On May 5, the Delphi Democracy Press is one of a number of publications that has published an adapted version of a long article by James K. Galbraith titledm “The Dollar in a Multi-Polar World,” that will be published in a special issue of the International Journal of Political Economy. Galbraith writes:
The “rise” of China is an uncontested fact. As such it poses a lethal threat to neoliberal ideology, even though the Chinese themselves have made little effort to brand their experience and none whatever to export it as a competing economic model. China simply is, and as such it poses an interpretive challenge that neoliberalism cannot handle.
Consider the options. According to one, once popular but somewhat fading in recent years, China has made a successful “transition to capitalism” and owes its success to having applied the principles of the free market. But if that were the case, how can the West complain? It is unsportsmanlike to kvetch if bested at one’s own game.
A fall-back is to assert that while China has indeed played the capitalist game, it has gained an unfair advantage by bending “the rules” – for instance by appropriating “intellectual property,” manipulating the RMB, or running a low-wage industrial system. But this claim merely exposes the rules for what they are: an effort to preserve the monopolies and privileges of the already-rich. Such rules have been broken by every rising power going back to the 17th century at least; in the 19th century the practice of systematic violation of “the rules” even had a name: “The American System”.
The third option, taken up avidly by voices as disparate as Mike Pompeo and Robert Kuttner, is to slime China as a “totalitarian” state, an aggressive economic power, ruthlessly driven forward by its Communist Party. But this solution amounts to conceding the superiority of communism and the inferiority of capitalism and of democracy in the economic sphere. It thus completely negates the triumphalist posing that gave neoliberalism its legitimacy 40 years ago.
The China that one sees with trained but unfiltered eyes does not so easily fit into these simple boxes. It has the following key characteristics:
• it is a very large, administratively decentralized, internally-integrated economy, regaining in these respects attributes that were already familiar to Adam Smith;
