Tower, was published in 2017.

Grégoire Roos is a market analyst in the financial industry and has been a Leader of Tomorrow of the St. Gallen Symposium ever since 2014.

Interview Part Two: China and the Future of Freedom

This is the continuation of the first part of this interview.

GREGOIRE ROOS (GR): Isn’t one of China’s foremost strengths its ability to think on the very long term (2049 for that matter) and deploy a strategy accordingly, when the West (US and Europe alike) only thinks with the horizon of the next big election in mind? Whether we like it or not, China has a vision (think about the One Belt One Road Initiative, or the thought of Chairman Xi, which has been inscribed into the doctrine and the constitution of the Chinese communist party, for the first time since Mao and Deng). Do empires (China, Russia…) have a competitive advantage in today’s world?

NIALL FERGUSON (NF): Well, empire is a difficult word to use in the 21st century. It’s somehow become disgraced. In reality, both China and Russia are what I call “empire-States” [War of the World (2006)]. In the course of the 20th century, some empires (land-empires, sea-empires…) were able to morph into Nation-States. That happened in Russia’s case because the Soviet Union substantially homogenised the Russian Empire. And although the USSR collapsed in 1991, the Russian Federation is still a large part of what was the Russian Empire. As regards China, they are still somehow conditioned by centuries of empire, as they’ve only been a Republic since the 20th century. So we’re dealing here with these hybrid entities that really have the scale of empires but act like Nation-States. The Chinese will tell you that they have nothing to do with the Western concept of empire, expanding and conquering territory the way we wicked Westerners did. But that is obviously nonsense, because just look at Western China, look at the treatment of Tibet: the current territory of the PRC actually reflects substantial territorial expansion, including expansion in the Qing era. So the first thing is to disregard what the Chinese say about their own History, as it’s nearly all propaganda. They are now embarking on a new phase of overseas expansion, which is unusual in Chinese history because it involves large-scale investments not only in other parts of Asia, but also in Africa and Europe. They‘re now investing all around the world and the One Belt One Road has become a kind of grab bag of different initiatives of varying degrees of economic rationality. And I think, having seen this playbook used before (it’s quite a lot like the British and French playbook in the 19th century), we can predict with reasonable certainty that as China acquires assets in Africa and elsewhere it will acquire, whether it likes it or not, security obligations, because it will end up having to protect those assets from confiscation or just local insecurity.

GR: The West should now expect China’s overseas presence in military terms to grow, and China’s navy will sure range further afield when Beijing has successfully developed a full network of ports that extend across the Indian Ocean.

NF: Yes, all of this seems like a pretty predictable sequence of events. And it will also turn out to cost the Chinese more than they expect and to be less profitable than they hope. That seems like a pretty likely bet to make.

GR: Doesn’t sound like an advantageous expansion…

NF: I don’t know really. I mean in the end empire only makes sense if you can get resources more efficiently and cheaply through your expanded network of conquests than you would on the open market. In the end copper is for sale. You don’t need to own Zambia to get the copper, you need to pay the price. Empire only makes sense here if you think you’re going to get the copper more securely and more cheaply through some form of control. Most of History would suggest that at some point the cost of empire will outweigh the benefits, and that you would probably be better off buying your stuff on the open market.

GR: But there is indeed something no empire in History has ever been able to master as deeply and opportunistically as China is today, it is technology. With the democratisation of the Internet and new technologies, many predicted that digital technologies would lead to a redistribution of power, to the benefit of society and the ordinary citizen and at the expense of the government. This has actually turned out to be true… but only in the West. For in China, new technologies have actually enabled the Party to increase its control over the population and double down on authoritarianism 2.0…

NF: Yes, I think that’s right. These are the same people who predicted that the Internet would be great for democracy and terrible for dictators and then said the exact opposite in the space of less than 10 years. I wish I had that kind of flexibility. As far as I can see, the point about technology is that it doesn’t really have a strong political preference; the technology can be used by both democracies and authoritarian regimes. Democratic movements probably made more effective use of the technology in the early 2000s, and now you see the authoritarians getting the hang of it, and China in particular. Totalitarianism (which I think would be a better word than authoritarianism) “2.0” as you say, with the Internet, with 24/7 surveillance, with facial recognition, with AI, promises to be a more effective totalitarianism than the first edition, which “just” tapped your telephone or had the secret police bug your room.

