China and the J Curve

Dave shoots a few holes in the latest trendy theory that purports to explain everything and fits on a napkin…

One more post before I go to Macau for a visa stamp and cheese.

From the Telegraph:

A new catchphrase is buzzing its way around the political salons of Washington and New York. Move over, “tipping point”.

The “J curve” is an explanation for the way the world works that is so simple that you can draw it on the back of a paper napkin. Indeed, its inventor, a boyish American political scientist called Ian Bremmer, spent years doing just that.

“God knows how many napkins I got through,” he says. “And my friends kept telling me, ‘Wow, write a book.’ So here it is.”

Bremmer, 36, is chairman and founder of the Eurasia Group, the world’s largest political risk consultancy.

When governments and businessmen want to know whether they should invest in a country with a dodgy government, or whether they should run a mile from it because the capital city is about to go up in flames, they come to him.

What’s the J-Curve? Here’s an excerpt from the J Curve website:

What is the J curve? Imagine a graph on which the vertical axis measures stability and the horizontal axis measures political and economic openness to the outside world. Each nation whose level of stability and openness we want to measure appears as a data point on the graph. These data points, representing a cross-section of countries, produce a ‘J’ shape. Nations to the left of the dip in the J are less open; nations to the right are more open. Nations higher on the graph are more stable; those that are lower are less stable.

I’m in the wrong business. How does this apply to China? Here’s Bremmer himself in Institutional Investory breaking it down for us.

Openness is a measure of the extent to which a state allows people, ideas, information, goods, and services to flow freely across its borders in both directions. How much foreign direct investment is there in the country? How much local money is invested in other countries? How many books written in another language are translated into the local language? How much direct contact do locals have with foreigners? How free are citizens to travel outside the country? What percentage of a nation’s citizens has access to foreign media? By these measures, China is far more open than it used to be, though a recent crackdown on both domestic and foreign reporting on sensitive political issues signals the state’s determination to monopolize the distribution of certain types of information.

But openness also refers to the movement of people, resources, information, and ideas within the country. Are citizens able to communicate freely with one another? Do they have access to accurate information about events in other parts of the country? Are they free to travel within the country without restriction? Are freedoms of speech and assembly legally enforced? How transparent are the processes of local and national government? Do citizens have access to and influence with their leaders? Here, China is not open by any measure.

He concludes:

Can the Chinese Communist Party’s monopoly on political power survive the country’s economic opening to the outside world? Can China’s current system survive the eventual passage through the dip in the J curve? Perhaps double-digit growth and the middle class freedoms it has created will indefinitely keep a lid on public anger with the country’s authoritarian political system.

But maybe it won’t. The dangers of a sudden economic downturn (driven by a spike in global energy prices or the severe restrictions on travel into, out of, and around the country following confirmation of human-to-human transmission of bird flu, for example) could be unprecedented for China. The last time Chinese citizens experienced a sharp and sustained economic slowdown, they did not yet have the communications tools that might allow them to focus their anger at their government and to coordinate resistance should the state fail to meet their demands for change.

If the Chinese economy were to hit a wall, we might discover that the country is already closer to dangerous instability than we realize. The J curve suggests that this might well be the case.

Whatever this guy charges, it’s way too much. There is no stunning news here. There’s not even news. And some reviewers say it doesn’t really work well:

Bremmer’s struggle over where to place China on the J curve reflects the limitations of his one-dimensional model. By conflating the economic and political into a single measure of “openness,” Bremmer’s J curve masks the fact that there are really three types of state in transition: those that are neither politically nor economically open, those that are politically but not economically open, and vice versa. Bremmer argues that China, an example of the latter, is trying, futilely, to “beat the J curve.” But the same could be said about India, which is trying to pursue economic reform in a democratic state without triggering a paralyzing backlash from those with a stake in the old system.

I was looking at Bremmer’s openness criteria and wondered how accurate some of these indicators are. For example, he says one question on openness is “How many books written in another language are translated into local languages?â€? and I wondered what those numbers are for China and the U.S.

In 2004, Bowker, publishers of the Global Books in Print database, reported:

The English-speaking countries remain relatively inhospitable to translations into English from other languages. In all, there were only 14,440 new translations in 2004, accounting for a little more than 3% of all books available for sale. The 4,982 translations available for sale in the U.S. was the most in the English-speaking world, but was less than half the 12,197 translations reported by Italy in 2002, and less than 400 more than the 4,602 reported by the Czech Republic in 2003. Almost three quarters of all books translated into English from other languages last year were non-fiction.

Does somebody wanna weigh in here on the stability of Italy? Like a rock or linguini? Meanwhile, the Hindu reports this from the Beijing International Book Fair:

With the Chinese economy surging, all publications benefit from a market that is growing by more than $ 300 million a year. Industry sources say 400 new titles are launched every day, though only six per cent are translations.

