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September 25, 2014

China vs. Europe: A Historical Comparison

By Frank Li via Econintersect  
The 21st century will belong to either the U.S. or China. But who will deserve it and who will ultimately claim it? China, unless the U.S. dramatically changes

To best appreciate my bet on China, you must understand China better, for which a comparison between China and Europe will help.
1. China and Europe are similar
First of all, China and Europe are similar in size:
  1. Google “China's size”, here is the result: 3.748 million miles² (or 9.707 million km²).
  2. Google “Europe's size”, here is the result: 3.931 million miles² (or 10.18 million km²).
Secondly, China and Europe entered their respective first golden age at about the same time: 500 BC. For example, here are some famous philosophers with lasting impact:
  1. China: Laozi (~500 BC), Confucius (551–479 BC), and Mencius (372–289 BC). 
  2. Europe: Plato (~400 BC), Aristotle (384–322 BC), and Cicero (106–43 BC). 
Thirdly, China and Europe started exploring the world's oceans at about the same time (i.e. the 15th century):
  1. China: Zheng He (1371–1433), in his 7th and last voyage, reached what's known today as “South Africa”. For more, read: The Seven Voyages Of The Treasure Fleet.
  2. Europe: Christopher Columbus (1450/1451–1506) “discovered” Americas in 1492.
2. China and Europe are different
The biggest difference between China and Europe is China's singularity vs. Europe's plurality. Specifically, three big aspects:
  1. Language.
  2. Culture.
  3. Politics.
Let me elaborate on each.
2.1 Language
Chinese, the language, is pictorial. The earliest Chinese language, recorded in large quantity before 1000 BC, is the Oracle bone script (pictured below). It is the ancestor of the Chinese family of scripts.
Around 200 BC, the First Emperor unified the variations by having a common “official” written language, which remains true today. For those foreigners who are cultured enough to wonder about the differences between Mandarin and Cantonese, they are the same written language different in pronunciation only!
In contrast, there are many languages in Europe, from Greek and Latin in ancient times to French and English today. All of them are alphabetical.
2.2 Culture
A single (written) language in China has resulted in a single culture and one people, with Han Chinese being more than 95% of the population.
In contrast, different languages in Europe have resulted in different cultures and different people, such as the French and the Polish. Now, you may argue it was the people first and the languages and cultures second. Fine!
2.3 Politics
For the 2,000 years prior to 1976, China's political system was very different from Europe's. For example, unlike Europe, which fashioned democracy (e.g. Ancient Greece), the dramatic fusion of imperial power and religion (e.g. the Roman Empire), and the limited monarchy (e.g. British Monarchy), China was mostly an absolute monarchy throughout this period, with neither democracy nor a significant religion.
Today, China's political system is not only still very different from Europe's, but also very different from itself prior to 1976: China is no longer an absolute monarchy, but a dictatorship without a dictator!  
3. Governance
China has been mostly a single empire since the First Emperor unified China more than 2,000 years ago. There were wars periodically, but they were mostly “domestic” fights among the Chinese.
In contrast, after the Roman Empire, there has been no real emperor in Europe, who is remotely as grandiose as a Chinese Emperor (Lists of emperors). Instead, Europe has been having mostly kings or queens.
The image below shows the Forbidden City. Is there any residence like that in Europe? It's real as well as symbolic for the Chinese Emperors' grandiosity ...
In short, governance in China has been, will continue to be, very different from that in Europe. Let's examine them in some details, respectively.
3.1 Governance in China
    How did a Chinese Emperor (Huangdi-皇帝) govern? He did so by ruling over several kings (Wang-王 or Hou-侯), some of whom were relatives, by blood or marriage.
    How did an emperor fill the important government positions at all levels? Mainly by the Imperial Examinations! Here is an excerpt from Wikipedia:

    The Imperial examinations or Keju (Traditional Chinese: 科舉; pinyin: kējǔ), were an essential part of the Chinese government administration from their introduction in the Han Dynasty (206 B.C.E. to 220 C.E.) until they were abolished during Qing attempts at modernization in 1905. The examination system was systematized in the Sui Dynasty (581–618) as an official method for recruiting bureaucrats. It was intended to ensure that appointment as a government official was based on merit and not on favoritism or heredity. Theoretically, any male adult in China, regardless of his wealth or social status, could become a high-ranking government official by passing the imperial examination. Examinations were given on four levels, local, provincial, metropolitan and national. Candidates on their knowledge of the Confucian classics, their ability to write, and the "Five Studies:" military strategy, civil law, revenue and taxation, agriculture, and geography. Though only about 5 percent of those who took them passed, the examinations served to maintain cultural unity and consensus on basic values and ensured the identification of the educated elite with national, rather than regional, goals and values.
    In short, China's political system has been strictly hierarchical over the past 2,000 years at least, including today! Moreover, China's college exams today (pictured below) resemble the Imperial Examinations: your entire future could be decided on that day!
    3.2 Governance in Europe
      Europe has never been a single country. Therefore, there is really no such a thing as common governance in Europe as is the case in China.
      Europe is composed of many countries, each governing itself, with alliances and wars, both political and economic, between them from time to time.
      Europe's political system is not strictly as hierarchical as China's for one key reason: the existence of at least one religious hierarchy that intertwines with the political hierarchy!
      The establishment of the EU was a step toward a single Europe. However, although the EU has been trying to do to Europe just a fraction of what the First Emperor accomplished in China more than 2,000 years ago, it is obviously not succeeding: the monetary union via the Euro is deeply in trouble today!
      4. China vs. Europe: Yesterday
      Overall, China's system had two major advantages over Europe's system:
      1. It was more efficient, as the entire country was like an army with a single emperor at the top.
      2. It was more effective, when the leadership was good and when the “army” was not very big.
      Fortunately for China, it had worked out better than Europe throughout much of the first 15 centuries: China was more prosperous, had more inventions, and was the largest economy in the world!
      Unfortunately for China, the leadership was not always good, and the “army” often proved to be too big to govern. Specifically,
      1. Leadership: There were more than 10 dynasties in China over the 2,000 years prior to 1912, when China became a republic. Each dynasty started with a self-made emperor, who was always a great man by definition, because he had to fight his way to the top. But his successor was often inferior. Worse yet, some kings often wanted to be the emperor, resulting in a vicious cycle of fighting, splitting, union, and more fighting, until a new dynasty was born. Then the vicious cycle just repeated itself ... For a few times, a peasant fought all his way to the top, with the last example being Mao (1949-1976), the last de facto emperor in China.
      2. Too big to govern: China was so strictly hierarchical that it proved to be too rigid and too inept at adapting itself. Internal strife and isolationism made it miss the Industrial Revolution, entirely!
      China's weaknesses were Europe's strengths, and vice versa. For example, the Europeans fought among themselves even harder than the Chinese did, resulting in better weapons and better technologies. Specifically, after the Dark Ages, Europe thrived with three big events:
      1. The Renaissance: It brought Europe out of the Dark Ages.
      2. Enlightenment: It promoted science over (religious) superstition.
      3. The Industrial Revolution: It changed Europe from agricultural to industrial, with drastic improvement in productivity.
      Together, these three events propelled Europe ahead of China, with massive territorial expansions all over the world. As a result, not only did Europe clearly leap ahead of China around 1800, the Europeans also invaded China several times (e.g.Two Opium Wars and Eight Nation Alliance against China), out-gunning the Chinese every time.
      Unfortunately for Europe, its plurality caused some huge problems for itself too, with the worst examples being WWI and WWII.
      5. China vs. Europe: today
      China is back, thanks to a wise leader named Deng Xiaoping. Deng did two big things for China:
      1. The widespread introduction of capitalism to China.
      2. A new form of government. It is still strictly hierarchical, but it's not feudalistic and the top leadership is almost guaranteed to be good. Very importantly, with the advancement of technologies, the world has become practically smaller, especially in terms of communication and transportation. As a result, the same country (or “army”) that was too big to govern before may no longer be too big! 
      In contrast, Europe is back in trouble again, with no easy way out, thanks largely to democratic socialism.
      Bottom line: China is thriving, thanks to the fall of communism and the rise of capitalism over there, but Europe is failing, thanks to the rise of socialism and the fall of capitalism over there!
      6. Discussion
      China has Four Great Inventions: Compass, Gunpowder, Paper-making, and Printing. But the Europeans took advantages of them better than the Chinese did. For example, the Europeans invented guns to use the Gunpowder, and Christopher Columbus used the compass to “discover” Americas.
      On the other hand, it was the Europeans that showed the Chinese how great the Industrial Revolution was. The Chinese are now working hard to catch up, rapidly ...
      China will slow down – No country can keep growing at 10%, on average, for decades. But China will move forward rapidly, much faster than any other country on earth, today and in the coming decades!
      China faces monumental challenges, with environmental pollution and government corruption being the top two problems for now, and an aging population soon. But it seems likely that the Chinese will meet these challenges, over time. After all, the worse (i.e. communism) is over, and far behind them.
      I like hierarchical (or pyramidal) structures. It is not only natural (e.g. gravity), but also the most effective and efficient way of managing anything serious (e.g. military or business). 
      A functional society is always hierarchical, economically if not politically. The key to success is to ensure two types of equality: equal opportunity and equal justice. China must improve greatly on both, with one certainty: western democracy is not the way to go! In the West, especially the U.S., both equality and “dreams” have been oversold and overbought. 
      In summary, look at the calendar: China's singularity (i.e. one language, one culture/people, and one political hierarchy) outperformed Europe's plurality (i.e. multiple languages, multiple cultures/people, and multiple political hierarchies including religions) for the first 15 centuries (aka “the first golden age for China”). Europe outperformed China for the next five centuries (aka “China's dark age”), including multiple European invasions of China, humiliating China in the worst way. Now, China is back. All signs indicate that China has entered its second golden age of lasting prosperity. Europe, on the other hand, is rapidly failing.
      To my friends in the West: do not take China's system (i.e. capitalism + autocracy) lightly! Here is a simple tip: How many problems in Europe (as well as in America) are caused by race and religion? China has neither! Most of the problems in China over the past 500 years were caused by two factors: (1) the lack of capitalism and (2) an antiquated political system called feudalism. Both are gone now - China has adopted capitalism and feudalism has been replaced by a new system called “a dictatorship without a dictator”. As a result, China may fly high again, like no other country on earth!
      7. Closing
      The old is new; the new is old.
      Europe needs a new strategy to best China, again ...
      My fellow Americans, the key to the future is in the past! By studying China vs. Europe, you will hopefully truly understand China much better. China has arrived at a much better place for itself: its culture, its people, and its political system are much better organized for success in a global economy like ours today and in the coming decades. Recognizing and accepting this reality is essential for us to have any chance in our head-on competition with China in the 21st century!
      Courtesy Frank Li for Global Economic Intersection  (EconMatters author archive here)

      The views and opinions expressed herein are the author's own, and do not necessarily reflect those of EconMatters.

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