GR: It’s kind of beyond Orwell…

NF: It definitely is beyond Orwell, where China now has got to. And I think most people are rather appalled at the prospect of a one-party State having that kind of power, or to be more accurate that kind of knowledge about its citizens, with almost no constraints, no restrictions. I remain, however, very sceptical of the proposition that totalitarianism will win, because even AI-enabled totalitarianism still has the fundamental defect that all totalitarianism has, namely that it restricts the individual freedoms too much to be bearable, and also too much to be really efficient and optimal. The excess of centralisation of power in Xi Xinping’s hands is bound to go wrong at some point, just as the excess of centralisation of power in Vladimir Putin’s hands is not going very well for Russia. Because mistakes are actually much more likely to be made without the constraints of accountable Government than with them. So I think we shouldn’t worry too much. The fact that the Chinese Government spends so much on keeping its own people under surveillance suggests that it’s very afraid of them, that it doesn’t really have a deep legitimacy and that it is therefore quite weak.

GR: So just as Paul Samuelson exaggerated the Soviet challenge by asserting in 1961 that the Soviet national income would overtake that of the United States by 1997…?

NF: Precisely so! I think we’re probably exaggerating the Chinese challenge today or what you called earlier China’s political competitive advantage. Not in economic terms of course, because I think that’s real; but in terms of the viability of totalitarianism. Ultimately, even with AI, they are bound to fail, because it is fundamentally impossible for a fifth of humanity to be governed indefinitely by a single party, with a single leader, who’s not really accountable to the law or to the people. 

GR: One could argue that a few more years of Xi’s rule under such conditions would be enough for Beijing to become a global, almost unrivalled, economic, military, diplomatic and perhaps even cultural superpower…

NF:  I think yes, they will certainly become a near equal of the United States, at least on economic terms. Conceivably, they can become a near equal of the US on military terms, although that would take longer. I think in intellectual terms, they stand no chance of catching up with the West, because anybody who watches Chinese cinema or listens to Chinese music or reads Chinese literature can tell you it is a far less creative system than that of the free societies in the West.

GR: Talking of intellectual power, do the populism-fuelled victories of Brexit and Donald Trump mark the end of dialectic as a driver of political progress and collective wisdom?

NF: Well when anybody mentions the dialectic I tend to turn to Hegel… I think we are still inclined to progress from thesis to antithesis to synthesis, much as Hegel suggested. And this is especially true in our adversarial political systems. And so we had the thesis which was globalisation, which seemed awesome, and then we had the financial crisis which suggested that perhaps it was not entirely awesome; and populism would become the antithesis. I believe the dialectic will continue with this progressive response to populism, which essentially says, “Actually, some parts of globalisation, especially the migration, were fine”. So I think we’re still trapped in that kind of a process, as long as we have adversarial politics; even with multiple parties, it feels like the discussion goes pretty much in the Hegelian way. I’m lucky to have been born and raised in Scotland, and to have been given a pretty good old-fashioned education that equipped me to think critically about historical processes, and to try to understand the present and future by looking back and seeing its connections to the past. Moving to the US was a conscious attempt on my part to understand better what was happening there, which I didn’t think I could do sitting in Oxford. And I’ve spent quite some time thinking about American empire in the Bush years, thinking about American degeneration in the Obama years and think now about American populism and social networks in the Trump years. It’s never boring. And I’m happy to say that as long as we are a free society, it will never be static. There’s perhaps still a lot to be pessimistic about, but I will always tend to bet on the countries with the maximum individual liberty, because it’s from that freedom that innovation comes.

This was the second part of the interview. You can find the first part here.