Deputy head of the Government’s press and publications administration, Yu Yongzhan said China’s 573 publishing houses produced 6.4 billion books, including 1,28,578 new titles, in 2005.

6% of 400 is 24, multiplied by 365 is 8760 titles a year. And while Chinese statistics are always sketchy (and no more so than this), anecdotal evidence at my local used bookstore yesterday includes translations of Empire: A Tale of Obsession, Betrayal and the Battle for An American Icon, I Am The Central Park Jogger, Stephen King’s “The Standâ€? and “Salem’s Lotâ€?, two books in the eschatological Christian pulp series “Left Behindâ€?, and The Book of Mormon (ok, probably not printed by a Chinese publishing house, but smuggled in). That and the copy of Animal Farm on my shelf. China is not wanting for translations. For godsakes, isn’t Jack Welch’s book required reading at the party school these days?

Beyond this, I do wonder if Bremmer is overconfident that he has discovered some immutable law. As Dorothy Parker said, you can lead a whore to culture but you can’t make her think. Even when people have access to information, it doesn’t mean they will necessarily find it, want it or accept it. Witness the one third of the United States that believes Saddam Hussein was involved with Al Qaeda. More to the point, is it really the number of translated books Americans read that makes their country more stable? Or is simply that they’re richer and therefore have more to lose?

The Discussion: 8 Comments

Actually, there was a study done for the UN by Arab scholars about the distressing state of the Arab world, and one of the factors they pointed to was the lack of openness, as evidenced by the lack of foreign translations. They made the comparison to China, which they stated translated many, many foreign titles.

So maybe the guy’s theory isn’t a complete load of hooey; he is just underestimating the extent of China’s “openness.”

I bet he didn’t factor in the availability of pirated DVDs!

October 11, 2006 @ 3:16 pm | Comment

Dave, my man, bend your ear close and listen to me. And no I won’t shout, because I know your brain actually functions:

You know how some people (eg, some commenters here) say that I “don’t know how to make a logical argument”? Well, maybe you’ve noticed a pattern:
There are some kinds of arguments which just don’t merit much attention, and so I treat them with scorn and mockery instead of actually wasting any time on “logically” refuting them.

Dave, this wanker’s theory is one such piece of intellectual diarreah which simply just doesn’t deserve any serious analysis or refutation.

But I do think it’s cool that you posted it, just to give us some laughs. Comic relief is always cool. 😉

October 11, 2006 @ 3:25 pm | Comment

The Daily Show had this guy on the show on the 4th of this month to promote his book. They introduce a lot of books that sound pretty good on that show, but this is the first one I’ll be purchasing.

The full clip is on YouTube too.

http://youtube.com/watch?v=bj41v1gehCQ

October 11, 2006 @ 6:33 pm | Comment

All I’ll say is that predicting the future behaviour of entire nations based on abstract concepts and pseudo-scientific mathematics has been tried before, and failed miserably. Karl Marx tried to do exactly that.

According to Marx, Germany should have become the place of origin of the inevitable worldwide Communist Revolution.

The world is still waiting….

In sum, this is just intellectual wanking, and the fact that anyone takes it seriously at all is a sign that America is plunging into a Dark Age.

October 12, 2006 @ 5:24 am | Comment

I posted about the J Curve a couple of weeks ago – a clear sign of Dave and I being great minds and thinking alike. Or at least just thinking alike.

The J Curve is interesting, but I wasn’t too impressed by his China thinking…seemed like he’d read a couple of newspaper reports and that was it.

http://20six.co.uk/positivesolutions/art/575958/On_an_upward_J_curve#comm

October 12, 2006 @ 1:06 pm | Comment

Charlie, actually (in my opinion) great minds think differently. Mediocre minds are the ones who follow intellectual fashions.

And that’s one of the reasons why I consider all fashionable “theories” (like this one) to be inherently suspect.

October 12, 2006 @ 6:32 pm | Comment

“Can the Chinese Communist Party’s monopoly on political power survive the country’s economic opening to the outside world? “

No.

It’s simply a matter of time.

Bullets, Tanks, and Death don’t matter.

Ideas matter, and with a Billion+ Chinese, .1% of people having and idea won’t matter in the long run…

October 12, 2006 @ 10:25 pm | Comment

@Darin:

I saw it on TDS/YouTube as well, and that’s why I wrote this up – because I wouldn’t buy it.

@Ivan:

This wanker makes fat wadges running the Eurasia Group. Dark Ages, indeed.

As Charlie says in his post: “Call me a cynical bastard, but if anyone has a motivation for painting the world in a troubled light, it is the head of a leading political risk advisory and consultancy firm…”

October 13, 2006 @ 8:04 pm | Comment

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