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What the U.S. Can Learn from China

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What the U.S. Can Learn from China

An Open-Minded Guide to Treating Our Greatest Competitor as Our Greatest Teacher

Berrett-Koehler,

15 min read
10 take-aways
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China is the new champion of capitalism. Should America do what China does?

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7

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Recommendation

In the late 1970s, China first began to open its economy and edge toward capitalism – a process that, perhaps, evolved into a conscious policy direction only when Deng Xiaoping declared in 1992, “To get rich is glorious.” In this transition, China decided not to adopt the West’s approach. Instead, it altered capitalism to fit Chinese culture, traditions and sensibilities. In the interim, China has experienced an “economic miracle,” achieving an outstanding annual growth rate. Meanwhile, the United States faces economic challenges. Therefore, contends economist Ann Lee, the US should change how capitalism works within its borders. She says America could learn from China’s policies, such as its inventive adaptation of capitalism and certain aspects of its governance. A former stock research analyst and now a New York University professor, Lee is a frequent US media commentator. She offers a pessimistic – though sometimes fond – view of the US and the West, and a positive – sometimes excessively so – view of China. (For instance, China does help African nations, as she says, but often in exchange for their natural resources.) Both points of view may seem contrarian to most Westerners, so Lee’s treatise could well be instructive – and she may more candidly reflect beliefs held in China than most US coverage. While always politically neutral, getAbstract suggests her iconoclastic, controversial book to those who are interested in her take on how China’s economy grew, how it works and whether it offers ideas that might benefit the West.

Summary

Is the United States the New Spain?

During the 15th century, when Spain was the world’s dominant power, people called it “the empire on which the sun never set” due to its territories and colonies across the globe. While militarily imposing, however, Spain was really just an empty shell. Medici bankers in Italy financed Spain’s operations. The empire depended on goods that other nations manufactured. Inflation debased its currency. Multiple wars eventually exhausted Spain and its resources. By the 19th century, Spain had degenerated into a country without colonies, power or prestige.

For Americans, this sad story may sound eerily familiar. Indeed, in many ways, the United States may be the modern-day Spanish empire. Unlike Spain, the US has never been a major colonial power. However, for decades, America has used foreign aid and weapon sales to prop up venal dictators who terrorize their own citizens. Since the 1970s, inflation has threatened Americans and their currency, and the country has faced many other challenges, including wealth inequality and decreasing living standards.

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About the Author

Ann Lee is a finance and economics professor at New York University; a former visiting professor at Peking University; and a senior fellow at Demos, a public policy think tank.

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