Western democracies, ‘China envy’ and the coronavirus pandemic

Has China done better than affluent Western democracies ranging from the United States to Australia in tackling the coronavirus pandemic? Is there indeed a case for ‘China envy’? The latter thesis was propounded by intrepid New York Times columnist Thomas Friedman. In 2009,

… Friedman admitted to a large dose of China-envy in offering praise for an authoritarian system that could ignore democratic political chaos, identify problems and implement solutions with minimal fuss and opposition. In short, its authoritarian system was simply better, simpler and more effective.

This does not mean that Friedman wanted Western democracies to become like China. Instead, he wanted such democracies to function like China while retaining their core norms, institutions and values.

There is another, less charitable, interpretation of ‘China envy’. This represents a grudging acknowledgement by the West of China’s global dominance in the 21st century from a dirt-poor autarchy in the 1960s ravaged by Mao Zedong’s ideological obsessions. Like all grudging acknowledgements, such sentiments can easily turn into what Germans call ‘schadenfreude’ – a disreputable disposition in which one derives malicious pleasure out of the misfortune of others.

The current pandemic certainly originated in China prompting President Trump to describe it as ‘China virus’ with its intended racist overtones. Trump was also reflecting the dark side of American history when the government of the day promulgated the Chinese Exclusion Act of 1882.

Regardless of what one thinks about Trump’s attempt to pin the blame on China for creating a pandemic, the harsh reality is that the Chinese authorities initially mismanaged a public health crisis as they succumbed to the proclivity of authoritarian regimes to suppress bad news. Yet, since those initial missteps, China appears to have tackled the coronavirus epidemic with draconian measures that led to a freeze on economic and social activities for millions. In order to cope with a public health crisis, China was prepared to inflict the pain of an economic recession – a remarkable feat for a government that attaches primacy to economic growth. It was prepared to accept the collective wisdom of the scientific community that sharply curtailing human interaction is one of the most effective ways to reduce – and ultimately control – epidemics. This meant enduring – at least for the short run – a great deal of economic and social disruption.

Meanwhile, the Western world watched events unfold in China with a degree of complacency and indifference. The presumption was that coronavirus was a China-specific affair (it’s the outcome of their ‘disgusting wildlife market’ as one Australian politician intoned with the wisdom of a clown) and, even if did spread to the West, the implicit assumption was that affluent democratic societies could cope with it in their inimitable way, drawing on self-regulation and good collective behaviour rather than through brute enforcement.

Yet, the most recent developments suggest a much messier picture. As WHO has declared, the epicentre of the pandemic has shifted to Europe, with Italy – the home of Michael Angelo and Leonardo Da Vinci – being the worst affected. Like dominoes, many European countries are belatedly seeking to implement Chinese-style lockdown of its citizens. The cherished principle of freedom of movement across Europe has given way to closing of borders. The notion that self-regulation is effective has been seriously compromised. This is reflected, for example, in the abject failure in Australia to enforce limited public gathering among beachgoers determined to enjoy themselves in the midst of a public health crisis.

In the USA, a self-absorbed President is preoccupied with deflecting blame as the various levels of the government are also seeking to emulate the Chinese approach to dealing with a pandemic. China, in turn, is busy crafting a strategy of offering technical assistance and experience to beleaguered European nations and the rest of the world perhaps setting in motion a new global order in which American – and Western – leadership is conspicuously absent.





IMF downgrades India’s growth forecast for 2020-2021

In the latest World Economic Outlook, the IMF makes the following observations on the Indian economy.

India’s growth is estimated at 4.8 percent in 2019, projected to improve to 5.8 percent in 2020 and 6.5 percent in 2021 (1.2 and 0.9 percentage point lower than in the October WEO), supported by monetary and fiscal stimulus as well as subdued oil prices.

A world without work

Oxford economist Daniel Susskind paints a dystopian future of a world without work as a result of the relentless onslaught of new technology. This, critics might proclaim, is an old argument evoking new fears. But, according to a reviewer, Susskind has a compelling story to tell that entails a judicious juxtaposition of innovative analysis and novel evidence. Susskind does not merely document the promises, pitfalls, and perils of new technology. He argues that the private sector is unlikely to redress the challenges of a world without work. Such responsibility lies with the government and its ability to design appropriate and effective policies of redistribution.

Bushfires and the Australian economy

The calamitous bushfires that have engulfed Australia are most likely to have an adverse impact on the Australian economy. The upfront cost is projected to be in excess of A$ four billion. Beyond this headline figure, a painful period of adjustment lies ahead. A piece in the New York Times offers a poignant portrayal of such a challenge facing policymakers and politicians across both sides of the political divide. A good read….