Was at a philanthropy conference today, and one of the panels was about trends in the financial markets and their implications for foundation investment management. Unfortunately, the second part of that topic wasn’t really touched upon, but the three old white guys they had talking about the first part were pretty interesting. Half the conversation was about China: how long it’s going to rule the world, what that’ll be like. Turns out China has been the leading economic power in the world 17 of the last 20 centuries, so according to one guy, there’s a feeling of, “oh, we’re just reclaiming our rightful place.”
But the part that most caught my attention was the discussion of how China has managed to achieve spectacular economic growth in the last 30 years, not in spite of an authoritarian government, but because of it. I appreciated that one of the panelists pointed out that authoritarian governments may be good at the early stages of economic growth, but have a harder time with the more complex dynamics of the global economy. I’ve also seen the argument that China’s growth is not sustainable because the environmental shortcuts they’re taking will catch up with them sooner rather than later. I’d like to think these will be sufficient incentives to democratize, but I kind of doubt it.
I’ve written a fair amount on here about varieties of capitalism, and the types of innovation that different types of economies are good at. But I haven’t considered the Chinese model – particularly in the light of Gates and Buffett’s challenges bringing the Giving Pledge to China. Sounds like the start of another series…..